EXHIBIT 10.80
LEASE AGREEMENT
BETWEEN
OXBRIDGE DEVELOPMENT AT CROWN POINTE, L.C.
A MARYLAND LIMITED LIABILITY COMPANY
AS LANDLORD
AND
THERIMMUNE RESEARCH CORPORATION
A MARYLAND CORPORATION
AS TENANT
FOR PREMISES LOCATED AT
000 XXXXXXXXXXXX XXXXX
XXXXXXXXXXXX, XXXXXXXX
DATED: OCTOBER 26, 2000
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TABLE OF CONTENTS
ARTICLE I BASIC LEASE PROVISIONS........................................................ 1
ARTICLE II DEFINITIONS................................................................... 2
ARTICLE III THE BUILDING.................................................................. 3
ARTICLE IV TERM.......................................................................... 5
ARTICLE V RENT.......................................................................... 6
ARTICLE VI SECURITY DEPOSIT.............................................................. 6
ARTICLE VII CAM COSTS..................................................................... 7
ARTICLE VIII TAXES.......................................................................... 11
ARTICLE IX PARKING........................................................................ 13
ARTICLE X USE; LEGAL COMPLIANCE.......................................................... 13
ARTICLE XI ASSIGN AND SUBLETTING.......................................................... 14
ARTICLE XII MAINTENANCE AND REPAIR......................................................... 16
ARTICLE XIII INITIAL CONSTRUCTION; ALTERATIONS.............................................. 17
ARTICLE XIV SIGNS.......................................................................... 18
ARTICLE XV TENANT EQUIPMENT AND PROPERTY.................................................. 18
ARTICLE XVI RIGHT OF ENTRY................................................................. 20
ARTICLE XVII INSURANCE...................................................................... 20
ARTICLE XVIII LANDLORD SERVICES AND UTILITIES................................................ 22
ARTICLE XIX LIABILITY OF LANDLORD.......................................................... 22
ARTICLE XX RULES AND REGULATIONS.......................................................... 24
ARTICLE XXI DAMAGE; CONDEMNATION........................................................... 24
ARTICLE XXII DEFAULT OF TENANT.............................................................. 25
ARTICLE XXIII MORTGAGES...................................................................... 27
ARTICLE XXIV SURRENDER, HOLDING OVER........................................................ 28
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ARTICLE XXV QUIET ENJOYMENT................................................................ 28
ARTICLE XXVI HAZARDOUS MATERIALS............................................................ 28
ARTICLE XXVII MISCELLANEOUS.................................................................. 30
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LIST OF EXHIBITS
Exhibit A-1 Plat Showing Land and Building
Exhibit A-2 Description of the Land
Exhibit B Work Agreement
Exhibit C Existing Title Matters
Exhibit D Form of Letter of Credit
Exhibit E Rules and Regulations
Exhibit F Subordination, Nondisturbance, and Attornment Agreement
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LEASE AGREEMENT
THIS LEASE AGREEMENT (this "Lease") is made as of the 26th day of
October, 2000 (the "Date of Lease"), by OXBRIDGE DEVELOPMENT AT CROWN POINTE,
L.C., a Maryland limited liability company ("Landlord"), and THERIMMUNE RESEARCH
CORPORATION, a Maryland corporation ("Tenant").
Landlord and Tenant intending legally to be bound, covenant and agree
as set forth below.
ARTICLE I
BASIC LEASE PROVISIONS
When used in this Lease, the following terms shall have the meanings
set forth below:
1.1. Building. The building, known as Crown Pointe I and containing
approximately 26,127 rentable square feet, as shown by cross-hatching on Exhibit
A-1, attached hereto and made a part hereof, including all alterations,
additions, improvements, restorations or replacements now or hereafter made
thereto, with an address of 000 Xxxxxxxxxxxx Xxxxx, Xxxxxxxxxxxx, Xxxxxxxx
00000. The Building is part of the Corporate Park.
1.2. Corporate Park. The Land, the Building, and all other
buildings and improvements located on the Land, including, without limitation,
the building known as Crown Pointe II. containing approximately 58,897 rentable
square feet ("Building II"), and the Common Area.
1.3. Term. Ten (10) years, subject to adjustment as set forth in
Article IV.
1.4. Renewal Options. One (1) five (5) year option to renew.
1.5. Commencement Date. March 1, 2001.
1.6. Expiration Date. Ten (10) years after the Commencement Date.
1.7. Basic Rent. Sixteen and 63/100 Dollars ($16.63) for each
rentable square foot of the Building during the first Lease Year [equal to a
total of Four Hundred Thirty-Four Thousand Four Hundred Ninety-Two and 00/100
Dollars ($434,492.00) for the first Lease Year, subject to annual increase under
Section 1.8].
1.8. Escalation. On the first day of the second Lease Year, and on
the first day of every Lease Year thereafter during the Term, the Basic Rent
shall increase at the rate of three percent (3%) per annum over the Basic Rent
in effect during the immediately preceding Lease Year.
1.9. Security Deposit. Two Hundred Seventy-Five Thousand Dollars
($275,000.00) subject to reduction in accordance with Article VI.
1.10. Intentionally Omitted.
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1.11. Tenant's Proportionate Share. A percentage obtained by
multiplying 100 by a fraction, the numerator of which shall be the rentable area
of the Building and the denominator of which shall be the total rentable area of
the Building and Building II together. However, (i) until the first tenant in
Building II takes occupancy of its premises in Building II, Tenant's
Proportionate Share of CAM Costs shall be fifty percent (50%), (ii) Tenant's
Proportionate Share of Real Estate Taxes imposed on the Building shall be one
hundred percent (100%) and Tenant's Proportionate of Real Estate Taxes imposed
on the Land shall be thirty and 73/100 percent (30.73%), and (iii) until
Building II is added for coverage purposes to the property insurance maintained
by Landlord for the Corporate Park, Tenant's Proportionate Share of Insurance
Premiums shall be one hundred percent (100%).
1.12. Parking Rent. None.
1.13. Parking Space Allocation. 78 unreserved, non-exclusive parking
spaces in the Parking Facilities.
1.14. Permitted Use. General office purposes, laboratory research,
and lawful uses ancillary thereto.
1.15. Broker(s). Landlord's: TSC ReaIty Services, LLC. Tenant's:
Atlantic Real Estate Group, Inc.
1.16. Landlord's Address. Oxbridge Development at Crown Pointe,
L.C., 000 Xxxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxxxx, Xxxxxxxx 00000, Attn: Xxxx X.
Xxxxx. Copies to: TSC Realty Services, LLC, 0000 Xxxxxxxxx Xxxxxx, Xxxxx 000,
Xxxxxxxx, Xxxxxxxx 00000, Attn: Peregrine Xxxxxxx and Linowes and Xxxxxxx LLP,
0000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxxxxx Xxxxxx, Xxxxxxxx 00000, Attn: Xxxxxx X.
Xxxxxxxxx, Esquire.
1.17. Tenant's Address. Before occupancy of the Building: TherImmune
Research Corporation, 000 Xxxxxx Xxxxxxx Xxxx, Xxxxx 000, Xxxxxxxxxxxx, Xxxxxxxx
00000, Attn: Xx. Xxxxxx Xxxxxxxx. After occupancy of the Building: TherImmune
Research Corporation, 000 Xxxxxxxxxxxx Xxxxx, Xxxxxxxxxxxx, Xxxxxxxx 00000,
Attn: Xx. Xxxxxx Xxxxxxxx. Copies to: Xxxxxxx X. Xxxxx, Esquire, Grossberg,
Yochelson, Fox & Xxxxx, LLP., 0000 X Xxxxxx, X.X., Xxxxx 000, Xxxxxxxxxx, X.X.
00000.
ARTICLE II
DEFINITIONS
When used in this Lease, the following terms shall have the meanings
set forth below:
2.1. Additional Rent. As defined in Section 5.3.
2.2. Agents. Officers, partners, directors, employees, agents,
licensees, customers and invitees.
2.3. Alterations. Alterations, additions or improvements of any
kind or nature to the Building, whether structural or nonstructural, interior,
exterior or otherwise excluding alterations
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which are solely cosmetic in nature within the interior of the Building (i.e.
installation or replacement of carpet, paint or wallcoverings).
2.4. Building's Architect. Any architect, space planner, designer
or engineer retained by Landlord to provide professional services in connection
with the Building.
2.5. Calendar Year. A period of twelve (12) consecutive months
commencing on each January 1 during the Term, except that the first Calendar
Year shall be that period from and including the Commencement Date through
December 31 of that same year, and the last Calendar Year shall be that period
from and including the last January 1 of the Term through the earlier of the
Expiration Date or date of the Lease termination.
