1
Exhibit 10.41
LEASE
BY AND BETWEEN
TCIT DALLAS INDUSTRIAL, INC., A DELAWARE CORPORATION
AS LANDLORD
AND
INTELECT NETWORK TECHNOLOGIES COMPANY,
A NEVADA CORPORATION
AS TENANT
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MULTI-TENANT INDUSTRIAL GROSS (BY) LEASE
REFERENCE PAGE
BUILDING: 1600 Distribution (0000-0000 Xxxxxxxx Xxxxx)
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LANDLORD: TCIT Dallas Industrial, Inc.. a Delaware Corporation
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LANDLORD'S ADDRESS: 0000 Xxxxxx Xxx, Xxxxx 000, Xxxxxxxxxx. XX 00000
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LEASE REFERENCE DATE: January 31, 1997
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TENANT: Intelect Network Technologies Company, a Nevada Corporation
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TENANTS ADDRESS:
(a) As of beginning of Term: 0000 Xxxxxxxx Xxxxx, Xxxxxxxxxx, XX 00000
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(b) Prior to beginning of Term (if different): 0000 Xxxxxxxxx Xxxxx. Xxxxxxxxxx. XX 00000
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PREMISES IDENTIFICATION: Suite Number 1225
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(for outline of Premises see Exhibit A)
PREMISES RENTABLE AREA: approximately 28.590 sq. ft.
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USE: Light manufacturing and assembly of telecommunications
equipment
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SCHEDULED COMMENCEMENT DATE: April 15, 1997
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TERMINATION DATE: June 30, 2002
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TERM OF LEASE: five (5) years, two (2) months and fifteen (15) days beginning on the
Commencement Date and ending on the Termination Date (unless
sooner terminated pursuant to the Lease)
INITIAL ANNUAL RENT (Article 3): $ See Article 39
INITIAL MONTHLY INSTALLMENT OF $ See Article 39
ANNUAL RENT (Article 3):
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BASE YEAR (DIRECT EXPENSES): 1997
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BASE YEAR (TAXES): 1997
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TENANT'S PROPORTIONATE SHARE: 24.61 %
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SECURITY DEPOSIT: $ 16,081.00
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ASSIGNMENT/SUBLETTING FEE: $ 1,000.00
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REAL ESTATE BROKER DUE COMMISSION: Xxxxx Companies & Xxxx Partners
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The Reference Page information is incorporated into and made a part of the
Lease. In the event of any conflict between any Reference Page information
and the Lease, the Lease shall control. This Lease includes Exhibit A
through C, all of which are made a part of this Lease.
LANDLORD: TENANT:
TCIT Dallas Industrial, Inc., Intelect Network Technologies
a Delaware corporation Company, a Nevada corporation
By: RREEF Management Company,
a California corporation
By: By:
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Xxxxxx X. Xxxx Xxxx Xxxxxx
Title: District Manager Title: President
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Dated: Dated:
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LEASE
By this Lease Landlord leases to Tenant and Tenant leases from
Landlord the Premises in the Building as set forth and described on the
Reference Page. The Reference Page, including all terms defined thereon, is
incorporated as par of this Lease.
1. USE AND RESTRICTIONS ON USE.
1.1 The Premises are to be used solely for the purposes stated on the
Reference Page. Tenant shall not do or permit anything to be done in or
about the Premises which will in any way obstruct or interfere with the
rights of other tenants or occupants of the Building or injure, annoy, or
disturb them or allow the Premises to be used for any improper, immoral,
unlawful, or objectionable purpose. Tenant shall not do, permit or suffer
in, on, or about the Premises the sale of any alcoholic liquor without
the written consent of Landlord first obtained, or the commission of any
waste. Tenant shall comply with all governmental laws, ordinances and
regulations applicable to the use of the Premises and its occupancy and
shall promptly comply with all governmental orders and directions for the
correction, prevention and abatement of any violations in or upon, or in
connection with, the Premises, all at Tenant's sole expense. Tenant shall
not do or permit anything to be done on or about the Premises or bring or
keep anything into the Premises which will in any way increase the rate
of, invalidate or prevent the procuring of any insurance protecting
against loss or damage to the Building or any of its contents by fire or
other casualty or against liability for damage to property or injury to
persons in or about the Building or any part thereof. Landlord shall
maintain the exterior of the Building (but not doorways) in compliance
with the Americans With Disabilities Act of 1990, as amended.
1.2 Tenant shall not and shall not direct, suffer or permit any of its
agents, contractors, employees, licensees or invitees to at any time
handle, use, manufacture, store or dispose of in or about the Premises or
the Building any (collectively "Hazardous Materials") flammables,
explosives, radioactive materials, hazardous wastes or materials, toxic
wastes or materials, or other similar substances, petroleum products or
derivatives or any substance subject to regulation by or under any
federal, state and local laws and ordinances relating to the protection
of the environment or the keeping, use or disposition of environmentally
hazardous materials, substances, or wastes, presently in effect or
hereafter adopted, all amendments to any of them, and all rules and
regulations issued pursuant to any of such laws or ordinances
(collectively "Environmental Laws"), nor shall Tenant suffer or permit
any Hazardous Materials to be used in any manner not fully in compliance
with all Environmental Laws, in the Premises or the Building and
appurtenant land or allow the environment to become contaminated with any
Hazardous Materials. Notwithstanding the foregoing, and subject to
Landlord's prior consent, Tenant may handle, store, use or dispose of
products containing small quantities of Hazardous Materials (such as
aerosol cans containing insecticides, toner for copiers, paints, paint
remover and the like) to the extent customary and necessary for the use
of the Premises for general office purposes; provided that Tenant shall
always handle, store, use, and dispose of any such Hazardous Materials in
a safe and lawful manner and never allow such Hazardous Materials to
contaminate the Premises, Building and appurtenant land or the
environment. Tenant shall protect, defend, indemnify and hold each and
all of the Landlord Entities (as defined in Article 30) harmless from and
against any and all loss, claims, liability or costs (including court
costs and attorney's fees) incurred by reason of any actual or asserted
failure of Tenant to fully comply with all
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applicable Environmental Laws, or the presence, handling, use or
disposition in or from the Premises of any Hazardous Materials (even
though permissible under all applicable Environmental Laws or the
provisions of this Lease), or by reason of any actual or asserted failure
of Tenant to keep, observe, or perform any provision of this Section 1.2.
2. TERM
2.1 The Term of this Lease shall begin on the date ("Commencement Date")
which shall be the Scheduled Commencement l;)ate as shown on the
Reference Page and the date that Landlord shall tender possession of the
Premises to Tenant. Landlord shall tender possession of the Premises with
all the work, if any, to be performed by Landlord pursuant to Exhibit B
to this Lease substantially completed. Tenant shall deliver a punch list
of items not completed within 30 days after Landlord tenders possession
of the Premises and Landlord agrees to proceed with due diligence to
perform its obligations regarding such items. Landlord and Tenant shall
execute a memorandum setting forth the actual Commencement Date and
Termination Date.
2.2 Tenant agrees that in the event of the inability of Landlord to
deliver possession of the Premises on the Scheduled Commencement Date,
Landlord shall not be liable for any damage resulting from such
inability, but Tenant shall not be liable for any rent until the time
when Landlord can, after notice to Tenant, deliver possession of the
Premises to Tenant. No such failure to give possession on the Scheduled
Commencement Date shall affect the other obligations of Tenant under this
Lease, except that if Landlord is unable to deliver possession of the
Premises within one hundred twenty (120) days of the Scheduled
Commencement Date (other than as a result of strikes, shortages of
materials or similar matters beyond the reasonable control of Landlord
and Tenant is notified by Landlord in writing as to such delay), Tenant
shall have the option to terminate ,this Lease unless said delay is as a
result of: (a) Tenant's failure to agree to plans and specifications; (b)
Tenant's request for materials, finishes or installations other than
Landlord's standard except those, if any, that Landlord shall have
expressly agreed to furnish without extension of time agreed by Landlord;
(c) Tenant's change in any plans or specifications; or, (d) performance
or completion by a party employed by Tenant If any delay is the result of
any of the foregoing, the Commencement Date and the payment of rent under
this Lease shall be accelerated by the number of days of such delay.
2.3 In the event Landlord shall permit Tenant to occupy the Premises
prior to the Commencement Date, such occupancy shall be subject to all the
provisions of this Lease Said early possession shall not advance the
Termination Date.
3. RENT.
3.1 Tenant agrees to pay to Landlord the Annual Rent in effect from time
to time by paying the Monthly Installment of Rent then in effect on or
before the first day of each full calendar month during the Term, except
that the first month's rent shall be paid upon the execution of this
Lease. The Monthly Installment of Rent in effect at any time shall be
one-twelfth of the Annual Rent in effect at such time. Rent for any
period during the
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Term which is less than a full month shall be a prorated portion of the
Monthly Installment of Rent based upon a thirty (30) day month. Said rent
shall be paid to Landlord, without deduction or offset and without notice
or demand, at the Landlord's address, as set forth on the Reference Page,
or to such other person or at such other place as Landlord may from time
to time designate in writing
3.2 Tenant recognizes that late payment of any rent or other sum due
under this Lease will result in | administrative expense to Landlord, the
extent of which additional expense is extremely difficult and
economically impractical to ascertain. Tenant therefore agrees that if
rent or any other sum is not paid three (3) days after it becomes due and
payable pursuant to this Lease, a late charge shall be imposed in an
amount equal to the greater of: (a) Fifty Dollars (S50.00), or (b) a sum
equal to five percent (5%) per month of the unpaid rent or other payment.
