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EXHIBIT 10.10
OFFICE LEASE
BETWEEN
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY (LANDLORD) AND
QUEST SOFTWARE, INC. (TENANT)
CORNERSTONE AT CANTERA OFFICE BUILDING
0000 XXXXXXXX XXXX
XXXXXXXXXXX, XX 00000
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TABLE OF CONTENTS
ARTICLE PAGE
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Article 1. BASIC LEASE INFORMATION............................................1
1.1 Basic Lease Information..................................1
1.2 Exhibits.................................................3
Article 2. AGREEMENT..........................................................3
2.1 Lease Grant, Term and Use................................3
2.2 Termination Right........................................3
Article 3. DELIVERY OF PREMISES...............................................4
3.1 Delivery of Possession...................................4
3.2 Early Entry..............................................4
3.3 Right of First Offer.....................................4
Article 4. MONTHLY RENT.......................................................6
4.1 Monthly Rent.............................................6
4.2 .........................................................6
Article 5. OPERATING EXPENSES..................................................7
5.1 General..................................................7
5.2 Estimated Payments.......................................8
5.3 Annual Settlement........................................8
5.4 Final Proration..........................................9
5.5 Occupancy Variance.......................................9
5.6 Other Taxes..............................................9
5.7 Additional Rent..........................................9
Article 6. INSURANCE ........................................................10
6.1 Landlord's Insurance....................................10
6.2 Tenant's Insurance......................................10
6.3 Forms of Policies.......................................10
6.4 Waiver of Subrogation...................................10
6.5 Adequacy of Coverage....................................10
6.6 Certain Insurance Risks.................................11
Article 7. USE...............................................................11
Article 8. COMPLIANCE WITH LAWS..............................................11
Article 9. HAZARDOUS MATERIALS...............................................11
Article 10. ASSIGNMENT AND SUBLETTING........................................12
10.1 General.................................................12
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10.2 Recapture...............................................12
10.3 Submission of Information...............................13
10.4 Payments to Landlord....................................14
10.5 Prohibited Transfers....................................14
10.6 Permitted Transfer......................................14
10.7 Condition...............................................14
10.8 Remedies................................................14
Article 11. RULES AND REGULATIONS............................................14
Article 12. COMMON AREAS.....................................................15
Article 13. LANDLORD'S SERVICES..............................................15
13.1 Landlord's Repair and Maintenance.......................15
13.2 Landlord's Other Services...............................15
13.3 Tenant's Costs..........................................16
13.4 Limitation on Liability.................................16
Article 14. TENANT'S CARE OF THE PREMISES....................................17
Article 15. ALTERATIONS......................................................17
15.1 General.................................................17
15.2 Free-Standing Partitions................................17
15.3 Removal.................................................17
15.4 ADA Compliance..........................................18
Article 16. MECHANICS' LIENS.................................................18
Article 17. END OF TERM......................................................18
Article 18. EMINENT DOMAIN...................................................19
Article 19. DAMAGE AND DESTRUCTION...........................................19
Article 20. SUBORDINATION....................................................20
20.1 General.................................................20
20.2 Attornment..............................................20
Article 21. ENTRY BY LANDLORD................................................21
Article 22. INDEMNIFICATION, WAIVER AND RELEASE..............................21
22.1 Tenant's Indemnification ...............................21
22.2 Waiver and Release......................................21
Article 23. QUIET ENJOYMENT..................................................22
Article 24. EFFECT OF SALE...................................................22
Article 25. DEFAULT ........................................................22
25.1 Events of Default by Tenant.............................22
25.2 Landlord's Remedies.....................................23
25.3 Damages; no Termination.................................23
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25.4 Damages upon Termination................................23
25.5 Cumulative Remedies.....................................24
25.6 ........................................................24
Article 26. INTENTIONALLY OMITTED.............................................24
Article 27. PARKING ........................................................24
Article 28. MISCELLANEOUS.....................................................25
28.1 Intentionally Omitted...................................25
28.2 Security Deposit........................................25
28.3 Signs...................................................25
28.4 No Offer................................................25
28.5 Joint and Several Liability.............................25
28.6 No Construction Against Drafting Party..................26
28.7 Time of the Essence.....................................26
28.8 No Recordation..........................................26
28.9 No Waiver...............................................26
28.10 Limitation on Recourse..................................26
28.11 Estoppel Certificates...................................26
28.12 Waiver of Jury Trial....................................26
28.13 No Merger...............................................26
28.14 Holding Over............................................27
28.15 Notices.................................................27
28.16 Severability............................................27
28.17 Written Amendment Required..............................27
28.18 Captions................................................27
28.19 Authority...............................................27
28.20 Brokers.................................................27
28.21 Governing Law...........................................27
28.22 No Easements for Air or Light...........................27
28.23 Tax Credits.............................................28
28.24 Intentionally Omitted...................................28
28.25 Landlord's Fees.........................................28
28.26 Non-waiver..............................................28
28.27 Presumption.............................................28
28.28 Waiver of Technical Defects in Notices..................28
28.29 No Right to Terminate...................................28
28.30 No Liability for Crimes.................................28
28.31 Binding Effect..........................................28
28.32 Confidentiality.........................................28
28.33 Force Majeure...........................................29
28.34 Interest................................................29
28.35 Entire Agreement........................................29
EXHIBITS
Exhibit A -- Layout Of The Premises
Exhibit B -- Work Letter
Exhibit C -- Commencement Date Certificate
Exhibit D -- Rules and Regulations
Exhibit E -- Tenant Estoppel Certificate
Exhibit F -- Option to Renew
Exhibit G - Janitorial Specifications
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OFFICE LEASE
BETWEEN
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY ("LANDLORD") AND
QUEST SOFTWARE, INC. ("TENANT")
THIS OFFICE LEASE ("Lease") is entered into by Landlord and Tenant on
the date set forth in the following Basic Lease Information. Landlord and Tenant
hereby agree as follows:
ARTICLE 1. BASIC LEASE INFORMATION.
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1.1 BASIC LEASE INFORMATION. In addition to the Terms that are defined
elsewhere in this Lease, the following terms shall have the following meaning as
set forth in this Lease:
(a) LEASE DATE: September 30, 1999
(b) LANDLORD: The Northwestern Mutual Life Insurance
Company
TYPE OF LEGAL ENTITY AND STATE OF FORMATION:
a Wisconsin Corporation
(c) LANDLORD'S ADDRESS FOR RECEIPT OF NOTICE:
The Northwestern Mutual Life Insurance Company
c/o Northwestern Investment Management Company
00 Xxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attn: Regional Manager
(Fax: 312/000-0000)
with a copy to:
Northwestern Investment Management Company
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attn: Managing Director-Asset Management
(Fax: 414/000-0000)
(d) TENANT: Quest Software, Inc.
TYPE OF LEGAL ENTITY AND STATE OF FORMATION:
a California corporation
(e) TENANT'S ADDRESS FOR RECEIPT OF NOTICE: at the
following address until the Commencement Date, and
thereafter at the Premises:
Quest Software, Inc.
000 Xxxxxxx Xxxxxx Xxxxx; Xxxxx 0000
Xxxxxxx Xxxxx, XX 00000
Attn: Xxxxx Xxxxxxxx
(Fax: 000-000-0000)
with a copy to: Pinto & Dubia, LLP
0 Xxxx Xxxxx, Xxxxx 000
Xxxxxx, XX 00000-0000
Attn: Xxxxx X. Xxxxxxx
(Fax: 000-000-0000)
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(f) LAND: The parcel of land located at the Building
Address upon which the Building is situated.
(g) PROJECT: The development commonly known as
Cornerstone At Cantera consisting of the Land and all
Improvements built on the Land, including without
limitation, the Building, Common Areas, parking lot
or parking structure, if any, walkways, driveways,
fences and landscaping.
(h) BUILDING: The building located on the Land of which
the Premises are a part.
(i) BUILDING ADDRESS: 0000 Xxxxxxxx Xxxx, Xxxxxxxxxxx,
Xxxxxxxx 00000.
(j) PREMISES: The Premises located at Suite 500 on the
fifth floor of the Building, as further shown on
Exhibit A to this Lease.
(k) RENTABLE AREA OF THE PREMISES: 15,633 square feet,
which Landlord and Tenant hereby conclusively agree
shall be the Rentable Area of the Premises for all
purposes of this Lease.
(l) TERM: 84 months, beginning on the Commencement Date
and ending on the Expiration Date.
(m) COMMENCEMENT DATE: November 1, 1999 or as extended
pursuant to Article 3.1 of this Lease.
(n) EXPIRATION DATE: October 31, 2006, or as extended
pursuant to Article 3.1 of this Lease.
(o) SECURITY DEPOSIT: $32,347.50, subject to the
provisions of Article 28.2.
(p) MONTHLY RENT: [see Section 4]
($______________________________________)
(q) ADDITIONAL RENT: Any amounts that this Lease requires
Tenant to pay in addition to Monthly Rent.
(r) RENT: Collectively, the Monthly Rent and Additional
Rent.
(s) TENANT'S PROPORTIONATE SHARE: 10.4744%, which is the
ratio of the rentable square footage of the Premises
(15,633 square feet) to the rentable square footage
of the Building (149,250 rentable square feet).
(t) [Intentionally omitted.]
(u) [Intentionally omitted.]
(v) LANDLORD'S BROKER: Xxxxx Xxxx LaSalle Americas
(Illinois), L.P.
(w) TENANT'S BROKER: CB XXXXXXX XXXXX
(x) PRIME RATE: The rate of interest from time to time
published in the "Money Rates" section of the Wall
Street Journal on the date such calculation is to be
made or if not published on such date, the date of
publication immediately preceding such calculation
date.
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(y) USE: The permitted use of the Premises shall be used
for general office use.
(z) LEASE YEAR: A period of twelve (12) consecutive
calendar months with the first full Lease Year
commencing on the Commencement Date (unless the
Commencement Date is not the first day of a calendar
month, in which case the first Lease Year will
commence on the first day of the calendar month
following the Commencement Date) and each succeeding
Lease Year commencing on the anniversary of the
commencement of the first Lease Year.
(aa) CALENDAR YEAR: Each year in which any part of the
Term falls through and including the year in which
the Term expires.
If any other provision of this Lease conflicts with anything set forth in this
Article 1.1, such other provision will prevail.
1.2 EXHIBITS. The following exhibits are attached to this Lease
and are made part hereof:
Exhibit A -- Layout Of The Premises
Exhibit B -- The Work Letter
Exhibit C -- Commencement Date Certificate
Exhibit D -- Rules and Regulations
Exhibit E -- Tenant Estoppel Certificate
Exhibit F -- Option to Renew
Exhibit G -- Janitorial Specifications
ARTICLE 2. AGREEMENT.
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2.1 LEASE GRANT, TERM AND USE. Landlord leases the Premises to Tenant,
and Tenant leases the Premises from Landlord, pursuant to the terms and
conditions of this Lease. The duration of this Lease shall be the Term. The Term
shall commence on the Commencement Date and shall expire on the Expiration Date,
except as may be otherwise set forth in this Lease.
Landlord also grants to Tenant the rights under this Lease to use in
common with Landlord and other tenants, occupants and visitors to the Building,
the common areas, as hereinafter defined, including the common walkways and
sidewalks of the Property, the Building lobby (but not for advertising or
promotional purposes), entrances, stairs and elevators, and, if the Premises
include less than an entire floor of the Building, the common lobbies, hallways
and toilets and other common facilities of such floor. Landlord reserves the
right to increase, reduce or change the size, layout or location of the Common
Areas and facilities (as long as access to the Premises is not materially
impaired). No easement, license or other right to light, air or view is created
by this Lease.
For the purpose of calculating the amounts due from Tenant as Rent and
other charges, the First Lease Year shall include the period of time beginning
on the Commencement Date to the first day of the calendar month following the
Commencement Date.
2.2 TERMINATION RIGHT. Provided no Event of Default exists, and no
condition exists which, with the giving of notice or the passing of time or both
would result in an Event of Default, Tenant will have the right to terminate
this Lease at the expiration of the fifth Lease Year. Tenant will exercise the
right granted herein by delivering written notice to Landlord on or prior to
February 1, 2004 exercising this termination right. Failure by Tenant to deliver
such written notice within the time period stipulated herein will constitute a
waiver of Tenant's right of termination.
If Tenant elects to terminate this Lease as provided herein, Tenant
must pay to Landlord an early termination fee in an amount equal to the sum of
the following (the "TERMINATION FEE"): (i) $251,835.00 (which was calculated as
the unamortized cost (as of the expiration of the fifth Lease Year) of the Work
described in the Work Letter and of leasing commissions paid by Landlord in
connection with this Lease, such costs being
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amortized at 11% per annum over the period beginning on the Commencement Date
and ending on the scheduled expiration of the initial Lease Term as set forth in
Article 1.1(n)), plus any applicable sales tax, plus (ii) if Tenant has
exercised its right of first offer under Article 3.3, the unamortized cost of
any tenant improvement allowance or similar economic concession given to Tenant
with respect to the Additional Premises and of any leasing commissions paid by
Landlord in connection with the Additional Premises, such costs being amortized
at 11% per annum over the period beginning on the date of the commencement of
Tenant's lease of such Additional Premises and ending on the scheduled
expiration of the initial Lease Term as set forth in Article 1.1(n) (as the same
may have been extended under Article 3.1). Tenant must pay the entire
Termination Fee at the time Tenant delivers its notice exercising its right to
terminate. If the Termination Fee is not paid to Landlord when due, Tenant's
right to terminate under this Article 2.2 will be deemed void and inoperable.
If this Lease is terminated as provided herein, the parties agree
to execute an instrument which confirms and effects a release and surrender of
all right, title and interest in and to the Premises pursuant to the terms of
this Lease and otherwise.
ARTICLE 3. DELIVERY OF PREMISES.
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3.1 DELIVERY OF POSSESSION. Landlord shall construct or install in the
Premises any improvements to be constructed or installed by Landlord according
to the Work Letter attached to this Lease as Exhibit B (such improvements
described herein and in the Work Letter as the "Work" or "Tenant Improvements").
If Landlord is unable to deliver possession of the Premises or substantial
completion of the Work is delayed due to any circumstances besides a Tenant
Delay (as defined in the Work Letter), this Lease shall not be void or voidable
and Landlord shall not be liable to Tenant for any resultant loss or damage;
however, in such event the Commencement Date will be deferred until the Work is
substantially complete and Landlord is able to deliver possession of the
Premises to Tenant and the Expiration Date will be deferred for an equal amount
of time. Substantial completion of the Work will include a final inspection by
the City of Warrenville and the oral or written approval by such City for
occupancy of the Premises. However, if the Expiration Date, as so extended,
falls on other than the last day of a month, then the Expiration Date will be
further extended to fall on the last day of such month. If Landlord's delay in
delivering possession of the Premises or substantial completion of the Work is
the result of a Tenant Delay, this Lease and Tenant's obligations hereunder
shall be deemed to have become effective as of the scheduled Commencement Date,
and there will be no deferral of the Commencement Date or Expiration Date. The
Work shall be deemed substantially complete when the Work is completed except
for Punch List items, as that term is defined in the Work Letter. Tenant and
Landlord shall execute the Commencement Date Certificate attached to this Lease
as Exhibit C within fifteen (15) days of Landlord's request.
Tenant acknowledges that neither Landlord nor its agents or employees
have made any representations or warranties as to the suitability or fitness of
the Premises for the conduct of Tenant's business or for any other purpose, nor
has Landlord or its agents or employees agreed to undertake any alterations or
construct any tenant improvements to the Premises except as expressly provided
in this Lease and the Work Letter.
3.2 EARLY ENTRY. Tenant shall have the right to enter the Premises 5
days prior to the Commencement Date for the purpose of installing fixtures,
furniture, equipment and telephone systems permitted by Landlord and for any
other purpose permitted by Landlord. Such entry prior to the Commencement Date
shall be at Tenant's sole risk and subject to all the terms and provisions of
this Lease as though the Commencement Date had occurred, except for the payment
of Rent. Tenant, its agents or employees shall not interfere with or delay
Landlord's completion of construction of the Tenant Improvements set forth in
the Work Letter. All rights of Tenant under this Article 3.2 shall be subject to
the requirements of all applicable building codes, zoning requirements, and
federal, state, and local laws, rules, and regulations, so as not to interfere
with Landlord's compliance with all laws, including the obtaining of a
certificate of occupancy for the Premises. Landlord has the right to impose
additional conditions on Tenant's early entry that Landlord, in its reasonable
discretion, deems appropriate, including without limitation, an indemnification
of Landlord and proof of insurance, and Landlord shall further have the right to
require that Tenant execute an early entry agreement containing such conditions
prior to Tenant's early entry.
3.3 RIGHT OF FIRST OFFER. During the initial Term of this Lease (but
excluding the Renewal Term) and subject to the provisions set forth hereinafter
and provided Tenant has not exercised its right to terminate this Lease as set
forth in Article 2.2 herein, Tenant will have a continuing right of first offer
to lease from Landlord all or any of the remainder of the fifth floor of the
Building (the "ADDITIONAL PREMISES").
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If Tenant's Exercise Notice (defined below) is received before the end
of the first Lease Year and the scheduled commencement of Tenant's lease of the
Additional Premises (or such portion) occurs during the first 15 full calendar
months of the Term, then Tenant's lease of such space will be on the same terms
as contained in this Lease for the initial Premises, excluding the Work Letter,
and except that (a) the Monthly Rent for the Additional Premises will be at a
rate equal to the Monthly Rent per rentable square foot per annum then
applicable to the Premises, increasing as and when the Monthly Rent increases
under this Lease; and (b) Landlord will cause such space to be improved at
Tenant's cost, in accordance with Landlord's then standard-form work letter for
"allowance" buildouts, except that Landlord will provide an allowance (which may
be applied to hard and soft construction costs only) calculated as follows:
$35.00 multiplied by the number of rentable square feet in the subject portion
of the Additional Premises to be leased by Tenant, divided by 84, and multiplied
by the number of full calendar months in the period beginning on the date of
commencement of the term of Tenant's lease of such portion of the Additional
Premises through the Expiration Date.