2.6. Common Area. All areas, improvements, facilities and equipment
on or serving the Corporate Park which, from time to time, are designated by
Landlord for the common use or benefit of Tenant, other tenants and occupants of
the Corporate Park, and their Agents, including, without limitation, roadways,
entrances and exits, landscaped areas, open areas, park areas, exterior
lighting, service drives, pedestrian walkways, sidewalks, courtyards, exterior
concourses, stairs and ramps, exterior utility lines, common trash areas and
Parking Facilities.
2.7. Event of Default. As defined in Article XXII.
2.8. Herein, Hereafter, Hereunder and Hereof. Anything contained in
this Lease, including, without limitation, all Exhibits and any Riders.
2.9. Interest Rate. The per annum interest rate listed as the prime
rate on corporate, loans at large U.S. money center commercial banks as
published from time to time under "Money Rates" in the Wall Street Journal, plus
two (2) points, but in no event greater than the maximum rate permitted by law.
In the event the Wall Street Journal ceases to publish the prime rate, Landlord
shall choose, at Landlord's reasonable discretion, a similar publication which
publishes such rate.
2.10. Land. The piece or parcel of land, containing approximately
7.51 acres, shown on Exhibit A-1 and described on Exhibit A-2 attached hereto
and made a part hereof, and all rights, easements and appurtenances thereunto
belonging or pertaining, or such portion thereof as may be allocated by Landlord
to the Building by re-subdivision or otherwise.
2.11. Lease Year. Each consecutive twelve (12) month period elapsing
after (i) the Commencement Date if the Commencement Date occurs on the first day
of a month, or (ii) the first day of the first month following the Commencement
Date if the Commencement Date does not occur on the first day of the month.
2.12. Mortgage. Any mortgage, deed of trust, security interest or
title retention interest affecting the Building or the Land.
2.13. Mortgagee. The holder of any note or obligation secured by a
mortgage, deed of trust, security interest or title retention interest affecting
the Building or the Land, including, without limitation, lessors under ground
leases, sale-leasebacks and lease-leasebacks.
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2.14. CAM Costs. As defined in Section 7.2.
2.15. Parking Facilities. All parking areas now or hereafter made
available by Landlord for use by tenants and occupants of the Corporate Park,
including, without limitation, open-air parking, parking decks and parking
areas.
2.16. Real Estate Taxes. As defined in Article VIII.
2.17. Rent. Basic Rent as set forth in Section 1.7 and Additional
Rent as defined in Section 5.3.
2.18. Rules and Regulations. The rules and regulations set forth in
Exhibit D attached hereto and made a part hereof, as the same may be amended or
supplemented from time to time, upon notice to Tenant.
2.19. Space Plan. The configuration of the internal portion of the
Building as designed by Tenant and approved by Landlord in accordance with
Exhibit B.
2.20. Substantial Completion. As defined in the Work Agreement
attached hereto and made a part hereof as Exhibit B.
2.21. Substantial Part. More than fifty percent (50%) of the
rentable square feet of the Building or such lesser portion of the rentable area
of the Building which, if not available to Tenant would result in Tenant being
unable to reasonably conduct its business theretofore conducted at the Building
within the remaining portion.
2.22. Tenant's Architect. Any architect, space planner, designer or
engineer retained by Tenant to provide professional services in connection with
the Building.
2.23. Work Agreement. Exhibit B attached hereto and made a part
hereof.
ARTICLE III
THE BUILDING
3.1. Lease of Building. In consideration of the agreements
contained herein, Landlord hereby leases the Building to Tenant, and Tenant
hereby leases the Building from Landlord, for the Term and upon the terms and
conditions hereinafter provided. It is specifically understood that the rentable
area of the Building has been determined by the Building's Architect according
to the Building Owners and Managers Association International Standard Method
for Measuring Floor Space in Office Buildings (1996) (the "BOMA Method"), that
Tenant was given the opportunity to verify this determination prior to the Date
of Lease, and that the rentable area of the Building for all purposes under this
Lease shall be as set forth in Section 1.1. Unless and until otherwise
determined in accordance with the next sentence, the rentable area of Building
II shall be deemed to be the rentable area set forth in Section 1.2. Upon
substantial completion of Building II, the rentable area of Building II will be
determined by the Building's Architect according to the BOMA Method, will be
confirmed in writing to Tenant, and will be subject to verification by Tenant's
Architect, at Tenant's sole expense, within thirty (30) days thereafter. In the
event that the measurement by the Building's Architect, as may be verified by
Tenant's
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Architect, shall result in a determination by the parties that the rentable area
of Building II is more or less than the rentable area set forth in Section 1.2,
Tenant's Proportionate Share shall be adjusted in accordance with Section 1.11
using the corrected measurement. In the event there shall occur during the Term
any permanent increase or decrease to the rentable area of either the Building
or Building II, Tenants' Proportionate Share shall be appropriately adjusted as
of the date of substantial completion of such change.
3.2. Common Rights. As an appurtenance to the Building, Tenant
shall have the non-exclusive right, together with other tenants and occupants of
the Corporate Park, to use the Common Area. Landlord shall retain absolute
dominion and control over the Common Area and shall operate and maintain the
Common Area in such matter as Landlord, in its reasonable discretion, shall
determine; provided, however, that such exclusive right shall not operate to
impair or impede in any material and adverse manner Tenant's use of the Building
for the Permitted Use or Tenant's use of the Common Area for its intended
purposes. In no event shall any modification of the Common Area result in a
reduction of parking spaces within that portion of the Common Area cross-hatched
on Exhibit A-1 (the "Tenant Protected Area") to less than seventy-eight (78)
spaces. Landlord expressly reserves the right permanently to change, modify, or
eliminate, or temporarily to close, any portion of the Common Area so long as
such action does not unreasonably interfere with Tenant's use or enjoyment of
the Building or reduce the number of parking spaces within the Tenant Protected
Area as above provided. Tenant recognizes, however, that short-term disruptions
of parking within the Tenant Protected Area may occur while Building II is being
constructed or the Parking Facilities are being repaired and that such
disruptions shall not be deemed to be a violation of the terms of this Section
3.2. During the period of any such disruption, there shall be available to
Tenant alternative parking within the Common Area in reasonable proximity to the
Building. The Building is leased subject to, and Tenant agrees not to violate,
(i) the existing easements, covenants, conditions, restrictions, and other
matters of record which affect the Building or the Land as of the Date of Lease,
as set forth on Exhibit C attached to and made, a part of this Lease ("Existing
Title Matters"), or (ii) any additional easements, covenants, conditions,
restrictions, and other matters of record which may affect the Building or the
Land in the future ("Future Title Matters"), provided that none of the Future
Title Matters shall materially and adversely affect Tenant's use of the Building
for the Permitted Use or use of the Common Area for parking and access. The
Existing Title Matters and Future Title Matters are sometimes collectively
referred to in this Lease as the "Permitted Exceptions".
3.3 Landlord's Reservations. In addition to the other rights of
Landlord under this Lease, Landlord reserves the right (i) to change the street
address of the Building provided written notice thereof is given to Tenant not
later than sixty (60) days prior to the Commencement Date, (ii) to install,
erect, use, maintain and repair mains, pipes, conduits and other such facilities
in and through Tenant's premises to serve other tenants and occupants of the
Building if, in the future, this Lease is terminated by agreement of the parties
as to a portion of the Building and Tenant is no longer the sole tenant of the
Building, (iii) subject to Tenant's rights hereunder, to control the use of the
roof and exterior walls of the Building for any purpose, recognizing that,
except as provided in Article XVI, in no event shall Landlord install, affix or
otherwise place, or permit any others to place, any exterior signage,
advertisements or notices of any sort on such Building, it being the intent of
the parties that Tenant alone shall have sole signage rights on or at the
Building, subject to Article XIV, (iv) to re-subdivide or establish a
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condominium regime for the Land, and (v) to use Tenant's name in promotional
materials relating to the Corporate Park. Subject to Tenant's right of quiet
enjoyment, Landlord may exercise any or all of the foregoing rights without
being deemed to be guilty of an eviction, actual or constructive, or a
disturbance or interruption of Tenant's business or Tenant's use or occupancy of
the Building.
ARTICLE IV
TERM
4.1. Term. The Term shall commence on the Commencement Date and
expire at midnight on the Expiration Date. In the event that the Commencement
Date occurs on other than the first day of a month, the Expiration Date shall be
extended so as to be the last day of the month in which the Expiration Date
occurs. If requested by Landlord, Tenant shall, within five (5) business days of
such request, sign a declaration acknowledging the Commencement Date and the
Expiration Date. From the Date of Lease until the Commencement Date, all of the
terms of this Lease shall be in full force and effect, except that Basic Rent
and other amounts due from Tenant shall not be payable with respect to the
period preceding the Commencement Date.