The amount of the late charge to be paid by Tenant shall be reassessed
and added to Tenant's obligation for each successive monthly period until
paid. The provisions of this Section 3.2 in no way relieve Tenant of the
obligation to pay rent or other payments on or before the date on which
they are due, nor do the terms of this Section 3.2 in any way affect
Landlord's remedies pursuant to Article 19 in the event said rent or
other payment is unpaid after date due.
4. RENT ADJUSTMENTS.
4.1 For the purpose of this Article 4. the following terms are defined
as follows:
4.1.1 Lease Year. Each calendar year falling partly or wholly within
the Term.
4.1.2 Direct Expenses: All direct costs of operation, maintenance,
repair and management of the Building (including the amount of any
credits which Landlord may grant to particular tenants of the
Building in lieu of ; providing any standard services or paying any
standard costs described in this Section 4.1.2 for similar
tenants), as determined in accordance with generally accepted
accounting principles, including the following costs by way of
illustration, but not limitation: water and sewer charges;
insurance charges of or relating to all insurance policies and
endorsements deemed by Landlord to be reasonably necessary or
desirable and relating in any manner to the protection,
preservation, or operation of the Building or any part thereof;
utility costs, including, but not limited to, the cost of heat,
light, power, steam, gas, and waste disposal; the cost of
janitorial services; the cost of security and alarm services
(including any central station signaling system); window cleaning
costs; labor costs; costs and expenses of managing the Building
including management fees; air conditioning maintenance costs;
elevator maintenance fees and supplies; material costs; equipment
costs including the cost of maintenance, repair and service
agreements and rental and leasing costs; purchase costs of
equipment other than capital items; current rental and leasing
costs of items which would be amortizable capital items if
purchased; tool costs; licenses, permits and inspection fees; wages
and salaries; employee benefits and payroll taxes; accounting ant
legal fees; any sales, use or service taxes incurred in connection
therewith. Direct Expenses shall not include depreciation or
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amortization of the Building or equipment in the Building except as
provided herein, loan principal payments, costs of alterations of
tenants' premises, leasing commissions, interest expenses on
long-term borrowings, advertising costs or management salaries for
executive personnel other than personnel located at the Building.
In addition, Landlord shall be entitled to amortize and include as
an additional rental adjustment: (i) an allocable portion of the
cost of capital improvement items which are reasonably calculated
to reduce operating expenses; (ii) fire sprinklers and suppression
systems and other life safety systems; and (iii) other capital
expenses which are required under any govenmental laws, regulations
or ordinances which were not applicable to the Building at the time
it was constructed. All such costs shall be amortized over the
reasonable life of such improvements in accordance with such
reasonable life and amortization schedules as shall be determined
by Landlord in accordance with generally accepted accounting
principles, with interest on the unamortized amount at one percent
(1%) in excess of the prime lending rate announced from time to
time as such by The Northern Trust Company of Chicago, Illinois.
4.1.2a Notwithstanding the foregoing provisions of this Article to
the contrary, Landlord agrees that major repairs or replacements to
the roof of the Building which are capitalized on Landlord's
financial books and records shall not be included within the
definition of Direct Costs.
4.1.3 Taxes: Real estate taxes and any other taxes, charges and
assessments which are levied with respect to the Building or the
land appurtenant to the Building, or with respect to any
improvements, fixtures and equipment or other property of Landlord,
real or personal, located in the Building and used in connection
with the operation of the Building and said land. any payments to
any ground lessor in reimbursement of tax payments made by such
lessor; and all fees, expenses and costs incurred by Landlord in
investigating, protesting, contesting or in any way seeking to
reduce or avoid increase in any assessments, levies or the tax rate
pertaining to any Taxes to be paid by Landlord in any Lease Year.
Taxes shall not include any corporate franchise, or estate,
inheritance or net income tax, or tax imposed upon any transfer by
Landlord of its interest in this Lease or the Building
4.2 If in any Lease Year, (i) Direct Expenses paid or incurred shall
exceed Direct Expenses paid or incurred in the Base Year (Direct Expenses)
and/or (ii) Taxes paid or incurred by Landlord in any Lease Year shall
exceed the amount of such Taxes which became due and payable in the Base
Year (Taxes), Tenant shall pay as additional for such ear Tenant's
Proportionate Share of such excess.
4.3 The annual determination of Direct Expenses shall be made by
Landlord and, if certified by a nationally recognized firm of public
accountants selected by Landlord, shall be binding upon Landlord and
Tenant. Tenant may review the books and records supporting such
determination in the office of Landlord, or Landlord's agent, during
normal business hours, upon giving Landlord five (5) days advance written
notice within sixty (60) days after receipt of such determination, but in
no event more often than once in any one year
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period. In the event that during all or any portion of any Lease
Year, the Building is not fully rented and occupied Landlord may make
any appropriate adjustment in occupancy-related Direct Expenses for
such year for the purpose of avoiding distortion of the amount of
such Direct Expenses to be attributed to Tenant by reason of
variation in total occupancy of the Building, by employing sound
accounting and management principles to determine Direct Expenses
that would have been paid or incurred by Landlord had the Building
been fully rented and occupied, and the amount so determined shall be
deemed to have been Direct Expenses for such Lease Year.
4.4 Prior to the actual determination thereof for a Lease Year, Landlord
may from time to time estimate Tenant's liability for Direct Expenses
and/or Taxes under Section 4.2, Article 6 and Article 29 for the Lease
Year or portion thereof. T Landlord will give Tenant written notification
of the amount of such estimate and Tenant agrees that it will pay, by
increase of its Monthly Installments of Rent due in such Lease Year,
additional rent in the amount of such estimate. Any such increased rate of
Monthly Installments of Rent pursuant to this Section 4.4 shall remain in
effect until further written notification to Tenant pursuant hereto.
4.5 When the above mentioned actual determination of Tenant's liability
for Direct Expenses and/or Taxes is made for any Lease Year and when
Tenant is so notified in writing, then:
4.5.1 If the total additional rent Tenant actually paid pursuant to
Section 4.3 on account of Direct Expenses and/or Taxes for the
Lease Year is less than Tenant's liability for Direct Expenses
and/or Taxes, then Tenant shall pay such deficiency to
Landlord as additional rent in one lump sum within thirty (30)
days of of Landlord's xxxx therefor; and
4.5.2 If the total additional rent Tenant actually paid pursuant to
Section 4.3 on account of Direct Expenses and/or Taxes for the
Lease Year is more than Tenant's liability for Direct Expenses
and/or Taxes, then Landlord shall credit the difference
against the then next due payments to be made by Tenant under
this Article 4. Tenant shall not be entitled to a credit by
reason of actual Direct Expenses and/or Taxes in any Lease
Year being less than Direct Expenses and/or Taxes in the Base
Year (Direct Expenses and/or Taxes).
4.6 If the Commencement Date is other than January 1 or if the
Termination Date is other than December 31, Tenant's liability for Direct
Expenses and Taxes for the Lease Year in which said Date occurs shall be
prorated based upon a three hundred sixty-five (365) day year.
5. SECURlTY DEPOSIT.
Tenant shall deposit the Security Deposit with Landlord upon the execution of
this Lease. Said sum shall be held by Landlord as security for the faithful
performance by Tenant of all the terms,
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covenants and conditions of this Lease to be kept and performed by Tenant and
not as an advance rental deposit or as a measure of Landlord's damage in case of
Tenant's default. If Tenant defaults with respect to any provision of this
Lease, Landlord may use any part of the Security Deposit for the payment of any
rent or any other sum in default, or for the payment of any amount which
Landlord may spend or become obligated to spend by reason of Tenant's default,
or to compensate Landlord for any other loss or damage which Landlord may suffer
by reason of Tenant's default. If any portion is so used, Tenant shall within
five (5) days after written demand therefor, deposit with Landlord an amount
sufficient to restore the Security Deposit to its original amount and Tenant's
failure to do so shall be a material breach of this Lease. Except to such
extent, if any, as shall be required by law, Landlord shall not be required to
keep the Security Deposit separate from its general funds, and Tenant shall not
be entitled to interest on such deposit. The Security Deposit or any balance
thereof shall be returned to Tenant at such time after termination of this Lease
when Landlord shall have determined that all of Tenant's obligations under this
Lease have been fulfilled.
6. ALTERATIONS
6.1 Except for those, if any, specifically provided for in Exhibit B to
this Lease, Tenant shall not make or suffer to be made any alterations,
additions, or improvements, including, but not limited to, the attachment
of any fixtures or equipment in, on, or to the Premises or any part
thereof or the making of any such improvements as required by Article 7,
without the prior written consent of Landlord, which consent shall not be
unreasonably withheld. When applying for such consent, Tenant shall, if
requested by Landlord, furnish complete plans and specifications for such
alterations, additions and improvements.