If Tenant's Exercise Notice (defined below) is received after the end
of the first Lease Year or the scheduled commencement of Tenant's lease of the
Additional Premises (or such portion) occurs after the first 15 full calendar
months of the Term, then Tenant's lease of such space will be on the same terms
as contained in this Lease for the initial Premises, excluding the Work Letter,
and except that (A) the Monthly Rent for the Additional Premises will be at a
rate equal to the then prevailing market rate as reasonably determined by
Landlord for fully credit worthy tenants for comparable space in the Building
and other first class office buildings which have comparable tenant improvements
in the vicinity of the Building, for a term equal or comparable to the
then-remaining initial Term of this Lease, with increases in fixed amounts based
on prevailing-market Monthly Rent increases; and (B) Tenant will lease the
Additional Premises in "as-is" condition, except that if in the prevailing
market, as reasonably determined by Landlord, the rental rate determined in
clause (A) above includes an allowance for leasehold improvements, then Landlord
will grant to Tenant such prevailing market allowance (which may be applied to
hard and soft construction costs only) to improve such space in accordance with
Landlord's then standard-form work letter for "allowance" buildouts.
The provisions of this Article will apply to all or any of the
Additional Premises as all or any of the Additional Premises may become
available for lease at any time from and after the date hereof, subject to any
expansion and renewal options of any current tenant or tenants, their successors
or assigns in the Building, and any extensions or renewals of existing leases
for the Additional Premises. While Tenant's right of first offer is in effect,
if Landlord sends to a prospective tenant a lease proposal for the Additional
Premises, Landlord will contemporaneously deliver to Tenant a written notice
stating that Landlord has delivered or is delivering such proposal to a
prospective tenant, identifying the Additional Premises or portion thereof that
is the subject of the proposal, and offering such space to Tenant on the terms
set forth in this Section 3.3. Tenant must exercise its right of first offer by
written notice to Landlord ("TENANT'S EXERCISE NOTICE") within 15 days following
receipt of any such notice from Landlord. If Tenant exercises the right granted
herein, Landlord and Tenant will enter into an amendment to this Lease to
incorporate the respective portion of the Additional Premises and to make
necessary adjustments to the Base Rental and similar provisions of this Lease.
If Tenant declines to exercise its right as above provided for, or fails to
deliver notice thereof within the time period stipulated above, or fails to
execute the requisite amendment to this Lease, this right of first offer will
lapse as to the subject proposal, and Landlord may lease the Additional Premises
to the prospective tenant named in such proposal, or such prospective tenant's
affiliates or designees, free of Tenant's rights under this Section but, after
Landlord enters into any such lease of the Additional Premises with a third
party(ies), if the subject portion of the Additional Premises again become
available for lease (subject to any expansion and renewal options of any tenant
or tenants at such time, their successors or assigns in the Building, and any
extensions or renewals of such lease to such third party(ies) for the Additional
Premises), Tenant will again have a right of first offer for the subject portion
of the Additional Premises as set forth in this Section 3.3. However, if
Landlord does not lease such space to such prospective tenant or its affiliates
or designees, Landlord will continue to deliver to notify Tenant of Landlord's
delivery of lease proposals to other prospective tenants of the Additional
Premises, and Tenant's rights under this Section 3.3 will continue.
The foregoing right of first offer may not be severed from this Lease
or separately sold, assigned or transferred and is subject to the following
additional conditions, namely: (a) that no less than 24 months remain on the
current Term; (b) that the Term for any Additional Premises will run
concurrently with this Lease; (c) that, at the time that Tenant exercises this
right of first offer for any Additional Premises, no Event of Default exists,
and no condition exists which, with the giving of notice or the passage of time,
or both, would constitute an Event of
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Default; (d) that, at the time Tenant exercises this right of first offer,
Tenant occupies and is in possession of the Premises and has not assigned the
Lease or sublet the Premises; and (e) that Tenant enters into an amendment to
this Lease to incorporate the Additional Premises and make corresponding
modifications to the provisions of this Lease.
ARTICLE 4. MONTHLY RENT.
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4.1 MONTHLY RENT. Throughout the Term, and any renewal term which may
be duly exercised by Tenant, Tenant shall pay Monthly Rent to Landlord in the
amounts and for the time periods described as follows:
PERIOD ANNUAL MONTHLY RENT MONTHLY INSTALLMENTS
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Commencement Date through the last day $265,761.00 $22,146.75
of the first Lease Year ($17.00 x 15,633 rsf / 12)
First day of the second Lease Year $273,733.80 $22,811.15
through the last day of the second ($17.51 x 15,633 rsf / 12)
Lease Year
First day of the third Lease Year $282,019.32 $23,501.61
through the last day of the third ($18.04 x 15,633 rsf / 12)
Lease Year
First day of the fourth Lease Year $290,461.20 $24,205.10
through the last day of the fourth ($18.58 x 15,633 rsf / 12)
Lease Year
First day of the fifth Lease Year $299,059.32 $24,921.61
through the last day of the fifth ($19.13 x 15,633 rsf / 12)
Lease Year
First day of the sixth Lease Year $308,126.40 $25,677.20
through the last day of the sixth ($19.71 x 15,633 rsf / 12)
Lease Year
First day of the seventh Lease Year $317,349.96 $26,445.83
through the last day of the Lease Term ($20.30 x 15,633 rsf / 12)
Monthly Rent shall be paid in advance on or before the first day of each
calendar month of the Term, and shall be accompanied by any applicable rent,
sales, use or other tax which is based on the amount and/or payment of Rent
payable pursuant to this Lease. If the Term commences on a day other than the
first day of a calendar month or ends on a day other than the last day of a
calendar month, then Monthly Rent will be appropriately prorated based on the
actual number of calendar days in such month. If the Term commences on a day
other than the first day of a calendar month, then the prorated Monthly Rent for
such month will be paid on or before the first day of the Term. Monthly Rent
shall be paid to Landlord, without written notice or demand and without
deduction or offset (except as may be otherwise expressly provided in this
Lease), as an independent covenant of Tenant, in lawful money of the United
States of America at Landlord's address set forth in Article 1.1 herein or to
such other address as Landlord may from time to time designate in writing. After
the service of more than one notice on Tenant for overdue Rent or if more than
one check is returned unpaid during any twelve month period during the Term,
then Rent for the remainder of the Term shall be paid by cashier's check.
4.2 If Tenant fails to pay any Rent when due, the unpaid amounts will
be subject to a late payment charge equal to three percent (3%) of the unpaid
amounts. This late payment charge is intended to compensate Landlord for its
additional administrative costs resulting from Tenant's failure, and has been
agreed upon by Landlord and Tenant as a reasonable estimate of the additional
administrative costs that will be incurred by Landlord as a result of Tenant's
failure. The actual cost in each instance is extremely difficult, if not
impossible, to determine. This late payment charge will constitute liquidated
damages and will be paid to Landlord together with such unpaid amounts and
interest pursuant to Article 28.34. The payment of this late payment charge will
not constitute a waiver by Landlord of any default by Tenant under this Lease.
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ARTICLE 5. OPERATING EXPENSES.
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5.1 GENERAL.
(a) In addition to Monthly Rent, beginning on the Commencement Date,
Tenant shall pay Tenant's Proportionate Share of the Operating Expenses of the
Project defined below, paid, payable or incurred by Landlord in each calendar
year or partial calendar year during the Term. If Operating Expenses are
calculated for a partial calendar year, an appropriate proration shall be made.
(b) As used in this Lease, the term "Operating Expenses" means:
(1) All costs of management, operation, and maintenance of the
Project, including without limitation real and personal property taxes and
assessments (and any tax levied in whole or in part in lieu of or in addition to
real property taxes); wages, salaries, and compensation of employees engaged in
the repair, operation, maintenance, leasing (but excluding third party leasing
commissions), or security of the Project; consulting, accounting, legal,
janitorial, maintenance, guard, and other services; management fees and costs
(charged by Landlord, any affiliate of Landlord, or any other entity managing
the Project and determined at a rate consistent with prevailing market rates for
comparable services and Projects); that part of office rent or rental value of
space in the Project used or furnished by Landlord to enhance, manage, operate,
and maintain the Project; electricity, water, waste disposal, and other
utilities; materials and supplies; maintenance and repairs; insurance obtained
with respect to the Project; depreciation on personal property and equipment,
except as set forth in Article 5.1(c), below, which is or should be capitalized
on the books of Landlord; and any other costs, charges, and expenses that under
generally accepted accounting principles would be regarded as management,
maintenance, and/or Operating Expenses; and
(2) The cost (amortized on a straight line basis over the
reasonable useful life as determined by Landlord) together with interest at the
lesser of the Prime Rate plus two percent (2%) or Landlord's borrowing rate for
such capital improvements (including the rental of equipment which would be a
substitute for a capital expense that the Landlord would otherwise incur), on
the unamortized balance of any capital improvements that are made to the Project
by Landlord (i) for the purpose of reducing Operating Expenses, or (ii) required
under any law or regulation that was not applicable to the Project at or prior
to the Commencement Date.
(c) The Operating Expenses will not include:
(1) depreciation on the Project (other than depreciation
on personal property, equipment, window coverings on
exterior windows provided by Landlord and carpeting
and wall covering in public corridors and Common
Areas);
(2) advertising costs, finders' fees and real estate
brokers' commissions;
(3) ground lease or mortgage payments;
(4) costs of replacements to personal property and
equipment for which depreciation costs are included
as an operating expense;
(5) the cost of repairs due to casualty or condemnation
that are reimbursed by third parties;
(6) any income, estate, inheritance, or other land
transfer or mortgage tax and any excess profit,
franchise, or similar taxes on Landlord's business
provided, however, that if a tax or excise on Rent or
other amounts payable by Tenant to Landlord is levied
or assessed against Landlord on account of Rent, such
tax shall not be excluded from Operating Expenses;
(7) The cost of correcting defects in construction of the
Building or in the Building systems or equipment (as
opposed to the cost of normal repair, materials and
equipment installed in the Building in light of their
specifications);
(8) All expenses for which Landlord has received any
reimbursement to the extent of such reimbursement
including, without limitation, reimbursements from
Tenant or other tenant (such as reimbursement for
repairs) or pursuant to contractor's or other
warranties or condemnation, but excluding matters
paid as additional rent or rent adjustment or other
tax or expense pass-through or escalation expressly
provided for in a tenant lease;
(9) Any interest or penalty charges or attorneys' fees
incurred by Landlord due to the violation of any law
or failure to pay obligations of the Landlord before
they become delinquent (whether or not the payment of
such obligations is reimbursed through Operating
Expenses);
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(10) Costs (including, without limitation, permit, license
and inspection fees) of any alterations, renovations
or improvements of, or decorating in, the Premises or
any other tenant's premises in the Building;
(11) Expenses incurred in connection with services
(including special service from Landlord's employees)
or other benefits of a type which are not available
or provided to Tenant (regardless of whether Landlord
is prepared to perform such services for Tenant) but
which are available to or provided to another tenant
or occupant of the Building;
(12) Attorneys' fees, costs and disbursements and other
expenses incurred in connection with any matters
related to Landlord which are not related to the
maintenance, operation or repairing of the Project
including, without limitation, any matter related to
(i) the formation and continued existence of
Landlord, (ii) any loans to Landlord relating to the
Building, (iii) tenant leases, including, without
limitation, negotiations with prospective tenants or
disputes with or enforcement actions against any
tenant, and (iv) the defense of Landlord's title to
or interest in the Building;
(13) The cost of any repairs, alterations, additions,
charges, replacements and other items not
specifically permitted to be included under this
Article 5 and which, under generally accepted
accounting principles, are properly classified as
capital expenditures;
(14) Any on-site management or other fees paid to an agent
which is related to Landlord to the extent such fees
are in excess of the then current market rate for
customary management fees for projects similar to the
Building;
(15) Payments in respect of profit to parties related to
Landlord for supplies or materials to the extent that
the cost of such supplies or materials exceeds the
cost that would have been paid had such supplies or
materials been provided by parties unaffiliated with
the Landlord on a competitive basis; and
(16) Costs incurred by Landlord in connection with the
removal, abatement, containment or remediation of
asbestos, asbestos containing material, volatile
organic compounds or other hazardous materials (if
and to the extent that such other hazardous materials
are classified as such under applicable hazardous
materials laws as in effect as of the date of this
Lease) from or with respect to the Project.
5.2 ESTIMATED PAYMENTS. During each calendar year or partial calendar
year in the Term beginning as of the Commencement Date, in addition to Monthly
Rent, Tenant shall pay to Landlord on the first day of each month an amount
equal to 1/12 of the product of Tenant's Proportionate Share multiplied by the
Estimated Operating Expenses, defined below, for such calendar year. Estimated
Operating Expenses for any calendar year means Landlord's reasonable estimate of
Operating Expenses for such calendar year and will be subject to revision
according to the further provisions of this Article 5.2 and Article 5.3. During
any partial calendar year during the Term, Estimated Operating Expenses will be
estimated on a full-year basis. During each December during the Term, or as soon
after each December as practicable, Landlord will give Tenant written notice of
Estimated Operating Expenses for the ensuing calendar year. On or before the
first day of each month during the ensuing calendar year (or each month of the
Term, if a partial calendar year), Tenant shall pay to Landlord 1/12 of the
product of Tenant's Proportionate Share multiplied by the Estimated Operating
Expenses for such calendar year; however, if such written notice is not given in
December, Tenant shall continue to make monthly payments on the basis of the
prior year's Estimated Operating Expenses until the month after such written
notice is given, at which time Tenant shall commence making monthly payments
based upon the revised Estimated Operating Expenses. In the month Tenant first
makes a payment based upon the revised Estimated Operating Expenses, Tenant
shall pay to Landlord for each month which has elapsed since December the
difference between the amount payable based upon the revised Estimated Operating
Expenses and the amount payable based upon the prior year's Estimated Operating
Expenses. If at any time or times it reasonably appears to Landlord that the
actual Operating Expenses for any calendar year will vary from the Estimated
Operating Expenses for such calendar year, Landlord may, by written notice to
Tenant, revise the Estimated Operating Expenses for such calendar year, and
subsequent payments by Tenant in such calendar year will be based upon such
revised Estimated Operating Expenses.
5.3 ANNUAL SETTLEMENT. Within one hundred twenty (120) days after the
end of each calendar year during the Term or as soon after such one hundred
twenty (120-day) period as practicable, Landlord shall deliver to Tenant a
statement of amounts payable under Article 5.1 for such calendar year prepared
and certified by Landlord
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or its agents. Such certified statement shall be final and binding upon Tenant
unless Tenant objects to it in writing to Landlord within thirty (30) days after
it is given to Tenant. If such statement shows an amount owing by Tenant that is
less than the estimated payments previously made by Tenant for such calendar
year, the excess shall be held by Landlord and credited against the next payment
of Rent; however, if the Term has ended and Tenant was not in default at its
end, Landlord shall refund the excess to Tenant. If such statement shows an
amount owing by Tenant that is more than the estimated payments previously made
by Tenant for such calendar year, Tenant shall pay the deficiency to Landlord
within thirty (30) days after the delivery of such statement. Provided no Event
of Default exists under this Lease, Tenant shall have ninety (90) days after
receipt of the statement to have an independent certified public accountant
which is either (i) a "big-six" accounting firm or (ii) is not working for
Tenant on a contingency fee basis, complete an audit of Landlord's books and
records on Operating Expenses, during normal business hours upon reasonable
advance written notice at Landlord's local office. Tenant shall deliver to
Landlord a copy of the results of such audit within ten (10) days of receipt by
Tenant. The cost of such audit will be borne solely by Tenant unless, in
connection with the audit, it is demonstrated that Landlord overstated Operating
Expenses by 5% or more in the aggregate (after netting any understated line
items against overstated line items), in which case Landlord will bear the
reasonable cost of such audit.
5.4 FINAL PRORATION. If the Term ends on a day other than the last day
of a calendar year, the amount of increase (if any) in the Operating Expenses
payable by Tenant applicable to the calendar year in which this Lease ends shall
be calculated on the basis of the number of days of the Term falling within such
calendar year, and Tenant's obligation to pay any increase, or Landlord's
obligation to refund any overage, shall survive the expiration or other
termination of this Lease.
5.5 OCCUPANCY VARIANCE. Operating Expenses which vary with occupancy
and are attributable to any part of the Term in which less than 95% of the
rentable area of the Building is occupied by tenants shall be adjusted by
Landlord proportionally to the amount that they would have been if 95% of the
rentable area of the Building had been occupied.
5.6 OTHER TAXES.
(a) Tenant shall reimburse Landlord within 30 days after demand for any
and all taxes payable by Landlord (other than as set forth in Article 5.6(b)
below), whether or not now customary or within the contemplation of Landlord and
Tenant:
(1) upon or measured by rent, including without limitation, any
gross revenue tax, excise tax, or value added tax levied by
the federal government or any other governmental body with
respect to the receipt of rent;
(2) upon this transaction or any document to which Tenant is a
party creating or transferring an interest or an estate in the
Premises; and
(3) upon a reassessment of the Project or Building by a taxing
authority having jurisdiction over the same.
(b) Tenant will not be obligated to pay any inheritance tax, gift tax,
transfer tax, franchise tax, income tax (based on net income), profit tax, or
capital levy imposed upon Landlord; provided, however, that Tenant shall pay any
tax or excise on Rent or other amounts payable by Tenant to Landlord levied or
assessed against Landlord on account of Rent.
(c) Tenant shall pay promptly when due all personal property taxes on
Tenant's personal property in the Premises and any other taxes payable by Tenant
that if not paid might give rise to a lien on the Premises or Tenant's interest
in the Premises.
5.7 ADDITIONAL RENT. Amounts payable by Tenant pursuant to this Article
5 shall be payable as Rent, without deduction or offset (except as may be
otherwise expressly provided in this Lease). If Tenant fails to pay any amounts
due according to this Article 5, Landlord shall have all the rights and remedies
available to it under this Lease and/or applicable law.
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ARTICLE 6. INSURANCE.
----------------------
6.1 LANDLORD'S INSURANCE. At all times during the Term, Landlord shall
procure and keep in full force and effect the following insurance:
(a) All-risk Property Insurance insuring the Building, its equipment,
common area furnishings, and the Tenant Improvements (as that term is defined in
the Work Letter) at full replacement cost (excluding foundations), with such
deductibles as Landlord considers appropriate;
(b) Commercial General Liability Insurance insuring its interest in the
Project in such amounts as Landlord deems reasonably appropriate for the Project
in the geographical area in which it is located;
(c) Such other insurance as Landlord reasonably determines from time to
time and is commercially reasonable and customary for the Project in the
geographical area in which it is located.
6.2 TENANT'S INSURANCE. Tenant shall, at its sole cost and expense,
keep in full force and effect the following insurance:
(i) All-Risk Property Insurance on "Tenant's Property" for the
full replacement value. Such policy shall contain an Agreed
Amount endorsement in lieu of a coinsurance clause. "Tenant's
Property" is defined to be all improvements, betterments and
personal property of Tenant located in or on the Premises,
Common Areas or Building, excluding that which is insured by
Landlord's all-risk Property Insurance, as set forth in
Article 6.1(a) herein.
