LEASE
BY AND BETWEEN
XXXXXXX LLC,
as Landlord
AND
TANGRAM ENTERPRISE SOLUTIONS, INC.,
as Tenant
LEASE AGREEMENT
INDEX OF LEASE SECTIONS
1. OUTLINE OF LEASE PROVISIONS
2. DEMISE
3. DEFINITIONS
4. TERM
5. RENT
6. TENANT'S USE
7. LANDLORD'S DUTIES
8. CONDITION OF DEMISED PREMISES
9. INDEMNIFICATION AND INSURANCE
10. FIRE OR OTHER CASUALTY
11. ASSIGNMENT AND SUBLETTING
12. DEFAULT AND REMEDIES
13. BANKRUPTCY
14. COMMON AREAS
15. EMINENT DOMAIN
16. LANDLORD'S RIGHT OF ENTRY
17. QUIET ENJOYMENT
18. WAIVER
19. ACCORD AND SATISFACTION
20. SUBORDINATION
21. ESTOPPEL LETTER
22. NOTICES
23. REAL ESTATE COMMISSION
24. HOLDING OVER
25. RELATIONSHIP BETWEEN THE PARTIES
26. PARTIAL INVALIDITY
27. SUCCESSORS
28. TRANSFER OF LANDLORD INTEREST
29. LANDLORD'S LIABILITY
30 HAZARDOUS MATERIALS
31. REIMBURSEMENT OF FEES AND COSTS
32 FORCE MAJEURE
33. ENTIRE AGREEMENT; NO ORAL MODIFICATION
34. CONFIDENTIALITY
35. REVIEW OF DOCUMENTS
36. RULES
37. SIGNS
38. RIGHT TO PERFORM
39. EFFECTIVE
40. SECURITY
41. FINANCIAL STATEMENTS
42. COMPLIANCE WITH LAWS
43. LEASE RIDERS
LEASE RIDERS:
Lease Rider No. 1: Right of First Offer
Lease Rider No. 2: Intentionally Deleted
Lease Rider No. 3: Pre-Move In Expansion Offer
Lease Rider No. 4: Renewal Options
Lease Rider No. 5: Termination Option
LEASE EXHIBITS:
Exhibit A: Legal Description
Exhibit A-1: Building
Exhibit A-2: Building Floor Plan
Exhibit B: Description of Landlord Work and Tenant Work
Exhibit B-1: Space Plan
Exhibit C: Rules and Regulations
Exhibit D: Confirmation Agreement
LEASE AGREEMENT
This LEASE AGREEMENT (THE "LEASE") made and entered into this day of
December, 1996, by and between Xxxxxxx LLC a North Carolina Limited Liability
company, referred to as "LANDLORD", and TANGRAM ENTERPRISE SOLUTIONS, INC. a
Delaware corporation, referred to as "TENANT".
1. OUTLINE OF LEASE PROVISIONS: This Section 1 is intended to provide a
convenient reference to the provisions contained in this Lease. Each reference
in this Lease to any of the following subjects shall be construed to incorporate
the data stated for that subject in this Section 1.
A. LANDLORD AND LANDLORD'S NOTICE ADDRESS:
Xxxxxxx LLC
c/x Xxxxx Management, Inc.
11,000 Xxxxxxx Xxxxxxx, Xxxxx 000
Xxxx, Xxxxx Xxxxxxxx 00000
Attn: Xxx Xxxxxxxxx
B. TENANT AND TENANT'S NOTICE ADDRESS:
Sterling Regency
00000 XXXXXXX XXXXXXX
XXXX, XXXXX XXXXXXXX 00000
ATTN: XXXXX XXXX
C. BUILDING ADDRESS:
Sterling Regency
00000 Xxxxxxx Xxxxxxx
Xxxx, Xxxxx Xxxxxxxx 00000
D. Suite 301/401
E. RENTABLE SQUARE FEET OF DEMISED PREMISES: 49,574
F. RENTABLE SQUARE FEET OF BUILDING: 252,939
G. TERM COMMENCEMENT DATE: MARCH 1, 1997
H. TERM EXPIRATION DATE: THE END OF THE 91ST MONTH AFTER THE
COMMENCEMENT DATE.
I. MINIMUM RENT EACH LEASE YEAR PER SQUARE FOOT:
MONTH PRSF MONTHLY MINIMUM RENT YEARLY MINIMUM RENT
---------------------------------------------------------------------
1-6 $17.25 $12,650.00
7 $17.25 $35,631.31
8-19 $17.25 $71,262.63
20-31 $17.60 $72,708.53 $872,502.40
32-43 $17.95 $74,154.44 $889,853.30
44-55 $18.30 $75,600.35 $907,204.20
56-67 $18.65 $77,046.26 $924,555.10
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68-79 $19.00 $78,492.17 $941,906.00
80-91 $19.35 $79,938.08 $959,256.90
*All rents calculated based on 49,574 RSF
Total Aggregate Minimum Rent:$6,461,960.77
J. ESTIMATE OF PRO RATA SHARE OF OPERATING EXPENSES FOR FIRST LEASE
YEAR: 19.6%
K. PERATING EXPENSE BASE YEAR:The lower of 1997 or 1998 grossed up
to reflect 100% occupancy.
L. SECURITY DEPOSIT: NONE.
M. PERMITTED USE: General Office Use.
THE REMAINDER OF THIS PAGE IS INTENTIONALLY BLANK
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2. DEMISE:
A. DEMISED PREMISES: Landlord hereby leases the "Demised Premises"
described in EXHIBIT A, attached hereto and incorporated herein
by reference together with the nonexclusive use of the Common
Areas, to Tenant, and Tenant leases and accepts, subject to the
terms and conditions of this Lease, the premises referred to as
the Demised Premises which the parties stipulate for purposes of
this Lease (including all rent and other charges hereunder)
shall be 49,574 rentable square feet of space in the office
building with an address listed in Section 1(C) known as 11000
Regency, as shown on the site plan attached hereto and
incorporated herein and marked EXHIBIT "A-1".
B. EXCEPTION AND RESERVATION: Landlord reserves and excepts from
within the Demised Premises the roof and exterior walls of the
Building of which the Demised Premises are a part, and further
reserves the right to construct additional floors on, or
additions to, the Building of which the Demised Premises are a
part and the right in, over and upon the Demised Premises as may
be reasonably necessary or advisable for the servicing of the
Demised Premises or of other portions of the Building. Landlord
will provide Tenant with sixty (60) days notice prior to
commencement of construction.
3. DEFINITIONS: In addition to definitions contained within the body
of this Lease, the following definitions shall apply:
A. BUILDING: The term "Building" as used herein shall be deemed to
mean the entire existing building and improvements, including
all land as shown on EXHIBIT A-1 and any and all proposed
structures (whether reflected on EXHIBIT A-1 or hereafter
incorporated in the office building during the term or any
extension thereof), parking or as the same may from time to time
be increased by the addition of other land or decreased by the
deletion of a portion thereof, together with structures and the
like thereon which may from time to time be included by Landlord
in the development.
B. COMMON AREAS: The term "Common Areas" as used herein shall
include parking areas, service roads, loading facilities,
washrooms, hallways, interior corridors, sidewalks and other
areas constructed or to be constructed for use in common by the
Tenant, other tenants in the Building and their employees and
business invitees, subject, however, to the terms of this Lease
and to the rules and regulations which may be prescribed from
time to time by Landlord.
C. HOLIDAYS: The term "Holidays" shall mean New Year's Day,
Memorial Day, Independence Day, Labor Day, Thanksgiving Day and
Christmas Day.
D. LEASE YEAR: The term "Lease Year" shall mean the twelve (12)
month period beginning on the first day of the first full month
immediately following the Commencement Date referred to below,
and each successive twelve (12) month period thereafter,
provided that if the Commencement Date is on a day other than
first day of a calendar month, the first Lease Year shall
include the period from the Commencement Date through the end of
the calendar month in which the Commencement Date occurs.
E. NORMAL BUSINESS HOURS: The term "Normal Business Hours" shall
mean the period from 8:00am to 6:00pm, Monday through Friday and
from 8:00am to 12:00 noon on Saturdays, excluding Holidays.
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F. OPERATING EXPENSES: The term "Operating Expenses" shall mean (A)
Landlord's operating expenses that are reasonable, actual and
necessary, out-of-pocket (except Landlord may use its normal
accrual method of accounting), obtained at competitive prices
and that are directly attributable to the operation,
maintenance, management, and repair of the Building, as
determined under generally accepted accounting principles
consistently applied, including:
1. All supplies and materials used, and labor charges incurred,
in the operation, maintenance, decoration, repairing and
cleaning of the Building;
2. Cost of all equipment purchased, leased or rented which is
utilized in the performance of Landlord's obligations hereunder,
and the cost of maintenance and operation of any such equipment;
3. Cost of all third party management, maintenance and service
agreements for the Building and the equipment therein,
including, without limitation, alarm service, security service,
window cleaning, and elevator maintenance;
4. Accounting costs, including the cost of audits by certified
public accountants, and legal and engineering fees and expenses
incurred in connection with the operation and management of the
Building, except for such costs based upon Landlord's gross
negligence;
5. Wages, salaries commissions, and related expenses of all
on-site and off-site agents or employees engaged in the
operation, maintenance, security and management of the Building;
6. Cost of all insurance coverage for the Building;
7. Any and all maintenance and repair (including repainting) of
the common areas and public areas of the Building, and exterior
and interior landscaping;
8. Cost of removal of trash, rubbish, garbage and other refuse
from the Building as well as removal of ice and snow from the
sidewalks on or adjacent to the Building;
9. The annual amortization over its useful life with a
reasonable salvage value on a straight-line basis of cost of any
capital improvements made to the Building subsequent to the
Commencement Date (including legal, architectural and
engineering fees incurred in connection therewith), which serve
to reduce operating costs;
10. All charges for gas, water, sewerage service, and other
utilities furnished to the Building;
11. All electricity furnished to the Building, including,
without limitation, electricity furnished to individual tenants
of the Building, to the common areas and public areas of the
Building, and to the machinery and equipment (including any
heating, ventilation and air-conditioning equipment) used in the
operation and maintenance of the Building:
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12. Janitorial service, including service to areas of the
Building leased to tenants;
13. Management fees payable to any managing agent of the
Building at market rates;
14. Real property taxes assessed against the Building.
15. Installments and interest on assessments for public
betterment or public improvements.
16. Legal fees and costs incurred in connection with contesting
the amounts or the impositions of any Real Property Taxes.