6.2 In the event Landlord consents to the making of any such alteration,
addition or improvement by Tenant, the same shall be made using Tenant's
contractor, subject to approval by Landlord, at Tenant's sole cost and
expense. If Tenant shall employ any Contractor other than Landlord's
contractor and such other Contractor or any subcontractor of such other
Contractor shall employ any non-union labor or supplier, Tenant shall be
responsible for any and all delays, damages and extra costs suffered by
Landlord as a result of any dispute with any labor unions concerning the
wage, hours, terms or conditions of the employment of any such labor. In
any event Landlord may charge Tenant a reasonable charge to cover its
overhead as it related to such proposed work.
6.3 All alterations, additions or improvements proposed by Tenant shall be
constructed in accordance with all governmental laws, ordinances, rules
and regulations and Tenant shall, prior to construction, provide the
additional insurance required under Article 11 in such case, and also all
such assurances to Landlord, including but not limited to, waivers of
lien, surety company performance bonds and personal guaranties of
individuals of substance as Landlord shall require to assure payment of
the costs thereof and to protect Landlord and the Building and appurtenant
land against any loss from any mechanic's, materialmen's or other liens.
Tenant shall pay in addition to any sums due to pursuant to Article 4, any
increase in real estate taxes attributable to any such alteration,
addition or improvement for so long, during the Term as such increase is
ascertainable; at Landlord's election said sums shall be paid in the same
way as sums due under Article 4.
6.4 All alterations, additions, and improvements in, on, or to the
Premises made or installed by Tenant, including carpeting, shall be and
remain the property of Tenant during the Term but,
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excepting furniture, furnishings, movable partitions of less than full
height from the floor to ceiling and other trade fixtures shall become a
part of the realty and belong to Landlord without compensation to Tenant
upon the expiration or sooner termination of the Term, at which time title
shall pass to Landlord under this Lease as by a xxxx of sale, unless
Landlord elects otherwise. Upon such election by Landlord, Tenant shall
upon demand by Landlord, at Tenant's sole cost and expense, forthwith and
with all due diligence remove any such alterations, additions or
improvements which are designated by Landlord to be removed (other than
demising walls which Tenant will not be required to move), and Tenant
shall forthwith and with all due diligence, as its sole cost and expense,
repair and restore the Premises to their original condition, reasonable
wear and tear and damage by fire or other casualty expected.
7. REPAIR
7.1 Landlord shall have no obligation to alter, remodel, improve, repair,
decorate or paint the Premises, except as specified in Exhibit B if
attached to this Lease and expect that Landlord shall repair and maintain
the structural portions of the roof, walls and foundation of the Building.
By taking possession of the Premises, Tenant accepts them as being in good
order, condition and repair and in the condition in which Landlord is
obligated to deliver them. It is hereby understood and agreed that no
representations respecting the condition of the Premises or the building
have been made by landlord to Tenant, except as specifically set forth in
this Lease. Landlord shall not be liable for any failure to make any
repairs or to perform any maintenance unless such failure shall persist
for an unreasonable time after written notice of the need of such repairs
or maintenance is give to Landlord by Tenant.
7.2 Tenant shall at its own cost and expense keep and maintain all parts
of the Premises and such portion of the Building and improvements as are
within the exclusive control of the Tenant in good condition, promptly
making all necessary repairs and replacements, whether ordinary or
extraordinary, with materials and workmanship of the same character, kind
and quality as the original (including, but not limited to, repair and
replacement of all fixtures installed by Tenant, water heaters serving the
Premises, windows, glass and plate glass, doors, exterior stairs,
skylights, and special office entries, interior walls and finish work,
floors and floor coverings, heating and air conditioning systems serving
the Premises, electrical systems and fixtures, sprinkler systems, dock
boards, truck doors, dock bumpers, plumbing work and fixtures, and
performance of regular removal of trash and debris). Tenant as part of its
obligations hereunder shall keep the Premises in a clean and sanitary
condition. Tenant will, as far as possible keep all such parts of the
Premises from deterioration due to ordinary war and from falling
temporarily out of repair, and upon termination of this Lease in any way
Tenant will yield up the Premises to Landlord in good condition and
repair, loss by fire or other casualty expected (but not excepting any
damage to glass). Tenant shall, at its own cost and expense, repair any
damage to the Premises or the Building resulting from and/or caused in
whole or in part by the negligence or misconduct of Tenant, its agents,
employees, invitees, or any other persons entering upon the Premises as a
result of Tenant's business activities or caused by Tenant's default
hereunder.
7.3 Except as provided in Article 22, there shall be no abatement of rent
and no liability of Landlord by reason of any injury to or interference
with Tenant's business arising from the making of any repairs, alterations
or improvements in or to any portion of the Building or the
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Premises or to fixtures, appurtenances and equipment in the Building.
Except to the extent, if any, prohibited by law, Tenant waives the right
to make repairs at Landlord's expense under any law, statute or ordinance
now or hereafter in effect.
7.4 Tenant shall, at its own cost and expense, enter into a regularly
scheduled preventive maintenance/service contract with a maintenance
contractor approved by Landlord for servicing all heating and air
conditioning systems and equipment serving the Premises (and a copy
thereof shall be furnished to Landlord). The service contract must include
all services suggested by the equipment manufacturer in the
operation/maintenance manual and must become effective within thirty (30)
days of the date Tenant takes possession of the Premises. Landlord may,
upon notice to Tenant, enter into such a maintenance/ service contract on
behalf of Tenant or perform the work and in either case, charge Tenant the
cost thereof along with a reasonable amount for Landlord's overhead.
7.4a Notwithstanding the foregoing provisions of this Article, Tenant may
use its own qualified resources or purchased maintenance services for the
heating and air conditioning systems, provided that such resources or
services are at least equal to those suggested by the equipment
manufacturers. Finally, Landlord agrees that the heating and air
conditioning system to be provided pursuant to Article 40 below
will exclusively service the Premises.
8. LIENS.
Tenant shall keep the Premises, the Building and appurtenant land and Tenant's
leasehold interest in the Premises free from any liens arising out of any
services, work or materials performed, furnished, or contracted by tenant, or
obligations incurred by Tenant. In the event that Tenant shall not, within
thirty (30) days following the imposition of any such lien, either cause the
same to be released of record or provide T Landlord with insurance against the
same issued by a major title insurance company or such other protection against
the same as Landlord shall accept, Landlord shall have the right to cause the
same to be released by such means as it shall deem proper, including payment of
the claim giving rise to such lien. All such sums paid by Landlord and all
expenses incurred by it in connection therewith shall be considered additional
rent and shall be payable to it by Tenant on demand.
9. ASSIGNENT AND SUBLETTING.
9.1 Tenant shall not have the right to assign or pledge this Lease or to
sublet the whole or any part of the Premises whether voluntarily or by
operation of law, or permit the use or occupancy of the Premises by anyone
other than Tenant, and shall not make, suffer or permit such assignment,
subleasing or occupancy, without the prior written consent of Landlord,
and said restrictions shall be binding upon any and all assignees of the
Lease and subtenants of the Premises. In the event Tenant desires to
sublet, or permit such occupancy of, the Premises, or any portion thereof,
or assign this Lease, Tenant shall give written notice thereof to Landlord
at least ninety (90) days but no more than one hundred eighty (180) days
prior to the proposed commencement date of such subletting or assignment,
which notice shall set forth the name of the proposed subtenant or
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assignee, the relevant terms of any sublease or assignment and copies of
financial reports and other relevant financial reports and other relevant
financial information of the proposed subtenant or assignee.
9.2 Notwithstanding any assignment or subletting, permitted or otherwise,
Tenant shall at all times remain directly, primarily and fully responsible
and liable for the payment of the rent specified in this Lease and for
compliance with all of its other obligations under the terms, provisions
and covenants of this Lease. Upon the occurrence of an Event of Default,
if the Premises or any part of them are then assigned or sublet, Landlord,
in addition to any other remedies provided in this Lease or provided by
law, may, at its option, collect directly from such assignee or subtenant
all rents due and becoming due to Tenant under such assignment or sublease
and apply such rent against any sums due to Landlord from Tenant under
this Lease, and no such collection shall be construed to constitute a
novation or release of Tenant from the further performance of Tenant's
obligations under this Lease.
9.3 In addition to Landlord's right to approve of any subtenant or
assignee, Landlord shall have the option, in its sole discretion, in the
event of any proposed subletting or assignment, to terminate this Lease,
or in the case of a proposed subletting of less than the entire Premises,
to recapture the portion of the Premises to be sublet, as of the date the
subletting or assignment is to be effective. The option shall be
exercised, if at all, by Landlord giving Tenant written notice given by
Landlord to Tenant within sixty (60) days following Landlord's receipt of
Tenant's written notice as required above. If this Lease shall be
terminated with respect to the entire Premises pursuant to this Section,
the Term of this Lease shall end on the date stated in Tenant's notice as
the effective date of the sublease or assignment as if that date had been
originally fixed in this lease for the expiration of the Term. If Landlord
recaptures under this Section only a portion of the Premises, the rent to
be paid from time to time during the unexpired Term shall xxxxx
proportionately based on the proportion by which the approximate square
footage of the remaining portion of the Premises shall be less than that
of the Premises as of the date immediately prior to such recapture.