4.2. Renewal Option.
(i) Tenant shall have one (1) option (the "Renewal
Option") to extend the Term for an additional five (5) year period (the "Renewal
Period"). The Renewal Option shall be exercised, if at all, strictly in
accordance with this Section 4.2 and such exercise shall be effective only if no
Event of Default shall exist at the time of exercise or at the time of
commencement of the Renewal Period. The Renewal Option shall be exercisable only
by written notice given by Tenant to Landlord at least twelve (12) months prior
to the expiration of the Term. In the event that Tenant does not timely exercise
the Renewal Option, the Renewal Option shall be null and void and of no further
force or effect. As used in this Lease, "Term" shall mean the initial Term and,
if the Renewal Option is properly exercised in accordance with this Section 4.2,
the Renewal Period.
(ii) If Tenant properly exercises the Renewal Option, all
terms and conditions of this Lease shall be applicable during the Renewal
Period, except that (a) no further Renewal Options may be exercised under this
Lease, (b) Tenant shall not be entitled again to any of the rental abatements,
rental credits, or tenant allowances once provided under this Lease (but market
rental concessions shall be taken into account in determining "Prevailing Market
Rent" as provided below), and (c) the Basic Rent during the first Lease Year of
the Renewal Period shall be the greater of (1) the Basic Rent applicable during
the last Lease Year of the Term then expiring, increased in accordance with
Section 1.8, or (2) the then "Prevailing Market Rent". The Prevailing Market
Rent shall be the triple net rent which is being asked of tenants for office/R
and D space comparable to the Building under five (5) year leases in similar
buildings in the Gaithersburg, Maryland area as of the date the brokers make
their determinations under Section 4.2(iii), taking into account the value of
brokerage commissions, rental abatements, rental credits, and tenant allowances,
if any, typically being offered or paid under such leases.
(iii) If Tenant exercises the Renewal Option, Landlord and
Tenant shall endeavor in good faith to agree on the Prevailing Market Rent. If,
however, they are unable to
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do so within thirty (30) days, Tenant shall notify Landlord of the name and
address of a leasing broker selected by Tenant to determine the Prevailing
Market Rent. Within ten (10) days after receipt of Tenant's notice, Landlord
shall notify Tenant in writing of the name and address of a leasing broker
selected by Landlord to determine the Prevailing Market Rent. Each broker shall
independently make his or her determination of the Prevailing Market Rent within
thirty (30) days after the appointment of Landlord's broker. The Prevailing
Market Rent shall be deemed to be the average of the two determinations unless
the higher of such determinations is greater than one hundred five percent
(105%) of the lower of the determinations. If the higher determination is
greater than one hundred five percent (105%) of the lower determination, the
brokers selected by Landlord and Tenant shall together select a third broker
within ten (10) days after rendering their determinations. The third broker
shall have twenty (20) days to make his or her determination of the Prevailing
Market Rent and upon such determination, the Prevailing Market Rent shall be
deemed to be the median determination made by the three (3) brokers.
(iv) Each broker appointed pursuant to this Section shall
be a disinterested broker licensed in the State of Maryland having recognized
competence in the field of commercial leasing and a minimum of ten (10) years
experience as a commercial leasing broker or agent in Xxxxxxxxxx County,
Maryland. Each party shall pay for the consulting fee of the broker which it
selects and the parties shall share equally the consulting fees of the third
broker, if any.
(v) Beginning with the second Lease Year of the Renewal
Period and continuing in each subsequent Lease Year of the Renewal Period, Basic
Rent shall increase in the manner provided in Section 1.8. If, however, Basic
Rent for the first Lease Year of the Renewal Period is determined on the basis
of Prevailing Market Rent, the escalation factor that shall apply to Basic Rent
over the balance of the Renewal Period shall be determined as part of the
determination of Prevailing Market Rent.
ARTICLE V
RENT
5.1. Basic Tenant. Tenant shall pay to Landlord the Basic Rent as
specified in Section 1.7, escalated in accordance with Section 1.8.
5.2. Payment of Basic Rent. Throughout the Term, Basic Rent for
each Lease Year shall be payable in twelve (12) equal monthly installments, in
advance, without demand, notice, deduction, offset, recoupment or counterclaim
(except as otherwise expressly provided in this Lease), on or before the first
day of each and every calendar month during the Lease Year; provided, however,
that if the Commencement Date occurs on a date other than on the first day of a
calendar month, Basic Rent shall be pro rated on a per diem basis for the period
from the Commencement Date through the last day of such calendar month at the
rate payable for the first Lease Year and shall be due and payable on the
Commencement Date. Tenant shall pay the Basic Rent and all Additional Rent, by
good check or in lawful currency of the United States of America, to Landlord at
Landlord's Address, or to such other address or in such other manner as Landlord
from time to time specifies by written notice to Tenant. Any payment made by
Tenant to Landlord on account of Basic Rent may be credited by Landlord to the
payment of any late
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charges then due and payable and to any Basic or Additional Rent then past due
before being credited to Basic Rent currently due.
5.3. Additional Rent. All sums payable by Tenant under this Lease,
other than Basic Rent, shall be deemed "Additional Rent", and, unless otherwise
set forth herein, shall be payable in the same manner as set forth above for
Basic Rent.
5.4. Net Lease. Except as otherwise expressly provided in this Lease,
Tenant shall pay all Real Estate Taxes, all water, sewer, and other utility
charges and assessments, all maintenance, repair and replacement costs
(excluding any costs of structural repairs which Landlord is obligated to bear
under this Lease and any items required to be excluded from CAM Costs or Real
Estate Taxes under the terms of this Lease), all fire protection and security
costs, and all other expenses of every kind and character, whether foreseen or
unforeseen, ordinary or extraordinary, which either Landlord or Tenant becomes
liable to pay due to its estate or interest in the Building, or which arise out
of the possession, use, occupancy, operation, maintenance or repair of all or
any portion of the Building.
ARTICLE VI
SECURITY DEPOSIT
6.1. Letter of Credit. Simultaneously with the execution of this
Lease, Tenant shall deliver the Security Deposit to Landlord. The Security
Deposit shall consist of an irrevocable letter of credit substantially in the
form of Exhibit D attached to and made a part of this Lease (the "Letter of
Credit"). The Letter of Credit shall be issued by either Allfirst Bank or such
other federally insured bank with branches in the Washington, D.C. metropolitan
area which is reasonably acceptable to Landlord and shall be transferable by
Landlord. Subject to the reductions set forth below, the Letter of Credit shall
be maintained in full force and effect by Tenant throughout the Term until
returned to Tenant for cancellation. The Security Deposit shall be held by
Landlord, without obligation for interest, as security for the performance of
Tenant's obligations and covenants under this Lease. It is expressly understood
and agreed that the Security Deposit is not an advance rental deposit or a
measure of Landlord's damages in case of an Event of Default. If an Event of
Default shall occur or if Tenant fails to surrender the Building in the
condition required by this Lease, Landlord shall have the right (but not the
obligation), and without prejudice to any other remedy which Landlord may have
on account thereof, to draw upon and use all or any portion of the Security
Deposit to cure the default or remedy the condition of the Building. In the
event any portion of the Security Deposit has been so used by Landlord during
the Term, Tenant shall restore the Security Deposit to its full original amount
within ten (10) days after Landlord has drawn upon the Security Deposit. If at
any time prior to the return of the Security Deposit to Tenant either (a) Tenant
fails to renew the Letter of Credit for a one (1) year period at least thirty
(30) days prior to its then current expiration date, or (b) Landlord receives
written notice from the issuer of the Letter of Credit that such issuer does not
intend to renew the Letter of Credit for another one (1) year period, Landlord
may draw upon the Letter of Credit to its full outstanding amount and the
proceeds of such draw shall thereafter constitute the Security Deposit. If
Landlord shall sell or transfer its interest in the Building, Landlord shall
transfer the Security Deposit to the purchaser or transferee, in which event
Tenant shall look solely to such purchaser or transferee for the return of the
Security Deposit and Landlord shall be released from all liability to Tenant for
the return of the Security Deposit.
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Tenant, upon request by Landlord, shall cooperate with Landlord and execute any
documents which may be required to effectuate the transfer of the Security
Deposit to any purchaser, transferee, or Mortgagee of the Building. Any
remaining balance of the Security Deposit shall be returned to Tenant at the
later of (i) thirty (30) days after the Expiration Date or earlier termination
of this Lease or (ii) the fulfillment of all of Tenant's obligations under this
Lease following the Expiration Date or earlier termination of this Lease.