NOTWITHSTANDING THE FOREGOING OPERATING EXPENSES EXCLUDE:
1. Leasing commissions, costs, disbursements, and other expenses
incurred for leasing, renovating, or improving space for
tenants;
2. Costs (including permit, license, and inspection fees)
incurred in renovating, improving, decorating, painting, or
redecorating vacant space or space for tenants;
3. Landlord's cost of electricity or other service sold to
tenants for which Landlord is to be reimbursed as a charge over
the Rent and Additional Rent payable under the lease with that
tenant;
4. Depreciation and amortization on the Building;
5. Costs incurred because the Landlord or another tenant
violated the terms of any lease;
6. Overhead and profit paid to subsidiaries or affiliates of
Landlord for management or other services on or to the Building
or for supplies or other materials, to the extent that the costs
of the services, supplies or materials exceed the competitive
costs of the services, supplies, or materials were they not
provided by a subsidiary or affiliate;
7. Interest on debt or amortization payments on mortgages or
deeds of trust or any other debt for borrowed money;
8. Compensation paid to clerks, attendants, or other persons in
commercial concessions operated by Landlord;
9. Items and services for which Tenant reimburses Landlord or
pays third parties or that Landlord provides selectively to one
or more tenants of the Building other than Tenant without
reimbursement;
10. Advertising and promotional expenditures;
11. Repairs or other work needed because of fire windstorm, or
other casualty or cause insured against by Landlord or to the
extent Landlord's insurance would have provided insurance,
whichever is the greater coverage;
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12. Costs incurred in operating a parking facility for the
Building, if Landlord is charging for parking spaces.
13. Nonrecurring costs incurred to remedy structural defects in
original construction materials or installations;
14. Any costs, fines, or penalties incurred because Landlord
violated any governmental rule or authority;
15. Costs incurred to test, survey, cleanup, contain, xxxxx,
remove, or otherwise remedy hazardous wastes or
asbestos-containing materials from the Land or the Building
unless the wastes or asbestos-containing materials were in or on
the Property because of Tenant's acts.
16. Cost of capital improvements or capital repairs, except as
specifically provided for above.
G. PARTIAL YEAR: The term "Partial Year" shall mean any period
beginning on the first day of any Lease Year and ending, by
reason of the termination of this Lease, prior to the end of
such Lease Year.
H. REAL PROPERTY TAXES: The term "Real Property Taxes" shall mean
any form of assessment, license, fee, rent tax, levy, or tax,
imposed by any authority having the direct or indirect power to
tax, or by any city, county, state of federal government or any
other district or division thereof, on the Building or any part
thereof, or any legal or equitable interest of Landlord in the
same.
I. RENT: The term "Rent" shall mean minimum rent, Tenant's Pro Rata
Share of Operating Expenses, and all other sums required to be
paid by Tenant under the terms of this Lease, as additional
rent, and, in the event of non-payment thereof, Landlord shall
have the rights and remedies herein provided for in the case of
non-payment of Rent.
J. SINGLE TENANT FLOOR: The term "Single Tenant Floor" shall mean
an entire floor within one wing of the Building occupied by a
single tenant.
K. TENANT'S PRO RATA SHARE shall mean that fraction, the numerator
of which equal the number of rentable square feet in the Demised
Premises, and the denominator of which equals the
from-time-to-time total rentable square footage of the Building.
L. USEABLE SQUARE FEET: The term "Useable Square Feet" for
multi-tenant floors is the total floor square footage less
vertical openings and Common Areas. The term "Useable Square
Feet" for Single Tenant Floors is the total floor square footage
less vertical openings.
M. RENTABLE SQUARE FEET: The term "Rentable Square Feet" of Demised
Premises for multi-tenant floors is Usable Square Feet plus
fifteen percent (U + 15%). The term "Rentable Square Feet" of
Single Tenant Floors is Usable Square Feet plus ten percent (U +
10%).
4. TERM: This Lease shall commence on the commencement date specified
in Section 1(F) (the "Commencement Date") and shall terminate at
noon on the date specified in Section 1(G). If Landlord, for
whatever reason, cannot deliver possession of the Demised Premises
to Tenant on the Commencement Date, this Lease shall not be void
9
or voidable; no obligation of Tenant shall be affected thereby
(except that the payment of Rent shall not commence until delivery
of possession); and neither Landlord nor Landlord's agents shall be
liable to Tenant for any loss or damage resulting therefrom;
provided, however, that in such event, the dates of commencement
and termination for this Lease, and all other dates affected
thereby, shall be revised to conform to the date of Landlord's
delivery of possession to Tenant. However, Landlord will deliver
Demised Premises within thirty-five (35) days of Commencement Date
or pay a penalty of $2,000.00 per day to Tenant for each day beyond
thirty (30) days; provided Lease is signed by December 20, 1996,
and Tenant is not responsible for any delays. If Landlord is unable
to deliver possession of the Demised Premises within sixty (60)
days of the Commencement Date, Tenant may terminate this Lease by
delivering written notice to Landlord.
TENANT SHALL BE GIVEN ACCESS TO THE DEMISED PREMISES FOR A PERIOD
OF SEVEN (7) DAYS PRIOR TO THE LEASE COMMENCEMENT DATE FOR
INSTALLATION OF FURNITURE, PHONE SYSTEMS, ETC. AT NO COST TO TENANT
SO LONG AS TO NOT INTERFERE WITH LANDLORD'S WORK AND IS NOT IN
VIOLATION OF ANY BUILDING CODES.
5. RENT:
A. MINIMUM RENT: Tenant shall pay Landlord as minimum rent for the
Demised Premises, the amount per rentable square foot specified
in Section 1(I), in monthly installments of the amounts
specified in Section 1(I), without any setoff or deduction
whatsoever and in advance on the first day of each month
beginning in the eighth month following the Commencement Date
and every month thereafter during the entire term of this Lease
at the address specified in Section 1(A), or at such other place
as Landlord may designate from time to time.
B. ADDITIONAL RENT: Following the calendar year listed in Section
1(K) (the "Base Year"), Landlord shall determine its Operating
Expenses for the Base Year. Each succeeding year during the term
hereof, Landlord shall estimate its Operating Expenses for the
upcoming calendar year for the Building. If these Operating
Expenses are estimated to exceed the Operating Expenses for the
Base Year, then the Tenant shall pay Tenant's Pro Rata Share of
any such overage. The Landlord's determination of the Operating
Expenses for the Base Year shall be computed based upon a 100%
occupancy of the Building. Landlord shall give Tenant notice of
the estimated amount by which Operating Expenses for the
upcoming calendar year are anticipated to exceed Operating
Expenses for the Base Year. Tenant shall pay in equal monthly
installments, as additional rent, one twelfth (1/12th) of the
amount of such overage each month.Landlord shall provide
computation of actual operating expenses to Tenant within
seventy-five (75) days of the end of each calendar year. Any
overages shall be distributed to Tenant by check or rental
credit within thirty (30) days.
C. PAYMENT OF CHARGES: All Rent and other charges to be paid by
Tenant shall be paid as provided in this Lease agreement without
any setoff or deduction whatsoever and the non-payment of any
item when due (or with the monthly payments if not otherwise
provided for herein) shall constitute an item of default under
the terms hereof.
D. LATE CHARGE: Rent in arrears five (5) days after the same is due
shall bear interest at the annual rate (the "Default Rate")
which shall be the lesser of eighteen percent (18%) or the
highest amount permitted by law. This
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provision shall in no way affect the right of Landlord to
declare Tenant in default of this Lease for the failure to pay
any sums when due. Landlord shall be obligated to provide Tenant
with written notice, a maximum of two times per calendar year
and Tenant shall have a five (5) day grace period after receipt
of such notice.
6. TENANT'S USE:
A. PERMITTED USE: The Demised Premises shall be used and occupied
by Tenant solely for the purposes listed in Section 1(M) and for
no other purpose without Landlord's prior written consent.
B. RESTRICTION ON USE: Tenant shall not do or permit anything to be
done in or about the Demised Premises which will in any way
obstruct or interfere with the rights of other tenants or
occupants of the Building. Tenant shall not use or allow the
Demised Premises to be used for any improper, immoral, unlawful
or for any business, use or purpose deemed to be disreputable or
inconsistent with the operation of a first class office
building. Tenant shall not commit or suffer the commission of
any waste in, on, or about the Demised Premises. Tenant shall
not use the Demised Premises or permit anything to be done in or
about the Demised Premises which will in any way conflict with
any law, statute, ordinance, regulation, government rule or
regulation, now or hereafter enacted. If any of the Tenant's
office machines or equipment create a nuisance to any other
tenant in the Building, then Tenant shall provide adequate
insulation, or take such other action as may be necessary to
eliminate the noise or disturbance.
7. LANDLORD'S DUTIES:
A. MAINTENANCE AND REPAIR: Landlord will maintain and keep in
reasonable repair the Demised Premises, including plumbing,
electrical, and heating, and air conditioning systems,
elevators, and the Common Areas on the floor, including, but not
limited to, washrooms, hallways and elevator areas and in the
building, as well as the foundation, exterior walls and roof of
the Building in which the Demised Premises are located and the
structural portions of the Demised Premises and the Building.
Landlord shall not be called upon to make any such repairs
occasioned by the act of neglect of Tenant, its agents,
employees, invitees, licensees or contractors. Except as
provided in Exhibit B, Landlord shall not be called upon to make
any other improvements or repairs of any kind upon the Demised
Premises and appurtenances. Any of the foregoing repairs
required to be made by reason of the negligence of Tenant, its
agents, employees, invitees, licensees, or contractors, as above
described, shall be the responsibility of Tenant notwithstanding
the provisions contained in this paragraph. Tenant shall
promptly report in writing to Landlord any defective condition
known to it. Landlord will make all repairs and replacements in
a reasonable period of time after receiving notice or having
actual knowledge of the need for repair or replacement. If after
thirty (30) days, excluding emergencies, Landlord fails to make
such repair and replacement, provided it can be repaired within
thirty (30) days, Tenant can do so and charge Landlord. Tenant
hereby waives the right to make repairs at Landlord's expense
under any other law, statute or ordinance now or hereafter in
effect.
B. JANITORIAL AND UTILITY SERVICES: Landlord will provide for the
Demised Premises during the five (5) business days per week,
excluding Holidays:
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1. Janitorial services.
2. Electrical power at voltage standard for office buildings
similar in type to the Building.
3. Heating and air conditioning, sufficient to maintain
temperatures during Normal Business Hours as follows: 75
degrees fahrenheit or lower when outside conditions are less
than 95 degrees fahrenheit but greater than 60 degrees
fahrenheit; and 70 degrees fahrenheit or higher when outside
conditions are greater than 10 degrees fahrenheit but less
than 60 degrees fahrenheit. If requested by Tenant, with 24
hour notice, Landlord shall furnish heat and air conditioning
at times other than Normal Business Hours and the cost of
such services at the rate of $25.00 per hour shall be paid by
Tenant as additional Rent, payable within ten (10) days of
notice of such fee from Landlord.
4. Removal of trash from site dumpsters in accordance with city
schedules.
5. Cold water for lavatory and toilet purposes and hot water for
lavatory purposes.
6. Restroom facilities.
7. Sanitary sewer facilities.
8. Directory listings for the various tenants at the Building,
including Tenant.
9. Keys or access cards to serve the Demised Premises, up to a
total of four per 1,000 rsf without charge (additional keys
or access cards will be available for a fee determined by
Landlord).
10. Elevators providing adequate services leading to the floor
on which the Demised Premises is located.
11. Replacement of light tubes and lamp ballasts.
12. Extermination and pest control.
13. Maintenance of Common Areas in a manner comparable to other
first class office buildings in the Raleigh, NC area.
However, if Tenant utilizes machines or equipment which expend
an extraordinary amount of HVAC, Tenant will pay to Landlord the
monthly amount which reasonably covers such extraordinary usage.