(ii) Commercial General Liability Insurance insuring Tenant against
any liability arising out of its use, occupancy or maintenance
of the Premises or the business operated by Tenant pursuant to
the Lease. Such insurance shall be in the amount of at least
$2,000,000 per occurrence. Such policy shall name Landlord,
Landlord's wholly owned subsidiaries and agents and any
Mortgagees of Landlord as additional insureds.
(iii) Workers' Compensation insurance as required by state law.
(iv) Any other form or forms of insurance or increased amounts of
insurance as Landlord or any Mortgagees of Landlord may
reasonably require from time to time.
All such policies shall be written in a form and with an insurance
company satisfactory to Landlord and any mortgagees of Landlord, and
shall provide that Landlord, and any mortgagees of Landlord, receive
not less than thirty (30) days prior written notice of any
cancellation. Prior to or at the time that Tenant takes possession of
the Premises, Tenant shall deliver to Landlord copies of policies or
certificates evidencing the existence of the amounts and forms of
coverage satisfactory to Landlord. Tenant shall, within ten (10) days
prior to the expiration of such policies, furnish Landlord with
renewals or "binders" thereof, or Landlord may order such insurance and
charge the cost thereof to Tenant as Additional Rent.
6.3 FORMS OF POLICIES. All policies maintained by Tenant will provide
that they may not be terminated nor may coverage be reduced except after thirty
(30) days' prior written notice to Landlord. All Commercial General Liability
and All-Risk property policies maintained by Tenant shall be written as primary
policies, not contributing with and not supplemental to the coverage that
Landlord may carry.
6.4 WAIVER OF SUBROGATION. Notwithstanding that any loss or damage may
be due to or result from the negligence of either of the parties hereto,
Landlord and Tenant, for themselves and their respective insurers, each waive
any and all rights to recover against the other, against any subsidiary or joint
venture of such other party or against any other occupant of the Project, or
against the officers, directors, shareholders, partners, joint ventures,
employees, agents, customers, invitees, or business visitors of such other party
or of such other tenant or occupant of the Project, for any loss or damage to
the property of such such waiving party arising from any cause.
6.5 ADEQUACY OF COVERAGE. Landlord, its agents and employees make no
representation that the limits of liability specified to be carried by Tenant
pursuant to this Article 6, are adequate to protect Tenant. If Tenant believes
that any of such insurance coverage is inadequate, Tenant will obtain such
additional insurance coverage as Tenant deems adequate, at Tenant's sole
expense.
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6.6 CERTAIN INSURANCE RISKS. Tenant shall not do or permit to be done
any act or thing upon the Premises or the Project which would (a) jeopardize or
be in conflict with fire insurance policies covering the Project or fixtures and
property in the Project; (b) increase the rate of fire insurance applicable to
the Project to an amount higher than it otherwise would be for general office
use of the Project; or (c) subject Landlord to any liability or responsibility
for injury to any person or persons or to property by reason of any business or
operation being carried on upon the Premises.
ARTICLE 7. USE.
----------------
The Premises shall be used only for the purposes designated in Article
1.1(y) and purposes incidental to that use, and for no other purpose without the
prior written consent of Landlord, which consent shall not be unreasonably
withheld or delayed. Tenant shall use the Premises in a careful, safe, and
proper manner. Tenant shall not use or permit the Premises to be used or
occupied for any purpose or in any manner prohibited by any applicable laws, for
the use or purposes of demonstrations or picketing, or for any improper,
immoral, unlawful, pornographic, sexually explicit, or objectionable use or
purpose. Tenant shall not cause, maintain, or permit any nuisance in, on, or
about the Premises. Tenant shall not commit waste or suffer or permit waste to
be committed in, on, or about the Premises. Tenant shall conduct its business
and control its employees, and agents in such a manner as not to create any
nuisance or interfere with, annoy, or disturb any other Tenant or occupant of
the Project or Landlord in its operation of the Project.
ARTICLE 8. COMPLIANCE WITH LAWS.
---------------------------------
Tenant, at its sole cost and expense, shall promptly comply with all
laws, including building and zoning laws, the ADA, statutes, ordinances, and
governmental rules and regulations with respect, related or applicable to
Tenant's use or occupancy of the Premises. Tenant shall also comply with the
requirements of any board of fire underwriters or other similar body constituted
after the Lease Date, with any direction or occupancy certificate issued
pursuant to any law by any public officer or officers, and with the provisions
of all recorded documents affecting the Premises, insofar as they relate to the
condition, use, or occupancy of the Premises, or improvements or alterations
made by or for the Tenant after the Lease Date, excluding requirements of
structural changes to the Premises or the Building, unless required by
negligence or willful acts of the Tenant or by the unique nature of Tenant's use
or occupancy of the Premises. Landlord represents and warrants to Tenant that as
of the date of this Lease, Landlord has received no written notice from any
governmental entity that the Project is in violation of any law applicable to
the Project, which violation has not been corrected to the satisfaction of the
governmental entity giving such notice.
ARTICLE 9. HAZARDOUS MATERIALS.
--------------------------------
(a) For purposes of this Lease, "hazardous materials" means any
explosives, radioactive materials, petroleum products, hazardous wastes, or
hazardous substances, including without limitation substances defined as
"hazardous substances" in the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended, 42 U.S.C. Section 9601-9657; the
Hazardous Materials Transportation Act of 1975, 49 U.S.C. Section 1801-1812; the
Resource Conservation and Recovery Act of 1976, 42 U.S.C. Section 6901-6987; or
any other federal, state, or local statute, law, ordinance, code, rule,
regulation, order, or decree regulating, relating to, or imposing liability or
standards of conduct concerning hazardous materials, waste, or substances now or
at any time hereafter in effect (collectively, "hazardous materials laws").
(b) Tenant shall not cause or permit the storage, use, generation, or
disposition of any hazardous materials in, on, or about the Premises or the
Project by Tenant, its agents, employees, or contractors or invitees except to
use in the ordinary course of Tenant's business in customary quantities for
office tenants and in compliance with hazardous materials laws. Tenant shall not
permit the Premises to be used or operated in a manner that may cause the
Premises or the Project to be contaminated by any hazardous materials in
violation of any hazardous materials laws or result in the diminution of the
value of the Building or Project or degradation of structural materials of the
Premises. Tenant shall immediately advise Landlord in writing of (1) any and all
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enforcement, cleanup, remedial, removal, or other governmental or regulatory
actions instituted, completed, or threatened pursuant to any hazardous materials
laws relating to any hazardous materials affecting the Premises; and (2) all
claims made or threatened by any third party against Tenant, Landlord, or the
Premises relating to damage, contribution, cost recovery, compensation, loss, or
injury resulting from any hazardous materials on or about the Premises. Without
Landlord's prior written consent, Tenant shall not take any remedial action or
enter into any agreements or settlements in response to the presence of any
hazardous materials in, on, or about the Premises.
(c) Tenant shall be solely responsible for and will defend, indemnify
and hold Landlord, its agents, and employees harmless from and against all
claims, costs, and liabilities, including attorneys' fees and costs, arising out
of or in connection with Tenant's breach of its obligations in this Article 9.
Tenant will be solely responsible for and will defend, indemnify, and hold
Landlord, its agents, and employees harmless from and against any and all
claims, costs, and liabilities, including attorneys' fees and costs, arising out
of or in connection with the removal, cleanup, and restoration work and
materials necessary to return the Premises and any other property of whatever
nature located on the Project to their condition existing prior to the default.
Tenant's obligations under this Article 9 will survive the expiration or other
termination of this Lease.
ARTICLE 10. ASSIGNMENT AND SUBLETTING.
---------------------------------------
10.1 GENERAL. Tenant, for itself, its heirs, distributees, executors,
administrators, legal representatives, successors, and assigns, covenants that
it shall not assign, mortgage, or encumber this Lease, nor sublease, nor permit
the Premises or any part of the Premises to be used or occupied by others,
without the prior written consent of Landlord in each instance, which consent
shall not be unreasonably withheld or delayed. Any assignment or sublease in
violation of this Article 10 will be void. If this Lease is assigned, or if the
Premises or any part of the Premises are subleased or occupied by anyone other
than Tenant, Landlord may, after default by Tenant, collect rent from the
assignee, subtenant, or occupant, and apply the net amount collected to Rent. No
assignment, sublease, occupancy, or collection shall be deemed (a) a waiver of
the provisions of this Article 10; (b) the acceptance of the assignee,
subtenant, or occupant as Tenant; or (c) a release of Tenant from the further
performance by Tenant of covenants on the part of Tenant contained in this Lease
including, without limitation, the covenant to pay Rent. The consent by Landlord
to an assignment or sublease will not be construed to relieve Tenant from
obtaining Landlord's prior written consent in writing to any further assignment
or sublease. No assignment or subletting shall relieve Tenant from its
obligations hereunder, and Tenant shall continue to be liable as a principal and
not as a guarantor or surety to the same extent as though no assignment or
sublease has been made. No permitted subtenant may assign or encumber its
sublease or further sublease all or any portion of its subleased space, or
otherwise permit the subleased space or any part of its subleased space to be
used or occupied by others, without Landlord's prior written consent in each
instance. Notwithstanding anything to the contrary contained herein, Landlord
may withhold consent to a sublease or assignment unless Landlord is provided
with waivers from any brokers involved in such subleasing or assignment of all
lien rights of any such brokers under Illinois law, including but not limited to
the Commercial Real Estate Broker Lien Act. Landlord also may withhold consent
to a sublease or assignment if the proposed assignee or sublessee or its
business is subject to compliance with additional requirements of the ADA,
including related regulations as hereinafter defined, beyond those requirements
which are applicable to Tenant unless Tenant, its assignee or subtenant at
Landlord's request agree to make such alterations to the Premises and the
Project that may be necessary in order to comply with the ADA as it applies to
the use, occupancy, or alteration of the Premises, and to deposit with Landlord
100% of Landlord's reasonable estimate of the cost of such alterations.
Notwithstanding anything in this Lease to the contrary, Tenant shall not assign
this Lease or sublet all or any part of the Premises to a proposed assignee or
sublessee whose use, occupancy, or tenancy of the Premises is prohibited by the
terms of a lease between Landlord and any other tenant in: (i) the Building or
(ii) any other building owned, developed, or constructed by or at the direction
of Landlord on land adjacent to the Project. ("Prohibited Tenant.") Prohibited
Tenant shall include, but not be limited to, BURGER KING, CHECKERS, HARDEE'S,
WHITE CASTLE, WENDY'S, CARL'S JUNIOR, XXXX IN THE BOX, AND RALLY'S.
10.2 RECAPTURE. Landlord shall have the additional right to terminate
this Lease as to that portion of the Premises which the Tenant seeks to assign,
or in the case of a sublease, to suspend this Lease as to that portion of the
Premises and for that portion of the Term which the Tenant seeks to sublet. The
Landlord may exercise such right to terminate or suspend by giving written
notice to Tenant at any time on or before the date by which the Landlord
notifies Tenant whether it consents to a proposed assignment or sublease. If the
Landlord exercises such right to terminate or suspend, such termination or
suspension shall become effective on the date set forth in the Landlord's
written notice, which shall in no event be sooner than fifteen (15) days prior
to, or later than fifteen (15)
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days following, the effective date of the proposed assignment or sublease as set
forth in the Tenant's request for the Landlord's consent; provided that if the
Tenant has failed to request such consent, then the effective date of any
termination or suspension by the Landlord pursuant to this Article 10.2 shall be
on any date specified by the Landlord which is reasonably determined to be the
date which would have been necessary to get the space ready for possession by
the Tenant's proposed subtenant or assignee. Upon any termination of this Lease
pursuant to this Article 10.2, whether with respect to all or any portion of the
Premises, Tenant shall have no further obligation under this Lease with respect
to all or such portion of the Premises, as the case may be, for the period
following the termination; provided that the Tenant shall remain liable to the
Landlord for obligations which arose prior to the termination. Upon any
suspension of this Lease pursuant to this Article 10.2, whether with respect to
all or any portion of the Premises, Tenant shall have no obligations to Landlord
with respect to all or such portion of the Premises, as the case may be, for the
period of such suspension but shall remain liable for all obligations which
arose prior to the effective date of the suspension, and shall again become
liable for all obligations arising after the expiration of the suspension.
Notwithstanding the foregoing, if Landlord shall exercise its right to terminate
or suspend this Lease by giving written notice pursuant to this Article 10.2,
the Tenant may rescind its request for an assignment, or subletting, by giving
the Landlord written notice of such decision within fifteen (15) days of the
Landlord's written notice of termination or suspension, and upon such rescission
the termination or suspension of this Lease by the Landlord shall be null and
void. The recapture right set forth in this Article 10.2 will not apply to any
sublease that will, by its terms, (i) expire at least 12 months before the
expiration of the Lease Term, with the subtenant having no right to renew or
extend the sublease term into such 12-month period, AND (ii) grant to the
subtenant the right to use no more than 3,500 rentable square feet.
Prior to seeking Landlord's consent to a specific sublease or
assignment, Tenant may elect to notify Landlord of Tenant's intention to
sublease a portion of the Premises or to assign this Lease, and to request
Landlord to state whether Landlord would exercise its right of recapture in
connection therewith. Tenant's notice need not be accompanied by a copy of the
sublease or assignment, but must contain in reasonable detail the name of the
proposed subtenant or assignee, a description of the space to be subleased
(including the number of rentable square feet and a depiction), the proposed
commencement and expiration dates of the sublease or the commencement of the
assignment, a summary of the key economic terms and any material nonmonetary
terms of the proposed transaction, and must request Landlord to notify Tenant
whether Landlord will exercise its recapture right under this Section 10.2 in
connection therewith. If Landlord receives such a notice, Landlord will notify
Tenant whether Landlord elects to exercise its recapture right under this
Section 10.2 with respect to such proposal. If Tenant's notice (requesting
Landlord's notice of whether Landlord will exercise its recapture right)
contains the following phrase in bold capital letters, then Landlord's right to
exercise its recapture right with respect to such proposal will expire at the
end of the 15th day after Landlord's receipt of such notice if it is not
exercised within such time: "LANDLORD'S FAILURE TO EXERCISE ITS RECAPTURE RIGHT
WITHIN 15 DAYS AFTER RECEIPT OF THIS NOTICE WILL RESULT IN EXPIRATION OF SUCH
RECAPTURE RIGHT, AS SET FORTH IN SECTION 10.2 OF THE LEASE." If Landlord
notifies Tenant that Landlord elects to recapture, then Tenant may, within 15
days after Landlord's notice, notify Landlord that Tenant elects not to proceed
with the subject sublease or assignment and desires to keep this Lease in full
force and effect, in which case Landlord's exercise of its recapture right will
be rescinded. If, in response to Tenant's initial notice, Landlord notifies
Tenant that Landlord elects not to recapture, then if Landlord receives from
Tenant within 90 days after Landlord's notice of election a written request for
Landlord's consent to a sublease or assignment conforming in all material
respects (including, without limitation, commencement and expiration dates) to
the proposal with respect to which Landlord elected not to recapture, then
Landlord will not exercise its recapture right with respect to such sublease or
assignment. Landlord's election not to recapture will not constitute Landlord's
consent to the proposed transaction.
10.3 SUBMISSION OF INFORMATION. If Tenant requests Landlord's consent
to a specific assignment or subletting, Tenant shall submit in writing to
Landlord at least thirty (30) business days prior to the effective date of the
proposed assignment or sublease (a) the name and address of the proposed
assignee or subtenant; (b) the business terms of the proposed assignment or
sublease; (c) reasonably satisfactory information as to the nature and character
of the business of the proposed assignee or subtenant, and as to the nature of
its proposed use of the space; (d) banking, financial, or other credit
information reasonably sufficient to enable Landlord to determine the financial
responsibility and character of the proposed assignee or subtenant; (e) the
proposed form of assignment or sublease for Landlord's reasonable approval and
any other information which Landlord may reasonably deem relevant.
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10.4 PAYMENTS TO LANDLORD. If Landlord consents to a proposed
assignment or sublease, then Landlord shall have the right to require Tenant to
pay to Landlord (I) 50% of the total amount of (a) any rent or other
consideration paid to Tenant by any proposed transferee that (after deducting
the costs of Tenant, if any, in effecting the assignment or sublease, including
reasonable alterations costs, commissions and legal fees) is in excess of the
Rent allocable to the transferred space then being paid by Tenant to Landlord
pursuant to this Lease; and (b) any other profit or gain (after deducting any
necessary expenses incurred) realized by Tenant from any such sublease or
assignment; plus (II) 100% of Landlord's reasonable attorneys' fees and costs
incurred in connection with negotiation, review, and processing of the transfer.
All such sums payable will be payable to Landlord at the time the next payment
of Monthly Rent is due.
10.5 PROHIBITED TRANSFERS. The transfer of a majority of the issued and
outstanding capital stock of any corporate tenant or subtenant of this Lease, or
a majority of the total interest in any partnership tenant or subtenant, however
accomplished, and whether in a single transaction or in a series of related or
unrelated transactions, will be deemed an assignment of this Lease or of such
sublease requiring Landlord's consent in each instance. For purposes of this
Article 10, the transfer of outstanding capital stock of any corporate tenant
will not include any sale of such stock by persons other than those deemed
"insiders" within the meaning of the Securities Exchange Act of 1934, as
amended, effected through the "over-the-counter market" or through any
recognized stock exchange.
10.6 PERMITTED TRANSFER. Notwithstanding anything to the contrary
contained in this Article, Landlord's consent shall not be required for an
assignment or other transfer of Tenant's interest under this Lease or a sublease
of the entire Premises to an affiliate of Tenant or to an entity resulting from
a merger with Tenant or to an entity purchasing substantially all of the assets
or capital stock of Tenant provided that (i) Tenant shall notify Landlord in
writing of the proposed transaction and the identity of the proposed assignee or
sublessee, (ii) at the time of such proposed assignment, transfer or sublease,
Tenant shall not be in default of any of the terms of this Lease, (iii) any
proposed assignee or transferee shall agree in a writing reasonably acceptable
to Landlord that it will assume and be bound by the terms of this Lease, (iv)
there shall be no change in use of the Premises, (v) any proposed assignee or
transferee shall have a net worth no less than the net worth of Tenant as of the
date of execution of this Lease, and (vi) that Tenant agrees to make such
alterations to the Premises and the Project that may be necessary in order to
comply with the ADA as it applies to the use, occupancy, or alteration of the
Premises by the assignee or subtenant. As used herein, an "affiliate" shall mean
an entity which directly or indirectly controls or is controlled by or is under
common control with Tenant. "Controls," "controlled by" or "under common
control" means with regard to a corporation ownership of at least 50% of the
issued and outstanding stock or with regard to a corporation and any other
entity, ownership of at least 50% of the equity, interests, voting or other
decision making power.