6.2. Reduction of Letter of Credit. Notwithstanding the foregoing,
the Security Deposit shall be reduced to One Hundred Seventy-Five Thousand
Dollars ($175,000.00) as of the first day of the fourth Lease Year and to
Seventy-Three Thousand Four Hundred Forty-Four Dollars ($73,444.00) as of the
first day of the ninth Lease Year, provided that, at the time for reduction, no
Event of Default exists and no event has occurred and is continuing which would
constitute an Event of Default with the giving of notice or the passage of time
or both. Each reduction shall be effectuated by Tenant obtaining and furnishing
to Landlord, as of the time for reduction, an amendment of the Letter of Credit
appropriately reducing the amount of the Letter of Credit. If required by the
issuer of the Letter of Credit, Landlord shall confirm in writing its consent to
such amendment, provided that the conditions for reduction set forth above are
satisfied. Except as expressly provided in this Article, the Security Deposit
shall not be reduced.
6.3. Increase of Letter of Credit. Notwithstanding anything
contained in this Article, the Security Deposit shall be subject to increase,
and the reduction provisions of Section 6.2 shall not apply, to the extent set
forth in Section 11.1.
ARTICLE VII
CAM COSTS
7.1. Tenant's Proportionate Share. Commencing with the first Lease
Year and during each Lease Year of the Term thereafter, Tenant shall pay to
Landlord, as Additional Rent, Tenant's Proportionate Share of the CAM Costs
incurred during each Calendar Year.
7.2. CAM Costs Defined. As used herein, the term "CAM Costs" shall
mean all expenses and costs of every kind and nature which Landlord incurs
because of or in connection with the ownership, maintenance, repair, management
and operation of the Land and Common Area, subject to the exceptions set forth
below. CAM Costs shall include, without limitation, all costs, expenses and
disbursements incurred or made in connection with the following:
(i) Wages and salaries of all employees up to and
including the grade of chief engineer, whether employed by Landlord or the
Corporate Park's management company, engaged in the operation and maintenance or
security of the Land and the Common Area (except that if any such employee is
not employed full-time in connection with providing such services to the
Corporate Park, such wages and/or salaries shall be pro rated proportionally to
reflect the percentage of time such employee is engaged in work related to the
Corporate Park), and all costs related to or associated with such employees or
the carrying out of their duties, including uniforms and their cleaning, taxes,
insurance and benefits;
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(ii) All supplies and materials used directly in the
operation and maintenance of the Land and the Common Area;
(iii) All utilities serving the Land or the Common Area;
(iv) All maintenance, operation and service agreements for
the Land and the Common Area and any equipment related thereto, including,
without limitation, service and/or maintenance agreements for security,
groundskeeping, landscaping and exterior plant maintenance;
(v) All repairs and replacements to the Land and the
Common Area (excluding amounts paid for by proceeds of insurance or by Tenant or
other third parties other than as a part of the CAM Costs), regardless of
whether foreseen or unforeseen;
(vi) All operation and maintenance of the Land and the
Common Area, including, without limitation, ice and snow removal, landscaping,
groundskeeping, sweeping and trash removal, maintenance of entry features and
directional signage, patching, re-striping, and resurfacing of roads, driveways
and parking lots, and lighting of the Common Area;
(vii) Accounting and legal fees incurred in connection with
the operation and maintenance of the Corporate Park, excluding attorneys' fees
and other expenses incurred in connection with leasing space in the Corporate
Park or with negotiations or disputes with tenants, brokers, adjoining parties,
other occupants, or prospective tenants or occupants of the Corporate Park;
(viii) Any additional services not provided to tenants of
the Corporate Park at the Commencement Date but thereafter provided by Landlord
as Landlord shall deem necessary or desirable in connection with the management
or operation of the Land and the Common Area, provided that the additional
services are customarily furnished by landlords in similar office and R and D
complexes in Xxxxxxxxxx County, Maryland;
(ix) All community association dues and all assessments,
whether general, special or otherwise, levied against Landlord or the Corporate
Park pursuant to any declaration or other instrument affecting the Corporate
Park, subject to the limitations on the costs of capital improvements set forth
below;
(x) Any capital improvements (including, without
limitation, replacements) made to the Land or Common Area after the Commencement
Date which are primarily installed for the purpose of reducing CAM Costs (as
opposed to those installed because of the obsolescence of the item being
replaced or the recognition that such item has reached the end of its useful
life) or are required or imposed by any law or governmental rule, regulation, or
requirement that was not applicable to the Land or the Corporate Park at the
time the Corporate Park was constructed (each a "Permitted Capital
Improvement"). The cost of each Permitted Capital Improvement shall be amortized
over the useful life of that improvement consistent with generally accepted
accounting principles consistently applied ("GAAP"), together with interest on
the unamortized balance of such cost at the Interest Rate or such higher rate as
may have been paid by Landlord on funds borrowed for the purposes of
constructing or installing the Permitted
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Capital Improvement, to the extent that such higher rate is consistent with then
prevailing market interest rates;
(xi) Other expenses and costs reasonably necessary for
operating and maintaining the Land and the Common Area.
7.3 Exclusions from CAM Costs. Notwithstanding Section 7.2, CAM
Costs shall not include any of the following: (i) depreciation or expenses for
capital improvements made to the Land or Corporate Park, other than Permitted
Capital Improvements; (ii) costs of repairs, restoration, replacements or other
work occasioned by either (a) fire, windstorm or other casualty coverable by the
property insurance required to be maintained by Landlord under Section 17.5,
(whether such destruction be total or partial), provided, however, that up to
Ten Thousand Dollars ($10,000.00) of the costs of such repairs and restoration
may be included in CAM Costs to the extent such costs are payable by Landlord
pursuant to the deductible under its property insurance, (b) the exercise by
governmental authorities of the right of eminent domain, whether such taking be
total or partial, or (c) the negligence or intentional tort of Landlord, or any
subsidiary or affiliate of Landlord, or any representative, employee or agent of
same; (iii) interest and amortization of funds borrowed by Landlord, whether
secured or unsecured, and other financing costs (except financing for Permitted
Capital Improvements); (iv) bad debt charges; (v) leasing commissions or costs
to obtain prospective or actual tenants at the Corporate Park; (vi) costs,
fines, interest, penalties, legal fees or costs of litigation incurred due to
Landlord's late payment of taxes, utility bills and other costs (or late filing
of tax returns or other informational returns or reports), unless caused by late
payment of Rent and other amounts by Tenant under this Lease (or, in the case of
tax or informational returns or reports, Tenant's failure or delay in furnishing
to Landlord information relative to Tenant required for the filing of the
returns); (vii) costs incurred for any item covered by a manufacturer's,
materialman's, vendor's or contractor's warranty (a "Warranty") to the extent
that proceeds under the Warranty are paid to Landlord for such item (but costs
of obtaining recovery under the Warranty shall be included as part of CAM
Costs); (viii) income, excess profits, franchise taxes or other such taxes
imposed on or measured by the income of Landlord from the operation of the
Corporate Park; (ix) costs of Landlord's defense of lawsuits against Landlord
and any judgments or costs of settlement resulting from such lawsuits (but this
exclusion shall not be deemed to limit in any way any indemnification by Tenant
provided for in this Lease); (x) legal fees and other costs (including charges
for prepayment of any indebtedness) incurred in connection with any mortgaging,
financing, refinancing, sale, or change of ownership or entering into,
extending, or modifying any financing, declaration of covenants, ground lease or
other lease; (xi) the costs of services or items provided by Landlord's
affiliates to the extent that such costs exceed reasonable and customary charges
for such services or items in the Washington, D.C. metropolitan area (the
"Market Area"); (xii) acquisition or leasing costs of sculpture, paintings or
other objects of art; (xiii) accounting fees, other than those incurred in
connection with the preparation of statements required pursuant to the
provisions of this Lease; (xiv) costs and expenses (including court costs,
attorneys' fees and disbursements) related to or in connection with disputes
with any holder of a mortgage or by or among any persons having an interest in
Landlord or the Corporate Park or any part thereof; (xv) consulting costs and
expenses paid by Landlord, except those involving maintenance, repair, or
improvement of the Common Area or Building; (xvi) any cost incurred in
connection with the investigation or remediation of any Hazardous Material (as
defined in Section 26.1) located in, on, under or about the Corporate Park as of
the Date of Lease or any
15
Hazardous Material stored, used or released by Landlord, its employees, agents,
licensees, or tenants after the Date of Lease, and any cost incurred in
connection with any government investigation, order, proceeding or report with
respect thereto (unless such substances were introduced in the Building or
Corporate Park by Tenant, its invitees or guests); (xvii) costs or fees incurred
in connection with a sale, lease or transfer (including testamentary transfers)
of all or any part of the Corporate Park or any interest therein, or of any
interest in Landlord, or in any person comprising, directly or indirectly,
Landlord or in any person having an equity interest, directly or indirectly in
Landlord; (xviii) the cost of any utilities consumed in Building II inasmuch as
the utilities for the Building are being separately metered and paid for by
Tenant or the cost of any "tap fees" or one-time lump sum sewer or water
connection fees for the Corporate Park payable in connection with the initial
construction of the Corporate Park; (xix) any costs, fines or penalties incurred
as a result of a violation by Landlord of any legal requirements which Landlord
is required to comply with under the terms of this Lease; (xx) all costs and
expenses (including services and utilities) paid directly by Tenant to the party
(other than Landlord) from whom Tenant ordered such services; (xxi) costs for
repairing, replacing or otherwise correcting defects (but not the costs of
repair or normal wear and tear) in the initial construction of the Building or
Building II; (xxii) Insurance Premiums or any premiums for insurance excluded
from Insurance Premiums, Real Estate Taxes or any taxes excluded from Real
Estate Taxes (Insurance Premiums and Real Estate Taxes being separately
addressed elsewhere in this Lease); (xxiii) costs of initial construction of the
Building or Building II or any of the Common Areas; (xxiii) costs and expenses
incurred by Landlord associated with the operation of the legal entity or
entities which constitute Landlord (as opposed to costs and expenses associated
with the operation of the Corporate Park); (xxiv) rent for any on-site offices
of Landlord or its managing agent; (xxv) charitable or political contributions;
(xxvi) intentionally omitted; (xxvii) intentionally omitted; (xxviii)
advertising and promotional expenditures in connection with leasing any space in
the Corporate Park; (xxix) costs of the installation of signs identifying the
occupant, owner and/or manager of Building II; and (xxx) the cost of provision
of electronic cards or security keys for Building II inasmuch as Tenant is
responsible for such costs in the Building. There shall not be duplication in
charges to Tenant by reason of the provisions setting forth Tenant's obligation
to reimburse Landlord for CAM Costs and any other provision in this Lease. It is
expressly further agreed that Tenant shall not be billed for any costs incurred
by reason of the construction of Building II or resurfacing, restoration or
repair of any of the Common Area required by reason of such construction. In
addition, in the event Landlord elects or is required by its tenant to provide a
particular service or amenity in Building II which is not provided to Tenant
(e.g., Landlord places a concierge in Building II or a security guard), the cost
of such amenity or service shall expressly not be included in CAM Costs.