Landlord shall not be responsible for any failure or
interruption in utility services to the Demised Premises.
Landlord shall not be liable for any loss, injury or damage
caused by or resulting from any variation, interruption, or
failure of such services due to any cause whatsoever, or from
failure to make any repairs or perform any maintenance. In no
event shall Landlord be liable for any damage to the Demised
Premises or for any loss, damage or injury to any property
therein or thereon occasioned by bursting, ruptured, leakage, or
overflow of any plumbing or other pipes or other similar cause,
unless such act or omission is a
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result of Landlord's gross negligence or willful act. Tenant
shall pay or cause to be paid all charges for telephone or any
other communication services.
8. CONDITION OF DEMISED PREMISES
A. INITIAL CONSTRUCTION: Except as specified in Exhibit B, Tenant
shall be deemed to have accepted the Demised Premises on the
Commencement Date in their "as is" condition. The acceptance of
the Demised Premises by Tenant shall be deferred until receipt
by Tenant of an architect's certificate of readiness certifying
that the Demised Premises are ready for occupancy and such
occupancy has been granted. Within five (5) business days after
the architect gives such notice, Tenant shall make such
inspection of the Demised Premises as Tenant deems appropriate,
and, except as otherwise notified by Tenant in writing to
Landlord within such period, Tenant shall be deemed to have
accepted the Demised Premises in its then condition. If, as a
result of such inspection, Tenant discovers minor deviations or
variations from the plans and specifications for Tenant's
improvements of a nature commonly referred to as a "punch list"
item, Tenant shall promptly notify Landlord of each deviation.
The existence of any punchlist item shall not postpone the Lease
Commencement Date nor the obligation of Tenant to pay Rent or
any other charge due hereunder. Landlord will diligently attempt
to complete the punchlist items within thirty (30) days after
the Commencement Date. Landlord will also correct any latent
defects as they become known. Landlord's obligations with
respect to any upfit for Tenant, however, shall be limited to
Landlord's Work set forth on EXHIBIT B attached hereto.
B. TENANT'S DUTY TO REPAIR:
1. Maintenance Obligation: Except as provided in Section 7 of
this Lease as being required of Landlord, Tenant shall keep
and maintain the Demised Premises in good order, condition
and repair, except for reasonable wear and tear, casualty and
condemnation.
2. Surrender of Premises: Upon termination of this Lease or any
renewal term, Tenant shall deliver the Demised Premises in
broom clean and otherwise in the same condition as received
by it on the Commencement Date (subject to the removals
hereinafter required), reasonable wear and tear excepted, and
shall surrender all keys and access cards for the Demised
Premises to Landlord at the place then fixed for the payment
of Rent and shall inform Landlord of all combinations for
locks, safes and vaults, if any, in the Demised Premises.
Tenant, during the last thirty (30) days of the term, shall
remove all of its trade fixtures, and, to the extent required
by Landlord by written notice, any other installations,
alterations or improvements installed subsequent to
Commencement Date, before surrendering the Demised Premises
as aforesaid and shall repair any damage to the Demised
Premises caused thereby. Tenant's obligation to observe or
perform this covenant shall survive the expiration or other
termination of the Lease Term. Any items remaining in the
Demised Premises on the termination date of this Lease shall
be deemed abandoned for all purposes and shall become the
property of Landlord and the latter may dispose of the same
without liability of any type of nature.
C. TENANT'S ALTERATIONS: Tenant shall not make any alterations,
additions, changes or improvements to the Demised Premises,
without, in each instance,
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the prior written approval of Landlord, which Landlord shall not
unreasonably withhold or delay. All such work shall be done in a
good and workmanlike manner using only good grades of material,
and shall comply with all applicable laws of every governmental
authority having jurisdiction over the Building at the time such
work is performed and thereafter, and shall be diligently
prosecuted through completion.
D. MECHANICS LIENS: If Tenant makes any alterations or improvements
in the Demised Premises, Tenant must pay for same when made.
Nothing in the Lease shall be construed to authorize Tenant or
any person dealing with or under Tenant, to charge the rents of
the Demised Premises, or the property of which the Demised
Premises forms a part, or the interest of Landlord in the estate
of the Demised Premises or the Building, or any person under or
through whom Landlord has acquired its interest in the estate of
the Demised Premises, with a mechanic's lien or encumbrance of
any kind, and under no circumstances shall Tenant be construed
to be the agent, employee or representative of Landlord in the
making of any such alterations or improvements to the Demised
Premises, but, to the contrary, the right or power to charge any
lien, claim or encumbrance of any kind against Landlord's rents
or the Demised Premises or said land is denied. Landlord shall
have the right, but not the obligation, to notify any person or
entity supplying labor or materials for Tenant to the Demised
Premises that such work is for the exclusive benefit of Tenant
in order to notify the provider thereof that Landlord's interest
in the Demised Premises is not subject to impression of a lien
with respect thereto. If Tenant does authorized construction and
a mechanic's or materialmen's lien is filed, the Tenant's only
obligation shall be to remove the lien or post a bond in
accordance with North Carolina statutes. In the event of the
filing of a notice of any mechanic's or materialmen's lien,
Tenant will promptly pay same and take steps immediately to have
the same removed. If the same is not removed or bonded off
within twenty (20) days from the date of written notice from
Landlord, Landlord shall have the right at Landlord's option of
paying the same or any portion thereof and the amounts so paid,
including attorneys' fees and expenses associated therewith and
interest at the Default Rate on any sums and expenses paid or
advanced from the date of expenditure until the date of
reimbursement by Tenant, shall be deemed to be additional rent
due from Tenant to Landlord and shall be paid to Landlord
immediately upon rendition to Tenant of a xxxx for same. Tenant
shall indemnify and save harmless Landlord from and against all
losses, claims, damages, costs or expenses suffered by Landlord
by reason of any repairs, installations or improvements, made by
Tenant.
E. ROOF: Tenant will not in any manner cut or drive nails into or
otherwise mutilate the roof of the Demised Premises and will be
responsible for any damage caused to the roof by any acts of
Tenant, its agents, servants, employees or contractors.
9. INDEMNIFICATION AND INSURANCE:
A. INDEMNIFICATION: Tenant shall protect, indemnify and save
Landlord harmless from and against any and all liability and
expense of any kind arising from injuries or damages to persons
or property on the Demised Premises or arising out of or
resulting in any way from any negligent act or omission of
Tenant, its agents, employees, contractors, licensees or
invitees during the term of this Lease.
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Landlord shall protect, indemnify and save Tenant harmless from
and against any and all liability and expense of any kind
arising from injuries or damages to persons or property arising
out of or resulting in any way from any gross negligent acts or
omissions of Landlord, its agents or employees, contractors,
licensees or invitees during the term of this Lease.
B. NOTICE OF CLAIM OR SUIT: Tenant agrees to promptly notify
Landlord of any claim, action, proceeding or suit instituted or
threatened against Landlord, Tenant or Landlord's Lender.
Landlord agrees to promptly notify Tenant of any claim, action,
proceeding or suit instituted or threatened against Tenant of
which Landlord has knowledge. In the event Landlord is made a
party to any action for damages which Tenant has agreed to
indemnify Landlord against, then Tenant shall pay all costs and
shall provide counsel reasonably acceptable to Landlord and
Landlord's Lender in such litigation or shall pay at Landlord's
option the attorney fees and costs incurred in connection with
said litigation by Landlord or Landlord's Lender.
C. FIXTURES: Tenant shall obtain insurance covering all fixtures,
merchandise, equipment and personal property from time to time
located in, on or upon the Demised Premises, in the amount of
their full replacement cost from time to time during the term of
this Lease, providing protection against any peril included
within the classification "Fire and Extended Coverage", together
with insurance against sprinkler leakage (if the Demised
Premises are sprinkled), vandalism and malicious mischief. Any
policy proceeds shall be used for the repair or replacement of
the property damaged or destroyed unless this Lease shall cease
and terminate under the provisions of Section 10 hereof, in
which event the terms of Section 10 hereof shall control.
Landlord will maintain 100% replacement cost "all risk" policy
for the Building at all times during the term of this Lease.
D. LIABILITY INSURANCE: Tenant agrees to maintain at its expense at
all times during the lease term full Commercial General
Liability Insurance naming Landlord and Landlord's Lender, to
the extent requested in writing, as additional insureds in an
amount not less than $2,000,000.00 per occurrence.
Landlord will maintain Commercial General Liability Insurance in
amounts customary for office buildings in Raleigh, NC of the
size of the Building.
E. FAILURE TO PROCURE INSURANCE: In the event Tenant shall fail to
procure insurance required under this Section and fail to
maintain the same in force continuously during the term, of if
Tenant shall fail to pay for any increase in premiums required
hereunder, Landlord shall be entitled to procure the same and
Tenant shall immediately reimburse Landlord for such premium
expense, plus interest thereon at the Default Rate from the date
of expenditure by Landlord until the date of reimbursement by
Tenant. In order to collect such reimbursement, Landlord shall
have all the remedies available to it under this Lease for a
default in the payment of Rent.
15
F. INCREASE IN FIRE INSURANCE PREMIUM: Tenant agrees not to keep
upon the Demised Premises any articles, materials, equipment or
goods which may be prohibited by the standard form of fire
insurance policy. It is agreed between the parties that in the
event the insurance rates applicable to fire and extended
coverage insurance covering the within premises shall be
increased by reason of any use of the Demised Premises made by
Tenant, then Tenant shall pay to Landlord such increase in
insurance as shall be occasioned by said use, within ten (10)
days of Tenant's receipt of a xxxx for same.
G. PROPERTY OF TENANT: Tenant agrees that all property owned by it
in, on or about the Demised Premises shall be at the sole risk
and hazard of Tenant. Landlord shall not be liable or
responsible for any loss of or damage to Tenant, or anyone
claiming under or through Tenant, or otherwise, whether caused
by or resulting from a peril required to be insured hereunder,
or from water, steam, gas, leakage, plumbing, electricity or
electrical apparatus, pipe or apparatus of any kind, the
elements or other similar or dissimilar causes, and whether or
not originating in the Demised Premises or elsewhere, and
provided such damage or loss is not the result of an intentional
and willful wrongful act of Landlord or the result of gross
negligence by Landlord, its agents, employees, invitees,
licensees or contractors.
H. POLICY FORM OF TENANT'S INSURANCE: All policies of insurance
required of Landlord and Tenant herein shall be issued by
insurance companies, with a general policy holder's rating of
not less than "A" and a financial rating of not less than VIII
as rated in the most current available "Best's" insurance
reports, and qualified to do business in the State where the
Demised Premises is located, which policies shall be for the
mutual and joint benefit and protection of Landlord and Tenant.
Executed copies of insurance certificates thereof shall be
delivered to Landlord prior to delivery of possession of the
Demised Premises to Tenant, renewal policies or certificates
shall be delivered to Landlord within thirty (30) days prior to
the expiration of the term of each such policy and upon request
of Landlord at any time during the term. All public liability
policies shall contain a provision that Landlord and Landlord's
Lender shall be entitled to recovery under said policies for any
loss occasioned to it or its servants, agents and employees by
reason of the negligence of Tenant. Tenant's insurance policies
shall contain endorsement that such insurance may not be
cancelled or amended except upon thirty (30) days' prior written
notice from the insurance company to Landlord, sent by certified
or registered mail. As often as any such policies shall expire
or terminate, renewal or additional policies shall be procured
and maintained by Tenant in like manner and to like extent. All
public liability, property damage and other casualty policies
shall be procured and maintained by Tenant in like manner and to
like extent. All public liability, property damage and other
casualty policies shall be written as primary policies, not
contributing with and not in excess of coverage which Landlord
may carry.