10.7 CONDITION. It is an express condition of any permitted assignment
or sublease that Tenant not be in default of any of the terms of this Lease at
the time Tenant provides Landlord its request for written consent to such
assignment or sublease.
10.8 REMEDIES. If Tenant believes that Landlord has unreasonably
withheld or delayed its consent pursuant to this Article 10, Tenant's sole
remedy will be to seek a declaratory judgment that Landlord has unreasonably
withheld or delayed its consent or an order of specific performance or mandatory
injunction of the Landlord's agreement to not unreasonably withhold or delay its
consent.
ARTICLE 11. RULES AND REGULATIONS.
-----------------------------------
Tenant and its employees, agents, licensees, and visitors shall at all
times observe faithfully, and comply strictly with, the Rules and Regulations
set forth in Exhibit D. Landlord may from time to time reasonably amend, delete,
or modify existing rules and regulations, or adopt reasonable new rules and
regulations for the use, safety, cleanliness, and care of the Premises, the
Building, and the Project, and the comfort, quiet, and convenience of occupants
of the Project. Modifications or additions to the Rules and Regulations will be
effective upon thirty (30) days' prior written notice to Tenant from Landlord.
In the event of any breach of any of the Rules or Regulations or any amendments
or additions thereto, Landlord shall have all remedies that this Lease provides
for default by Tenant, and shall in addition have any remedies available at law
or in equity, including the right to enjoin any breach of such Rules and
Regulations. Landlord shall not be liable to Tenant for violation of such Rules
and Regulations by any other person. In the event of any conflict between the
provisions of this Lease and the Rules and Regulations, the provisions of this
Lease shall govern.
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ARTICLE 12. COMMON AREAS.
--------------------------
As used in this Lease, the term "Common Areas" means, without
limitation, the above ground parking area, hallways, entryways, stairs,
elevators, driveways, walkways, terraces, docks, loading areas, restrooms, trash
facilities, and all other areas and facilities in the Project that are provided
and designated from time to time by Landlord for the general nonexclusive use
and convenience of Tenant with Landlord and their guests, invitees, employees,
licensees, or visitors. Without advance written notice to Tenant, except with
respect to matters covered by Article 12(a) below, and without any liability to
Tenant in any respect, provided Landlord will take no action permitted under
Article 12(a) in such a manner as to materially impair or adversely affect
Tenant's substantial benefit and enjoyment of the Premises, Landlord will have
the right to:
(a) Close off any of the Common Areas to whatever extent required
in the reasonable opinion of Landlord to prevent a dedication
of any of the Common Areas or the accrual of any rights by any
person or the public to the Common Areas;
(b) Temporarily close any of the Common Areas for maintenance,
alteration, or improvement purposes; and
(c) Subject to the provisions of Article 27, change the size, use,
shape, or nature of any such Common Areas, including erecting
additional Buildings on the Common Areas, expanding the
Building or other Buildings to cover a portion of the Common
Areas, converting Common Areas to a portion of the Building or
other Buildings, altering the Common Areas in order to comply
with the ADA, or converting any portion of the Building
(excluding the Premises) or other Buildings to Common Areas.
Upon erection of any additional Buildings or change in Common
Areas, the portion of the Project upon which Buildings or
structures have been erected shall no longer be deemed to be a
part of the Common Areas.
ARTICLE 13. LANDLORD'S SERVICES.
---------------------------------
13.1 LANDLORD'S REPAIR AND MAINTENANCE. Landlord shall maintain and
repair the Common Areas of the Project, including lobbies, stairs, elevators,
corridors, and restrooms, the windows in the Building, the mechanical, plumbing
and electrical equipment serving the Building, and the structural elements of
the Building in reasonably good order and condition, the cost of which is
included in Operating Expenses.
13.2 LANDLORD'S OTHER SERVICES.
(a) Landlord shall furnish the Premises with those services customarily
provided in comparable office buildings in the vicinity of the Project,
including without limitation (1) heat and air conditioning reasonably required
for the comfortable occupation of the Premises during business hours; (2) access
and elevator service; (3) lighting replacement during business hours (for
Building standard lights, but not for any special Tenant lights, which will be
replaced at Tenant's sole cost and expense); (4) restroom supplies; (5) window
washing with reasonable frequency, as determined by Landlord; and (6) cleaning
service five (5) days per week in accordance with the cleaning specifications
attached hereto as Exhibit G. Landlord may, but will not be obligated to
provide, any such services (except access and elevator service) on holidays.
Landlord shall not provide electricity for lighting, receptables and outlets or
incidental uses in the Premises which shall be separately metered to Tenant.
Tenant, at its sole cost and expense, shall make all necessary arrangements with
the utility company for the provision of electric service and shall pay for
electric current furnished by it to Tenant and Tenant shall pay for all charges
for electric current consumed on the Premises during Tenant's occupancy thereof.
Landlord will cause the initial Premises to be separately metered for
electricity, and will bear the cost of such meter and the installation thereof.
(b) Tenant will have the right to purchase for use during business
hours and non-business hours the services described in Article 13.2(a)(1) and
(2) in excess of the amounts Landlord has agreed to furnish so long as
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(1) Tenant gives Landlord reasonable prior written notice of its desire to do
so; (2) the excess services are reasonably available to Landlord and to the
Premises; and (3) Tenant pays as Additional Rent (at the time the next payment
of Monthly Rent is due) the cost of such excess service from time to time
charged by Landlord; subject to the procedures established by Landlord from time
to time for providing such additional or excess services.
(c) The term "business hours" means 8:00 a.m. to 6:00 p.m. on Monday
through Friday, except holidays (as that term is defined below), and 8:00 a.m.
to 1:00 p.m. on Saturdays, except holidays. The term "holidays" means New Year's
Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day, and Christmas
Day.
13.3 TENANT'S COSTS. Whenever equipment or lighting (other than
building standard lights) is used in the Premises by Tenant and such equipment
or lighting affects the temperature otherwise normally maintained by the design
of the Building's air conditioning system, Landlord shall have the right, after
prior written notice to Tenant, to install supplementary air conditioning
facilities in the Premises or otherwise modify the ventilating and air
conditioning system serving the Premises; and the cost of such facilities,
modifications, and additional service shall be paid by Tenant as Additional Rent
within thirty (30) days of receipt of an invoice. Should Tenant desire any
additional service beyond that described in Article 13.2 hereof, Landlord may,
at Landlord's option upon reasonable advance notice from Tenant to Landlord, (i)
refuse to consent to such services or (ii) consent to such services upon such
conditions as Landlord elects (including the requirement that submeters be
installed at Tenant's expense, that Tenant pay directly to the provider of such
service (in the case of submetered services) or to Landlord, as Additional Rent
within thirty (30) days of receipt of an invoice, Landlord's additional expenses
resulting therefrom, and that Tenant pay the cost of all alterations or
additions made to accommodate such excess use, including the cost of a submeter
and installation of the same.) Neither party to this Lease is aware of anything
set forth in the Working Drawings (as defined in the Work Letter) that would
require supplemental heating or air conditioning.
13.4 LIMITATION ON LIABILITY. Landlord shall not be in default under
this Lease or be liable to Tenant or any other person for direct or
consequential damage, or otherwise, for any failure to supply any heat, air
conditioning, elevator, cleaning, lighting, security; for surges or
interruptions of electricity; or for other services which Landlord has agreed to
supply during any period provided that Landlord uses commercially reasonable
diligence to supply such services. Landlord will use commercially reasonable
efforts to diligently remedy any interruption in the furnishing of such
services. Landlord reserves the right temporarily to discontinue such services
at such times as may be necessary by reason of accident, repairs, alterations or
improvements, strikes, lockouts, riots, acts of God, governmental preemption in
connection with a national or local emergency, any rule, order, or regulation of
any governmental agency, conditions of supply and demand that make any product
unavailable, Landlord's compliance with any mandatory governmental energy
conservation or environmental protection program, or any voluntary governmental
energy conservation program at the request of or with consent or acquiescence of
Tenant, mandatory or prohibitive injunction issued in connection with the
enforcement of the ADA, or any other event or condition beyond the control of
Landlord. Landlord shall not be liable to Tenant or any other person or entity
for direct or consequential damages resulting from the admission to or exclusion
from the Building or Project of any person. In the event of invasion, mob, riot,
public excitement, strikes, lockouts, or other circumstances rendering such
action advisable in Landlord's sole opinion, Landlord shall have the right to
prevent access to the Building or Project during the continuance of the same by
such means as Landlord, in its sole discretion, may deem appropriate, including
without limitation locking doors and closing parking areas and other Common
Areas. Landlord shall not be liable for damages to person or property or for
injury to, or interruption of, business for any discontinuance permitted under
this Article 13, nor will such discontinuance in any way be construed as an
eviction of Tenant or (except as otherwise provided below in this Article 13.4)
cause an abatement of Rent or operate to release Tenant from any of Tenant's
obligations under this Lease. If any utility or other service described in this
Article 13.4 is interrupted, Tenant will promptly notify Landlord in writing. If
(a) any utility or other service described in this Article 13.4 is discontinued
or interrupted and (b) such discontinuance or interruption is within Landlord's
reasonable control, and (c) such discontinuance or interruption continues for at
least five consecutive business days and renders all or a material portion of
the Premises untenantable for such period such that Tenant cannot and does not
operate its business from the Premises or such portion for such period, then as
Tenant's sole and exclusive remedy for such discontinuance or interruption
Landlord will equitably xxxxx Tenant's obligation to pay Monthly Rent and
Tenant's Proportionate Share of Operating Expenses (as set forth in Article 5)
beginning on the sixth business day after the later of (i) the first day of such
interruption and (ii) the date of Landlord's receipt of Tenant's notice thereof,
and ending on the date on which such service is substantially restored.
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ARTICLE 14. TENANT'S CARE OF THE PREMISES.
-------------------------------------------
Tenant shall maintain the Premises (including Tenant's equipment,
personal property, and trade fixtures located in the Premises) in the same
condition as at the time they were delivered to Tenant, reasonable wear and tear
and damage by casualty excluded. Tenant shall immediately advise Landlord of any
damage to the Premises, Building or the Project. All damage or injury to the
Premises, Building or the Project, or the fixtures, appurtenances, and equipment
therein that is caused by Tenant, its agents, employees, or invitees may be
repaired, restored, or replaced by Landlord, at the expense of Tenant. Such
expense (plus 10% of such expense for Landlord's overhead) will be collectible
as Additional Rent and will be paid by Tenant within ten (10) days after
delivery of a statement for such expense.
ARTICLE 15. ALTERATIONS.
-------------------------
15.1 GENERAL.
(a) Except as otherwise specifically set forth in the Work Letter,
Tenant shall not make or allow to be made any alterations, additions, or
improvements to or of the Premises, the Building or the Project or any part
thereof, or attach any fixtures or equipment thereto after the Lease Date,
without first obtaining Landlord's prior written consent, which consent shall
not be unreasonably withheld or delayed; provided however that Landlord may
withhold its consent, in its sole and absolute discretion, to any alteration,
addition or improvement to the structural portions or the HVAC, plumbing or
electrical systems of the Building. All such alterations, additions, and
improvements consented to by Landlord, and capital improvements that are
required to be made to the Project as a result of the nature of Tenant's use of
the Premises:
(1) Shall be performed by contractors reasonably approved
by Landlord and subject to conditions specified by
Landlord (which may include requiring the posting of
a mechanic's or materialmen's xxxx xxxx); and
(2) At Landlord's option, will be made by Landlord for
Tenant's account, and Tenant will reimburse Landlord
for their cost within ten (10) days after receipt of
a statement of such cost.
(b) Subject to Tenant's rights in Article 17 herein, all alterations,
additions, fixtures, and improvements, whether temporary or permanent in
character, made in or upon the Premises either by Tenant or Landlord, shall
immediately become Landlord's property, and at the end of the Term shall remain
on the Premises without compensation to Tenant, unless when consenting to such
alterations, additions, fixtures, or improvements, Landlord has advised Tenant
in writing that such alterations, additions, fixtures, or improvements must be
removed at the expiration or other termination of this Lease.
15.2 FREE-STANDING PARTITIONS. Tenant shall have the right to install
free-standing work station partitions, without Landlord's prior written consent,
so long as no building or other governmental permit is required for their
installation or relocation; however, if a permit is required, Landlord shall not
unreasonably withhold its consent to such relocation or installation. The
free-standing work station partitions for which Tenant pays shall be part of
Tenant's trade fixtures for all purposes under this Lease.
15.3 REMOVAL. If Landlord has required Tenant to remove any or all
alterations, additions, fixtures, and improvements that are made in or upon the
Premises pursuant to this Article 15 prior to the Expiration Date, Tenant shall
remove such alterations, additions, fixtures, and improvements at Tenant's sole
cost and shall restore the Premises to the condition in which they were before
such alterations, additions, fixtures, improvements, and additions were made,
reasonable wear and tear excepted. However, at the time that Tenant requests
Landlord's consent to specific alterations, Tenant may also request that
Landlord notify Tenant whether Landlord will, upon expiration or termination of
the Lease Term, require Tenant to remove the subject improvements. If Tenant so
requests and if Landlord consents to the alterations, then Landlord will also
notify Tenant whether Landlord will require removal of any such alterations or
improvements at the expiration or termination of the Lease Term. At the
expiration or termination of the Lease Term, Tenant will not be required to
remove any alterations or improvements which Landlord has previously notified
would not be required to be removed. Landlord will not require removal of
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any of the initial Tenant Improvements performed under the Work Letter attached
hereto as Exhibit B.
15.4 ADA COMPLIANCE. Landlord shall comply with ADA Requirements,
defined below, with respect to the Common Areas. Tenant, with respect to the
Premises, at Tenant's sole cost and expense (but subject to Landlord's prior
written approval, which approval shall not be unreasonably withheld or delayed),
shall comply with the requirements imposed by the Americans with Disabilities
Act (42 U.S.C. Article 12101 et seq.) and any regulations promulgated pursuant
thereto effective from time to time during the Term ("ADA Requirements") if:
(a) the requirement for such alteration or addition arises as a
result of:
(1) Any alteration or addition by Tenant after the Lease
Date;
(2) Any violation by Tenant of any ADA Requirements;
(3) A special use of the Premises or any part thereof by
Tenant or any assignee or subtenant of Tenant
(including but not limited to use for a facility
which constitutes, or if open to the public generally
would constitute, a "place of public accommodation"
under the ADA Requirements);
(4) The special needs of the employee(s) of Tenant or any
assignee or subtenant of Tenant; or
(b) The ADA Requirements would otherwise make Tenant rather than
Landlord primarily responsible for making such alteration or
addition.
ARTICLE 16. MECHANICS' LIENS.
-------------------------------
Tenant shall pay or cause to be paid all costs and charges for work (a)
done by Tenant or caused to be done by Tenant, in or to the Premises, and (b)
for all materials furnished for or in connection with such work. Tenant shall
indemnify Landlord against and hold Landlord, the Premises, and the Project
free, clear, and harmless of and from all mechanics' liens and claims of liens,
and all other liabilities, liens, claims, and demands on account of such work by
or on behalf of Tenant, other than work performed by Landlord pursuant to this
Lease. If any such lien, at any time, is filed against the Premises or any part
of the Project, Tenant shall cause such lien to be discharged of record within
ten (10) days after the filing of such lien, except that if Tenant desires to
contest such lien, it shall deliver to Landlord, within such 10-day period, at
least one hundred percent (100%) of the amount of the claim, plus estimated
costs and interest, by cashier's check or certified funds, which shall be held
by Landlord as security to insure payment of the lien and to prevent any sale of
the Project by foreclosure or otherwise by reason of such lien, or, at Tenant's
option, Tenant may within such time cause such lien to be insured over or bonded
over, by a title insurance or bonding company and in an amount reasonably
satisfactory to Landlord. If a final judgment establishing the validity or
existence of a lien for any amount is entered, Tenant shall pay and satisfy the
same at once. If Tenant fails to pay any charge, cost or expense for which a
mechanics' lien has been filed, and has not given Landlord security as described
above, Landlord may, at its option, pay such charge and related costs and
interest, and the amount so paid, together with reasonable attorneys' fees
incurred in connection with such lien, shall be immediately due from Tenant to
Landlord as Additional Rent. Nothing contained in this Lease will be deemed the
consent or agreement of Landlord to subject Landlord's interest in the Project
to liability under any mechanics' or other lien law. If Tenant receives written
notice that a lien has been or is about to be filed against the Premises or the
Project, or that any action affecting title to the Project has been commenced on
account of work done by or for or materials furnished to or for Tenant, it shall
immediately give Landlord written notice of such notice. At least fifteen (15)
days prior to the commencement of any work (including but not limited to any
maintenance, repairs, alterations, additions, improvements, or installations) in
or to the Premises, by or for Tenant, Tenant shall give Landlord (i) written
notice of the proposed work and the names and addresses of the persons supplying
labor and materials for the proposed work and (ii) two copies of Tenant's plans
and specifications for such work.
ARTICLE 17. END OF TERM.
-------------------------
On the Expiration Date or earlier termination of this Lease, Tenant
shall promptly quit and surrender the Premises broom-clean, in good order and
repair, ordinary wear and tear and damage from casualty or condemnation. If
Tenant is not then in default, Tenant may remove from the Premises any trade
fixtures, equipment, and movable furniture placed in the Premises by Tenant,
whether or not such trade fixtures or equipment
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are fastened to the Building. Tenant shall not remove any trade fixtures or
equipment without Landlord's prior written consent if such fixtures or equipment
are used in the operation of the Building, or if the removal of such fixtures or
equipment may result in impairing the structural strength of the Building.
Whether or not Tenant is in default, Tenant shall remove such alterations,
additions, improvements, trade fixtures, equipment, and furniture as Landlord
has requested in accordance with Article 15. Tenant shall fully repair any
damage occasioned by the removal of any trade fixtures, equipment, furniture,
alterations, additions, and improvements. All trade fixtures, equipment,
furniture, inventory, effects, alterations, additions, and improvements on the
Premises after the end of the Term shall be deemed conclusively to have been
abandoned and may be appropriated, sold, stored, destroyed, or otherwise
disposed of by Landlord without written notice to Tenant or any other person and
without obligation to account for them. Tenant shall pay Landlord for all
expenses reasonably incurred in connection with the removal of such property,
including but not limited to the cost of repairing any damage to the Building or
Premises caused by the removal of such property. Tenant's obligation to observe
and perform this covenant will survive the expiration or other termination of
this Lease.
ARTICLE 18. EMINENT DOMAIN.