9.4 In the event that Tenant sells, sublets, assigns or transfers this
Lease, Tenant shall pay to Landlord as additional rent an amount equal to
one hundred percent (100%) of any Increased Rent (as defined below) when
and as such Increased Rent is received by Tenant. As used in this Section,
"Increased Rent" shall mean the excess of (i) all rent and other
consideration which Tenant is entitled to receive by reason of any sale,
sublease, assignment or other transfer of this Lease, over (ii) the rent
otherwise payable by Tenant under this Lease at such time. For purposes of
the foregoing, any consideration received by Tenant in form other than
cash shall be valued at its fair market value as determined by Landlord in
good faith.
9.5 Notwithstanding any other provision hereof, Tenant shall have no
right to make (and Landlord shall have the absolute right to refuse
consent to) any assignment of this Lease or
13
sublease of any portion of the Premises if at the time of either Tenant's
notice of the proposed assignment or sublease or the proposed commencement
date thereof, there shall exist any uncured default of Tenant or matter
which will become a default of Tenant with passage of time unless cured,
or if the proposed assignee or subleasee is an entity: (a) with which
Landlord is already in negotiation as evidenced by the issuance of a
written proposal; (b) is already an occupant of the Building unless
Landlord is unable to provide the amount of space required by such
occupant; (c) is a governmental agency; (d) is incompatible with the
character of occupancy of the Building; or (e) would subject the Premises
to a use which would: (i) involve increased personnel or wear upon the
Building; (ii) violate any exclusive right granted to another tenant of
the Building; (iii) require any addition to or modification of the
Premises or the Building in order to comply with building code or other
governmental requirements; or, (iv) involve a violation of Section 1.2.
Tenant expressly agrees that Landlord shall have the absolute right to
refuse consent to any such assignment or sublease and that for the
purposes of any statutory or other requirement of reasonableness on the
part of Landlord such refusal shall be reasonable.
9.6 Upon any request to assign or sublet, Tenant will pay to Landlord the
Assignment/Subletting Fee plus, on demand, a sum equal to all of
Landlord's costs, including attorney's fees, incurred in investigating and
considering any proposed or purported assignment or pledge of this Lease
or sublease of any of the Premises (not to exceed $1,000, i.e., in
addition to the Assignment/Subletting fee) regardless of whether Landlord
shall consent to, refuse consent, or determine that Landlord's consent is
not required for, such assignment, pledge or sublease. Any purported sale,
assignment, mortgage, transfer of this Lease or subletting which does not
comply with the provisions of this Article 9 shall be void.
9.7 If Tenant is a corporation, partnership or trust, any transfer or
transfers of or change or changes within any twelve month period in the
number of the outstanding voting shares of the corporation, the general
partnership interests in the partnership or the identity of the persons or
entities controlling the activities of such partnership or trust resulting
in the persons or entities owning or controlling a majority of such
shares, partnership interests or activities of such partnership or trust
at the beginning of such period no longer having such ownership or control
shall be regarded as equivalent to an assignment of this Lease to the
persons or entities acquiring such ownership or control and shall be
subject to all the provisions of this Article 9 to the same extent and for
all intents and purposes as though such an assignment.
10. INDEMNIFICATION:
None of the Landlord Entities shall be liable and Tenant hereby waives all
claims against them for any damage to any property or any injury to any person
in or about the Premises or the Building by
14
or from any cause whatsoever (including without limiting the foregoing, rain or
water leakage of any charactcr from the roof, windows, walls, basement, pipes,
plumbing works or appliances, the Building not being in good condition or
repair, gas, fire, oil, electricity or theft), except to the extent caused by or
arising from the gross negligence or willful misconduct of Landlord or its
agents, employees or contractors. Tcnant shall protect, indemnify and hold the
Landlord Entities harmless from and against any and all loss, claims, liability
or costs (including court costs and attorney's fees) incurred by reason of (a)
any damage to any property (including but not limited to property of any
Landlord Entity) or any injury (including but not limited to death) to any
person occurring in, on or about the Premises or the Building to the extent that
such injury or damage shall be caused by or arisc from any actual or alleged
act, neglect, fault, or omission by or of Tenant, its agents, servants,
employees, invitees, or visitors to meet any standards imposed by any duty with
respect to the injury or damage; (b) the conduct or management of any work or
thing whatsoevcr done by the Tenant in or about the Premises or from
transactions of the Tcnant concerning the Premiscs; (c) Tenant's failure to
comply with any and all governmental laws, ordinanscs and regulations applicable
to the condition or use of the Premises or its occupancy; or (d) any breach or
default on the part of Tenant in the perforrnancc of any covenant or agrecment
on the part of the Tenant to be performed pursuant to this Lease. The provisions
of this Article shall survive the tcrmination of this Lease with respect to any
claims or liability accruing prior to such termination.
11. INSURANCE.
11.1 Tenant shall keep h force throughout the Term: (a) a Commercial
General Liability Insurance policy or policies to protect the Landlord
Entities against any liability to the public or to any invitee of Tenant
or a Landlord Entity incidental to the use of or resulting from any
accident occumng in or upon the Premises with a limit of not less than
$1,000,000.00 per occurrence and not less than S2,000,000.00 in the annual
aggregate, or such larger amount as Landlord may prudently require from
time to time, covering bodily injury and property damage liability and
S1,000,000 products/completed operations aggregate; (b) Business Auto
Liability covering owned, non-owned and hired vehicles with a limit of not
less than S1,000,000 per accident; (c) insurance protecting against
liability under Worker's Compensation Laws with limits at least as
required by statute; (d) Employers Liability with limits of S500,000 each
accident, S500,000 disease policy limit, S500,000 disease-each employee,
(e) All Risk or Special Form coverage protecting Tenant against loss of or
damage to Tenant's alteratdons, addidons, improvements, carpeting, floor
coverings, panelings, decorations, fixtures, inventory and other business
personal property situated in or about the Premises to the full
replacement value of the property so insured
11.2 Each of the aforesaid policies shall (a) be provided at Tenant's
expense; (b) name the Landlord and the building mangement company, if any,
as additional insureds; (c) be
15
issued by an insuranse company with a minimum Best's rating of "A:VII"
during the Term; and (d) provide that said insurance shall not be canceled
unless thirty (30) days prior written notice (ten days for non-payment of
premium) shall have been given to Landlord; and said policy or policies or
certificates thereof shall be delivered to Landlord by Tenant upon the
Commencement Date and at least thirty (30) days prior to each renewal of
said insurance.
11.3 Whenever Tenant shall undertake any alterations, additions or
improvements in, to or about the Prernises ("Work") the aforcsaid
insurance protcction must extend to and include injuries to persons and
damage to property arising in connection with such Work, without
limitation including liability under any applicable structural work act,
and such other insurance as Landlord shall require; and the policies of or
certificates evidencing such insurance must be delivered to Landlord prior
to the commenencement of any such Work.
12. WAIVER OF SUBROGATION.
So long as their respective insurers so permit, Tenant and Landlord hereby
mutually waive their respective rights of recovery against each other for any
loss insured by fire, extended coverage, All Risks or other insurance now or
hereafter existing for the benefit of the respective party but only to the
extent of the net insuranse proceeds payable under such policies. Each party
shall obtain any special endorsements required by their insurer to evidence
compliance with the aforementioned waiver.
13. SERVICES AND UI L1TIES.
Tenant shall pay for all water, gas, heat, light, power, telephone, sewer,
sprinkler system charges and other utilities and services used on or from the
Premises, together with any taxes, penalties, and surcharges or the like
pertaining thereto and any maintenance charges for utilities. Tenant shall
furnish all electric light bulbs, tubes and ballasts, battery packs for
emergency lighting and fire extinguishers. If any such services are not
separately metered to Tenant, Tenant shall pay such proportion of all charges
jointly metered with other premises as determined by Landlord, in its sole
discretion, to be reasonable. Any such charges paid by Landlord and assessed
against Tenant shall be immediately payable to Landlord on demand and shall be
additional rent hereunder. Landlord shall in no event be liable for any
interruption or failure of utility services on or to the Premises.
14. HOLDING OVER.
Tenant shall pay Landlord for each day Tenant retains possession of the
Premises or part of them after termination of this Lease by lapse of time or
otherwise at the rate ("Holdover Rate") which shall be one-hundred twenty five
percent (125%) of the amount of the Annual Rent for the last period prior to
the date of such terminadon plus all Rent Adjustments under Article 4; prorated
16
on a daily basis, and also pay all damages sustained by Landlord by reason of
such retention. If Landlord gives notice to Tenant of Landlord's election to
that effect, such holding over shall constitute renewal of this Lease for a
period from month to month or one year; whichever shall be specified in such
notice, in either case at the Holdover Rate, but if the Landlord does not so
elect, no such renewal shall result notwithstanding acotptance by Landlord of
any sums due hereunder after such termination; and instead, a tenancy at
sufferanse at the Holdover Rate shall be deemed to have been created. In any
event, no provision of this Article 14 shall be deemed to waive Landlord's
right of reentry or any other right under this Lease or at law.