7.4. Management Fee. In addition to Tenant's Proportionate Share of
CAM Costs, Tenant shall pay to Landlord, for each Calendar Year, an
administrative fee for managing the Common Area equal to three percent (3%) of
the Basic Rent payable by Tenant during such Calendar Year (the "Management
Fee"). There shall be no other fee for management, overhead or supervision by
Landlord included in CAM Costs, except as provided in Section 7.2(i).
7.5. Estimated Payment. Prior to the Commencement Date and prior to
the first day of each Calendar Year thereafter during the Term, Landlord shall
submit to Tenant an estimate of the CAM Costs expected to be incurred by
Landlord during the upcoming Calendar Year and a statement of Tenant's
Proportionate Share of such estimated annual CAM Costs. In addition to
16
the Basic Rent, Tenant shall pay to Landlord, beginning on the Commencement Date
and continuing on the first day of each month thereafter during each Calendar
Year, one-twelfth (1/12) of the estimated annual amount of Tenant's
Proportionate Share of CAM Costs as set forth in Landlord's statement, plus
one-twelfth (1/12) of the Management Fee payable for that Calendar Year.
However, if the Commencement Date is a day other than the first day of a
calendar month, then the installment of CAM Costs and Management Fee for the
first month of the Term shall be pro rated on the basis of a thirty (30)-day
month. If Landlord fails to give Tenant notice of its estimated payments due
under this Section for any Calendar Year, then Tenant shall continue making
monthly estimated payments in accordance with the estimate for the previous
Calendar Year until a new estimate is provided. When the new estimate is
provided, Tenant's monthly estimated payments shall be adjusted in accordance
with the new estimate and if any deficiency exists in the payments already made
for the Calendar Year in question, the deficiency shall be paid with the next
monthly installment of Basic Rent. No delay by Landlord in providing any
estimate under this Section or any statement under Section 7.5 shall excuse
Tenant from paying Tenant's Proportionate Share of CAM Costs or the Management
Fee for any period within the Term. If Landlord determines during any Calendar
Year that, because of unexpected increases in CAM Costs, Landlord's estimate of
the CAM Costs for that Calendar Year was too low, then Landlord shall have the
right to give a new statement of the estimated Tenant's Share of CAM Costs for
such Calendar Year or the balance thereof and to xxxx Tenant for any deficiency
which may have accrued during such Calendar Year, and Tenant shall thereafter
pay monthly estimated payments based on such new statement. The initial amount
of Tenant's estimated monthly payments of CAM Costs and Management Fee shall be
Two Thousand Seven Hundred Sixty-Five and 11/100 Dollars ($2,765.11) per month
(exclusive of Real Estate Taxes, Insurance Premiums, and any costs of
maintaining and repairing the Building).
7.6. Actual CAM Costs. Within ninety (90) days after the end of
each Calendar Year or as soon thereafter as reasonably practicable, Landlord
shall submit a statement to Tenant showing the actual CAM Costs incurred by
Landlord for such Calendar Year and the amount of Tenant's Proportionate Share
of such actual CAM Costs. If, for any Calendar Year, Tenant's estimated payments
exceeded Tenant's Proportionate Share of actual CAM Costs, Tenant shall receive
a credit in the amount of the overpayment toward Tenant's next monthly payments
of CAM Costs. If, for any Calendar Year, Tenant's estimated monthly payments
were less than Tenant's Proportionate Share of actual CAM Costs, then Tenant
shall pay the total amount of such deficiency to Landlord within thirty (30)
days after receipt of the statement from Landlord. Landlord's and Tenant's
obligations with respect to any overpayment or underpayment of Tenant's
Proportionate Share of CAM Costs shall survive the expiration or termination of
this Lease.
7.7. Audit Rights. Tenant or its agent shall have the right, for a
period of ninety (90) days after Tenant's receipt of the statement of actual CAM
Costs for each Calendar Year, and upon giving reasonable notice to Landlord and
during normal business hours, to audit, review and inspect at Landlord's offices
Landlord's bills, invoices and records applicable to the actual CAM Costs for
that particular Calendar Year to verify the CAM Costs. Such audit, review and
inspection shall be at Tenant's sole cost, except as otherwise provided below.
Unless otherwise mutually agreed, should such audit, review or inspection result
in a dispute by Tenant as to the CAM Costs charged by Landlord, such dispute
shall be determined by arbitration, in the
17
jurisdiction in which the Building is located, in accordance with the then
current commercial rules of the American Arbitration Association. The costs of
the arbitration shall be divided equally between Landlord and Tenant, except
that each party shall bear the cost of its own legal fees, unless (i) the
arbitration results in a determination that Landlord's statement contained a
discrepancy of less than five percent (5%) in Landlord's favor, in which event
Tenant shall bear all costs incurred in connection with such arbitration,
including, without limitation, reasonable legal fees, or (ii) the arbitration
results in a determination that Landlord's statement contained a discrepancy of
at least five percent (5%) in Landlord's favor, in which event Landlord shall
bear all costs incurred in connection with such arbitration, including, without
limitation, reasonable legal fees. If such review, audit or inspection reveals
that Landlord overstated Tenant's obligation for CAM Costs in any Calendar Year,
the excess shall be credited against Tenant's next monthly payments of CAM
Costs. If such review, audit or inspection reveals that Landlord understated
Tenant's obligation for CAM Costs in any Calendar Year, Tenant shall pay the
total amount of such deficiency to Landlord within thirty (30) days after such
determination. During the pendency of any audit or arbitration proceedings as
provided for in this Section, Tenant shall continue to make payments of CAM
Costs as required by this Lease.