----------------------------
If all of the Premises are taken by exercise of the power of eminent
domain (or conveyed by Landlord in lieu of such exercise) this Lease shall
terminate on a date (the "Termination Date") which is the earlier of the date
upon which the condemning authority takes possession of the Premises or the date
on which title to the Premises is vested in the condemning authority. If any
material portion of the Premises is so taken which prevents Tenant's reasonable
use of the Premises for its intended purpose ("Material Portion"), Tenant will
have the right to cancel this Lease by written notice to Landlord given within
twenty (20) days after the termination date. If less than a Material Portion of
the Premises is so taken, or if the Tenant does not cancel this Lease according
to the preceding sentence, the Monthly Rent shall be abated in the proportion of
the rentable area of the Premises so taken to the rentable area of the Premises
immediately before such taking, and Tenant's Proportionate Share shall be
appropriately recalculated. If twenty-five percent (25%) or more of the Building
or the Project is so taken, Landlord may cancel this Lease by written notice to
Tenant given within thirty (30) days after the termination date. In the event of
any such taking, the entire award shall be paid to Landlord and Tenant will have
no right or claim to any part of such award; however, Tenant shall have the
right to assert a claim against the condemning authority in a separate action,
so long as Landlord's award is not otherwise reduced, for Tenant's moving
expenses and leasehold improvements owned by Tenant.
ARTICLE 19. DAMAGE AND DESTRUCTION.
------------------------------------
(a) If the Premises or the Building are damaged by fire or other
insured casualty, Landlord shall give Tenant written notice of the time which
will be needed to repair such damage, as determined by Landlord in its
reasonable discretion, and the election (if any) which Landlord has made
according to this Article 19. Such notice will be given before the thirtieth
(30th) day (the "notice date") after the fire or other insured casualty.
(b) If the Premises or the Building are damaged by fire or other
insured casualty to an extent which may be repaired within 180 days after the
notice date, as reasonably determined by Landlord, Landlord shall promptly begin
to repair the damage after the notice date and will diligently pursue the
completion of such repair. In that event this Lease will continue in full force
and effect except that Monthly Rent shall be abated on a pro rata basis from the
date of the damage until the date of the completion of such repairs (the "repair
period") based on the proportion of the rentable area of the Premises Tenant is
unable to use during the repair period.
(c) If the Premises or the Building are damaged by fire or other
insured casualty to an extent that may not be repaired within 180 days after the
notice date, as reasonably determined by Landlord, then (1) Landlord may cancel
this Lease as of the date of such damage by written notice given to Tenant on or
before the notice date or (2) Tenant may cancel this Lease as of the date of
such damage by written notice given to Landlord within 30 days after Landlord's
delivery of a written notice that the repairs cannot be made within such 180-day
period. If neither Landlord nor Tenant so elects to cancel this Lease, Landlord
shall diligently proceed to repair the Building and Premises and Monthly Rent
shall be abated on a pro rata basis during the repair period based on the
proportion of the rentable area of the Premises Tenant is unable to use during
the repair period.
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(d) Notwithstanding the provisions of Article 19(a), (b), and (c)
above, if the Premises or the Building are damaged by uninsured casualty, or if
the proceeds of insurance are insufficient to pay for the repair of any damage
to the Premises or the Building, Landlord shall have the option to repair such
damage or cancel this Lease as of the date of such casualty by written notice to
Tenant on or before the notice date. However, nothing in this clause (d) will
waive or diminish Tenant's remedies for Landlord's failure to maintain the
property insurance that Landlord is required to maintain under Article 6.1(a).
(e) If any such damage by fire or other casualty is the result of the
willful conduct or negligence or failure to act of Tenant, its agents,
contractors, employees, or invitees, there will be no abatement of Monthly Rent
as otherwise provided for in this Article 19. Tenant shall have no rights to
terminate this Lease on account of any damage to the Premises, the Building, or
the Project except as specifically set forth herein, Tenant hereby waiving any
such right which exists at law or in equity to the extent Tenant is not in
violation of any laws.
ARTICLE 20. SUBORDINATION.
---------------------------
20.1 GENERAL. This Lease and Tenant's rights under this Lease are
subject and subordinate to any ground or underlying lease, mortgage, indenture,
deed of trust, or other lien encumbrance (each a "superior lien"), together with
any renewals, extensions, modifications, consolidations, and replacements of
such superior lien, now or after the date affecting or placed, charged, or
enforced against the Land, the Building, or all or any portion of the Project or
any interest of Landlord in them or Landlord's interest in this Lease and the
leasehold estate created by this Lease (except to the extent any such instrument
expressly provides that this Lease is superior to such instrument); provided,
however, that any such subordination shall be subject to the right of Tenant to
remain in possession of the Premises pursuant to the terms of this Lease,
notwithstanding any foreclosure of such superior lien or any sale pursuant
thereto, so long as Tenant is not in default under this Lease. This provision
shall be self-operative and no further instrument shall be required in order to
effect it. Notwithstanding the foregoing, Tenant shall execute, acknowledge, and
deliver to Landlord, within twenty (20) days after written demand by Landlord,
such documents as may be reasonably requested by Landlord or the holder of any
superior lien to confirm or effect any such subordination and non-disturbance
agreement.
20.2 ATTORNMENT. Tenant agrees that in the event that any holder of a
superior lien succeeds to Landlord's interest in the Premises, Tenant shall pay
to such holder all Rent subsequently payable under this Lease provided Tenant is
given notice of such lien and succession. Further, Tenant agrees that in the
event of the enforcement by the holder of a superior lien of the remedies
provided for by law or by such superior lien, Tenant shall, upon request of any
person or party succeeding to the interest of Landlord as a result of such
enforcement, automatically become the Tenant of and attorn to such successor in
interest without change in the terms or provisions of this Lease provided Tenant
is given notice of such lien and succession. Such successor in interest,
however, shall not be bound by:
(a) Any payment of rent for more than one month in advance, except
prepayments in the nature of security for the performance by
Tenant of its obligations under this Lease;
(b) Any amendment or modification of this Lease made without the
written consent of such successor in interest (if such consent
was required under the terms of such superior lien and Tenant
was notified of such required consent);
(c) Any claim against Landlord arising prior to the date on which
such successor in interest succeeded to Landlord's interest;
or
(d) Any claim or offset of Rent against the Landlord.
Upon request by such successor in interest and without cost to Landlord or such
successor in interest, Tenant shall, within twenty (20) days after written
demand, execute, acknowledge, and deliver an instrument or instruments
confirming the attornment, so long as such instrument provides that such
successor in interest will not disturb Tenant in its use of the Premises in
accordance with this Lease.
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ARTICLE 21. ENTRY BY LANDLORD.
-------------------------------
Landlord, its agents, employees, and contractors may enter the Premises
at reasonable hours after reasonable notice, or at any time in response to an
emergency, to:
(a) Inspect the Premises;
(b) Exhibit the Premises to prospective purchasers, lenders, or,
during the last twelve (12) months of the Term, to prospective
tenants;
(c) Determine whether Tenant is complying with all its obligations
in this Lease;
(d) Supply cleaning service and any other service to be provided
by Landlord to Tenant according to this Lease;
(e) Post written notices of nonresponsibility or similar notices;
or
(f) Make repairs required of Landlord under the terms of this
Lease or make repairs to any adjoining space or utility
services or make repairs, alterations, or improvements to any
other portion of the Building; however, all such work shall be
done as promptly as reasonably possible and so as to cause as
little interference to Tenant as reasonably possible.
Tenant, pursuant to this Article 21, waives any claim against Landlord, its
agents, employees, or contractors for damages for any injury or inconvenience to
or interference with Tenant's business, any loss of occupancy or quiet enjoyment
of the Premises, or any other loss occasioned by any permitted entry in
accordance with this Article 21. Landlord shall at all times have and retain a
key with which to unlock all of the doors in, on, or about the Premises
(excluding Tenant's vaults, safes, and similar areas designated in writing by
Tenant in advance). Landlord shall have the right to use any and all lawful
means Landlord may deem proper to open doors in and to the Premises in an
emergency in order to obtain entry to the Premises, provided that Landlord will
promptly repair any damages caused by any forced entry. Any entry to the
Premises by Landlord in accordance with this Article 21 will not be construed or
deemed to be a forcible or unlawful entry into or a detainer of the Premises or
an eviction, actual or constructive, of Tenant from the Premises or any portion
of the Premises, nor shall any such entry entitle Tenant to damages or an
abatement of Monthly Rent, Additional Rent, or other charges that this Lease
requires Tenant to pay.
ARTICLE 22. INDEMNIFICATION, WAIVER AND RELEASE.
-------------------------------------------------
22.1 TENANT'S INDEMNIFICATION. Except for any injury to persons or
damage to property on the Premises that is proximately caused by or results
proximately from the negligence or deliberate act of Landlord, its employees or
agents, and subject to the provisions of Article 6.4 herein, Tenant shall
indemnify and hold Landlord, Landlord's wholly owned subsidiaries and the
employees and agents of Landlord and Landlord's wholly owned subsidiaries,
(hereinafter collectively referred to as the "Indemnified Parties" and
individually as an "Indemnified Party"), their employees and agents harmless
from and against, any and all demands, claims, causes of action, fines,
penalties, damages, liabilities, judgments, and expenses (including, without
limitation, reasonable attorney's fees) incurred in connection with or arising
from:
(a) the use or occupancy or manner of use or occupancy of the
Premises by Tenant or any person claiming under Tenant;
(b) any activity, work, or thing done or permitted by Tenant in or
about the Premises, the Building, or the Project;
(c) any breach by Tenant or its employees, agents, contractors, or
invitees of this Lease;
(d) any injury or damage to the person, property, or business of
Tenant, its employees, agents, contractors, or invitees
entering upon the Premises under the express or implied
invitation of Tenant; and
(e) any alleged violation by Tenant of any statutes, laws, rules,
regulations, including, without limitation, the ADA.
If any action or proceeding is brought against an Indemnified Party by
reason of any such claim for which Tenant has indemnified the Indemnified
Parties, Tenant, upon written notice from such Indemnified Party, shall defend
the same at Tenant's expense, with counsel reasonably satisfactory to Landlord.
22.2 WAIVER AND RELEASE. Tenant, as a material part of the
consideration to Landlord for this Lease, by this Article 22.2 waives and
releases all claims against Landlord, Landlord's wholly owned subsidiaries, and
their employees and agents with respect to all matters for which Landlord has
disclaimed liability pursuant to the provisions of this Lease.
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ARTICLE 23. QUIET ENJOYMENT.
-----------------------------
Landlord covenants and agrees with Tenant that, so long as Tenant pays
the Rent and observes and performs all the terms, covenants, and conditions of
this Lease on Tenant's part to be observed and performed, Tenant may peaceably
and quietly enjoy the Premises and Tenant's possession will not be disturbed by
anyone claiming by, through, or under Landlord, subject to the terms and
conditions of this Lease.
ARTICLE 24. EFFECT OF SALE.
----------------------------
A sale, conveyance, or assignment of the Building or the Project shall
operate to release Landlord from liability from and after the effective date of
such sale, conveyance, or assignment upon all of the covenants, terms, and
conditions of this Lease, express or implied, except those liabilities that
arose prior to such effective date, and, after the effective date of such sale,
conveyance, or assignment, Tenant shall look solely to Landlord's successor in
interest in and to this Lease. Landlord will deliver or credit to any such
successor in interest the unapplied portion of any security deposit paid by
Tenant under this Lease. This Lease shall not be affected by any such sale,
conveyance, or assignment, and Tenant shall attorn to Landlord's successor in
interest to this Lease, so long as such successor in interest assumes Landlord's
obligations under the Lease from and after such effective date.
ARTICLE 25. DEFAULT.
---------------------
25.1 EVENTS OF DEFAULT BY TENANT. The following events are referred to,
collectively, as "events of default" or, individually, as an "Event of Default":
(a) Tenant fails to pay Rent when due, and such failure continues
for five (5) days after written notice from Landlord;
(b) Tenant breaches any of the other agreements, terms, covenants,
or conditions that this Lease requires Tenant to perform, and
such breach continues for a period of fifteen (15) days after
written notice from Landlord to Tenant or, if such breach
cannot be cured reasonably within such fifteen (15-day)
period, if Tenant fails to diligently commence to cure such
breach within fifteen (15) days after written notice from
Landlord and to complete such cure within a reasonable time
thereafter.
(c) This Lease or the Premises or any part of the Premises are
taken upon execution or by other process of law directed
against Tenant, or are taken upon or subject to any attachment
by any creditor of Tenant or claimant against Tenant, and said
attachment is not discharged or disposed of within fifteen
(15) days after its levy;
(d) Tenant files a petition in bankruptcy or insolvency or for
reorganization or arrangement under the bankruptcy laws of the
United States or under any insolvency act of any state, or
admits the material allegations of any such petition by answer
or otherwise, or is dissolved or makes an assignment for the
benefit of creditors;
(e) Involuntary proceedings under any such bankruptcy law or
insolvency act or for the dissolution of Tenant are instituted
against Tenant, or a receiver or trustee is appointed for all
or substantially all of the property of Tenant, and such
proceeding is not dismissed or such receivership or
trusteeship vacated within sixty (60) days after such
institution or appointment;
(f) Tenant shall repeatedly default in the timely payment of Rent
or any other charges required to be paid, or shall repeatedly
default in keeping, observing or performing any other
covenant, agreement, condition or provision of this Lease,
whether or not Tenant shall timely cure any such payment or
other default. For the purposes of this Article 25.1, the
occurrence of similar defaults three (3) times during any
twelve (12) month period shall constitute a repeated default.
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25.2 LANDLORD'S REMEDIES. If any one or more events of default set
forth in Article 25.1 occurs then Landlord has the right, at its election:
(a) To give Tenant written notice of Landlord's intention to
terminate this Lease on the earliest date permitted by law or
on any later date specified in such notice, in which case
Tenant's right to possession of the Premises shall cease and
this Lease shall be terminated, except as to Tenant's
liability, on the date specified by Landlord;
(b) Without further demand or notice, to reenter and take
possession of the Premises or any part of the Premises,
repossess the same, expel Tenant and those claiming through or
under Tenant, and remove the effects of both or either, using
such lawful force for such purposes as may be necessary,
without being liable for prosecution, without being deemed
guilty of any manner of trespass, and without prejudice to any
remedies for arrears of Monthly Rent or other amounts payable
under this Lease or as a result of any preceding breach of
covenants or conditions; or
(c) Without further demand or notice to cure any Event of Default
and to charge Tenant for the cost of effecting such cure,
including without limitation reasonable attorneys' fees and
interest on the amount so advanced at the rate set forth in
Article 28.32, provided that Landlord will have no obligation
to cure any such Event of Default of Tenant.
Should Landlord elect to reenter as provided in Article 25.2(b), or should
Landlord take possession pursuant to legal proceedings or pursuant to any notice
provided by law, Landlord may, from time to time, without terminating this
Lease, relet the Premises or any part of the Premises in Landlord's or Tenant's
name, but for the account of Tenant, for such term or terms (which may be
greater or less than the period which would otherwise have constituted the
balance of the Term) and on such conditions and upon such other terms (which may
include concessions of free rent and alteration and repair of the Premises) as
Landlord, in its reasonable discretion, may determine, and Landlord may collect
and receive the Rent. Landlord will in no way be responsible or liable for any
failure to relet the Premises, or any part of the Premises, or for any failure
to collect any Rent due upon such reletting. No such reentry or taking
possession of the Premises by Landlord will be construed as an election on
Landlord's part to terminate this Lease unless a written notice of such
intention is given to Tenant. No written notice from Landlord under this Article
or under a forcible or unlawful entry and detainer statute or similar law will
constitute an election by Landlord to terminate this Lease unless such notice
specifically so states. Landlord reserves the right following any such reentry
or reletting to exercise its right to terminate this Lease by giving Tenant such
written notice, in which event this Lease will terminate as specified in such
notice.
25.3 DAMAGES; NO TERMINATION. In the event that Landlord does not elect
to terminate this Lease as permitted in Article 25.2(a), but on the contrary
elects to take possession as provided in Article 25.2(b), Tenant shall pay to
Landlord Monthly Rent and other sums as provided in this Lease that would be
payable under this Lease if such repossession had not occurred, less the net
proceeds, if any, of any reletting of the Premises after deducting all of
Landlord's reasonable expenses in connection with such reletting, including
without limitation all repossession costs, brokerage commissions, reasonable
attorneys' fees, expenses of employees, alteration and repair costs, and
expenses of preparation for such reletting. If, in connection with any
reletting, the new lease term extends beyond the Term, or the Premises covered
by such new lease includes other premises not part of the Premises, a fair
apportionment of the Rent received from such reletting and the expenses incurred
in connection with such reletting as provided in this Article 25.3 will be made
in determining the net proceeds from such reletting, and any Rent concessions
will be equally apportioned over the term of the new lease. Tenant will pay such
rent and other sums to Landlord monthly on the day on which the Monthly Rent
would have been payable under this Lease if possession had not been retaken, and
Landlord shall be entitled to receive such rent and other sums from Tenant on
each such day.
25.4 DAMAGES UPON TERMINATION.
(i) If this Lease is terminated on account of the occurrence of an
Event of Default, Tenant shall remain liable to Landlord for damages in an
amount equal to Monthly Rent and other amounts that would have been owing by
Tenant for the balance of the Term, had this Lease not been terminated, less the
net proceeds, if any, of any reletting of the Premises by Landlord subsequent to
such termination, after deducting all of Landlord's expenses in connection with
such reletting, including without limitation the expenses enumerated in Article
25.3. Landlord shall be entitled to collect such damages from Tenant monthly on
the day on which Monthly Rent and other amounts would have been payable under
this Lease if this Lease had not been terminated, and Landlord shall be entitled
to receive such Monthly Rent and other amounts from Tenant on each such day.
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(ii) Alternatively, at the option of Landlord, in the event this Lease
is so terminated, Landlord shall be entitled, upon written notice to Tenant at
any time after such termination, to declare the present cash value (as of the
date of such default) of the entire balance of Rent for the remainder of the
Term to be due and payable, and to collect such balance in addition to any
additional amounts due prior to such termination in any manner not inconsistent
with applicable law. For the purpose of this Article 25.4, the "present cash
value" shall be computed by adding interest at the per annum interest rate
described in Article 28.34 herein from the date on which this Lease is
terminated to the date Landlord obtains a court judgment against Tenant for the
amount due and discounting the entire balance due to Landlord at the Discount
Rate charged by the Federal Reserve Banks as published in the "Money Rates"
section of the Wall Street Journal on the day the Lease is terminated or if not
published on such date, the publication date immediately prior to the
termination date, plus two percent (2%).