I. MUTUAL WAIVER OF SUBROGATION: Landlord and Tenant hereby waive
the rights each may have against the other on account of any
loss or damage occasioned to Tenant or Tenant, as the case may
be, their respective property, the Demised Premises or its
contents or to other portions of the Building, arising from any
risk insured against by Landlord or Tenant, and the parties
each, on behalf of their respective insurance companies insuring
the property of either Landlord or Tenant against any such loss,
waive any right of subrogation that it may have against Landlord
or Tenant, as the case may be. The release and waiver of
subrogation rights provided herein shall apply only if and to
the
16
extent that insurance proceeds are in fact paid to or for
the account of the party giving the release hereunder.
10. FIRE OR OTHER CASUALTY: If the Demised Premises shall be partially
damaged by fire or other casualty insured under Landlord's
insurance policies, then upon Landlord's receipt of the insurance
proceeds, Landlord shall, except as otherwise provided herein,
repair and restore the same (exclusive of Tenant's fixtures,
equipment, decorations, signs and contents and any of Tenant's work
described in EXHIBIT B hereto) substantially to the condition
thereof immediately prior to such damage or destruction; limited,
however, to the extent of the insurance proceeds received in hand
by Landlord therefor. If by reason of such occurrence, (a) the
Building or the Demised Premises are damaged in whole or in part as
a result of a risk which is not covered by Landlord's insurance
policies; or (b) the Building or the Demised Premises are damaged
to an extent of thirty percent (30%) or more of the then
replacement value thereof; or (c) any or all of said buildings or
the Common Areas of the Building are damaged (whether or not the
Demised Premises are damaged) to such an extent that the Building
cannot in the sole judgment of Landlord be operated as an integral
unit; or (d) any mortgagee or deed of trust holder requires that
any of Landlord's insurance proceeds be applied to reduce
Landlord's loan balance, then in any of such events, Landlord may
elect either to repair the damage as aforesaid, or cancel this
Lease by written notice of cancellation given to Tenant within
sixty (60) days after the date of such occurrence, and thereupon
this Lease shall cease and terminate with the same force and effect
as though the date set forth in Landlord's said notice were the
date herein fixed for the expiration of the term hereof and Tenant
shall immediately vacate and surrender the Demised Premises to
Landlord. In addition, Tenant may also terminate this Lease, by
written notice to Landlord (i) if prior to beginning the
restoration, Landlord cannot provide assurances satisfactory to
Tenant that such restoration can be completed within one hundred
twenty (120) days following the casualty or (ii) at any time
between the one hundred twenty-first (121st) and one hundred
thirty-fifth (135th) days after the occurrence of any such
casualty, if Landlord shall fail to restore the damaged portions of
the Demised Premises within one hundred twenty (120) days after
such casualty. However, if Landlord is prevented by any cause
beyond its reasonable control, from completing the restoration
within said one hundred twenty (120) day period, and if Landlord
shall provide Tenant with written notice of such cause for delay
within fifteen (15) days after the occurrence thereof, then
Landlord shall have an additional period beyond said one hundred
twenty (120) days, equal to the period Landlord is delayed by
causes beyond its reasonable control, in which to restore the
damaged areas of the Demised Premises, and Tenant may not elect to
terminate this Lease until said additional period has expired with
Landlord having failed to complete such restoration. In such case,
Tenant's fifteen (15) day right of termination shall begin to run
upon the expiration of Landlord's additional period for
restoration. Upon the termination of this Lease, Tenant's liability
for the Rent and other charges reserved hereunder shall cease as of
the effective date of the termination of this Lease.
Rent Abatement. If by reason of such casualty the Premises is
rendered wholly untenantable, the Rent and other charges payable by
Tenant shall be fully abated, or if only partially damaged, such
Rent and other charges shall be abated proportionately as to that
portion of the Demised Premises rendered untenantable, in either
event (unless the Lease is terminated, as aforesaid) from the date
of such casualty until the Demised Premises have been substantially
restored, or until Tenant has resumed its business operations in
the Demised Premises, whichever shall occur sooner.
11. ASSIGNMENT AND SUBLETTING:
17
A. TENANT ASSIGNMENT AND SUBLETTING: Tenant shall not assign,
transfer or encumber this Lease without the prior written
consent of Landlord, and shall not sublet or allow any other
tenant to come in, with or under Tenant without like prior
written consent, which consent shall not be unreasonably
withheld; provided, however, Tenant may assign this Lease to its
parent company, Safeguard Scientifics, Inc., or any corporation
resulting from the merger or consolidation with Tenant, without
Landlord's consent. Except for a corporate tenant whose stock is
traded on the New York or American Stock Exchange or on the
"over the counter" market, a transfer of any of Tenant's stock
or a transfer or change of "control" of Tenant or a change in
the composition of the persons or entities owning any interest
in any non-corporate tenant shall be deemed as assignment for
the purposes of this paragraph. "Control" shall mean, with
respect to a corporation, the ownership, directly, directly or
indirectly, of stock possessing, or the right to exercise, at
least 25% of the total combined voting power of all classes of
the controlled corporation's stock issued, outstanding, directly
or indirectly, of at least 25% of all legal and equitable
interests therein. If Tenant desires the consent of Landlord to
sublease or assign, Tenant must submit the sublease or
assignment to Landlord for its approval, together with the
following documents: (a) a complete financial statement of the
subtenant or assignee with an authorization to verify the same;
(b) a declaration by the subtenant or assignees as to the type
of business to be carried out and the number of employees to
occupy the Demised Premises; (c) payment of a $300.00 fee for
processing and approval of the sublease or assignment documents;
and (d) proof of payment of all leasing commissions, if
applicable. Consent of Landlord to one assignment or subletting
of the Demised Premises or any portion thereof for any use which
will violate the exclusive use rights or prohibited use
restrictions granted to any other tenant in the Building. Any
assignment or subletting, notwithstanding the consent of the
Landlord, shall not in any manner release Tenant herein from its
continued liability for the performance of the provisions of
this Lease and any amendments or modifications thereto. In
addition, the assignee shall agree in writing (a copy of which
shall be delivered to Landlord) to assume all of Tenant's
obligations under this Lease. The acceptance of any rental
payments by Landlord from any alleged assignee shall not
constitute approval of the assignment of this Lease by Landlord.
Tenant expressly acknowledges that Landlord may refuse to give
its consent to any proposed assignment or subletting if Landlord
determines in good faith that Landlord's interest in the Demised
Premises or the Building would be adversely affected by, among
other things, (i) the financial condition, credit-worthiness or
business reputation of the proposed assignee or subtenant; (ii)
the proposed use of the Demised Premises by, or business of, the
proposed assignee or subtenant; (iii) the tenant mix of the
Building; or (iv) the obligations of Landlord and/or the rights
of other tenants of the Building.
B. LEGAL FEES: Landlord shall be promptly fully reimbursed by
Tenant for legal fees incurred by Landlord with respect to any
proposed assignment or sublease, regardless of whether the
assignment or sublease is approved.
C. RENTALS: In the event that pursuant to any assignment or
sublease, Tenant receives or has the right to receive any
monies, rental payments or any other consideration in excess of
Tenant's rental obligations hereunder, Tenant guarantees that
fifty percent (50%) of all such excess amounts from any sublease
or assignments shall, when due or payable, be immediately
delivered or paid to the Landlord by Tenant or any such assignee
or subtenant. All such monies, rental payments or any other
consideration shall be the sole and
18
exclusive property Landlord. In determining any minimum sublease
rent requirements or excess rent received from a subtenant which
occupies less than all of the Demised Premises, the rent payable
by Tenant hereunder shall be compared to the rent payable by
the subtenant on a per square foot basis, i.e, rent shall be the
total rent accruing during such period multiplied by a fraction,
the numerator of which is the floor area of any such subleased
area and the denominator of which is the area of the Demised
Premises.
D. NOTICE OF CONTEMPLATED ASSIGNMENT OR SUBLETTING: In the event
Tenant shall desire to assign, transfer or sublet the Demised
Premises to any other person or entity, then Tenant shall notify
Landlord in writing and shall furnish Landlord with information
regarding the assignee, transferee, subtenant or the change in
the ownership of the controlling interest of Tenant. The phrase
"controlling interest" as used in the preceding sentence shall
have the same meaning as the word "control" as described in
Section 11(A). Landlord shall have twenty (20) days after
receipt of such notice and supporting data to adopt one of the
following alternatives: (a) to approve the proposed assignment,
transfer or subletting (or stock sale or transfer where
applicable), in which case Tenant shall continue to be liable
along with the said assignee for the fulfillment of all Tenant's
obligations for the remainder of the term; or (b) to disapprove
the same and provide Tenant with its written reasons for
disapproving, in which case this Lease shall continue in full
force and effect with Tenant continuing to occupy the Demised
Premises under the terms hereof.
12. DEFAULT AND REMEDIES:
A. DEFAULT: The following events shall be deemed to be events of
default by Tenant under this Lease: (a) if Tenant shall fail to
make any payment of Rent within five (5) days after the same
shall become due; (b) if Tenant shall fail to comply with any
term, provision or covenant of this Lease, other than the
payment of Rent, and shall not cure such failure within ten (10)
days after written notice thereof to Tenant; (c) the failure of
Tenant to open for business in the Demised Premises within
ninety (90) days of the Commencement Date; or (d) if Tenant
assigns its assets for the benefit of its creditors. Landlord
shall be obligated to provide Tenant with written notice, a
maximum of two times per calendar year, of a payment default and
Tenant should have a five (5) day grace period after receipt of
such notice. For a non-monetary default, Tenant shall have a
30-day grace period after receipt of written notice from
Landlord to cure such default.
B. REMEDIES OF LANDLORD: Upon the occurrence of any such event of
default, Landlord shall have the option to pursue any one or
more of the following remedies (as well as any other remedies
provided by law) without any notice or demand whatsoever:
1. Enter upon and take possession of the Demised Premises
without terminating this Lease and without relieving Tenant
of its obligation to make the payments of Rent herein
reserved, and expel or remove Tenant and any other person who
may be occupying the Demised Premises or any part thereof and
any personal property or trade fixtures located therein, and
change or alter the locks and other security devices, and
relet the Demised Premises on behalf of Tenant, at any rental
readily obtainable, and receive the rent therefor. In such
event, Tenant shall pay to Landlord on demand the reasonable
expenses of
19
such reletting, and any deficiency which may arise by reason
of such reletting for the residue of the term of this Lease.
2. Forfeit and terminate this Lease forthwith. In the event of
such termination, Tenant shall immediately surrender the
Demised Premises the Landlord and if Tenant fails to do so,
Landlord may enter upon and take possession of the Demised
Premises and expel or remove Tenant and any other person who
may be occupying the Demised Premises or any part thereof,
and any personal property or trade fixtures located therein.