ARTICLE VIII
TAXES
8.1. Tenant's Obligation. Tenant shall be liable for Tenant's
Proportionate Share of all Real Estate Taxes for any period falling within the
Term. "Real Estate Taxes" shall mean all taxes and assessments, general or
special, ordinary or extraordinary, foreseen or unforeseen, assessed, levied or
imposed by any governmental authority upon the Corporate Park, and the rental,
revenue or receipts derived therefrom, under the current or any future taxation
or assessment system or modification of, supplement to, or substitute for such
system. Real Estate Taxes shall not include any special assessments for public
improvements, including, without limitation, road improvement assessments,
special use area assessments, and school district assessments (collectively,
"Special Assessments") levied as of the Date of Lease, but shall include Special
Assessments levied after the Date of Lease and annual sewer and water front foot
benefit charges. If at any time the method of taxation prevailing at the Date of
Lease shall be altered so that in lieu of, as a substitute for or in addition to
the whole or any part of the taxes now levied or assessed, there shall be levied
or assessed a tax of whatever nature, then the same shall be included as Real
Estate Taxes hereunder. Further, for the purpose of this Article, Real Estate
Taxes shall include the reasonable expenses (including, without limitation,
reasonable attorneys' fees) incurred by Landlord in challenging or obtaining or
attempting to obtain a reduction of Real Estate Taxes, regardless of the outcome
of such challenge, provided that such challenge relates to a period elapsing
during the Term (and in the event any challenge pertains to a period extending
either before or after the Term, the costs of that challenge shall be
appropriately prorated based upon the period covered by such challenge in
relationship to the Term). Notwithstanding the foregoing, Landlord shall have no
obligation to challenge Real Estate Taxes. If, as a result of any such
challenge, a tax refund is made to Landlord, then the amount of such refund,
less the expenses of the challenge shall be deducted from Real Estate Taxes due
in the Lease Year such refund is received. Real Estate Taxes shall not include
any (i) interest and penalties due to late payment (or late filing of returns)
by Landlord, unless caused by Tenant's late payment or nonpayment, (ii)
franchise, capital stock, or similar taxes of Landlord, (iii) any income, excess
profits, or other taxes of Landlord determined on the basis of its income,
18
receipts, or revenues, (iv) any sales or excise tax imposed on the rent payable
by Tenant under the Lease, (v) any estate, inheritance, succession, gift,
capital levy, or similar tax of Landlord, and (vi) any transfer taxes (except as
provided in Section 27.18), recording fees, tap fees, excise taxes, license
fees, permit fees, impact fees, or inspection fees payable in connection with
Landlord's completion of the Corporate Park or any part thereof. Real Estate
Taxes shall specifically exclude any abatements, reductions or credits received
by Landlord. Assessments which may be paid over a period in excess of twelve
months without penalties shall be included within taxes only to the extent such
payments are required to be made within the particular Calendar Year. In the
event any contest or appeal of the Real Estate Taxes for any given year shall
result in a refund of taxes previously paid by Tenant, Tenant will receive its
proportionate share of the amount of the net refund, inclusive of any interest
received by Landlord by reason of the refund of taxes (i.e., the net amount
remaining after paying all costs and expenses of securing the refund, including
reasonable attorneys fees).
8.2. Estimated Payment. Prior to the Commencement Date and prior to
the first day of each Calendar Year thereafter during the Term, Landlord shall
submit to Tenant a reasonable estimate of the Real Estate Taxes expected to be
incurred by Landlord during the upcoming Calendar Year and a statement of
Tenant's Proportionate Share of such estimated annual Real Estate Taxes. In the
event that any tax xxxx imposes Real Estate Taxes on both the Building and
Building II without allocating such Taxes as between the two (2) buildings,
then, for the purposes of this Section and Section 8.3, the Real Estate Taxes
allocable to the Building shall be determined by reference to the tax assessor's
worksheet for the Corporate Park. It is the express intent of the parties that
Tenant shall not be obligated to pay any Real Estate Taxes levied, imposed, or
assessed against Building II. In addition to the Basic Rent, Tenant shall pay to
Landlord, beginning on the Commencement Date and continuing on the first day of
each month thereafter during each Calendar Year, one-twelfth (1/12) of Tenant's
Proportionate Share of annual Real Estate Taxes as set forth in Landlord's
statement. However, if the Commencement Date is a day other than the first day
of a calendar month, then the installment of Real Estate Taxes for the first
month of the Term shall be pro rated on the basis of a thirty (30)-day month. If
Landlord fails to give Tenant notice of its estimated payments due under this
Section for any Calendar Year, then Tenant shall continue making monthly
estimated payments in accordance with the estimate for the previous Calendar
Year until a new estimate is provided. When the new estimate is provided,
Tenant's monthly estimated payments shall be adjusted in accordance with the new
estimate and if any deficiency exists in the payments already made for the
Calendar Year in question, the deficiency shall be paid with the next monthly
installment of Basic Rent. No delay by Landlord in providing any estimate under
this Section or any statement under Section 6.3 shall excuse tenant from paying
Tenant's Proportionate Share of Real Estate Taxes for any period within the
Term. The initial amount of Tenant's estimated monthly payments of Real Estate
Taxes shall be Three Thousand Three Hundred Ninety-Six and 51/100 Dollars
($3,396.51) per month.
8.3. Actual Real Estate Taxes. Within ninety (90) days after the
end of each Calendar Year or as soon thereafter as reasonably practicable,
Landlord shall submit a statement to Tenant showing the actual Real Estate Taxes
incurred by Landlord for such Calendar Year and the amount of Tenant's
Proportionate Share of such actual Real Estate Taxes. If, for any Calendar Year,
Tenant's estimated payments exceeded Tenant's Proportionate Share of actual Real
Estate Taxes, Tenant shall receive a credit in the amount of the overpayment
toward Tenant's next
19
monthly payment of Real Estate Taxes. If, for any Calendar Year, Tenant's
estimated monthly payments were, less than Tenant's Proportionate Share of
actual Real Estate Taxes, then Tenant shall pay the total amount of such
deficiency to Landlord within thirty (30) days after receipt of the statement
from Landlord. Landlord's and Tenant's obligations with respect to Real Estate
Taxes shall survive the expiration or termination of this Lease.
8.4. Separate Assessment. (i) Despite the foregoing, if the
Building is separately assessed for tax purposes, or if the portion of the Land
upon which the Building is located is established as a separate tax parcel by
subdivision or otherwise, Tenant, in lieu of paying Tenant's Proportionate Share
of Real Estate Taxes applicable to the entire Corporate Park, shall pay the
separate Real Estate Taxes assessed to the Building and such tax parcel, as
applicable within thirty (30) days of billing from the Landlord. Tenant,
however, shall not be required to pay such Real Estate Taxes more than thirty
(30) days before the last date upon which such Real Estate Taxes may be paid
without penalty. If, however, Landlord's Mortgagee requires that Landlord
deposit in escrow funds for the payment of Real Estate Taxes on the Building and
the Land, Tenant shall pay such separate Real Estate Taxes on a monthly basis in
the same manner as is set forth in Section 8.2 and an annual reconciliation
shall be made in the same manner as is set forth in Section 8.3, as if Tenant
were paying Tenant's Proportionate Share of Real Estate Taxes applicable to the
entire Corporate Park.
(ii) In the event that the portion of the Land upon which
the Building is located is established as a separate tax parcel (and only in
that event), Tenant, after prior written notice to Landlord and at Tenant's sole
expense, may contest by appropriate legal proceedings conducted in good faith
and with due diligence, the amount, validity or application, in whole or in
part, of any Real Estate Taxes assessed against such separate tax parcel
(including the Building). Landlord, upon request by Tenant, shall join in any
such contest, but without any expense to Landlord, or if required by law or
regulation in order for Tenant to conduct such contest, shall prosecute such
contest, at Tenant's direction and expense. In addition, Landlord shall
cooperate with Tenant and execute any documents or pleadings legally required to
permit Tenant to conduct such contest, provided that none of the same shall
result in any expense or liability to Landlord, if, as a result of any such
challenge, a tax refund is made to Landlord, then the amount of such refund
attributable to Real Estate Taxes previously paid by Tenant, less the reasonable
expenses of the challenge incurred by Landlord, if any, shall be paid to Tenant
within fifteen (15) days following receipt by Landlord, Landlord's obligation to
return to Tenant any such Real Estate Taxes shall survive the expiration or
termination of the Lease. Landlord agrees to promptly provide Tenant with a copy
of any tax xxxx, or appeal notice so as to enable Tenant to exercise its rights
hereunder. Tenant shall promptly provide Landlord with a copy of any notice
received by Tenant relating to Real Estate Taxes.
8.5. Initial Payment of Real Estate Taxes. The parties recognize
that the Real Estate Taxes for the Corporate Park must be paid annually in
advance and that, on the Commencement Date, Landlord will have already paid
those taxes for the tax year then in effect (the "Initial Tax Year").