15. SUBORDINATION.
Without the necessity of any additional document being executed by Tenant for
the purpose of effecting a subordination, this Lease shall be subject and
subordinate at all times to ground or underlying leases and to the lien of any
mortgages or deeds of trust now or hereafter placed on, against or affecting
the Building, Landlord's interest or estate in the Building, or any ground or
underlying lease; provided, however, that if the lessor, mortgagee, trustee, or
holder of any such mortgage or deed of trust elects to have Tenant's interest
in this Lease be superior to any such instrument, then, by notice to Tenant,
this Lease shall be deemed superior, whether this Lease was executed before or
after said instrument. Notwithstanding the foregoing, Tenant covenants and
agrees to execute and deliver upon demand such further instrurnents evidencing
such subordination or superiority of this Lease as may be required by Landlord.
16. RULES AND REGULATIONS.
Tenant shall faithfully observe and comply with all the rules and regulations
as set forth in Exhibit C to this Lease and all reasonable modifications of and
additions to them from time to time put into effect by Landlord with notice to
Tenant. Landlord shall not be responsible to Tenant for the non-performance by
any other tenant or occupant of the Building of any such rules and regulations.
17. REENTRY BY LANDLORD.
17.1 Landlord reserves and shall at all times during normal business
hours and with prior notice except in the case of an emergency have the
right to re-enter the Premises to inspect the same, to show said Premises
to prospective purchasers, mortgagees or tenants, and to alter, improve or
repair the Premises and any portion of the Building, without abatement of
rent, and may for that purpose erect, use and maintain scaffolding, pipes,
conduits and other necessary structures and open any wall, ceiling or
floor in and through the Building and Premises where reasonably required
by the character of the work to be performed, provided entrance to the
Premises shall not be blocked thereby, and further provided that the
business of Tenant shall not be interfered with unreasonably.
17.2 Landlord shall have the right at any time to change the arrangement
and/or location of entrances, or passageways, doors and doorways, and
corridors, windows, elevators, stairs, toilets in any portions of the
Building which do not include the Premises, or other public parts of the
Building and to change the name, number or designation by which the
17
Building is commonly known. In the event that Landlord damages any portion
of any wall or wall covering, ceiling, or floor or floor covering within
the Premises, Landlord shall repair or replace the damaged portion to
match the original as nearly as commercially reasonable but shall not be
required to repair or replace more than the portion actually damaged.
17.3 Tenant hereby waives any claim for damages for any injury or
inconvenience to or interference with Tenant's business, any loss of
occupancy or quiet enjoyment of the Prernises, and any other loss
occasioned by any action of Landlord authorized by this Article 17. Tenant
agrees to reimburse Landlord, on demand, as additional rent, for any
expenses which Landlord may incur in thus effecting compliance with
Tenant's obligations under this Lease.
17.4 For each of the aforesaid puxposes, Landlord shall at all times have
and retain a key with which to unlock all of the doors in the Premises,
excluding Tenant's vaults and safes or special security areas (designated
in advance), and Landlord shall have the right to use any and all means
which Landlord may deem proper to open said doors in an emergency to
obtain entry to any portion of the Premises.
18. DEFAULT.
18.1 Except as otherwise provided in Article 20, the following events
shall be deemed to be Events of Default under this Lease:
18.1.1 Tenant shall fail to pay when due any sum of money becoming
due to be-paid to Landlord under this T ease, whether such sum be any
initallment of the rent reserved by this Lease, any other amount
treated as additional rent under this Lease, or any other payment or
reimbursement to Landlord required by this Lease, whether or not
treated as additional rent under this Lease, and such failure shall
continue for a period of five days after written notice that such
payment was five made when due, but if any such notice shall be
given, for the twelve month period commencing with the date of such
notice, the failure to pay within five days after due any additional
sum of money becoming due to be paid to Landlord under this Lease
during such period shall be an Event of Default, without notice.
18.1.2 Tenant shall fail to comply with any term, provision or
covenant of this Lease which is not provided for in another Section
of this Article and shall not cure such failure within thirty (30)
days (forthwith, if the failure involves a hazardous condition) after
written notice of such failure to Tenant.
18.1.3 Tenant shall fail to vacate the Premises immediately upon
termination of this Lease, by lapse of time or otherwise, or
upon termination of Tenant's right to possession only.
18.1.4 Tenant shall become insolvent, admit in writing its inability
to pay its debts
18
generally as they become due, file a petition in bankruptcy or a
petition to take advantage of any insolvency statute, make an
assignment for the benefit of creditors, make a transfer in fraud of
creditors, apply for or consent to the appointment of a receiver of
itself or of the whole or any substantial part of its property, or
file a petition or answer seeking reorganization or arrangement under
the federal bankruptcy laws, as now in effect or hereafter amended,
or any other applicable law or statute of the United States or any
state thereof.
18.1.5 A court of competent jurisdiction shall enter an order,
judgment or decree adjudicating Tenant bankrupt, or appointing a
receiver of Tenant, or of the whole or any substantial part of its
property, without the consent of Tenant, or approving a petition
filed against Tenant seeking reorganization or arrangement of Tenant
under the bankruptcy laws of the United States, as now in effect or
hereafter amended, or any state thereof, and such order, judgment or
decree shall not be vacated or set aside or stayed within thirty (30)
days from the date of entry thereof.
19. REMEDIES.
9.1 Except as otherwise provided in Article 20, upon the occurrence of
any of the Events of Default described or referred to in Article 18,
Landlord shall have the option to pursue any one or more of the following
remedies without any notice or demand whatsoever, concurrently or
consecutively and not alternatively:
19.1.1 Landlord may, at its election, terminate this Lease or
terminate Tenant's right to possession only, without terminating the
Lease.
19.1.2 Upon any termination of this Lease, whether by lapse of time
or otherwise, or upon any termination of Tenant's right to possession
without termination of the Lease, Tenant shall surrender possession
and vacate the Premises immediately, and deliver possession thereof
to Landlord, and Tenant hereby grants to Landlord full and free
license to enter into and upon the Premises in such event and to
repossess Landlord of the Premises as of Landlord's former estate and
to expel or remove Tenant and any others who may be occupying or be
within the Premises and to remove Tenant's signs and other evidence
of tenancy and all other property of Tenant therefrom without being
deemed in any manner guilty of trespass, eviction or forcible entry
or detained, and without incurring any liability for any damage
resulting therefrom, Tenant waiving any right to claim damages for
such re-entry and expulsion, and without relinquishing Landlord's
right to rent or any other right given to Landlord under this Lease
or by operation of law.
19.1.3 Upon any termination of this Lease, whether by lapse of time
or otherwise, Landlord shall be entitled to recover as damages, all
rent, including any amounts treated as additional rent under this
Lease, and other sums due and payable by Tenant on the date of
termination, plus as liquidated damages and not as a penalty,
19
an amount equal to the sum of: (a) an amount equal to the then
present value of the rent reserved in this Lease for the residue of
the stated Term of this Lease including any amounts treated as
additional rent under this Lease and all other sums provided in this
Lease to be paid by Tenant, minus the fair rental value of the
Premises for such residue; (b) the value of the time and expense
necessary to obtain a replacement tenant or tenants, and the
estimated expenses described in Section 19.1.4 relating to recovery
of the Premises, preparation for reletting and for reletting itself;
and (c) the cost of performing any other covenants uld have
otherwise been performed by Tenant.
19.1.4 Upon any termination of Tenant's right to possession only without
termination of the Lease:
19.1.4.1 Neither such termination of Tenant's right to possession
nor Landlord's taking and holding possession thereof as provided in
Section 19.1.2 shall terminate the Lease or release Tenant, in whole
or in part, from any obligation, including Tenant's obligation to pay
the rent, including any amounts treated as additional rent, under
this Lease for the full Term, and if Landlord so elects Tenant shall
pay forthwith to Landlord the sum equal to the entire amount of the
rent, including any amounts treated as additional rent under this
Lease, for the remainder of the Term plus any other sums provided in
this Lease to be paid by Tenant for the remainder of the Term.
19.1.4.2 Landlord may, but need not, relet the Premises or any part
thereof for such rent and upon such terms as Landlord, in its sole
discretion, shall determined (including the right to relet the
premises for a greater or lesser term than that remaining under this
Lease, the right to relet the Premises as a part of a larger area,
and the right to change the character or use made of the Premises).
In connection with or in preparation for any reletting, Landlord may,
but shall not be required to, make repairs, alterations and additions
in or to the Premises and redecorate the same to the extent Landlord
deems necessary or desirable, and Tenant shall, upon demand, pay the
cost thereof, together with Landlord's expenses of reletting,
including, without limitation, any commission incurred by Landlord.
If Landlord decides to relet the Premises or a duty to relet is
imposed upon Landlord by law, Landlord and Tenant agree that
nevertheless Landlord shall at most be required to use only the same
efforts Landlord then uses of lease premises in the Building
generally and that in any case that Landlord shall not be required to
give any preference or priority to the showing or leasing of the
Prerniscs over any other space that Landlord may be leasing or have
available and may place a suitable prospective tenant in any such
other space regardless of when such other spar; becomes available.