In the event of the forfeiture of this Lease as provided
herein, Tenant shall pay to Landlord, on demand, the
reasonable expenses of such reletting (including all repairs,
reasonable improvements, brokers' and attorneys' fees and all
loss or damage which Landlord may sustain by reason or such
re-entry and reletting) plus an amount equal to the
difference between the Rent provided for herein and the
amount of rent received by Landlord from the subsequent
reletting of the Demised Premises, for the balance of the
term of this Lease.
13. BANKRUPTCY:
A. TENANT BANKRUPTCY: If Tenant or the guarantor of Tenant's
obligations hereunder ("Guarantor") (i) makes an assignment or
other arrangement for the benefit of creditors or takes any
other similar action for the protection or benefit of creditors,
(ii) ceases doing business as a going concern, (iii) generally
does not pay its debts as they become due, (iv) admits in
writing its inability to pay its debts as they become due, (v)
takes any action to dissolution or liquidation, (vi) gives
written notice to any governmental body of insolvency, or
pending insolvency, or suspension or pending suspension of
operations, or (vii) takes any corporate or partnership action
in connection with any of the foregoing, then Landlord may give
Tenant a notice of termination of this Lease, in which case this
Lease shall terminate as of the date specified in such notice of
termination, whether or not the term has commenced, with the
same effect as if that day were the expiration date of the term.
If a petition shall be filled or a proceeding or bankruptcy case
commenced against Tenant or the Guarantor or any of their
affiliates in any court, pursuant to any bankruptcy or
insolvency or for arrangement or reorganization or for the
appointment of a receiver or trustee of all or a portion of
Tenant's or guarantor's or their respective affiliate's
property, and the same is not discharged within ninety (90)
days, or if Tenant or any of their respective affiliates shall
voluntarily file any such petition or make an assignment for the
benefit of creditors or petition for or enter into an
arrangement, this Lease shall, effective the date of filing,
automatically and as a matter of law, be deemed to have been
cancelled, terminated and expired with the same effect as if
that date were the expiration date of the term.
B. LEASE TERMINATION: From and after the date of a termination as
described above, neither Tenant nor anyone claiming through or
under Tenant by virtue of any statute or of an order of any
court shall be entitled to acquire or remain in possession of
the Demised Premises, and Landlord shall have no further
liability hereunder to Tenant, and any such person or entity, if
in possession, shall forthwith quit and surrender the Demised
Premises. If this Lease shall be so cancelled or terminated,
Landlord, in addition to the other rights and remedies of
Landlord by virtue of any other provisions herein or elsewhere
in this Lease contained or by virtue of any statute, law or rule
of law, may retain
20
as liquidated damages any rent, security deposit or monies
received by Landlord from Tenant or others in behalf of Tenant.
In the event of the termination of this Lease as described
above, Landlord shall be entitled to recover from Tenant an
amount equal to the maximum allowed by any statute, law or rule
of law in effect at the time when, and governing the proceeding
which, such damages are to be proved.
C. LEASE ASSUMPTION: If pursuant to the insolvency laws (i.e., the
United States Bankruptcy Code, 11 U.S.C. Section 101 et seq.,
and any federal, state, foreign or other laws of like impact),
Tenant or a trustee of Tenant is permitted to, and elects to,
assume or assume and assign this Lease:
1. Tenant or the trustee shall as a condition to such assumption
or assumption and assignment either cure all defaults under
this Lease, or provide Landlord Adequate Assurance
(hereinafter defined) that: (a) Tenant or the trustee shall
cure all monetary defaults under this Lease within ten (10)
days after the date of any such assumption; and (b) Tenant or
the trustee shall cure all non-monetary defaults under this
Lease within thirty (30) days after the date of any such
assumption.
2. Tenant or the trustee shall as a condition to such assumption
or assumption and assignment either compensate, or provide
Adequate Assurance to landlord that within ten (10) days from
the date of any such assumption Tenant or the trustee shall
compensate Landlord for any pecuniary loss incurred by
Landlord arising from any default under this Lease,
including, but not limited to, Landlord's attorneys' fees and
disbursements and any late charge applicable under this
Lease, as recited in Landlord's written statement of
pecuniary loss sent to Tenant or the trustee.
3. In the case of an assumption, Tenant or the trustee shall as
a condition to such assumption provide Landlord with Adequate
Assurance of the future performance of the obligations of
Tenant under this Lease, including, without limitation,
Adequate Assurance of Tenant's or the trustee's ability to
pay Rent.
4. In the case of an assumption and assignment, such assignee
shall as a condition to such assignment provide Landlord with
Adequate Assurance of the future performance of the
obligations of Tenant under this Lease, including, without
limitation, Adequate Assurance of such assignee's ability to
pay Rent.
5. In the case of an assumption and assignment, any and all
monies or other consideration payable or otherwise to be
delivered in connection with such assignment shall be paid or
delivered to Landlord (or shall be held in trust for the
benefit of Landlord and be promptly paid or delivered to
Landlord), shall be and remain the exclusive property of
Landlord and shall not constitute property of Tenant or of
the estate of Tenant within the meaning of the United States
Bankruptcy Code, 11 U.S.C. Section 101 et seq. (as the same
may be amended, the "Bankruptcy Code").
6. In the case of an assumption, Tenant or the trustee, and in
the case of an assumption and assignment, such assignee,
shall be deemed without further act or deed to have assumed
all of the obligations arising under
21
this Lease on and after the date of such assumption or
assumption and assignment. Tenant and any such trustee or
assignee shall upon demand execute and deliver to Landlord an
instrument confirming such assumption.
7. The assumption of this Lease by Tenant or the trustee and the
assumption and subsequent assignment of this Lease to the
assignee is subject to all the provisions of this Lease, and
Tenant, trustee or assignee will not breach any provision
contained in this Lease or any other lease, mortgage,
financing agreement, master agreement or other agreement
relating to the Building.
8. Notwithstanding anything in the Lease to the contrary, all
amounts payable by Tenant to or on behalf of Landlord under
this Lease, whether or not expressly denominated as Rent or
other charges due hereunder shall constitute rent for the
purpose of Section 502(b)(6) of the Bankruptcy Code and for
the purpose of any similar section of any other present or
future Insolvency Laws.
14. COMMON AREAS:
A. CONTROL OF COMMON AREAS: All parking areas, driveways, entrances
and exits thereto, sidewalks, ramps, landscaped areas, exterior
stairways, and all other Common Areas and facilities provided by
Landlord for the common use of tenants of the Building and their
agents, employees and customers, shall at all times be subject
to the exclusive control and management of Landlord. Landlord
shall have the right to operate and maintain the same in such
manner as Landlord, in its sole discretion, shall determine from
time to time, including without limitation the right to employ
all personnel and to make all rules and regulations pertaining
to and necessary for the proper operation and maintenance of
said Common Areas and the Building as a whole. Tenant shall not
use the sidewalks adjacent to the Demised Premises or any area
outside the Demised Premises for business purposes without the
previous written consent of Landlord. Landlord shall have the
exclusive right at any and all times to close any portion of the
Common Areas for the purpose of making repairs, changes or
additions thereto, provided that such changes do not materially
impair Tenant's use of the Premises and are consistent with
common areas in first class office buildings in Raleigh NC, and
may change the size, area or arrangement of the parking areas or
the lighting thereof within or adjacent to the existing areas
and may enter into agreements with adjacent owners for
cross-easements for parking, ingress or egress.
B. PARKING AREA: Tenant shall have the right to park in the
Building parking facilities in common with other tenants in the
Building upon such terms and conditions, including the
imposition of reasonable parking charges, if the same is
established by Landlord at any time during the term of this
Lease. Tenant agrees not to overburden the parking facilities
and agrees to cooperate with Landlord and other tenants in use
of the parking facilities. Landlord reserves the right in its
absolute discretion to determine whether the parking facilities
are being overburdened and to allocate and assign parking spaces
among Tenant and other tenants, and to reconfigure the parking
area and modify the existing ingress to and egress from the
parking area as Landlord shall deem appropriate. Landlord
further shall have the right from time to time to grant tenants,
including Tenant, exclusive rights to certain parking spaces at
the parking facilities at the Building. Landlord will provide
that it will always
22
maintain parking ratios as required by the zoning code, but in
no event less than four parking spaces per 1,000 useable square
feet of the Building. If Landlord offers reserved parking to any
other tenants in the Building, of less than 50,000 rsf, then
Landlord shall provide Tenant with not more than five (5)
designated parking spaces.
C. LOADING: Tenant agrees that all loading and unloading of
equipment, furniture, and goods shall be made at such places as
are designated by Landlord.
15. EMINENT DOMAIN:
A. FULL TAKING: If all of the Demised Premises shall be acquired
under threat of condemnation or condemned by eminent domain for
any public or quasi-public use or purpose, then and in that
event the term of this Lease shall cease and terminate from the
date of title vesting in such proceeding and Tenant shall have
no claim against Landlord for the value of any unexpired term of
this Lease.
B. PARTIAL TAKING: If any part of the Demised Premises (or so much
of the Building as to make continued operation of the Building
impractical in the reasonable business judgment of Landlord)
shall be acquired under threat of condemnation or condemned by
eminent domain for any public or quasi-public use or purpose
then Landlord may (i) elect to restore the Demised Premises to a
condition comparable to its condition at the time of such
condemnation less the portion taken in such condemnation
provided Tenant's use of the property is not materially
impaired, and this Lease shall thereafter continue in full force
and effect with a proportionate adjustment to the minimum rent
for the portion of the Demised Premises lost by such taking or
condemnation; or (ii) elect to cancel this Lease by written
notice of cancellation given to Tenant within one hundred twenty
(120) days after the date of such taking and thereupon this
Lease shall cease and terminate as of the date set forth in said
notice and Tenant shall immediate vacate and surrender the
Demised Premises to Landlord. The term "condemnation" as used
herein shall include any voluntary conveyance in lieu thereof.
If Tenant's space is materially impaired for more than one
hundred twenty (120) days, Tenant may terminate the Lease and
receive a rent abatement from the date of the condemnation
action.
C. AWARD: In the event the Demised Premises shall be acquired under
threat of condemnation or condemned by eminent domain for any
public or quasi-public use or purpose as hereinbefore provided,
either whole or partial, Tenant shall not be entitled to any
part of the award as damages or otherwise for such condemnation
and Landlord shall receive the full amount of such xxxx, Tenant
hereby expressly waiving any right or claim to any part thereof;
except that Tenant shall be entitled to receive and retain any
amounts which may be specifically awarded to it in such
condemnation proceedings because of the taking of its trade
fixtures. It is understood that in the event of the termination
of this Lease as aforesaid, neither Landlord nor Tenant shall
have any claim against the other for the value of any unexpired
term of this Lease and Tenant shall have no right or claim to
any part of the award on account thereof.