25.5 CUMULATIVE REMEDIES. Any suit or suits for the recovery of the
amounts and damages set forth in Articles 25.3 and 25.4 may be brought by
Landlord, from time to time, at Landlord's election, and nothing in this Lease
will be deemed to require Landlord to await the date upon which this Lease or
the Term would have expired had there occurred no Event of Default. Tenant
agrees that Landlord may file suit to recover any sums due to Landlord under
this Lease from time to time and that such suit or recovery of any amount due
Landlord hereunder shall not be any defense to any subsequent action brought for
any amount not previously reduced to judgment in favor of Landlord. Each right
and remedy provided for in this Lease is cumulative and is in addition to every
other right or remedy provided for in this Lease or now or after the Lease date
existing at law or in equity or by statute or otherwise, and the exercise or
beginning of the exercise by Landlord of any one or more of the rights or
remedies provided for in this Lease or now or after the Lease Date existing at
law or in equity or by statute or otherwise will not preclude the simultaneous
or later exercise by Landlord of any or all other rights or remedies provided
for in this Lease or now or after the Lease Date existing at law or in equity or
by statute or otherwise. All costs incurred by Landlord in collecting any
amounts and damages owing by Tenant pursuant to the provisions of this Lease or
to enforce any provision of this Lease, including reasonable attorneys' fees
from the date any such matter is turned over to an attorney, whether or not one
or more actions are commenced by Landlord, will also be recoverable by Landlord
from Tenant.
25.6 Landlord shall take reasonable measures to mitigate the damages
recoverable against Tenant. Tenant shall bear the burden of proving Landlord
failed to take such reasonable measures to mitigate damages in any lawsuit filed
by Landlord to recover damages under or pursuant to this Lease.
ARTICLE 26. INTENTIONALLY OMITTED.
-----------------------------------
ARTICLE 27. PARKING.
---------------------
At all times during the Term of this Lease and any duly exercised
Renewal Term, and conditioned upon this Lease being in full force and effect and
there being no Event of Default thereunder as defined herein, Tenant shall be
permitted to use the above ground, outdoor surface areas of the Project (the
"Outdoor Parking") as Landlord may designate from time to time for parking
automobiles, subject to the Rules and Regulations set forth in Exhibit D, and
any amendments or additions to such Rules and Regulations. The Outdoor Parking
will be used by Tenant and/ or tenant's guests and/or visitors on an unassigned,
nonreserved, and nondesignated basis or such other basis as Landlord directs
from time to time. During the Term of this Lease, Tenant will have the right to
use 3 vehicular parking spaces in the below-ground parking facility at an no
charge, together with the vehicular drives affording ingress to and egress from
said below-ground parking facility. In addition, during the Term of this Lease,
Tenant will have the right to use 2 additional vehicular parking spaces in the
below-ground parking facility, at an initial monthly charge of $50.00 per space,
together with the vehicular drives affording ingress to and egress from said
below-ground parking facility. Such charge will be subject to periodic increases
by Landlord, but not more than once per Lease Year. Tenant's specific
below-ground parking spaces will be designated by Landlord, and Tenant will use
the below-ground parking facility in common with others whom Landlord may permit
to use the same.
Landlord represents that for the Term of this Lease there will be at least 520
paved parking spaces serving the Project. In the event such parking is not
reasonably adequate for tenants at the Building in Landlord's reasonable
judgment, Landlord shall provide additional parking at the Building so that a
total of at least 570 paved parking spaces are serving the Project.
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ARTICLE 28. MISCELLANEOUS.
---------------------------
28.1 INTENTIONALLY OMITTED.
28.2 SECURITY DEPOSIT. As of the Lease Date, Tenant has deposited the
Security Deposit referred to in Article 1. of this Lease with Landlord as
security for the full, faithful, and timely performance of every provision of
this Lease to be performed by Tenant. If Tenant defaults with respect to any
provision of this Lease, including but not limited to the provisions relating to
the payment of Rent, Landlord may use, apply, or retain all or any part of the
Security Deposit for the payment of any Rent, or any other sum in default, or
for the payment of any other amount Landlord may spend or become obligated to
spend by reason of Tenant's default, or to compensate Landlord for any other
loss or damage Landlord may suffer by reason of Tenant's default. If any portion
of the Security Deposit is so used, applied, or retained, Tenant shall, within
five (5) days after written demand, deposit cash with Landlord in an amount
sufficient to restore the Security Deposit to its original amount. Landlord will
not be required to keep the Security Deposit separate from its general funds,
and Tenant will not be entitled to interest on the Security Deposit. The
Security Deposit shall not be deemed a limitation on Landlord's damages or a
payment of liquidated damages or a payment of the Monthly Rent due for the last
month of the Term. If Tenant fully, faithfully, and timely performs every
provision of this Lease to be performed by it, the Security Deposit or any
balance of the Security Deposit will be returned to Tenant within sixty (60)
days after the expiration of the Term. Landlord may deliver the funds deposited
under this Lease by Tenant to the purchaser of the Building in the event the
Building is sold, and after such time Landlord will have no further liability to
Tenant with respect to the Security Deposit.
If Tenant notifies Landlord that Tenant desires to replace Tenant's cash
Security Deposit with a letter of credit, Landlord will not unreasonably
withhold its consent thereto. The form and terms of the letter of credit and the
issuing bank will be subject to Landlord's approval.
28.3 SIGNS.
(a) Except for signs that are located inside the Building and
are not visible outside the Building, no signs will be placed in the Premises,
Building or Project without the prior written consent of Landlord as to size,
design, color, location, content, illumination, composition, material, and
mobility, which consent may be withheld for any reason in the sole discretion of
Landlord. All signs will be maintained by Tenant in good condition during the
Term and any duly exercised Renewal Term and shall, in any event, comply with
the Design Guidelines of the Cantera Owners Association. Tenant shall remove all
signs at the end of the Term or duly exercised Renewal Term and shall repair and
restore any damage caused by their installation or removal.
(b) So long as Tenant is not in default under this Lease and
so long as Tenant is primarily in the business of writing computer software and
computer operating systems, Landlord agrees that during the initial Term of this
Lease Landlord will not grant to another tenant of the Building the right to
have such tenant's sign installed on the exterior surface of the Building if
such tenant is primarily in the business of writing computer software or
computer operating systems unless, at the time Landlord grants such right to
such tenant, such tenant leases or has agreed in writing to lease a greater
number of rentable square feet in the Building than is then being leased by
Landlord to Tenant in the Building.
28.4 NO OFFER. This Lease is submitted to Tenant on the understanding
that it will not be considered an offer and will not bind Landlord in any way
until Tenant has duly executed and delivered duplicate originals to Landlord and
Landlord has executed and delivered one of such originals to Tenant.
28.5 JOINT AND SEVERAL LIABILITY. If Tenant is composed of more than
one signatory to this Lease, each signatory will be jointly and severally liable
with each other signatory for payment and performance according to this Lease.
The act of, written notice to, written notice from, refund to, or signature of
any signatory to this Lease (including without limitation modifications of this
Lease made by fewer than all such signatories) will bind every other signatory
as though every other signatory had so acted, or received or given the written
notice or refund, or signed.
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28.6 NO CONSTRUCTION AGAINST DRAFTING PARTY. Landlord and Tenant
acknowledge that each of them and their counsel have had an opportunity to
review this Lease and that this Lease will not be construed against Landlord
merely because Landlord has prepared it.
28.7 TIME OF THE ESSENCE. Time is of the essence of each and every
provision of this Lease.
28.8 NO RECORDATION. Tenant's recordation of this Lease or any
memorandum or short form of it will be void and a default under this Lease.
28.9 NO WAIVER. The waiver by Landlord of any agreement, condition, or
provision contained in this Lease will not be deemed to be a waiver of any
subsequent breach of the same or any other agreement, condition, or provision
contained in this Lease, nor will any custom or practice that may grow up
between the parties in the administration of the Terms of this Lease be
construed to waive or to lessen the right of Landlord to insist upon the
performance by Tenant in strict accordance with the Terms of this Lease. The
subsequent acceptance of rent by Landlord will not be deemed to be a waiver of
any preceding breach by Tenant of any agreement, condition, or provision of this
Lease, other than the failure of Tenant to pay the particular rent so accepted,
regardless of Landlord's knowledge of such preceding breach at the time of
acceptance of such rent.
28.10 LIMITATION ON RECOURSE. It is expressly understood and agreed by
Tenant that none of Landlord's covenants, undertaking or agreements continued in
this Lease are made or intended as personal covenants, undertaking or agreements
by Landlord or its partners. Tenant specifically agrees to look solely to
Landlord's interest in the Project for the recovery of any judgments from
Landlord. It is agreed that Landlord (and its shareholders, venturers, and
partners, and their shareholders, venturers, and partners and all of their
officers, directors, and employees) shall not be personally liable for any such
judgments. The provisions contained in the preceding sentences are not intended
to and will not limit any right that Tenant might otherwise have to obtain
injunctive relief against Landlord or relief in any suit or action in connection
with enforcement or collection of amounts that may become owing or payable under
or on account of insurance maintained by Landlord.
28.11 ESTOPPEL CERTIFICATES. At any time and from time to time but
within ten (10) days after prior written request by Landlord, Tenant shall
execute, acknowledge, and deliver to Landlord, promptly upon request, a
certificate in the form attached hereto as Exhibit E certifying as to the
matters set forth therein. Any such certificate may be relied upon by any
prospective purchaser or existing or prospective mortgagee or beneficiary under
any deed of trust of the Building or any part of the Project. Tenant's failure
to deliver such a certificate within such time will be conclusive evidence of
the matters set forth in it. Landlord will, at the request of Tenant, at any
time and from time to time upon not less than 10 days' prior notice, execute and
deliver to Tenant a certificate stating the following, as requested: (a) that
this Lease is unmodified and in full force and effect, (or, if modified, stating
the nature of such modification and certifying that this Lease, as so modified,
is in full force and effect); (b) the date the Lease commenced and the rent
commencement date (if different); (c) the current monthly installments of
Monthly Rent and Tenant's Proportionate Share of Operating Expenses, the dates
to which such rental and other charges have been paid, and that no such rent has
been paid for more than 30 days in advance of its due date; (d) the amount of
the Security Deposit paid to Landlord; (e) that Tenant is paying rent on a
current basis, and there are not, to Landlord's knowledge, any uncured defaults
on the part of Tenant (or specifying such offsets, claims or defaults, if any
are claimed); and (f) such other matters as may be reasonably requested.
28.12 WAIVER OF JURY TRIAL. LANDLORD AND TENANT, BY THIS ARTICLE 28.12,
WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM BROUGHT BY EITHER
OF THE PARTIES TO THIS LEASE AGAINST THE OTHER ON ANY MATTERS WHATSOEVER ARISING
OUT OF OR IN ANY WAY CONNECTED WITH THIS LEASE, THE RELATIONSHIP OF LANDLORD AND
TENANT, TENANT'S USE OR OCCUPANCY OF THE PREMISES, OR ANY OTHER CLAIMS (EXCEPT
CLAIMS FOR PERSONAL INJURY OR PROPERTY DAMAGE), AND ANY EMERGENCY STATUTORY OR
ANY OTHER STATUTORY REMEDY.
28.13 NO MERGER. The voluntary or other surrender of this Lease by
Tenant or the cancellation of this Lease by mutual agreement of Tenant and
Landlord or the termination of this Lease on account of Tenant's default shall
not work a merger, and shall, at Landlord's option, (a) terminate all or any
subleases and subtenancies or (b) operate as an assignment to Landlord of all or
any subleases or subtenancies. Landlord's option under this Article 28.13 shall
be exercised by written notice to Tenant and all known sublessees or subtenants
in the Premises or any part of the Premises.
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28.14 HOLDING OVER. Tenant shall have no right to remain in possession
of all or any part of the Premises after the expiration of the Term. If Tenant
remains in possession of all or any part of the Premises after the expiration of
the Term, with the express or implied consent of Landlord: (a) such tenancy
shall be deemed to be a periodic tenancy from month-to-month only; (b) such
tenancy shall not constitute a renewal or extension of this Lease for any
further Term; and (c) such tenancy may be terminated by Landlord upon the
earlier of 30 days' prior written notice or the earliest date permitted by law.
In the event Tenant remains in possession after the expiration of the Term,
Monthly Rent shall be increased to an amount equal to one hundred fifty percent
(150%) of the Monthly Rent payable during the last month of the Term, and any
other sums due under this Lease shall be payable in the amount and at the times
specified in this Lease. Such month-to-month tenancy shall be subject to every
other term, condition, and covenant contained in this Lease.
28.15 NOTICES. Any notice, request, demand, consent, approval, or other
communication required or permitted under this Lease must be in writing and
shall be deemed to have been given when (a) hand-delivered, effective upon
receipt, (b) sent by United States Express Mail or by private overnight courier,
effective upon receipt, or (c) sent by certified mail, return receipt requested,
addressed to the party for whom it is intended at its address set forth in
Article 1.1, deposited in the United States Mail, with postage thereon fully
prepaid, effective on the day of actual delivery as shown by the addressee's
return receipt or the expiration of three (3) business days after the date of
mailing, whichever is earlier, or (d) sent by facsimile transmission, effective
upon receipt provided that a hard copy is delivered by one of the methods
outlined in clauses (a) through (c) above within three (3) days thereafter.
Either Landlord or Tenant may add additional addresses or change its address for
purposes of receipt of any such communication by giving ten (10) days' prior
written notice of such change to the other party in the manner prescribed in
this Article 28.15.
28.16 SEVERABILITY. If any provision of this Lease proves to be
illegal, invalid, or unenforceable, the remainder of this Lease will not be
affected by such finding, and in lieu of each provision of this Lease that is
illegal, invalid, or unenforceable a provision will be added as a part of this
Lease as similar in terms to such illegal, invalid, or unenforceable provision
as may be possible and be legal, valid, and enforceable.
28.17 WRITTEN AMENDMENT REQUIRED. No amendment, alteration,
modification of, or addition to the Lease shall be valid or binding unless
expressed in writing and signed by Landlord and Tenant. Tenant agrees to make
any modifications of the Terms and provisions of this Lease required or
requested by any lending institution providing financing for the Building, or
Project, as the case may be, provided that no such modifications will materially
adversely affect Tenant's rights and obligations under this Lease.
28.18 CAPTIONS. The captions of the various articles of this Lease are
for convenience only and do not necessarily define, limit, describe, or construe
the contents of such articles.
28.19 AUTHORITY. Tenant and the party executing this Lease on behalf of
Tenant represent to Landlord that such party is authorized to do so by requisite
action of the board of directors or partners, as the case may be, and agrees,
upon execution of this Lease, to deliver to Landlord a resolution or similar
document to that effect.
28.20 BROKERS. Landlord and Tenant respectively represent and warrant
to each other that neither of them has consulted or negotiated with any broker
or finder with regard to the Premises except that Landlord has retained the
Broker and Tenant has retained the Tenant's Broker, each as named in Article 1.1
hereof. Landlord agrees to be responsible for payment of Broker's fees and for
the payment of Tenant's Broker's fees pursuant to separate agreement. Landlord
and Tenant shall mutually indemnify and hold each other harmless from and
against any claim for brokerage or finder's fees or other like payment based in
any way upon agreements, arrangements or understanding made or claimed to have
been made by Landlord or Tenant with any person other than Broker and Tenant's
Broker.
28.21 GOVERNING LAW. This Lease shall be governed by and construed
pursuant to the laws of the state of Illinois.
28.22 NO EASEMENTS FOR AIR OR LIGHT. Any diminution or shutting off of
light, air, or view by any structure that may be erected on lands adjacent to
the Building shall in no way affect this Lease or impose any liability on
Landlord.
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28.23 TAX CREDITS. Landlord is entitled to claim all tax credits and
depreciation attributable to leasehold improvements in the Premises. Promptly
after Landlord's demand, Landlord and Tenant shall prepare a detailed list of
the leasehold improvements and fixtures and their respective costs for which
Landlord or Tenant has paid. Landlord shall be entitled to all credits and
depreciation for those items for which Landlord has paid by means of any Tenant
finish allowance or otherwise. Tenant shall be entitled to any tax credits and
depreciation for all items for which Tenant has paid with funds not provided or
reimbursed by Landlord.
28.24 INTENTIONALLY OMITTED.
28.25 LANDLORD'S FEES. Whenever Tenant requests Landlord to take any
action or give any consent required or permitted under this Lease, Tenant shall
reimburse Landlord for all of Landlord's reasonable costs incurred in reviewing
the proposed action or consent, including without limitation reasonable
attorneys', engineers' or architects' fees, within ten (10) days after
Landlord's delivery to Tenant of a statement of such costs. Tenant shall be
obligated to make such reimbursement without regard to whether Landlord consents
to any such proposed action. However, in any action for the enforcement, defense
or interpretation of either party's right under this Lease, in addition to the
rents and other sums, found to be due hereunder, the prevailing party will be
entitled to payment of all collection and court costs incurred together with
reasonable attorneys' and paralegals' fees, whether such fees and costs be
incurred out of court, at trial, on appeal, or in any bankruptcy, arbitration or
other administrative proceedings.
28.26 NON-WAIVER. Any default in the payment of Monthly Rent or
Additional Rent or other charges, or any failure of Landlord to enforce the
provisions of this Lease upon any default by the Tenant shall not be construed
as creating a custom of deferring payment or as modifying in any way the Terms
of this Lease or as a waiver of Landlord's right to terminate this Lease as
herein provided, or otherwise, to enforce the provisions hereof for any prior or
subsequent default.
28.27 PRESUMPTION. In all cases hereunder, and in any suit, action or
proceeding of any kind between the parties, it shall be presumptive evidence of
the fact a charge being due, if Landlord shall produce a xxxx, notice or
certificate to the effect that such charge appears of record on the books in
Landlord's office or appears as an open charge on the books, records or official
bills of municipal authorities, and has not been paid.
28.28 WAIVER OF TECHNICAL DEFECTS IN NOTICES. In lieu of Landlord or
Tenant waiving the right to receive any notices, both parties hereby waives any
technical defects as to form, substance and delivery in the giving of any
notices required by this Lease and Illinois Compiled Statutes so long as the
notice reasonably apprises the appropriate party of the general nature of the
reason for the giving of the notice and affords such party a reasonable
opportunity to cure, if applicable.
28.29 NO RIGHT TO TERMINATE. Tenant hereby waives the remedies of
termination and rescission and hereby agrees that Tenant's sole remedies for
Landlord's default hereunder and for breach of any promise or inducement shall
be limited to a suit for damages and/or injunction.