Landlord shall not be required to observc any instruction given by
Tenant about any reletting or accept any tenant offered by Tenant
unless such offered tenant has a credit-worthiness acceptable to
Landlord and leascs the entire Premises upon terms and conditions
including a rate of rent (after giving effect to all expenditures by
Landlord for tenant
20
improvements, broker's commissions and other leasing costs) all no
less favorable to Landlord than as called for in this Lease, nor
shall Landlord be required to make or permit any assignmcnt or
sublcase for more than the current term or which Landlord would not
be required to permit under the provisions of Article 9.
19.1.4.3 Until such time as Landlord shall elect to terrninate the
Lease and shall thercupon be entitled to recover the amounts
specified in such case in Section 19.13, Tenant shall pay to Landlord
upon demand the full amount of all rent, including any arnounts
treated as additional rent under this Lease and other sums reserved
in this Lcase for the remaining Term, together with the costs of
repairs, alterations, additions, redecorating and Landlord's expenses
of reletting and the collection of the rent accruing therefrom
(including attorney's fees and broker's commissions), as the same
shall then be due or become due from time to time, less only such
consideration as Landlord may have received from any reletting of the
Premises; and Tenant agrees that Landlord may file suits from time to
time to recover any sums falling due under this Article 19 as they
become due. Any proceeds of reletting by Landlord in excess of the
amount then owed by Tenant to Landlord from time to time shall be
credited against Tenant's future-obligations under this Lcase but
shall not otherwise be refunded to Tenant or inure to Tenant's
benefit.
19.2 Landlord may, at Landlord's option, enter into and upon the Premises
if Landlord determine on its reasonable discretion that Tenant is not
acting within a commercially reasonable time to maintain, repair or
replace anything for which Tenant is responsible under this Lease and
correct the same, without being deemed in any manner guilty of trespass,
eviction or forcible entry and detainer and without incurring any
liability for any damage or interruption of Tenant's business resulting
therefrom. If Tenant shall have vacated the Premises, Landlord may at
Landlord's option re-enter the Premises a. any time during the last six
months of the then current Term of this Lease and make any and all such
changes, alterations, revisions, additions and tenant and other
improvemcnts in or about the Premises as Landlord shall elect, all without
any abatement of any of the rent otherwise to be paid by Tenant under this
Lease.
19.3 If, on account of any breach or default by Tcnant in Tenant's
obligations under the terms and conditions of this Lease, it shall become
necessary or appropriate for Landlord to employ or consult with an
attorney concerning or to enforece or defend any of Landlord's rights or
remedics arising under this Lcase, Tenant agrees to pay all reasonable
attorney's fees so incurred. Tenant expressly waives any right to: (a)
trial by jury; and (b) service of any notice required by any present or
futurc law or ordinance applicable to landlords or tenants but not
required by the tcrms of this Lease.
19.4 Pursuit of any of the foregoing remedies shall not preclude
pursuit of any of the other remedies provided in this Lcasc or any other
remedies provided by law (all such
21
remedies being cumulative), nor shall pursuit of any remedy provided in
this Lcase constitute a forfeiturc or waiver of any rcnt due to Landlord
under this Leasc or of any damages accruing to Landlord by reason of the
violation of any of the terms, provisions and covenants contained in this
Lease.
195 No act or thing donc by Landlord or its agents during the Term shall be
deemcd a termination of this Lcase or an acceptance of the surrender of the
Premises, and no agreemcnt to tcrminate this Lease or accept a surrcnder of said
Premises shall be valid, unless in writing signed by Landlord. No waiver by
Landlord of any violation or breach of any of the tcrms, provisions and
covenants contained in this Lcase shall be deemed or construed to constitute a
waiver of any other violation or breach of any of the terms, provisions and
covenants contained in this Lease. Landlord's acceptance of the paymcnt of
rcntal or other payments aftcr the occurrcnce of an Event of Dcfault shall not
be construed as a waiver of such Default, unless Landlord so notifies Tenant in
writing. Forbearance by Landlord in enforcing one or more of the remedies
provided in this Lease upon an Event of Default shall not be deemed or construed
to constitute a waiver of such Default or of Landlord's right to enforce any
such remedies with respect to such Default or any subsequent Default.
19.6 To secure the payment of all rentals and other sums of money
becoming due from Tenant under this Lease, Landlord shall have and Tenant
grants to Landlord a first lien upon the leasehold interest of Tenant
under this Lease, which lien may be enforced in equity, and a continuing
security interest upon all goods, wares, equipment, fixture, furniture,
inventory, accounts, contract rights, chattel paper and other personal
property of Tenant situated on the Premiscs, and such property shall not
be removed therefrom without the consent of Landlord until all arrearages
in rent as well as any and all other sums of money then due to Landlord
under this Lease shall first have been paid and discharged. In the event
of a Default under this Lease, Landlord shall have, in addition to any
other remedies provided in this Lease or by law, all rights and remedies
under the Uniform Commercial Code, including without limitation the right
to sell the property described in this Section 19.6 at public or private
sale upon five (5) days' notice to Tenant. Tenant shall execute all such
financing statements and other instruments as shall be deemed necessary or
desirable in Landlord's discretion to perfect the security interest hereby
created.
19.6 A Notwithstanding the foregoing provisions of this Article to the
contrary, Landlord agrees that it will subordinate its security interest
and landlord's lien to the security interest of Tenant's institutional
financial source, provided that such subordination must be limited to a
specified transaction and specified items of fixtures, equipment or
inventory involved in the transaction.
19.7 If and all property which may be removed from the Premises by
Landlord pursuant to the authority of this r; Ace or of '_w, to which
Tenant is or may be entitled, may be handled, removed and/or stored, as
the case may be, by or at the direction of Landlord but at the risk,
22
cost and expense of Tenant, and Landlord shall in no event be responsible
for the value, preservation or safekeeping thereof. Tenant shall pay to
Landlord, upon demand, any and all expenses incurred in such removal and
all storage charges against such property so long as the same shall be in
Landlord's possession or under Landlord's control. Any such property of
Tenant not retaken by Tenant from storage within thirty (30) days after
removal from the Premises shall, at Landlord's option, be deemed conveyed
by Tenant to Landlord under this Lease as by a xxxx of sale without
further payment or credit by Landlord to Tenant.
20. TENANTS BANKCRUPTCY OR lNSOLVENCY.
20.1 If at any time and for so long as Tenant shall be subjected to the
provisions of the United States Bankruptcy Code or other law of the United
States or any state thereof for the protection of debtors as in effect at
'such tirne (each a "Debtor's Law"):
20.1.1 Tenant, Tenant as debtor-in-possession, and any trustee or
receiver of Tenant's assets (each a "Tenant's Representative") shall
have no greater right to assume or assign this Lease or any interest
in this Lease, or to sublease any of the Premises than accorded to
Tenant in Article 9, except to the extent Landlord shall be required
to permit such assumption, assignment or sublease by the provisions
of such Debtor's Law. Without limitation of the generality of the
foregoing, any right of any Tenant's Representative to assume or
assign this Lease or to sublease any of the Premiscs shall be subject
to the conditions that:
20.1.1.1 Such Debtor's Law shall provide to Tenant's
Representative a right of assumption of this Lease which
Tenant's Representative shall have timely exercised and Tenant's
Representative shall have fully cured any default of Tenant
under this Lease.
20.1.1.2 Tenant's Representative or the proposed assignee, as
the case shall be, shall have deposited with Landlord as
security for the timely payment of rent an amount equal to the
larger of: (a) three months' rent and other monetary charges
accruing under this Lease; and (b) any sum specified in Article
5; and shall have provided Landlord with adequate other
assurance of the future performance of the obligations of the
Tenant under this Lease>ce. Without limitation, such assurances
shall include, at least, in the case of assumption of this
Lease,; demonstration to the satisfaction of the Landlord that
Tenant's Representative has and will continue to have sufficient
unencumbered assets after the payment of all secured obligations
and administrative expenses to assure Landlord that Tenant's
Representative will have sufficient funds to fulfill the
obligations of Tenant under this Lease; and, in the case of
assignment, submission of current financial statements of the
proposed assignee, audited by an independent certified public
accountant reasonably acceptable to Landlord and showing a net
worth and working capital in amounts determined by Landlord to
be sufficient to assure the future
23
performance by such assignee of all of the Tenant's obligations
under this Lease.
20.1.1.3 The assumption or any contemplated assignment of this
Lease or subleasing any part of the Premises. as shall be the
case, will not breach any provision in any other lease,
mortgage, financing agreement or other agreement by which
Landlord is bound.
20.1.1A - Landlord shall have, or would have had absent the
Debtor's Law, no right under Article 9 to refuse consent to the
proposed assignment or sublease by reason of the identity or
nature of the proposed assignee or subleassee or the proposed
use of the Premises concerned.
21. QUET ENJOYMENT.
Landlord represents and warrants that it has full right and authority to enter
into this Lease and that Tenant, while paying the rental and performing its
other covenants and agreements contained in this Lease, shall peaceably and
quietly have, hold and enjoy the Premises for the Term without hindrance or
molestation from Landlord subject to the terms and provisions of this Lease.
Landlord shall not be liable for any interference or disturbance by other
tenants or third persons, nor shall Tenant be released from any of the
obligations of this Lease because of such interference or disturbance.