16. LANDLORD'S RIGHT OF ENTRY: Except in the case of emergencies,
Landlord reserves the right at all reasonable times and with
reasonable notice to Tenant during the term of this Lease for
Landlord or Landlord's agents to enter the Demised Premises for the
purpose of inspecting and examining the same, and to show the same
23
to prospective purchasers or tenants, and to make such repairs,
alterations, improvements or additions as Landlord may deem
necessary or desirable. During the ninety (90) days prior to the
expiration of the term of this Lease or any renewal term, Landlord
may exhibit the Demised Premises to prospective tenants and place
upon the Demised Premises the usual notices advertising the Demised
Premises for lease, which notices Tenant shall permit to remain
thereon without molestation. If Tenant shall not be personally
present to open and permit an entry into said Demised Premises, at
any time, when for any reason an entry therein shall be necessary
or permissible, Landlord or Landlord's agents, connected with
Building maintenance, may enter the same by a master key, or may
forcibly enter the same, without rendering Landlord or such agents
liable therefore, and without in any manner affecting the
obligations and covenants of this Lease. Nothing herein contained,
however, shall be deemed or construed to impose upon Landlord any
obligation, responsibility or liability whatsoever for the care,
maintenance or repair of the Demised Premises or any part thereof,
except as otherwise herein specifically provided.
17. QUIET ENJOYMENT: Landlord agrees that, if the Rent is being paid in
the manner and at the time prescribed and the covenants and
obligations of Tenant are being all and singular kept, fulfilled
and performed, Tenant shall lawfully and peaceably have, hold,
possess, use and occupy and enjoy the Demised Premises so long as
this Lease remains in force, without hindrance, disturbance or
molestation from Landlord, subject to the specific provisions of
this Lease.
18. WAIVER: No failure to exercise, nor any delay in exercising any
right, power or remedy hereunder by Landlord shall operate as a
waiver thereof, nor shall any single or partial exercise by
Landlord of any such right, power or remedy preclude any other or
further exercise thereof or the exercise of any other right. Waiver
by Landlord of any default, breach or failure of Tenant under this
Lease shall not be construed as a waiver of any subsequent or
different default, breach or failure. In case of a breach by Tenant
of any of the covenants or undertakings of Tenant, Landlord
nevertheless may accept from Tenant any payment or payments
hereunder without in any way waiving Landlord's rights with respect
thereto as herein provided or any rights or remedies available at
law or in equity by reason of any other breach or lapse which was
in existence at the time such payment or payments were accepted by
Landlord.
19. ACCORD AND SATISFACTION: No payment by Tenant or receipt by
Landlord of a lesser amount than the Rent herein stipulated shall
be deemed to be other than on account of the earliest stipulated
Rent, nor shall any endorsement or statement on any check or any
letter accompanying any check or payment as Rent be deemed an
accord and satisfaction, and Landlord may accept such check or
payment without prejudice to Landlord's right to recover the
balance of such rent or pursue any other remedy in this Lease
provided.
20. SUBORDINATION: Tenant accepts this Lease subject and subordinate to
any mortgage or deed of trust presently existing or hereafter
arising on the Demised Premises or upon the Building, and to any
renewals, refinancing, extensions and replacements thereof.
Landlord and Tenant agree that this Lease shall be subordinate to
any future mortgage or deed of trust; provided that Tenant receives
an executed Non-Disturbance Agreement from such lender which sets
forth that Tenant's possession of the Demised Premises shall not be
disturbed so long as Tenant is not in default hereunder, and that
if any purchaser by a foreclosure sale or by deed in lieu of
foreclosure becomes the owner of the Demised Premises or the
Building, Tenant will attorn to and recognize such entity as
Landlord hereunder. In confirmation of this subordination, Tenant
shall execute and promptly deliver any certificate that lessor or
any mortgagee may reasonably require. Tenant agrees to give any
mortgagee and/or
24
trust deed holder, by certified mail, a copy of any notice of
default served upon the Landlord, provided that prior to such
notice Tenant has been notified in writing (by way of notice of
assignment of rents and leases or otherwise) of the address of such
mortgagee and/or trust deed holder. Tenant further agrees that if
Landlord shall have failed to cure any default hereunder within the
time provided for in this Lease, then the mortgagee and/or trust
deed holder shall have an additional thirty (30) days within which
to cure such default, or if such default cannot be cured within
that time, then such additional time as may be necessary if within
such thirty (30) day period, any mortgagee and/or trust deed holder
has commenced and is diligently pursuing the remedies necessary to
cure such default (including but not limited to commencement of
foreclosure proceedings if necessary to effectuate such cure).
21. ESTOPPEL LETTER:
Either party (Answering Party) shall from time to time, with ten
(10) business days after receiving a written request by the other
party (Asking Party), execute and deliver to the Asking Party a
written statement. This written statement, which may be relied upon
by the Asking Party and any third party with whom the Asking Party
is dealing shall certify:
(i) the accuracy of the Lease document;
(ii) the Beginning and Ending Dates of the Lease;
(iii) That the Lease is unmodified and in full effect or in full
effect as modified, stating the date and nature of the
modification;
(iv) whether to the Answering Party's knowledge the Asking Party is
in default or whether the Answering Party has any claims or demands
against the Asking Party and, if so, specifying the Default claim,
or demand; and
(v) to other correct and reasonably ascertainable facts that are
covered by the Lease terms.
22. NOTICES: All notices by either party to the other shall be made by
either (i) hand delivery; or (ii) depositing such notice with a
nationally known overnight courier service; or (iii) depositing
such notice in the certified mail of the United States of America.
Such notice shall be deemed to have been served on the date of hand
delivery or of such depositing in the Certified Mail or overnight
courier, as applicable. The refusal by either party to accept
delivery shall not negate its effectiveness. All notices shall be
delivered to the addresses specified in Section 1. Either party may
change its address from time to time, and shall give the other
party notice of such new address.
23. REAL ESTATE COMMISSIONS: Landlord and Tenant each represent that
they have dealt with no broker other than Xxxxxxx Xxxxx Xxxxx
Xxxxxxx and CORPORATE REALTY ADVISORS in connection with the
negotiation, execution and delivery of this Lease. Landlord agrees
to pay the commission due said brokers pursuant to a separate
agreement. This provision shall not be construed to create any
third party rights hereunder in favor of said brokers. If any
person or entity other than Xxxxxxx Xxxxx Xxxxx Xxxxxxx and
CORPORATE REALTY ADVISORS shall assert a claim to a finder's fee,
broker's commission or other compensation on account of the alleged
employment as finder or broker for Tenant or performance of
services as a finder or broker for Tenant in connection with this
transaction, Tenant agrees to indemnify and hold Landlord harmless
from and against any and all claims and all costs, expenses and
liabilities
25
incurred in connection therewith, including but not limited to
reasonable attorney's fees and court costs, by any other such
broker, agent or other person claiming a commission or other form
of compensation by virtue of having dealt with Tenant with regard
to this Lease.
24. HOLDING OVER: Should Tenant remain in possession of the Demised
Premises after the expiration or sooner termination of the term of
this Lease (or any renewal term hereof) without the consent of
Landlord, Landlord may, at its option, serve written notice upon
Tenant that such holding over constitutes any one of the following:
(i) a renewal of this Lease for one year; or (ii) a tenancy from
month-to-month terminable in accordance with applicable law; or
(iii) a tenancy at sufferance terminable in accordance with
applicable law. Any such period described in (i), (ii) or (iii)
shall be subject to all of the terms, covenants and conditions of
this Lease, except that Tenant shall pay Rent at 150% the rate of
Rent hereinbefore provided to be paid during the last month of the
lease term. If no notice is served, then a tenancy at sufferance
shall be deemed to be created. Tenant shall be liable to Landlord
for all damages suffered by Landlord resulting from retention of
possession by Tenant, including the loss of any proposed subsequent
Tenant for all or any portion of the Demised Premises.
25. RELATIONSHIP BETWEEN THE PARTIES: The sole relationship between
Landlord and Tenant is that of landlord and tenant. It is
understood that Landlord shall not be deemed to be a partner or
joint venturer with Tenant in the conduct of Tenant's business.
26. PARTIAL INVALIDITY: If any term or condition of this Lease or the
application thereof to any person or event shall to any extent be
invalid and unenforceable, the remainder of this Lease in the
application of such term, covenant or condition to persons or
events other than those to which it is held invalid or
unenforceable shall not be affected and each term, covenant and
condition of this Lease shall be valid and be enforced to the
fullest extent permitted by law.
27. SUCCESSORS: The provisions, covenants and conditions of this Lease
shall bind and inure to the benefit of the legal representatives,
and assigns of each of the parties, except that no assignment or
subletting by Tenant without the written consent of Landlord shall
vest any right in the assignee or sublessee of Tenant.
28. TRANSFER OF LANDLORD INTEREST: In the event of any sale or exchange
of the Building and the Demised Premises by Landlord, Landlord
shall be and is hereby entirely freed and relieved of all liability
under any and all of its covenants and obligations contained in or
derived from this Lease arising out of any act, occurrence or
omission relating to the Demised Premises or this Lease occurring
after the consummation of such sale, exchange or assignment.
29. LANDLORD'S LIABILITY: Anything contained in this Lease to the
contrary notwithstanding, Tenant agrees that Tenant shall look
solely to the estate and property of Landlord in the Demised
Premises for the collection of any judgment (or other judicial
process) requiring the payment of money by Landlord to Tenant in
the event of any default or breach by Landlord with respect to any
of the terms and provisions of this Lease to be observed and/or
performed by Landlord, subject, however, to the prior rights of any
holder of any mortgage covering the Building, and no other assets
of Landlord shall be subject to levy, execution or other judicial
process for the satisfaction of Tenant's claims.
26
30. HAZARDOUS MATERIALS: Tenant shall not use, store, manufacture,
dispose of or discharge any pollutants, contaminants, or harmful or
hazardous substances from or on the Demised Premises or otherwise
occupy or permit the Demised Premises to be occupied or used in a
manner which (i) violates any law, regulation, rule or other
governmental requirement, (ii) impairs the health, safety or
condition of any person or property or (iii) adversely affects the
use, enjoyment or value of the Demised Premises or the surrounding
property. Tenant shall promptly notify Landlord of the breach, or
the potential or threatened breach, of any of the provisions of
this paragraph. Landlord shall have the right of access to the
Demised Premises to inspect, test and, in Landlord's sole
discretion, remedy any potential environmental problem. Tenant
shall indemnify and hold Landlord, Landlord's Lender and their
respective officers, shareholders, partners, employees, and agents,
harmless from any loss, claim, liability or expense (including,
without limitation, attorneys' fees, court costs, consultant fees,
expert fees, penalties, fines, removal, clean-up, transportation,
disposal, restoration expenses, diminution in value of the Demised
Premises, damages for the loss or restriction on use of rentable or
usable space or of any amenity of the Demised Premises, damages
arising from any adverse impact on marketing of space) arising in
connection with Tenant's failure to comply with the provisions of
this paragraph. A breach of the provisions of this paragraph shall
be a material default enabling Landlord to exercise any of the
remedies set forth in this Lease or otherwise provided by law.
Tenant's obligation hereunder shall survive the expiration or
sooner termination of this Lease.
31. REIMBURSEMENT OF FEES AND COSTS: In the event that any action or
proceeding is brought to enforce any term, covenant or condition of
this Lease on the part of Landlord or Tenant, the prevailing party
shall be entitled to reasonable attorney's fees from the losing
party.