Accordingly, on the Commencement Date, Tenant shall pay to Landlord a fractional
amount of Tenant's Proportionate Share of the Real Estate Taxes for the Initial
Tax Year as set forth on a tax statement provided by Landlord to Tenant on or
before the Commencement Date. Such amount shall be determined by multiplying
Tenant's Proportionate Share of such Real Estate Taxes for the entire Initial
Tax Year by a fraction, the numerator of which shall be the
20
number of days remaining in the Initial Tax Year from and including the
Commencement Date, and the denominator of which shall be 365. This amount shall
be paid in addition to the payments of Tenant's Proportionate Share of Real
Estate Taxes provided for in Section 8.2.
8.6. Personal Property Taxes. Tenant shall be liable for, and shall
timely pay, all taxes levied against personal property and trade fixtures placed
by Tenant in the Building. In no event shall any taxes on personal property or
trade fixtures arising by reason of items placed or located in Building II be
included in Real Estate Taxes.
ARTICLE IX
PARKING
9.1. Parking Spaces. During the Term, Tenant shall have the right
to use the Parking Space Allocation without charge of any kind. The Parking
Space Allocation shall be unreserved and non-exclusive parking spaces as set
forth in Section 1.13.
9.2. Changes to Parking Facilities. Landlord shall have the right,
from time to time, without Tenant's consent, subject to Tenant's right of quiet
enjoyment, to change, alter, add to, temporarily close or otherwise affect the
Parking Facilities in such manner as Landlord, in its sole discretion, deems
appropriate, including, without limitation, the right to designate reserved
spaces available only for use by one or more tenants (however, no such reserved
spaces shall be located adjacent to the Building unless for Tenant's use) and in
such event, those parking spaces shall still be deemed Common Area for the
purpose of the definition of CAM Costs, provided that (except in emergency
situations or situations beyond Landlord's control) Landlord shall provide
alternative Parking Facilities sufficient to provide Tenant's Parking Space
Allocation within the same approximate distance as the normal Parking Facilities
are from the Building.
ARTICLE X
USE; LEGAL COMPLIANCE
Tenant shall occupy the Building solely for the Permitted Use. The
Building shall not be used for any other purpose without the prior written
consent of Landlord. Tenant shall comply, at Tenant's expense, with (i) all
present and Future laws, ordinances, regulations and orders of the United States
of America, the State of Maryland and any other public or quasi-public federal,
state or local authority ("Governmental Requirements") as such Governmental
Requirements apply to the Building and Tenant's use and occupancy of the same,
and (ii) any reasonable requests of any Mortgagee or any insurance company
providing coverage with respect to the Building. Without limiting the generality
of the preceding sentence, Tenant shall comply with all Governmental
Requirements pertaining to its improvement and use of the Building, including,
without limitation, the Americans with Disabilities Act of 1990, as amended, and
all regulations promulgated thereunder (the "ADA"). Tenant shall not use or
occupy the Building in any manner that is unlawful or dangerous or that shall
constitute waste, unreasonable annoyance or a nuisance to Landlord or the other
tenants of the Corporate Park. However, Tenant shall not be required to comply
with any Governmental Requirements (i) which would require Tenant to perform any
Alterations if Tenant's use of the Building without such Alterations is
"grandfathered" under Governmental Requirements, (ii) which are required by
reason of use or construction within any portion of the Corporate Park beyond
the Building or (iii) which would
21
require Tenant to correct or cure any defect or deficiency in work performed by
Landlord which has been noted in consent shall not be unreasonably withheld,
conditioned or delayed. If Tenant desires to assign this Lease or sublet all or
any part of the Building, Tenant shall notify Landlord in writing of such desire
and the notice shall set forth the name and address of the proposed assignee in
writing by Tenant to Landlord within six (6) months after the earlier of the
Commencement Date or the date that Tenant has taken occupancy of the Building.
Tenant shall not use, store or dispose of any hazardous, dangerous, inflammable,
toxic or explosive materials in the Building or otherwise act in a manner which
will increase Landlord's insurance rates as set forth in section 17.1 below.
Landlord shall not have any liability for violations of Governmental
Requirements created by Tenant.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
11.1. Consent. Except as otherwise provided herein, Tenant shall not
assign, transfer, mortgage or otherwise encumber this Lease or sublet (or permit
a third party to occupy or use) all or any part of the Building, nor shall any
assignment or transfer of this Lease occur by operation of law or otherwise,
without the prior written consent of Landlord in each instance. Landlord's
subtenant, the rent and all other sums to be paid under the proposed assignment
or sublease, and all other material terms of the proposed assignment or
sublease. The notice shall be accompanied by a current financial statement for
the proposed assignee or subtenant prepared in accordance with GAAP and
certified as correct by the chief financial officer or other authorized officer
of the proposed assignee or subtenant. In addition, Landlord shall be entitled
to review the documentation of the proposed assignment or sublease. Tenant shall
also furnish to Landlord such additional information about the proposed
assignee, or subtenant and its intended use of the Building as Landlord may
reasonably request. Without limiting the matters which Landlord may take into
consideration in determining whether to grant or deny its consent to the
proposed assignment or sublease, Landlord shall be deemed to be reasonable in
denying its consent (i) if the proposed assignee or subtenant is not reputable
or does not have a previous record of honoring lease, credit and other legal
obligations or does not have a tangible net worth reasonably indicating that it
is capable of satisfying its financial obligations under this Lease or the
proposed sublease, as the case may be, in addition to its other liabilities, or
(ii) if the use intended to be made of the Building by the proposed assignee or
subtenant, although in accordance with the Permitted Use, would interfere with
any of the other uses being conducted in the Corporate Park or is not of a
character in keeping with a first class office/R&D center. Within fifteen (15)
days after written request by Landlord, Tenant shall pay to Landlord the
reasonable attorneys' fees incurred by Landlord in connection with Tenant's
request for consent to the assignment or subletting, up to a maximum of
$1,000.00 for each such Tenant request. Any permitted assignment or sublease
shall be subject to all of the terms of this Lease. In the event of a permitted
assignment or sublease of twenty percent (20%) or more of the rentable area of
the Building, other than a No Consent Transfer (as defined below), Tenant shall
pay to Landlord, as and when received by Tenant, fifty percent (50%) of all
rent, additional rent, or other consideration paid to Tenant by the assignee or
subtenant in excess of the Rent payable by Tenant pursuant to this Lease, after
recovery by Tenant of any remodeling, move-in or other concession, brokerage,
and legal expenses incurred by Tenant with respect to the assignment or
transfer. Any assignment, transfer, encumbrance, or subletting undertaken
without Landlord's written consent shall be voidable by Landlord and, at
Landlord's election, constitute an Event of
22
Default. Neither the consent by Landlord to any assignment, transfer or
encumbrance of this Lease or subletting of all or any portion of the Building,
nor the collection or acceptance by Landlord of rent from any assignee,
subtenant or occupant shall be construed as a Waiver or release of any Tenant or
Guarantor from the terms and conditions of this Lease or relieve Tenant or any
subtenant, assignee or other party from obtaining the consent in writing of
Landlord to any further assignment, transfer, encumbrance or subletting. Tenant
hereby assigns to Landlord the rent and other sums due from any subtenant,
assignee or other occupant of the Building and hereby authorizes and directs
each such subtenant, assignee or other occupant to pay such rent or other sums
directly to Landlord; provided, however, that until the occurrence of an Event
of Default, Tenant shall have the license to continue collecting such rent and
other sums. For purposes of this Section 11.1, except during any period in which
Tenant's stock is publicly traded and except with respect to transfers made in
connection with a proposed public offering or debt placement by Tenant, a
"Control Transfer" (defined below) shall be deemed to be an assignment of this
Lease subject to Landlord's reasonable approval as set forth above. "Control
Transfer" means a transfer by Xxxxxxx X. Xxxxxxxx, at any one time or
cumulatively, of fifty percent (50%) or more of the beneficial interests which
he holds in Tenant as of the Date of Lease (whether stock, partnership
interests, membership interests or other form of ownership or control), other
than to his estate, court appointed representative in the case of incompetency,
spouse, descendants, or trust for the benefit of his spouse and/or descendants.
A dilution of Xx. Xxxxxxxx'x beneficial interests in Tenant resulting from the
issuance by Tenant of additional stock or other beneficial interests shall not
be deemed to be a Control Transfer so long as Xx. Xxxxxxxx continues to hold at
least a five percent (5%) ownership interest in Tenant after the transfer.
Landlord shall be entitled to reject any proposed Control Transfer to a party
(a) that is known in the community as being of bad moral character; (b) that is
controlled, directly or indirectly, by persons who have been convicted of
felonies in any state or federal court; or (c) that has failed to honor its
material financial obligations within the five (5) year period immediately
preceding the effective date of the proposed Control Transfer (a
"Non-Permissible Party"). In the event of a proposed Control Transfer to a party
other than a Non-Permissible Party, if the transfer is not approved by Landlord,
the Control Transfer may nevertheless take place if, prior to the effective date
of such transfer, Tenant delivers to Landlord an additional Security Deposit.