28.30 NO LIABILITY FOR CRIMES. Landlord makes no representations or
warranties with respect to crime in the area, undertakes no duty to protect
against criminal acts and shall not be liable for any injury, wrongful death or
property damage arising from any criminal acts. The Landlord may, from time to
time, employ or caused to be employed security personnel and equipment, however,
such personnel and equipment are only for the protection of Landlord's property.
Landlord reserves the right, in its sole and absolute discretion, to start,
alter or terminate any such security services without notice. Tenant is urged to
provide security for its invitees, its own personnel, and property as it deems
necessary. Tenant is urged to obtain insurance to protect against criminal acts.
28.31 BINDING EFFECT. The covenants, conditions, and agreements
contained in this Lease will bind and inure to the benefit of Landlord and
Tenant and their respective heirs, distributees, executors, administrators,
successors, and, except as otherwise provided in this Lease, their assigns.
28.32 CONFIDENTIALITY. Tenant acknowledges that the terms and
conditions of this Lease are to remain confidential for the Landlord's benefit,
and shall not be disclosed by Tenant to anyone, by any manner or means,
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directly or indirectly, without Landlord's prior written consent; provided,
however, Tenant may disclose such terms or conditions to affiliates of Tenant
and prospective subtenants and assignee for the sole purpose of evaluating a
potential sublease or assignment so long as such affiliates and prospective
subtenants and assignees agree to abide by the terms of this Article 28.32.
Tenant may also disclose the terms of this Lease to Tenant's attorneys,
accountants and consultants on a need-to-know basis, so long as Tenant advises
such attorneys, accountants and consultants of the confidential nature of such
information and such attorneys, accountants and consultants (as the case may be)
agree to maintain such confidentiality. The consent by Landlord to any
disclosures shall not be deemed to be a waiver on the part of Landlord of any
prohibition against any future disclosure.
28.33 FORCE MAJEURE. Landlord shall have no liability to Tenant, nor
will Tenant have any right to terminate this Lease or xxxxx Rent or assert a
claim of partial or total actual or constructive eviction, because of Landlord's
failure to perform any of its obligations in the Lease if the failure is due to
reasons beyond Landlord's reasonable control, including without limitation
strikes or other labor difficulties; inability to obtain necessary governmental
permits and approvals (including building permits or certificates of occupancy);
unavailability or scarcity of materials; war; riot; civil insurrection;
accidents; acts of God; and governmental preemption in connection with a
national emergency. If Landlord fails to perform its obligations because of any
reasons beyond Landlord's reasonable control (including those enumerated above),
the period for Tenant's performance will be extended day for day for the
duration of the cause of Landlord's failure.
28.34 INTEREST. All Rent and other sums dues under this Lease which are
not paid when due shall accrue interest at the lesser of 12% per annum or the
highest rate allowed by law.
28.35 ENTIRE AGREEMENT. This Lease, the exhibits and addenda, if any,
contain the entire agreement between Landlord and Tenant. No promises or
representations, except as contained in this Lease, have been made to Tenant
respecting the condition or the manner of operating the Premises, the Building,
or the Project.
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IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of the Lease
Date.
LANDLORD: THE NORTHWESTERN MUTUAL LIFE
INSURANCE COMPANY
By: NORTHWESTERN INVESTMENT MANAGEMENT
COMPANY, its wholly owned subsidiary
and authorized representative
By:
---------------------------------
Its:
--------------------------------
TENANT: QUEST SOFTWARE, INC.
By:
---------------------------------
Its:
--------------------------------
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EXHIBIT A
LAYOUT OF THE PREMISES
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EXHIBIT B
WORK LETTER
This Work Letter is attached to and forms part of the Office Lease
dated September 30, 1999 between THE NORTHWESTERN MUTUAL LIFE
INSURANCE COMPANY and QUEST SOFTWARE, INC., leasing space in the
Building commonly known as Xxxxxxxxxxx Xx Xxxxxxx, Xxxxxxxxxxx,
Xxxxxxxx
To induce Tenant to enter into the Lease, and in consideration of the
mutual covenants in the Lease and this agreement, Landlord and Tenant mutually
agree as follows:
1. Landlord will improve the Premises (the"Tenant Improvements" or
"Work") at its sole cost and expense in accordance with those certain plans (the
"Working Drawings") dated October 4, 1999, prepared by Gensler Inc. (the
"Architect"). However, if Tenant requests any changes in the Working Drawings,
Tenant will be solely responsible for any additional costs resulting from such
changes.
Landlord will pay for the preparation of the Working Drawings. All
additional costs and expenses relating to the preparation and completion of
plans or space plans for the Premises will be borne by Tenant, and will be due
and payable to Landlord by Tenant when billed.
2. Subject to the other terms and conditions of this Work Letter and
the Lease, Landlord will proceed diligently and use reasonable efforts to cause
the Work to be substantially completed on or before the Commencement Date set
forth in Section 1.1(m) of the Lease. Unless a Tenant Delay (defined below)
occurs, the Term of the Lease and Tenant's obligation to pay rent under the
Lease will not commence until the Work has been substantially completed, as
reasonably determined by Landlord. If Landlord fails to substantially complete
the Work by the Commencement Date set forth in Section 1.1(m) of the Lease and
any Tenant Delay (defined below) occurs, then the Term and Tenant's obligation
to pay rent under the Lease will commence on the date on which the Work would
have been substantially completed but for the Tenant Delay, as reasonably
determined by Landlord. All work to be done in the Premises, including, without
limitation, the Work, will be subject to Landlord's approval, and no work may be
undertaken in the Premises until such approval is given.
3. (a) When Landlord is of the opinion that the Tenant Improvements are
substantially complete, then Landlord shall notify Tenant. Tenant agrees that,
upon such notification, Tenant will promptly (and not later than two (2)
business days after the date of Landlord's notice) inspect the Premises and, if
applicable, furnish to Landlord a written statement that the Tenant Improvements
are substantially completed, with the exception of certain specified and
enumerated incomplete items consisting of insubstantial details of construction,
decoration or mechanical adjustment, none of which interferes with Tenant's use
and occupancy of the Premises for the conduct of its business, if any ("Punch
List"). If Tenant fails to inspect the Premises or to provide Landlord a Punch
List, the Tenant Improvements shall be deemed complete. Substantial completion
of the Work will include a final inspection by the City of Warrenville and the
oral or written approval by such City for occupancy of the Premises.
(b) Tenant agrees that, at the request of Landlord from time to time
thereafter, Tenant will promptly furnish to Landlord revised Punch Lists
reflecting any completion of any prior Punch List items. If the Punch List or
any revised Punch List consists only of items, the non-completion of which would
not materially impair Tenant's occupancy of the Premises, then, in such event,
the Premises shall be deemed to be substantially complete and Tenant will
acknowledge in writing that the Premises are substantially complete and accept
possession of the Premises. Tenant's acknowledgement or acceptance of the
Premises shall not relieve Landlord of its obligation to complete all Punch List
items.
4. Tenant shall have the right to inspect the Work from time to time,
provided that Tenant does not interfere with the progress of the Work. All
procedures and requirements relating to extras, changes and deletions
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in the Work, and the costs thereof, shall be governed by the terms of the
construction contract documents. No extras, changes, or deletions in the Work
materially affecting any structural elements, windows, elevators or HVAC,
electrical, plumbing or other systems serving portions of the Building, or
affecting the character or design of the Work shall be permitted without the
prior written consent of Landlord, which Landlord may withhold in its sole
discretion.
5. If Tenant wishes Landlord to do any work in connection with the
Premises prior to the Lease Commencement Date other than the Work (such other
work hereinafter is referred to as "Tenant's Extra Work"), the following terms,
conditions, agreements and procedures shall apply and control:
a. Tenant, at its sole cost and expense, shall submit to
Landlord, all necessary drawings, plans and
specifications for the proposed Tenant's Extra Work
(such drawings, plans and specifications hereinafter
are referred to as "Tenant's Extra Work Plans").
Tenant's Extra Work Plans must be acceptable in all
respects to Landlord, which acceptance Landlord may
withhold in its sole discretion.
b. Landlord will construct or cause to be constructed
Tenant's Extra Work substantially in accordance with
Tenant's Extra Work Plans provided that Tenant's
Extra Work Plans have been accepted in writing by
Landlord, and that Tenant has complied with all
provisions, terms and conditions of this Work Letter.
c. All of Tenant's Extra Work shall be done at Tenant's
sole cost and expense. Within 15 days after the
submission by Tenant to Landlord of proposed Tenant's
Extra Work Plans, Landlord shall submit to Tenant for
Tenant's approval a written estimate of the cost of
Tenant's Extra Work (hereinafter referred to as an
"Estimate"). Landlord may elect not to proceed with
Tenant's Extra Work unless and until: (i) one
Estimate covering the same is approved in writing by
Tenant and an approved copy is delivered to Landlord;
and (ii) Tenant has deposited with Landlord in escrow
an amount sufficient to cover all costs of performing
Tenant's Extra Work.
d. If Tenant desires any extras, changes or deletions in
Tenant's Extra Work at any time, Tenant in each
instance shall follow the same procedure prescribed
in this Paragraph 5 for the initiation, approval and
commencement of Tenant's Extra Work.
e. Tenant agrees to pay or reimburse Landlord for all
Architect's, Landlord's general contractor's,
subcontractor's and general conditions' costs
pertaining to Tenant's Extra Work. In the event
Tenant has not deposited in escrow an amount
sufficient to cover all costs of performing Tenant's
Extra Work or any extra or change as provided in
paragraph 5d hereof, then within 15 days after being
billed therefor, Tenant shall pay to Landlord or as
Landlord otherwise directs, all such costs for
Tenant's Extra Work. Landlord shall have, in
connection with all such costs, all the rights and
remedies that Landlord has under the Lease in
connection with Rent that is due and payable by
Tenant thereunder. All such costs shall be deemed
Additional Rent due and payable under the Lease.
However, the noncompletion of Tenant's Extra Work will not delay the Lease
Commencement Date.
6. Tenant, with Landlord's prior written permission, may enter the
Premises up to 5 days prior to the date specified in the Lease for the
commencement of payment of Rent, in order that Tenant may perform, through
Tenant's own contractors (which contractors shall be subject to Landlord's
approval), such other work and decorations as Tenant may desire and as may be
permitted in accordance with the terms and conditions of the Lease at the same
time that Landlord's contractors are working in the space. However, the
foregoing license to enter is conditioned upon Tenant's first obtaining the
insurance coverage required under the Lease and furnishing Landlord with
certificates of such insurance and paid premium receipts, and upon Tenant's
contractors and workmen working in harmony and not interfering with the labor
employed by Landlord, Landlord's contractors or any other tenant or their
contractors. If, at any time, such entry shall cause disharmony or interference
therewith, this license may be withdrawn by Landlord immediately (with no notice
being required). Such entry shall be deemed to be under all of
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the terms, covenants, conditions, provisions and agreements of the Lease except
the covenant to pay Rent. Landlord shall not be liable in any way for any work,
decorations or installations which are made prior to the date specified in the
commencement of the payment of Rent or to the equipment, materials or tools of
Tenant or its contractors, the same being solely at Tenant's risk. Prior to
commencement of any work under this paragraph, Tenant shall deliver to Landlord
all necessary permits, licenses, approvals, certificates and authorizations for
prosecution and completion of the work.
7. Miscellaneous:
a. The Work and Tenant's Extra Work, if any, shall be
done by Landlord and/or its designers, contractors
and subcontractors, in accordance with the terms,
conditions and provisions herein contained.
b. Except as provided in the Lease and the Working
Drawings, and except as herein expressly set forth,
Landlord has no agreement with Tenant and has no
obligation to perform or provide any other work with
respect to the Premises.
Any other work in the Premises which may be permitted
by Landlord pursuant to the terms and conditions of
the Lease shall be done at Tenant's sole cost and
expense and in accordance with the terms and
conditions and provisions of the Lease and this Work
Letter.
c. Under no circumstances shall the Lease Commencement
Date or Tenant's obligation to commence paying Rent
be delayed in whole or in part because of any delay
or cost arising from or incurred in connection with
(i) any extra, change or deletion requested or caused
by Tenant or its agents or contractors at any time to
any of the Work, (ii) Tenant's Extra Work or (iii)
delay due to special equipment, fixtures or materials
requested by Tenant or the unavailability of
materials specified for Tenant Improvements (each, a
"Tenant Delay").
d. Time is of the essence under this Agreement.
e. Landlord's preparation of Working Drawings and the
construction of Tenant Improvements shall not create
or imply any responsibility or liability on the part
of Landlord with regard to the completeness and
design sufficiency of both the Working Drawings and
the Tenant Improvements, or with regard to the
compliance of the Working Drawings and the Tenant
Improvements with all laws, rules and regulations of
governmental agencies.
f. Any person signing this Work Letter on behalf of the
Tenant warrants and represents that he has the
express authority of Tenant to do so.
g. Landlord appoints Xxxxx Xxxxxx as Landlord's
representative to act for Landlord in all matters
associated with this Work Letter. Tenant appoints
Xxxxx Xxxxxxxx, as Tenant's representative to act for
Tenant in all matters associated with this Work
Letter. All inquiries, requests, instructions,
authorizations, and other communications with respect
to the matters covered by this Work Letter shall be
made to Landlord's representative or Tenant's
representative, as the case may be. Tenant shall not
make any inquiries of or requests to, and will not
give any instructions or authorizations to, any
employee or agent of Landlord, including, without
limitation, Landlord's architect, engineers, and
contractors or any of their agents or employees, with
regard to matters associated with this Work Letter at
any time by providing three (3) days' prior written
notice to the other party.
h. This Work Letter shall not be deemed applicable to
any additional space added to the original Premises
at any time, whether by any options under the Lease
or otherwise, or to
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any portion of the original Premises or any additions
thereto in the event of a renewal or extension of the
original Term of the Lease, whether obtained pursuant
to any options under the Lease or otherwise, unless
expressly so provided in the Lease or a written
amendment or supplement thereto.
i. This Work Letter shall be binding upon and inure to
the benefit of the parties hereto and their
respective heirs, legal representatives, successors
and assigns.
j. All capitalized terms contained in this Work Letter
and all terms otherwise undefined shall have the same
meaning set forth in the Lease to the extent the same
are used or defined therein.
LANDLORD: THE NORTHWESTERN MUTUAL LIFE INSURANCE
COMPANY
By: NORTHWESTERN INVESTMENT MANAGEMENT COMPANY,
its wholly owned subsidiary and authorized
representative
By:
------------------------------------------
Its:
-----------------------------------------
TENANT: QUEST SOFTWARE, INC.
By:
------------------------------------------
Its:
-----------------------------------------
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EXHIBIT C
COMMENCEMENT DATE CERTIFICATE
This Commencement Date certificate is entered into by Landlord and
Tenant pursuant to Article 3.1 of the Lease.
1. DEFINITIONS. In this certificate the following terms have the
meanings given to them in the Lease:
(a) Landlord: __________________________________________
(b) Tenant: ____________________________________________
(c) Lease: Office Lease dated [date] between Landlord and Tenant.
(d) Premises: ___________________________________________
(e) Building Address: ____________________________________
2. CONFIRMATION OF LEASE COMMENCEMENT: Landlord and Tenant confirm that
the Commencement Date of the Lease is ____________ and the Expiration Date is
____________ and that Article 1.1 of the Lease is amended accordingly.
Landlord and Tenant have executed this Commencement Date certificate as
of the dates set forth below.
TENANT: ___________________________ LANDLORD: ________________________
By: ___________________________ By: _________________________
Its: ___________________________ Its: _________________________
Date: Date:
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EXHIBIT D
RULES AND REGULATIONS
1. Landlord may from time to time adopt reasonable and appropriate
systems and procedures for the security or safety of the Building, or any
equipment, furnishings, or contents of the Building, and Tenant will comply with
Landlord's reasonable requirements relative to such systems and procedures.
2. The sidewalks, halls, passages, exits, entrances, elevators, and
stairways of the Building shall not be obstructed by Tenant or used by Tenant
for any purpose other than for ingress to and egress from the Premises. The
halls, passages, exits, entrances, elevators, escalators, and stairways are not
for the general public, and Landlord shall in all cases retain the right to
control and prevent access to such halls, passages, exits, entrances, elevators,
and stairways of all persons whose presence in the judgment of Landlord would be
prejudicial to the safety, character, reputation, and interests of the Building,
provided that nothing contained in these Rules and Regulations shall be
construed to prevent such access to persons with whom any Tenant normally deals
in the ordinary course of its business, unless such persons are engaged in
illegal activities. Neither Tenant nor any employee or invitee of Tenant shall
go upon the roof of the Building. Tenant shall not be permitted to place or
install any object (including without limitation radio and television antennas,
loudspeakers, sound amplifiers, microwave dishes, solar devices, or similar
devices) on the exterior of the Building or on the roof of the Building.
3. Other than draperies expressly permitted by Landlord and building
standard mini-blinds, material visible from outside the building shall not be
permitted. In the event of the violation of this rule by Tenant, Landlord may
remove the violating items without any liability, and may charge the expense
incurred by such removal to the Tenant.
4. No cooking shall be done or permitted by Tenant on the Premises,
except in areas of the Premises which are specially constructed for cooking and
except that use by the Tenant of microwave ovens and Underwriters' Laboratory
approved equipment for brewing coffee, tea, hot chocolate, and similar beverages
shall be permitted, provided that such use is in accordance with all applicable
federal, state, and city laws, codes, ordinances, rules, and regulations.
5. Tenant shall not employ any person or persons other than the
cleaning service of Landlord for the purpose of cleaning the Premises, unless
otherwise agreed to by Landlord in writing. Except with the written consent of
Landlord, no person or persons other than those approved by Landlord shall be
permitted to enter the Building for the purpose of cleaning it. No Tenant shall
cause any unnecessary labor by reason of Tenant's carelessness or indifference
in the preservation of good order and cleanliness. Should Tenant's actions
result in any increased expense for any required cleaning, Landlord reserves the
right to assess Tenant for such expenses.
6. The toilet rooms, toilets, urinals, wash bowls and other plumbing
fixtures shall not be used for any purposes other than those for which they were
constructed, and no sweepings, rubbish, rags, or other foreign substances shall
be thrown in such plumbing fixtures. All damages resulting from any misuse of
the fixtures shall be borne by the Tenant who, or whose servants, employees,
agents, visitors, or licensees, caused the same.
7. Tenant shall not in any way deface any part of the Premises or the
Building of which they form a part. In those portions of the Premises where
carpet has been provided directly or indirectly by Landlord, Tenant shall at its
own expense install and maintain pads to protect the carpet under all furniture
having casters other than carpet casters.