32. FORCE MAJEURE: If either party shall be prevented or delayed from
punctually performing any obligation or satisfying any condition
under this Lease by any strike, lockout, labor dispute, inability
to obtain labor materials or reasonable substitutes therefor, acts
of God, unusual governmental restriction, regulation or control,
enemy or hostile government action, civil commotion, insurrection,
sabotage, fire or other casualty, or any other condition beyond the
reasonable control of such party or caused by the other party, then
the time to perform such obligation or to satisfy such condition
shall be extended on a day-by-day basis for the period of delay
caused by such event; provided, however, that the foregoing shall
not apply to the obligations of Tenant or Landlord pursuant to this
Lease to pay Rent or any other sums payable hereunder. In order for
the foregoing to be effective, the party claiming the benefit of
this paragraph shall give notice to the other party in writing
within ten (10) days of the incident specified and the
particularity of the nature thereof, the reason therefore, the date
and time incurred and the reasonable length the incident will delay
the fulfillment of obligations contained herein. Failure to give
such notice within the specified time shall render such delay
invalid in extending the time for performing the obligations
hereunder.
33. ENTIRE AGREEMENT; NO ORAL MODIFICATIONS: This Lease constitutes the
sole and only agreement of the parties hereto and supersedes any
prior understandings or written or oral agreements between the
parties respecting the transaction and cannot be changed except by
written agreement.
34. CONFIDENTIALITY: In order to induce Landlord to enter into this
Lease on the terms and conditions embodied in this Lease, Tenant
agrees to keep strictly confidential the terms and conditions and
rental set forth in this Lease and to cause all persons working for
Tenant to do likewise. Tenant agrees that said rental and other
27
terms and conditions of this Lease will be disclosed only to
lawyers and accountants working for Tenant who have a need to know
and on tax returns filed with required governmental authorities;
otherwise no disclosure whatsoever of said rental, and Lease terms
and conditions will be made by Tenant.
35. REVIEW OF DOCUMENTS: The parties hereto represent that they have
read and understand the terms of this Lease, and that they have
sought legal counsel to the extent deemed necessary in order to
protect their respective interests. Neither party shall be deemed
to be the author of this Lease. This Lease was mutually prepared by
both parties and shall not be more strongly construed against
either party hereto.
36. RULES: Tenant agrees to abide by the rules and regulations attached
hereto and incorporated herein as EXHIBIT C. Provided that all
these rules and regulations apply to all tenants of the Building.
Landlord may modify the rules and regulations at any time and from
time to time, and Tenant agrees to abide by any such modifications.
37. SIGNS: Tenant shall not erect, install or maintain any sign,
advertising or display matter on any exterior door, wall or window
of the Demised Premises or on any other part of the Demised
Premises which is visible to public view outside the Demised
Premises without the prior written approval of Landlord. LANDLORD
WILL PROVIDE TENANT WITH BUILDING STANDARD IDENTIFICATION ON THE
LOBBY DIRECTORY AND AT THE SUITE ENTRANCE TO THE DEMISED PREMISES
AT NO COST TO THE TENANT. TENANT SHALL HAVE THE RIGHT TO USE ITS
STANDARD LOGO AND GRAPHICS AT THE MONUMENT SIGN TO BE LOCATED AT
THE ENTRANCE OF THE BUILDING TO THE SAME EXTENT AS ANY OTHER TENANT
AS WELL AS ON THE BUILDING DIRECTORY AND ENTRANCE TO THE SUITE
SUBJECT TO LANDLORD'S REASONABLE APPROVAL, WHICH SHALL NOT BE
UNREASONABLE WITHHELD.
38. RIGHT TO PERFORM: If Tenant shall fail to pay any sum other than
Rent, or shall fail to perform any other act on its part to be
performed hereunder, and such failure shall continue for ten (10)
days following notice from Landlord, then Landlord may (but shall
not be obligated to and without waiving or releasing Tenant from
its obligations) perform on behalf of Tenant. All sums paid by
Landlord and all penalties, interest and costs in connection
therewith, shall be due and payable by Tenant on the next day after
such payment by Landlord, together with interest thereon at the
Default Rate of interest from such date to the date of payment.
39. EFFECTIVE: This Lease is not effective until duly signed by both
Landlord and Tenant.
40. SECURITY: Landlord shall be under no affirmative obligations with
respect to security at and for the Building, however, Tenant agrees
to the exercise by Landlord and its agents and employees, within
their sole discretion, of such security measures as Landlord deems
necessary.
41. FINANCIAL STATEMENTS: Tenant shall provide its annual report within
sixty (60) days after publication to Landlord. Failure to provide
this annual report shall not constitute an event of default by the
Tenant.
42. COMPLIANCE WITH LAWS:
A. Landlord's Compliance. Landlord warrants, that on the
Commencement Date, the Premises will comply with all applicable
laws, ordinances, rules, and regulations of governmental
authorities (Applicable Laws). During the Term, Landlord shall
comply with all Applicable Laws regarding the Demised Premises
and Building except to the extent Tenant must comply under
paragraph B below.
28
B. Tenant's Compliance. Tenant shall comply with all Applicable
Laws: (i) regarding the physical condition of the Demised
Premises but only to the extent the Applicable Laws pertain to
the particular manner in which Tenant uses the Demised Premises;
or (ii) that do not relate to the physical condition of the
Demised Premises but relate to the lawful use of the Demised
Premises and with which only the occupant can comply, such as
laws governing maximum occupancy, workplace smoking, and illegal
business operations, such as gambling.
43. LEASE RIDERS: The following riders to this lease, if any, are
attached hereto and incorporated herein by this reference (if none,
so state):
Lease Rider No. 1: Right of First Offer
Lease Rider No. 2: Intentionally Deleted
Lease Rider No. 3: Pre-Move In Expansion Offer
Lease Rider No. 4: Renewal Options
Lease Rider No. 5: Termination Option
THE REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK.
29
IN WITNESS WHEREOF, the undersigned have entered into this Lease the
day and year first above written.
LANDLORD:
XXXXXXX LLC,
a North Carolina Limited Liability company
BY: _____________________________________
PRINTED NAME: _____________________________________
TITLE: _____________________________________
ATTEST:
------------------------------
__________ Secretary
[AFFIX CORPORATE SEAL]
TENANT:
TANGRAM ENTERPRISE SOLUTIONS, INC.,
a (SEAL)
BY: ________________________________ (SEAL)
PRINTED NAME: _____________________________________
TITLE: _____________________________________
[if Tenant is a corporation]:
ATTEST:
------------------------------
__________ Secretary
[AFFIX CORPORATE SEAL]
30
LEASE RIDER NO. 1
RIGHT OF FIRST OFFER
IF TENANT DOES NOT EXERCISE ITS PRE-MOVE IN EXPANSION OPTION, Landlord
hereby grants to Tenant the Right of First Offer to lease the office premises
located on the second floor of the building (the "Expansion Premises"). If the
Expansion Premises become available for lease, and if Tenant is not then in any
form of default, Landlord shall give Tenant notice of Landlord's intent to lease
the Expansion Premises to a specifically identified third party and Tenant shall
have five (5) business days after receipt of such notice within which to give
Landlord written notice of whether or not Tenant desires to exercise its Rights
of First Offer to lease said space contemplated by the identified thirty party,
under the terms and conditions under which the third party would lease the
Expansion Premises. The failure of Tenant to so notify Landlord within such time
period shall be deemed to be a rejection by Tenant of its right to lease the
Expansion Premises. If Tenant exercises its right to lease such Expansion
Premises as herein provided, Landlord and Tenant shall enter into a supplemental
lease agreement relative to such Expansion Premises, on the same economic terms
offered to the third party. IF TENANT EXERCISES ITS RIGHTS OF FIRST OFFER AND
THERE IS A MINIMUM OF FORTY-TWO (42) MONTHS REMAINING ON THE TERM OF THE LEASE,
THE RENTAL RATE FOR THE EXPANSION PREMISES SHALL BE THE THEN CURRENT RENTAL RATE
PER RENTAL SQUARE FOOT BEING PAID WITHIN THE ORIGINAL LEASE, INCLUDING ANNUAL
INCREASES AND EXCLUDING ANY RENT ABATEMENT. FURTHER, IN THE EVENT TENANT
EXERCISES ITS RIGHTS OF FIRST OFFER, TENANT SHALL BE ENTITLED TO A RETROFIT
ALLOWANCE FOR THE EXPANSION PREMISES EQUAL TO TWENTY-FIVE CENTS ($.25) PER
USABLE SQUARE FOOT CONTAINED IN THE EXPANSION PREMISES TIMES THE NUMBER OF
MONTHS THEN REMAINING OF THE LEASE TERM (INCLUDING ANY EXTENSION THEN IN
EFFECT). HOWEVER, SUCH RETROFIT ALLOWANCE SHALL NOT EXCEED $15 PER USABLE SQUARE
FOOT.
31
LEASE RIDER NO. 2
THIS PAGE IS INTENTIONALLY DELETED
32
LEASE RIDER NO. 3
PRE-MOVE IN EXPANSION OPTION
Landlord agrees to hold one-half (1/2) of the second floor of the west
wing off the market until February 1, 1997. In order to exercise this Expansion
Option, Tenant must give notice to Landlord of its intent to exercise this
Option prior to February 1, 1997. IF WRITTEN NOTICE IS NOT RECEIVED, THIS OPTION
SHALL EXPIRE AND BECOME NULL AND VOID. Such space shall be leased at the same
rental rate and terms of this Lease, EXCLUDING FREE RENT AND including Tenant
improvement build-out as described herein for the third floor space in a
turn-key condition using building standard materials.
33
LEASE RIDER NO. 4
RENEWAL OPTIONS
Tenant shall have the right to extend the term of the Lease for two (2)
additional periods of five (5) years, commencing on the expiration of the
immediately preceding term of this Lease. Such renewal option shall be deemed
effectively exercised only if Tenant has given Landlord written notice thereof
at least one hundred twenty (120) days prior to the expiration of the original
term, and only if Tenant is not in default as determined under Section 12 at the
time of such exercise and at the time of the commencement of the renewal term.
All terms and provisions of this Lease shall be applicable during such renewal
term except that the renewal rental rate shall be at the then prevailing market
rental rate. For purposes of this Lease, the then prevailing market rental rate
shall mean the annual amount per rentable square foot that willing, comparable,
non-equity, non-renewal, non-expansion new tenant would pay, and a willing,
comparable Landlord of a similar property would accept, in an arm's length
transaction, as of the commencement of the renewal term, taking into account the
annual rental rates per rentable square foot, the standard of measurement by
which the rentable square footage is measured, the type of escalation clause,
the extent of Tenant's liability under the lease, abatement provisions
reflecting free rent and/or no rent during the period of construction or
subsequent to the commencement date as to the space in question, brokerage
commissions, if any, which would be payable by Landlord in similar transactions,
leasehold improvements which would be payable by Landlord in similar
transactions, length of the lease term, and the size and location of the
premises being leased, it being the intent that Tenant will obtain the same rent
and other economic benefits that Landlord would otherwise give in comparable
transactions and Landlord will make and receive the same economic payments and
concessions that Landlord would otherwise make and receive in comparable
transactions.