22. DAMAGE BY FIRE, ETC.
22.1 In the event the Premises or the Building are damaged by fire or
other cause and in Landlord's 5 reasonable estimation such damage can be
materially restored within one hundred eighty (180) days, Landlord shall
forthwith repair the same and this Lease shall remain in full force and
effect, except that Tenant shall be entitled to a proportionate abatement
in rent from the date of such darnage. Such abaternent of rent shall be
made pro rata in accordance with the extent to which the damage and the
making of such repairs shall interfere with the use and occupancy by
Tenant of the Premise from time to time. Within forty-five (45) days from
the date of such damage, Landlord shall notify Tenant, in writing, of
Landlord's reasonable estimation of the length of time within which
material restoration can be made, and Landlord's determination shall be
binding on Tenant. For purposcs of this Lease, the Building or Prernises
.shall be deemed "materially restored" if they are in such condition as
would not prevent or materially interfere with Tenant's use of the
Prernises for the purpose for which it was being used immediately before
such damage.
22.2 If such repairs cannot, in Landlord's reasonable estimation, be made
within two hundred fifty (250) days, Landlord and Tenant shall each have
the option of giving the other, at any time within sixty (60) days after
such damage, notice terminating this Lease as of the date of such damage.
In the event of the giving of such notice, this Lease shall expire and all
interest of the Tenant in the Premises shall terminate as of the date of
such damage as
24
if such date had been originally fixed in this Lease for the expiration of
the Term. In the event that neither Landlord nor Tenant exercises its
option to terminate this Lease, then Landlord shall repair or restore such
damage, this Lease continuing in full force and effect, and the rent
hereunder shall be proportionately abated as provided in Section 22.1.
22.3 Landlord shall not be required to repair or replace any damage or
loss by or from fire or other cause to any panelings, decorations,
partitions, additions, railings, ccilings, floor coverings, office
fixtures or any other property or improvernents installed on the Premises
or belonging to Tenant. Any insurance which may be carried by Landlord or
Tenant against loss or damage to the Building or Prernises shall be for
the sole benefit of the party carrying such insurance and under its sole
control.
22.4 In the event that Landlord should fail to complete such repairs and
material rcstoration within sixty (60) days after the date ectimated by
Landlord therefor as extended by this Section 22.4, Tenant may at its
option and as its sole remedy terminate this Lease by delivering written
notice to Landlord, within fifteen (15) days after the expiration of said
period of time, whereupon the Lease shall end on the date of such notice
or such later date fixed in such notice as if the date of such notice was
the date originally fixed in this Lease for the expiration of the Term;
provided, however, that if construction is delayel because of changes,
deletions or additions in construction requested by Tenant, strikes,
lockouts, casualties, Acts of God, war, material or labor shortages,
government regulation or control or other causes beyond the reasonable
control of Landlord, the period for restoration, repair or rebuilding
shall be extended for the amount of time Landlord is so delayed.
22.5 Notwithstanding anything to the contrary contained in this Article:
(a) Landlord shall not have any l obligation whatsoever to repair,
reconstruct, or restore the Premises when the damages resulting from any
casualty covered by the provisions of this Article 22 occur during the
last twelve (12) months of the Term or any extension thereof, but if
Landlord determines not to repair such damages Landlord shall notify
Tenant within fourty-five (45) days of the damages and if such damages
shall render any material portion of the Premises untenantable Tenant
shall have the right to terminate this Lease by notice to Landlord within
fifteen (15) days after receipt of Landlord's notice effective as of the
date of the casualty; and (b) in the event the of any indebtedness secured
by a mortgage or deed of trust covering the Premises or Building requires
that any insurance proceeds be applied to such indebtedness, then Landlord
shall have the right to terminate this Lease by delivering written notice
of termination to Tenant within fifteen (15) days after such requirernent
is made by any such holder, whereupon this Lease shall end on the date of
such damage as if the date of such damage were the date originally fixed
in this Lease for the expiration of the Term.
22.6 In the event of any damage or destruction to the Building or
Premises by any peril covered by the provisions of this Article 22, it
shall be Tenant's responsibility to properly secure the Premises and upon
notice from Landlord to remove forthwith, at its sole cost and expense,
25
such portion of all of the property belonging to Tenant or its licensees
from such portion or all of the Buildirg or Premises as Landlord shall
request.
23. EMINENT DOMAIN.
If all or any substantial part of the Premises shall be taken or appropriated
by any public or quasi-public authority under the power of eminent domain, or
conveyance in lieu of such appropriation, either party to this Lease shall have
the right, at its option, of giving the other, at any time within thirty (30)
days after such taking, notice terminating this Lease, except that Tenant may
only terminate this Lease by reason of taking or appropriation, if such taking
or appropriation shall be so substantial as to materially interfere with
Tenant's use and occupancy of the Premises. If neither party to this Lcase
shall so elect to terminate this Lease, the rental thereafter to be paid shall
be adjusted on a fair and equitable basis under the circumstances. In addition
to the rights of Landlord above, if any substantial part of the Building shall
be taken or appropriated by any public or quasi-public authority under the
power of eminent domain or conveyance in lieu thereof, and regardless of
whether the Prernises or any part thereof are so taken or appropriated,
Landlord shall have the right, at its sole option, to termination this Lease.
Landlord shall be entitled to any and all income, rent. award, or any interest
whatsoever in or upon any such sum, which may be paid or made in connection
with any such public or quasi-public use or purpose, and Tcnant hereby assigns
to
Landlord any interest it may have in or claim to all or any part of such sums,
other than any separate award which may be made with respect to Tenant's trade
fixtures and moving expenses; Tenant shall make no claim for the value of any
unexpired Term.
24. SALE BY LANDLORD.
In event of a sale or conveyance by Landlord of the Building, the same shall
operate to release Landlord from any future liability upon any of the covenants
or conditions, expressed or implied, contained in this Lease in favor of
Tenant, and in such event Tenant agrees to look solely to the responsibility of
the successor in interest of Landlord in and to this Lease. Except as set forth
in this Article 24, this Lease shall not be affected by any such sale and
Tenant agrees to attorn to the purchaser or assignee. If any security has been
given by Tenant to secure the faithful performance of any of the covenants of
this Lease, Landlord may transfer or deliver said security, as such, to
Landlord's successor in interest and thereupon Landlord shall be discharged
from any further liability with regard to said security.
25. ESTOPPEL CERTIFICATES.
Within ten (10) days following any written request which Landlord may make from
time to time, Tenant shall execute and deliver to Landlord or mortgagee or
prospective mortgagee a sworn statement certifying: (a) the date of
commencement of this Lease; (b) the fact that this Lease is unmodified and in
full force and effect (or, if there have been modifications to this Lease, that
this Lease is in full force and effect, as modified, and stating the date and
nature of such modifications); (c) the date to which the rent and other sums
payable under this Lease have been
26
paid; (d) the fact that there are no current defaults under this Lease by either
Landlord or Tenant except as specified in Tenant's statement; and (e) such other
matters as may be requested ~, Landlord. Landlord and Tenant intend that any
statement delivered pursuant to this Article 25 may be relied upon by any
mortgagee, beneficiary or purchaser and Tenant shall be liable for all loss,
cost or expense resulting from the failure of any sale or funding of any loan
caused by any material misstatement contained in such estoppel certificate.
Tenant irrevocably agrees that if Tenant fails to execute and deliver such
certificate within such ten (10) day period Landlord or Landlord's beneficiary
or agent may execute and deliver such certificate on Tenant's behalf, and that
such certificate shall be fully binding on Tenant.
26. SURRENDER OF PREMISES.
26.1 Tenant shall, at least thirty (30) days before the last day of the
Term, arrange to meet Landlord for a joint inspection of the Premises. In
the event of Tenant's failure to arrange such joint inspection to be held
prior to vacating the Premises, Landlord's inspection at or after Tenant's
vacating the Premises shall be conclusively deemed correct for purposes of
determining Tenant's responsibility for repairs and restoration.
26.2 At the end of the Term or any renewal of the Term or other sooner
tcrmination of this Lease, Tenant will peaceably deliver up to Landlord
possession of the Premises, together with all improvements or additions
upon or belonging to the same, by whomsoever rnade, in the same conditions
received or first installed, broom clean and free of all debris, excepting
only ordinary wear and tear and damage by fire or other casualty. Tenant
may, and at Landlord's request shall, at Tenant's sole cost, remove upon
termination of this Lcase, any and all furniture, furnishings, movable
partitions of less than full height from floor to ceiling, trade fixtures
and other property installed by Tenant, title to which shall not be in or
pass automatically to Landlord upon such termination, repairing all damage
caused by such removal. Property not so rcmoved shall, unless requested to
be removed, bc deemed abandoned by the Tenant and title to the same shall
thereupon pass to Landlord under this Lcase as by a xxxx of sale. All
other alterations, additions and improvements h, on or to the Premises
shall be dealt with and disposed of as provided in Article 6.