8. Tenant shall not alter, change, replace, or rekey any lock or
install a new lock or a knocker on any door of the Premises. Landlord, its
agents, or employees shall retain a pass (master) key to all door locks on the
Premises. Any new door locks required by Tenant or any change in keying of
existing locks shall be installed or changed by Landlord following Tenant's
written request to Landlord and shall be at Tenant's expense. All new locks and
rekeyed locks shall remain operable by Landlord's pass (master) key. Tenant,
upon termination of its tenancy, shall deliver to Landlord all keys and access
cards for the Premises and Building that have been furnished to Tenant. Landlord
will not unreasonably withhold its consent to Tenant's installation of a card
key access system for accessing the Premises.
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9. The elevator designated for freight by Landlord shall be available
for use by Tenant during the hours and pursuant to such procedures as Landlord
may determine from time to time. The persons employed to move Tenant's
equipment, material, furniture, or other property in or out of the Building must
be acceptable to Landlord. The moving company must be a locally recognized
professional mover, whose primary business is the performing of relocation
services, and must be bonded and fully insured. A certificate or other
verification of such insurance must be received and approved by Landlord prior
to the start of any moving operations. Insurance must be sufficient, in
Landlord's sole opinion, to cover all personal liability, theft or damage to the
Project, including but not limited to floor coverings, doors, walls, elevators,
stairs, foliage, and landscaping. Special care must be taken to prevent damage
to foliage and landscaping during adverse weather. All moving operations shall
be conducted at such times and in such a manner as Landlord shall direct, and
all moving shall take place during non-business hours unless Landlord agrees in
writing otherwise. Tenant shall be responsible for the provision of Building
security during all moving operations, and shall be liable for all losses and
damages sustained by any party as a result of the failure to supply adequate
security. Landlord shall have the right to prescribe the weight, size, and
position of all equipment, materials, furniture, or other property brought into
the Building. Heavy objects shall, if considered necessary by Landlord, stand on
wood strips of such thickness as is necessary to properly distribute the weight.
Landlord shall not be responsible for loss of or damage to any such property
from any cause, and all damage done to the Building by moving or maintaining
such property shall be repaired at the expense of Tenant. Landlord reserves the
right to inspect all such property to be brought into the Building and to
exclude from the Building all such property which violates any of these Rules
and Regulations or the Lease of which these Rules and Regulations are a part.
Supplies, goods, materials, packages, furniture, and all other items of every
kind delivered to or taken from the Premises shall be delivered or removed
through the entrance and route designated by Landlord, and Landlord shall not be
responsible for the loss or damage of any such property unless such loss or
damage results from the negligence of Landlord, its agents, or employees.
10. Tenant shall not use or keep in the Premises or the Building any
kerosene, gasoline, or any flammable, combustible or explosive fluid or material
or chemical substance other than cleaning fluids and solvents required in
Tenant's normal operations in the Premises. Without Landlord's prior written
approval, Tenant shall not use any method of heating or air conditioning other
than that supplied by Landlord. Tenant shall not use or keep or permit to be
used or kept any foul or noxious gas or substance in the Premises.
11. Subject to the restrictions set forth in Section 28.3(b), Landlord
shall have the right, exercisable upon written notice and without liability to
Tenant, to change the name and street address of the Building. If Landlord
changes the street address of the Building, Landlord will, upon written request
from Tenant, reimburse Tenant for Tenant's reasonable out-of-pocket costs of
replacing its stationery and business cards due to such change (not to exceed a
6-month supply)
12. Landlord shall have the right to prohibit any advertising by Tenant
mentioning the Building that, in Landlord's reasonable opinion, tends to impair
the reputation of the Building or its desirability as a Building for offices,
and upon written notice from Landlord, Tenant shall refrain from or discontinue
such advertising.
13. Tenant shall not bring any animals (except "Seeing Eye" dogs or
other guide animals) or birds into the Building, and shall not permit bicycles
or other vehicles inside or on the sidewalks outside the Building except in
areas designated from time to time by Landlord for such purposes.
14. All persons entering or leaving the Building between the hours of 6
p.m. and 7 a.m. Monday through Friday, and at all hours on Saturdays, Sundays,
and holidays shall comply with such off-hour regulations as Landlord may
establish and modify from time to time.
15. Tenant shall store all its trash and garbage within its Premises.
No material shall be placed in the trash boxes or receptacles if such material
is of such nature that it may not be disposed of in the ordinary and customary
manner of removing and disposing of trash and garbage without being in violation
of any law or ordinance governing such disposal. All garbage and refuse disposal
shall be made only through entryways and elevators provided for such purposes
and at such times as Landlord designates. Removal of any furniture or
furnishings, large equipment, packing crates, packing materials, and boxes shall
be the responsibility of each Tenant
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and such items may not be disposed of in the Building trash receptacles nor
shall they be removed by the Building's janitorial service, except at Landlord's
sole option and at the Tenant's expense. No furniture, appliances, equipment, or
flammable products of any type may be disposed of in the Building trash
receptacles.
16. Canvassing, peddling, soliciting, and distributing handbills or any
other written materials in the Building are prohibited, and Tenant shall
cooperate to prevent the same.
17. The requirements of the Tenant shall be attended to only upon
application by written, personal, or telephone notice at the office of the
Building. Employees of Landlord shall not perform any work or do anything
outside of their regular duties unless under special instructions from Landlord.
18. Tenant shall see that the doors of the Premises are closed and
locked and that all water faucets, water apparatus, and utilities are shut off
before Tenant or Tenant's employees leave the Premises, so as to prevent waste
or damage, and for any default or carelessness in this regard Tenant shall make
good all injuries sustained by other Tenants or occupants of the Building or
Landlord.
19. Tenant shall not conduct itself in any manner that is inconsistent
with the character of the Building as a first quality Building.
20. Neither Landlord nor any operator of the parking areas within the
Project wherein the parking is located, as the same are designated and modified
by Landlord, in its sole discretion, from time to time (sometimes collectively
the "parking areas") shall be liable for loss of or damage to any vehicle or any
contents of such vehicle or accessories to any such vehicle, or any property
left in any of the parking areas, resulting from fire, theft, vandalism,
accident, conduct of other users of the parking areas and other persons, or any
other casualty or cause. Further, Tenant understands and agrees that: (a)
Landlord shall not be obligated to provide any traffic control, security
protection or operator for the parking areas; (b) Tenant uses the parking areas
at its own risk; and (c) Landlord shall not be liable for personal injury or
death, or theft, loss of, or damage to property. Tenant waives and releases
Landlord from any and all liability arising out of the use of the parking areas
by Tenant, its employees, agents, invitees, and visitors, whether brought by any
of such persons or any other person.
21. Tenant [including Tenant's employees, agents, invitees, and
visitors] shall use the parking described in Paragraph 27 of the Lease solely
for the purpose of parking passenger cars, small vans, and small trucks and
shall comply in all respects with any rules and regulations that may be
promulgated by Landlord from time to time with respect thereto. Tenant shall
ensure that any vehicle parked in any of the parking spaces shall be kept in
proper repair, good operating condition, currently licensed, and shall not leak
excessive amounts of oil or grease or any amount of gasoline. If any of the
parking is at any time used (a) for any purpose other than parking as provided
above; (b) in any way or manner reasonably objectionable to Landlord; or (c) by
Tenant after default by Tenant under the Lease, Landlord, in addition to any
other rights otherwise available to Landlord, including, at the Tenant's
expense, the right to tow or boot the offending vehicle, may consider such
default an Event of Default under the Lease.
22. Tenant's right to use the parking shall be in common with other
parties permitted by Landlord to use the parking areas. Subject to the terms of
the Lease, Landlord shall not be liable to Tenant for any unavailability of
parking nor shall any unavailability entitle Tenant to any refund, deduction, or
allowance.
23. If the parking areas are damaged or destroyed, or if the use of the
parking areas is limited or prohibited by any governmental authority, or the use
or operation of the parking areas is limited or prevented by strikes or other
labor difficulties or other causes beyond Landlord's control, Tenant's inability
to use the parking areas shall not subject Landlord or any operator of the
parking areas to any liability to Tenant and shall not relieve Tenant of any of
its obligations under the Lease and the Lease shall remain in full force and
effect, subject to the terms of the Lease.
24. Tenant has no right to assign, sublease or sublicense, as the case
may be, any of its rights in the parking, except as part of a permitted
assignment or sublease of the Lease. However, Tenant may allocate the parking
among its employees.
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25. No act or thing done or omitted to be done by Landlord or
Landlord's agent during the Term of the Lease in connection with the enforcement
of these Rules and Regulations shall constitute an eviction by Landlord of any
Tenant nor shall it be deemed an acceptance of surrender of the Premises by any
Tenant, and no agreement to accept such termination or surrender shall be valid
unless in a writing signed by Landlord. The delivery of keys to any employee or
agent of Landlord shall not operate as a termination of the Lease or a surrender
of the Premises unless such delivery of keys is done in connection with a
written instrument executed by Landlord approving the Termination or surrender.
26. As used in these Rules and Regulations, the word "Tenant" includes
the employees, agents, invitees, and licensees of Tenant and others permitted by
Tenant to use or occupy the Premises.
27. Landlord shall have the right to designate all or any portion of
the Building and/or Project as a non-smoking facility at any time during the
Term.
28. These rules and regulations are in addition to, and shall not be
construed to modify or amend, in whole or in part, the terms, covenants,
agreements, and conditions of the Lease.
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EXHIBIT E
TENANT ESTOPPEL CERTIFICATE
RE: Lease dated ____________________ ("Lease") between The Northwestern
Mutual Life Insurance Company ("Landlord") and ____________________
("Tenant") for Suite _______ ("Premises") in a building located at
________________ and commonly known as ________________("Building").
The Tenant hereby certifies to Landlord, and to _________________, a
______________ ("_____________________") that the following information
with respect to the Lease is true and correct:
1. The Lease is in full force and effect and has not been modified or
amended except as specifically set forth in Paragraph 4. below. There
are no other agreements, understandings, contracts or commitments of
any kind with respect to the Lease or the Premises except as expressly
provided in the Lease or in any amendment or supplement thereto set
forth in Paragraph 4., below.
2. The Tenant asserts no claim of default, offset or defense against rent
or other charges payable by the maintenance of the property of which
the Premises are a part. To the best of Tenant's knowledge and belief,
there is no default by Landlord under the Lease and all commitments
made by Landlord to Tenant to induce Tenant to enter into the Lease
have been satisfied.
3. All rent due under the Lease has been paid to the end of the current
calendar month, which is ____, ____, and no rent due under the Lease
has been paid more than one month in advance of its due date.
4. Dates of any Lease amendments or modifications: _____________________.
5. Current Monthly Rental: ___________________________.
6. Lease Commencement Date: ___________________________________.
7. Lease Expiration Date: _______________________________________.
8. The Lease contains no options to renew, first rights of refusal,
options to expand, or options to terminate, except as follows:
______________________.
9. The Tenant has not assigned, or otherwise transferred its interest
under the Lease, except as follows: ____________________________.
10. Tenant is using the Premises only for those purposes specifically
permitted under the Lease, which is ____________________________.
11. Landlord is holding Tenant's security deposit of $__________________.
12. Tenant is not in default under the Lease nor are there any conditions,
or events which have occurred or which, with the passage of time or the
giving of notice or both, would constitute a default or breach. Tenant
is current in the payment of all taxes, utilities, common area
maintenance payments, and other charges required to be paid by the
Tenant pursuant to the Lease, and there exists no dispute relative to
any such amounts.
13. The improvements and space required to be furnished according to the
Lease have been duly delivered by the Landlord and accepted by the
Tenant.
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14. The undersigned has all requisite authority to execute this Estoppel
Certificate on behalf of Tenant.
Dated: _______________________, ____.
By:
------------------------------------
Its:
-----------------------------------
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EXHIBIT F
OPTION TO RENEW
Subject to the provisions set forth below, the Lease Term may be
renewed as to all (but not less than all) of the Premises as it then exists
(including any expansion space then leased by Tenant in the Building under this
Lease), at the option of Tenant, for one (1) additional period of 60 months (the
"RENEWAL TERM"). The Renewal Term will be upon the same terms, covenants and
conditions contained in the Lease, excluding the provision of Sections 2.2
(Termination Right), 3.3 (ROFO) and 28.3(b) (Signage Restrictions) of the Lease
and excluding the Work Letter, and except for the amount of Monthly Rent payable
during the Renewal Term, and any reference in the Lease to the "Lease Term" will
be deemed to include the Renewal Term and apply thereto, unless it is expressly
provided otherwise. Tenant will be deemed to have accepted the Premises in
"as-is" condition as of the commencement of the Renewal Term, it being
understood that Landlord will have no additional obligation to renovate or
remodel the Premises or any portion of the Building as a result of Tenant's
renewal of the Lease. Tenant will have no renewal option beyond the aforesaid
60-month period.
(a) The initial Monthly Rent during the Renewal Term for any
space then constituting a portion of the Premises will be at a rate
equal to the then prevailing market rate as reasonably determined by
Landlord for fully credit worthy tenants for comparable space in the
Building, for a term equal or comparable to the Renewal Term. The
Monthly Rent will increase by fixed amounts on each anniversary of the
commencement of the Renewal Term based on prevailing-market Monthly
Rent increases applicable at the commencement of the Renewal Term, as
reasonably determined by Landlord. Tenant's obligation to pay Tenant's
Proportionate Share of the Excess (actual Operating Expenses minus Base
Year Operating Expenses) pursuant to the Lease will continue during the
Renewal Term.
(b) Such option to renew will be exercised by Tenant by
delivering an initial nonbinding notice to Landlord no later than
February 1, 2006, and not earlier than 60 days before such date, in
which Tenant expresses its intention to exercise such option to renew.
Thereafter, Landlord will notify Tenant ("LANDLORD'S NOTICE") of
Landlord's calculation of (i) the initial prevailing market rate of
Monthly Rent for the Premises, which calculation will reflect the
market rate that would be payable per annum for a term commencing on
the first day of the Renewal Term, and (ii) the prevailing market rate
of increase in Monthly Rent applicable for such Renewal Term. If Tenant
fails to give its initial nonbinding notice of intent to exercise its
option to renew when due as provided in this Exhibit, Tenant will
irrevocably be deemed to have waived such option to renew. Such
calculation by Landlord will be final and will not be recalculated at
the actual commencement of the Renewal Term (if any).
(c) Within 15 days after Landlord delivers Landlord's Notice,
Tenant will deliver to Landlord a final binding notice in which Tenant
(i) elects to renew the Lease and accepts the terms stated in
Landlord's Notice, or (ii) declines to renew the Lease term, in which
case Tenant's rights under this Exhibit will be null and void. If
Tenant fails to notify Landlord within the 15-day period described
above (after having given its initial nonbinding notice within the
required time), time being of the essence, then Tenant will
conclusively be deemed to have elected to renew the Lease on the terms
set forth in Landlord's Notice and in this Exhibit.
(d) Tenant's right to exercise its option to renew this Lease
pursuant to this Exhibit is subject to the following conditions: (i)
that on the date that Tenant delivers notice of its election to
exercise its option to renew, no Event of Default exists, and no
condition exists which, with the giving of notice or the passage of
time, or both, would constitute an Event of Default; and (ii) that
Tenant has not assigned the Lease or sublet the Premises, at any time
during the period commencing with the date that Tenant delivers its
notice to Landlord of Tenant's exercise of such option to renew and
ending on the commencement date of the Renewal Term, or at any time
prior to such period, if such assignment or sublease extends into such
period.
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EXHIBIT G
JANITORIAL SPECIFICATIONS
1. NIGHT CLEANING
A. Night Cleaning Services
Service Contractor shall perform the following Night Cleaning Services
for the Property:
OFFICES & COMMON AREA'S:
------------------------
o Vacuum all high traffic carpeted area's (Hallways, receptionist area, etc.)
o Light vacuum individual office areas at least twice per week.
o Empty wastepaper baskets, and other trash receptacles, and remove to
appropriate outside trash container. Large cardboard boxes must be broken
down by tenant prior to removal.
o Clean cigarette urns (if any), and replace sand as necessary.
o Sanitize and clean all drinking fountains.
o Sweep all resilient tile and hard surface floors, and damp mop as
necessary.
o Damp dust tops of filing cabinets (any personal items and papers must be
removed), bookcases, window ledges & shelves.
o Dust all telephones.
o Desk tops and computer screens will be feather dusted. Desktops must be
clear and free of all paper and personal items for us to damp dust. We will
do this per your instructions.
o Clean upper side of all glass furniture tops (if any).
o Designated lights are to be turned off after work and buildings to be left
in a neat and orderly condition.
RESTROOMS:
----------
o Empty and clean all paper towel and sanitary disposal receptacles.
o Clean all mirrors, powder shelves, and bright work (includes flushometers
and piping).
o Refill soap, toilet tissue, and towel dispensers. Restroom stock is to be
supplied by the customer.
o Sanitary napkin dispensers (if any) are to be stocked and serviced by
customer.
o Mop all hard surface floors with a disinfectant cleaner three times a week.
o Remove wastepaper and refuse to designated trash pick up area or bin.
KITCHEN AREA & LUNCHROOM:
-------------------------
o Clean and sanitize sinks.
o Clean inside of Microwave Ovens.
o Dispose of any left over coffee and clean coffee pots.
o Clean tops of counter tops with disinfectant cleaner.
o Wipe down fronts of appliances and vending machines (if any).
o Sweep and spot damp mot tile flooring daily to remove spillage or track-in.
o Clean tops of tables and spot clean chairs (as needed) with disinfectant
cleaner.
o Damp mop tile floor thoroughly twice a week.
o Vacuum any carpeting (if any) and spot clean as necessary.
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VESTIBULES:
-----------
o All entry doors to be checked for finger marks and smudges and cleaned.
o Roll up mats (if any) cleaned.
o Mop hard surface flooring (as needed).
LAB AREA:
---------
o Clean as per instructed by tenant. Labs are critical areas that need to be
discussed.
MONTHLY:
--------
o Dust blinds (if any) in individual offices and receptionist area.
QUARTERLY:
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o Perform all high dusting which includes vertical surfaces such as walls
(cobwebs), partitions, and other surfaces not reached in daily cleaning.
o Wash partitions and tile walls with disinfectant in all restrooms.
o Vacuum upholstered furniture (if any).
o Clean leather furniture (if any) with leather cleaner.
SEMI-ANNUAL:
------------
o Carpet Cleaning: Recommend that carpeting in the high traffic areas be
cleaned at least semi-annually, and in the individual offices annually. A
separate bid will be submitted on this when the tenant is ready.
INTERIOR AND EXTERIOR WINDOW CLEANING:
--------------------------------------
o Interior and exterior cleaning of windows will be done on a separate bid
basis.
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