For the first thirty (30) days following Landlord's receipt of Tenant's
notice of exercise of such option to renew, Landlord and Tenant shall have the
opportunity and option to mutually agree on the fair market rental for the
Demised Premises. If Landlord and Tenant are unable to agree upon such fair
market rental within the time period set forth above, then each party shall
appoint an appraiser within ten (10) days after the lapse of such thirty (30)
day time period and notify the other party of such appointment by identifying
the appraiser. Each party hereto agrees to select as it respective appraiser a
licensed real estate broker, who is an individual having at least five (5) years
experienced with respect to office property ownership, management and marketing
in the Cary-Raleigh, North Carolina area, which person should not be regularly
employed or have been retained during the last two (2) years as a consultant by
the party selecting such person. Neither party may consult directly or
indirectly with any appraiser regarding the fair market rental prior to the
appointment or after appointment, outside the presence of the other party. Not
later than ten (10) days after both appraisers are appointed, each party shall
separately, but simultaneously, submit in a sealed envelope to each appraiser
their separate suggested fair market rental and shall provide a copy of such
submission to the other party. The two selected appraisers, after reviewing such
submissions, shall each independently determine the fair market rental for the
Demised Premises and shall determine whether the Landlord's or the Tenant's
estimate of fair market rental is closer to the actual market rental for the
Demised Premises. If both appraisers agree that one of the said declared
estimates is the actual fair market rental for the Demised Premises, they shall
declare that estimate to be the fair market rental for the Demised Premises, and
their decision shall be final and binding upon the parties. If the two selected
appraisers are unable to agree upon the fair market rental within thirty (30)
days after receipt of Landlord's and Tenant's submitted estimates, then the
appraisers shall inform the parties and the appraisers shall select a third
appraiser, not less than ten (10) days after the expiration of the thirty (30)
day period. If no appraiser is selected within such ten (10) day period, either
party may immediately petition a court of competent jurisdiction to appoint such
third appraiser. The third appraiser shall have the same qualifications set
forth above and the restrictions set forth above shall likewise apply. The third
appraiser shall independently determine the fair market
34
rental of the Demised Premises. The ultimate fair market rental of the Demised
Premises shall be the arithmetic average of the two closest fair market rental
values, determined by two of the three appraisers, but in no event in excess of
the bounds established by Landlord's or Tenant's estimates furnished as set
forth above. The fair market rental established under this paragraph shall be
conclusive, unappealable and binding upon the parties hereto. Each party shall
be responsible for the costs, charges and/or fees of its appraiser, and the
parties shall equally in the costs, charges and/or fees of the third appraiser.
35
LEASE RIDER NO. 5
TERMINATION OPTION
Landlord hereby grants to Tenant a one time right to terminate the
Lease pertaining to the square footage of space in the Demised Premises which is
occupied by that portion of Tenant's business dealing with AM:PM Software (the
"AM:PM Suite") at the end of the sixtieth (60th) month of the initial lease term
by providing Landlord one hundred eighty (180) days prior written notice. After
the effective date of such notice, Tenant shall have no further responsibilities
with respect to the AM:PM Suite.
36
EXHIBIT A
LEGAL DESCRIPTION
All of Xxxx X0x-0, X0x-0, and a portion of C6b-4 (consisting of
approximately 17.509 acres), as shown on survey of Xxxxxxx X. Xxxxx and
Associates, P.A., entitled "Regency park Site C6," recorded in Wake County
Register of Deeds, Book of Maps 1985, Page 1466.
37
EXHIBIT A-1
BUILDING
38
EXHIBIT X-0
XXXXXXXX XXXXX XXXX
00
XXXXXXX X
DESCRIPTION OF LANDLORD'S WORK AND TENANT'S WORK
Attached to and forming a
part of Lease
LANDLORD'S WORK
Landlord will provide the following (all other work not specifically identified
in this Exhibit B or elsewhere in this Lease in individual leases shall be at
Tenant's expense):
1. Landlord agrees to provide Tenant buildout using building standard
finishes based on the enclosed space plan as shown on Exhibit B-1.
LANDLORD SHALL PROVIDE A $5,000 ALLOWANCE TOWARD TENANT'S BUILT-IN
RECEPTION COUNTER.
2. Landlord shall be responsible for constructing the Demised Premises
according to the mutually agreed upon plans and specifications.
Landlord will provide a $14.35 tenant improvement allowance per
rentable square foot on 49,574 rentable square feet. In the event
that such costs exceeds $14.35, Landlord shall pay for such cost
and amortize such costs over seven (7) years at an interest rate of
ten percent (10%) and charge Tenant such amortized amount as part
of the base rent for the Demised Premises.
3. Landlord's upfitting of the Demised Premises shall not exceed the
items listed above and the plans attached as Exhibit B-1 which
include the engineers' drawings to be provided by Landlord in
connection therewith. Landlord is further responsible for providing
the common areas of the Building in compliance with the Americans
with Disabilities Act and all other applicable code, statute,
regulation or applicable law.
4. All architect, engineering and permitting cost to upfit the Demised
Premises.
5. Landlord shall make the following improvements to the base
Building:
Re-stripe the existing parking lot to maximize the number of spaces
available;
Label visitor parking adjacent to the Building entrance; and
Maintain a building perimeter entry control system for a
multi-tenant office building befitting a Class A suburban office
building, however, Landlord does not guaranty the safety or
security at the Demised Premises and Building and Landlord assumes
no liability under this Lease for such safety or security.
Landlord will use its best efforts to provide a cafeteria for the
nonexclusive use of tenants of the Building with such cafeteria
operational by the Term Commencement.
Landlord will use its best efforts to provide a fitness center
available for the nonexclusive use of the tenants of the Building
which will include without limitation locker room, changing rooms
and shower facilities for men and women within one hundred twenty
(120) days after the Term Commencement.
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Landlord to provide 100 KVA to each of the 3rd and 4th floors
mechanical rooms.
Landlord to provide $9,000.00 allowance to move Tenant's media
center.
TENANT'S WORK
Landlord's work is limited to the work hereinabove described and
excludes work described as Tenant's work; all work not classified as Landlord's
work is Tenant's work.
The work to be done by Tenant shall include, but not be limited to, the
purchase and/or installation and/or performance of the following, and all the
following shall be at Tenant's expenses. The plans and specifications, if any
are needed, and the detail and design shall be subject to the written approval
of Landlord or Landlord's architect. All construction to be performed by
Landlord's contractor.
Tenant is responsible for moving Tenant's media center.
ITEMS TO BE DONE
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EXHIBIT B-1
SPACE PLAN
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EXHIBIT C
RULES AND REGULATIONS
Tenant agrees as follows:
1. Tenant shall not display, any signs or banners or promotions without first
obtaining the Landlord's prior written approval. Landlord shall have the
right to remove any signs which are not in conformance with the terms of
Tenant's Lease or the terms of these Rules and Regulations.
2. All loading and unloading of goods shall be done only at such times, in the
areas, and through the entrances, designated for such purposes by Landlord.
3. The delivery or shipping of merchandise, supplies and fixtures to and from
the Demised Premises shall be subject to such rules and regulations as in
the judgment of Landlord are necessary for the proper operation of the
Demised Premises or the Building.
4. Landlord shall have the right to set the operating hours for the Building
and restrict access to the Demised Premises during non-operating hours.
Landlord may establish security controls for the purpose of regulating
access to the Building. Tenant shall have access to the Demised Premises 24
hours a day and seven days a week.
5. No radio, television, cable, ONH receiver or other similar device shall be
installed without first obtaining in each instance Landlord's consent in
writing. No aerial shall be erected on the roof or exterior walls of the
Demised Premises, or on the grounds, without in each instance, the written
consent of Landlord. Any aerial so installed without such written consent
shall be subject to removal without notice at any time. Landlord may install
a master antenna.
6. No loudspeakers, televisions, phonographs, radios or other devices shall be
used in a manner so as to be heard or seen outside of the Demised Premises
without the prior written consent of Landlord.
7. Tenant and Tenant's employees shall park their cars only in those portions
of the parking area designated for that purpose by landlord. Tenant shall
furnish Landlord with state automobile license numbers assigned to Tenant's
car or cars, and cars of Tenant's employees upon request.
8. The plumbing facilities shall not be used for any other purpose than that
for which they are constructed, and no foreign substance of any kind shall
be thrown therein, and the expense of any breakage, stoppage or damage
resulting from a violation of this provision shall be borne by Tenant, who
shall, or whose employees, agents or invitees shall have caused it.
9. Tenant shall not burn any trash or garbage of any kind in or about the
Demised Premises/Building or within one (1) mile of the outside property
lines of the Building.
10. Landlord reserves the right to make such reasonable amendments or additions
to these Rules and Regulations as is deemed necessary to the proper
administration and care of the Building. All amendments or additions to the
Rules and Regulations shall apply to all tenants of the Building.
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11. Before leaving the Demised Premises unattended, Tenant shall close and
securely lock all doors and other means of entry to the Demised Premises.
12. Landlord reserves the right to exclude or expel from the Building any person
who, in the judgment of Landlord, is intoxicated or under the influence of
drugs or alcohol. Tenant shall not serve alcohol in or about the Demised
Premises
13. Tenant shall not install or operate any internal combustion engine, boiler,
machinery, heating, or air conditioning apparatus in or about the Demised
Premises.
14. Tenant shall not solicit or canvass any occupant of the Building.
15. Tenant shall not waste electricity, water, heat or air conditioning and
agrees to cooperate fully with Landlord to assure the most effective
operation of the Demised Premises.
16. Tenant shall be allowed to install and maintain vending machines in the
Demised Premises without Landlord's prior written consent.
17. Tenant shall not introduce lead based paint or asbestos-containing materials
into the Building.
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EXHIBIT D
CONFIRMATION AGREEMENT - 11000 REGENCY
To the Lease dated as of the ____ day of _____________, 1996, made by
and between Xxxxxxx LLC, as the Landlord, and Tangram Enterprise Solutions,
Inc., as the Tenant, for Premises at the 11000 Regency office building in Cary,
North Carolina.
By this Confirmation Agreement dated the ____ day of _______________,
1996, landlord and Tenant agree as follows:
1. The Building Premises improvements required to be constructed and
finished by the Landlord in accordance with the terms of the Lease have
been satisfactorily completed by the Landlord, subject to the
completion of punch list items identified on the attachment hereto.
2. The Premises have been delivered to and accepted by the Tenant.
3. The term Commencement Date of the initial term of the Lease is the
____ day of _______________, 1996 and the Expiration Date is the _____
day of _________________, ______ subject, however, to the terms and
conditions of the Lease.
4. The Building contains a total of 260,690 rentable square feet. The
Premises consist of a total of 260,690 rentable square feet of floor
area as shown on the attached Exhibits A-1 and A-2, which have been
field verified as of the date hereof, comprised of 24,787 rentable
square feet on the third floor.
5. Minimum rent shall be payable in monthly installments as set forth
in Section 1(H).
6. Other than as set forth above, all of the terms and conditions of
the Lease are hereby ratified and confirmed, and shall continue in full
force and effect.
IN WITNESS WHEREOF, this instrument has been duly executed by the
Parties as of the date second written above.
XXXXXXX LLC
By: ____________________________
Title: ___________________________
("Landlord")
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EXHIBIT E
INTENTIONALLY DELETED
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