26.3 All obligations of Tenant under this Lcase not fully performed as of
the expiration or earlier tcrmination of the Terrn shall survive the
expiration or earlier terrnination of the Term. In the event that Tenant's
failure to perform prevents Landlord from releasing the Premiscs, Tenant
shall continue to pay rent pursuant to the provisions of Article 14 until
such performance is complete. Upon the expiration or earlier termination
of the Term, Tenant shall pay to Landlord the amount, as estimated by
Landlord, necessary to repair and restore the Premises as provided in this
Lease and/or to discharge Tenant's obligation for unpaid amounts due or to
become due to Landlord. All such amounts shall bc uscd and held by
Landlord for paymcnt of such obligations of Tenant, with Tenant being
liable for any additional costs upon demand by Landlord, or with any
excess to be rcturned to Tenant after all such obligations havc been
determined and satisficd. Any otherwise unused Security Deposit shall be
credited against the amount payable by Tcnant under this Lease.
27
27. NOTICES.
Any notice or documcnt required or perrnitted to be delivered under this Lcase
shall be addressed to the intended recipicnt, shall be transmitted personally,
by fully prepaid registered or certified United States Mail return receipt
requested, or by reputable independent contract delivery servicc furnishing a
written record of attempted or actual delivery, and shall be deemed to be
delivered when tendered for delivery to the addressee at its address set forth
on the Reference Page, or at such other address as it has then last specified
by written notice delivered in accordance with this Article 27, or if to Tenant
at either its aforesaid address or its last known registered office or home of
a general partner or individual owner, whether or not actually accepted or
received by the addressee.
28. TAXES PAYABLE BY TENANT.
In addition to rent and other charges to be paid by Tenant under this Lease,
Tenant shall reimburse to Landlord, upon demand, any and all taxes payable by
Landlord (other than net income taxes) whether or not now customary or within
the contemplation of the parties to this Lease: (a) upon, allocable to, or
measured by or on the gross or net rent payable under this Lease, including
without limitation any gross income tax or excise tax levied by the State, any
political subdivision thereof, or the Federal Government with respect to the
receipt of such rent; (b) upon or with respect to the possession, leasing,
operation, management, maintenance, alteration, repair, use or occupancy of the
Premises or any portion thereof, including any sales, use or service tax
imposed as a result thereof; (c) upon or measured by the Tenant's gross
receipts or payroll or the value of Tenant's equipment, furniture, fixtures and
other personal property of Tenant or leasehold improvements, alterations or
additions located in the Premises; or (d) upon this transaction or any document
to which Tenant is a party creating or transferring any interest of Tenant in
this Lease or the Premises. In addition to the foregoing, Tenant agrees to pay,
before delinquency, any and all taxes levied or assessed against Tenant and
which become payable during the term hereof upon Tenant's equipment, furniture,
fixtures and other personal property of tenant located in the Premises.
29. DEF1NED TERMS AND HEADINGS.
The Article headings shown in this Lease are for convenience of reference and
shall in no way define, increase, limit or describe the scope or intent of any
provision of this Lease. Any indemnification or insurance of Landlord shall
apply to and inure to the benefit of all the following "Landlord Entities",
being Landlord, Landlord's investment manager, and the trustees, boards of
directors, officers, general partners, beneficiaries, stocHholders, employees
and agents of each of them. Any option granted to Landlord shall also include
or be exercisable by Landlord's trustee, beneficiary, agents and employees, as
the case may be. In any case where this Lease is signed by more than one
person, the obligations under this Lease shall be joint and several. The terms
"Tenant" and "Landlord" or any pronoun used in place thereof shall indicate and
include the masculinc or femininc, the singular or plural number, individuals,
firms or corporations, and each of their respective successors, executors,
administrators and permitted assigns, according to the context hereof. The term
"rentable area" shall mean the rentable area of the Premises or the Building as
calculated by the Landlord on the basis of the plans and
28
specifications of the Building including a proportionate share of any common
areas. Tenant hereby accepts and agrees to be bound by the figures for the
rentable space footage of the Premises and Tenant's Proportionate Share shown on
the Reference Page.
30. TENANTS AUTHORITY.
If Tenant signs as a corporation each of the persons executing this Lease on
behalf of Tenant represents and warrants that Tenant has been and is qualified
to do business in the state in which the Building is located, that the
corporation has full right and authority to enter into this Lease, and that all
persons signing on behalf of the corporation were authorized to do so by
appropriate corporate actions. If Tenant signs as a partnership, trust or other
legal entity, each of the persons executing this Lease on behalf of Tenant
represents and warrants that Tenant has complied with all applicable laws,
rules and governmental regulations relative to its right to do business in the
state and that such entity on behalf of the Tenant was authorized to do so by
any and all appropriate partnership, trust or other actions. Tenant agrees to
furnish promptly upon request a corporate resolution, proof of due
authorization by partners, or other appropriate documentation evidencing the
due authorization of Tenant to enter into this Lease.
31. COMMISSIONS.
Each of the parties represents and warrants to the other that it has not dealt
with any broker or finder in connection with this Lease, except as described on
the Reference Page.
32. TIME AND APPLICABLE LAW.
Time is of the essence of this Lease and all of its provisions. This Lease
shall in all respects be governed by the laws of the state in which the Building
is located.
33. SUCCESSORS AND ASSIGNS.
Subject to the provisions of Article 9, the terms, covenants and conditions
contained in this Lease shall be binding upon and inure to the benefit of the
heirs, successors, executors, administrators and assigns of the parties to this
Lease.
34. ENTIRE AGREEMENT.
This Lease, together with its exhibits, contains all agreernents of t},e
parties to this Lease and supersedes any previous negotiations. There have been
no representations rnade by the Landlord or understandings rnade between the
parties other than those set forth in this Lease and its exhibits. This Lease
may not be modified except by a written instrument duly executed by the parties
to this Lease.
29
35. EXAMINATION NOT OPTION.
Submission of this Lease shall not be deemed to be a reservation of the
Premises. Landlord shall not be bound by this Lease until it has received a
copy of this Lease duly executed by Tenant and has delivered to Tenant a copy
of this Lease duly executed by Landlord, and until such delivery Landlord
reserves the right to exhibit and lease the Premises to other prospective
tenants. Notwithstanding anything contained in this Lease to the contrary,
Landlord may withhold delivery of possession of the Premises from Tenant until
such time as Tenant has paid to Landlord any security deposit required by
Article 5, the first month's rent as set forth in Article 3 and any sum owed
pursuant to this Lease.
36. RECORDATION.
Tenant shall not record or register this Lease or a short form memorandum
hereof without the prior written consent of Landlord, and then shall pay all
charges and taxes incident such recordirig or registration.
37. LIMITATION OF LANDLORD'S LIABILITYY.
Redress for any claim against Landlord under this Lease shall be limited to and
enforceable only against and to the extent of Landlord's interest in the
Building. The obligations of Landlord under Ws Lease are not intended to and
shall not be personally binding on, nor shall any resort be had to the private
properties of, any of its trustees or board of directors and officers, as the
case may be, its investment manager, the general partners thereof, or any
beneficiaries, stockholders, employees, or agents of Landlord or the investment
manager.
38. ANNUAL RENT AND MONTHLY INSTALLMENT OF ANNUAL RENT.
Annual Rent Monthly Installment of Annual Rent
----------- ----------------------------------
4/15/97 - 5/31/97 $ 0.00 $0.00
6/1/97 - 4/30-99 $192,982,50 $16,081.88
5/1/99 - 4/30/00 $200,130.00 $16,677.50
5/1/00 - 6/30/02 $207,277.50 $17,273.13
39. HVAC.
Notwithstanding anything to the contrary set forth in this Lease, Landlord
covenants that the heating and air conditioning systems within the Premises
will be in good condition and repair on the Commencement Date of this Lease.
From and after the Commencement Date, Tenant shall be solely responsible for
maintenance of the heating and air conditioning systems pursuant to Article 7.2
of this Lease. Landlord and Tenant shall mutually agree upon which portions of
the heating and air conditioning systems within the Premises will be utilized
by Tenant, and those and only those portions of the system will be brought into
compliance and maintained pursuant to this Article 40. Said systems to be
outlined and agreed to in a separate document.
30
40. COMMENCEMENT DATE.
40.1 The term of this Lease and Tenant's obligations to make monthly
rental installments shall commence on April 15, 1997 (the "Commencement
Date'). Notwithstanding the foregoing, Landlord agrees that Tenant will be
entitled to one and one-half months of free rent under this Lease, so that
the first rental installment shall be due and payable by Tenant on June I,
1997.
40.2 Landlord agrees that Tenant may occupy the Premises prior to the
Commencement Date for the purposes of performing the construction
contemplated by this Lease and to conduct business operations to the
extent such construction is completed prior to the Commencement Date;
however, Tenant agrees that during such period all of the requirements
under the Lease (other than the payment of rentals) shall be applicable,
including, without limitation, the indemnity and insurance requirements
set forth in Articles 10 and 11, respectively.
LANDLORD: TENANT:
TCIT Dallas Industrial, Inc., Intelect Network Technologies Company,
a Delaware corporation a Nevada corporation
By: RREEF Management Company,
a California corporation
By: By:
---------------------------------- ---------------------------------
Xxxxxx X. Xxxx Xxxx Xxxxxx
Title: District Manager Title: President
------------------------------- -----------------------------
Dated: Dated:
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