The additional Security Deposit shall (1) be in the form of cash or a letter of
credit meeting the requirements of Section 6.1, (2) be in an amount sufficient
to increase the total amount of the Security Deposit under this Lease to Five
Hundred Thousand Dollars ($500,000) if the effective date of the Control
Transfer occurs prior to the commencement of the ninth (9th) Lease Year or Three
Hundred Thousand Dollars ($300,000) if the effective date of the Control
Transfer occurs on or after the commencement of the ninth (9th) Lease Year (or
during the Renewal Period), and (3) be subject to the terms of Section 6.1 as if
it were a part of the original Security Deposit. Upon the posting of the
additional Security Deposit, the reduction provisions of Section 6.2 shall not
apply. Instead, if the additional Security Deposit is posted prior to the
commencement of the ninth (9th) Lease Year, then the total amount of the
Security Deposit may be reduced to Three Hundred Thousand Dollars ($300,000)
upon the commencement of the ninth (9th) Lease Year and shall remain at that
amount for the duration of the Term (including the Renewal Period).
11.2. Surrender. In the event of an assignment or subletting not
consented to by Landlord, Landlord shall have the right, by notice given to
Tenant, to terminate this Lease in its entirety in the event of an assignment or
as to the subleased portion of the Building in the event
23
of a sublease, and to require that all or part, as the case may be, of the
Building be surrendered to Landlord for the balance of the Term.
11.3. Permitted Assignment and Subletting. Notwithstanding any other
provision of this Lease to the contrary, Tenant has the right to assign this
Lease or sublet the Building in whole or in part to any subsidiary of Tenant,
affiliate of Tenant, or successor corporation or successor partnership to Tenant
with financial strength equal to or greater than that of Tenant, without
Landlord's consent, upon giving Landlord ten (10) days' prior written notice of
such assignment or subletting. Any such assignment or subletting is herein
referred to as a "No Consent Transfer". A "subsidiary" of Tenant shall mean any
corporation having fifty-one percent (51%) or more, of its outstanding voting
stock owned, directly or indirectly, by Tenant. An "affiliate" of Tenant shall
mean any corporation which, directly or indirectly, controls or is controlled by
or is under common control with Tenant. For the purpose of the definition of
"affiliate", the word "control" (including "controlled by" and "under common
control with"), as used with respect to any corporation, partnership, or
association shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policy of a particular
corporation, partnership or association, whether through the ownership of voting
securities or by contract or otherwise. A "successor corporation or successor
partnership" shall mean any corporation or partnership into which Tenant is
merged or with which Tenant is consolidated or to which all or a substantial
portion of Tenant's assets are transferred. In addition Tenant, without the
necessity of Landlord's consent, shall be entitled to enter into subleases or
license agreements with parties who are bona-fide joint venture partners with
Tenant in particular drug testing projects, provided that Tenant or any
subsidiary, affiliate, or successor corporation of Tenant shall continue to
occupy not less than eighty percent (80%) of the rentable area of the Building
after such sublease or license.
ARTICLE XII
MAINTENANCE AND REPAIR
12.1. Landlord's Obligation. From and after the Date of Lease and
throughout the Term, Landlord shall keep and maintain, in good condition and
repair and in a manner consistent with comparable properties in the
Gaithersburg, Maryland area, the following: (i) the Land and the Common Area,
and (ii) the structural elements, foundation, exterior walls, and roof of the
Building, including, without limitation, masonry, curtain walls, structural
walls, columns, and floor slab (collectively, the "Building Structure") but
excluding exterior doors and windows. Landlord shall comply with Governmental
Requirements as they relate to the Land, Common Area, and Building Structure.
The cost of maintenance, repairs, and replacements to the Land and Common Area
shall be included in the CAM Costs (unless otherwise expressly excluded under
this Lease or the responsibility of Landlord under Article XXI) and paid by
Tenant as provided in Article VII. Subject to the provisions of Article XXI and
Section 17.6, the cost of maintenance and repairs to the Building Structure
shall be advanced by Landlord but reimbursed to Landlord by Tenant within thirty
(30) days after written request by Landlord, accompanied by evidence of these
costs. The cost of replacements to the Building Structure shall be paid by
Landlord without reimbursement by Tenant. Subject to the provisions of Article
XXI and Section 17.6, if any repairs or replacements to the Land, Common Area,
or Building Structure are necessitated by the negligence or willful misconduct
of Tenant, its assignees or subtenants, or its or their agents, servants,
employees, contractors, invitees, licensees, customers or subtenants
24
("Permittees"), Tenant, at its own expense, shall promptly shall make such
repairs and replacements [or, if requested by Landlord, Tenant will reimburse
Landlord for the costs of such repairs and replacements within thirty (30) days
of written demand]. Tenant shall promptly notify Landlord of any maintenance,
repairs, and replacements to the Land, Common Area, or Building Structure of
which Tenant becomes aware.
12.2. Tenant's Obligation. From and after the Date of Lease and
throughout the Term, Tenant, at its sole expense, shall maintain in good
condition and repair and in a manner consistent with comparable buildings in the
Gaithersburg, Maryland area the entire Building, except for the Building
Structure, including, without limitation, the mechanical systems (i.e., the
plumbing, electrical, and HVAC systems), sprinkler system, security system, and
loading docks, Tenant's obligation under this Section shall include, without
limitation, the maintenance, repair, and replacement of any equipment, fixtures
or other improvements to the Building that are part of the Tenant Work as
defined in Exhibit B, all doors and windows of the Building, all plumbing,
electrical, and HVAC facilities and equipment within the Building, and all
personal property within the Building. Subject to the provisions of Section 17.6
below, Tenant also shall be responsible for (a) the full cost of repairs
(including interest thereon at the Interest Rate from the date due until paid)
of any and all damage caused by Tenant or its Permittees to the Building and
Common Area, ordinary wear and tear and damage by fire, casualty or condemnation
excepted, and (b) the maintenance, repair, and replacement of Tenants Sign in
accordance with Section 14.2, the Rooftop Equipment in accordance with Section
15.3, and the Outdoor Generator in accordance with Section 1.5.4. Tenant, at its
own expense, shall keep in force throughout the Term a contract for maintenance
of the HVAC system serving the Building with a competent, licensed mechanical
contractor and shall cause the HVAC to be regularly maintained by such
mechanical contractor so that the system remains in good condition at all times.
12.3. Landlord's Right to Maintain or Repair. If, within fifteen
(15) days following written notice to Tenant (or within such shorter time as may
reasonably be designated by Landlord if exigent circumstances require prompter
action), Tenant fails to perform any maintenance, repair, or replacement which
Tenant is obligated to perform under Section 12.2 or elsewhere in this Lease,
Landlord may, at its option, cause such maintenance, repairs or replacements to
be made. Within fifteen (15) days after written demand by Landlord, Tenant shall
pay to Landlord all reasonable costs incurred in connection therewith, plus
interest thereon at the Interest Rate from the due date until paid.
ARTICLE XIII
INITIAL CONSTRUCTION; ALTERATIONS
13.1. Initial Construction. Landlord and Tenant agree that the
construction of the Tenant Work and other initial construction with respect to
the Building shall be performed in accordance with Exhibit B attached hereto and
made a part hereof.
13.2. Alterations. Tenant shall not make or permit any Alterations,
without the prior written consent of Landlord. Such consent shall not be
unreasonably withheld or delayed in the case of interior Alterations which do
not affect the structure, roof, foundation, exterior walls, or mechanical or
sprinkler systems of the Building and may be granted or withheld in Landlord's
sole discretion in the case of all other Alterations. Landlord may impose any
reasonable
25
conditions to its consent to Alterations, including, without limitation, (i)
delivery to Landlord, as the work progresses, of partial waivers of mechanic's
and materialmen's liens with respect to the Building and the Land for all work,
labor and services performed and materials furnished, signed by all contractors,
subcontractors, materialmen and laborers participating in the Alterations (with
a final fully executed release of liens to be delivered to Landlord upon
completion of the Alterations), (ii) prior approval of the plans and
specifications and Tenant's contractor(s) with respect to the Alterations, and
(iii) supervision by Landlord or Landlord's representative of the Alterations.
The Alterations shall conform to the requirements of Landlord's and Tenant's
insurers and of the federal, state and local governments having jurisdiction
over the Building (including, without limitation, all applicable provisions of
the ADA), shall be performed in accordance with the terms and provisions of this
Lease in a good and workmanlike manner and shall not adversely affect the value,
utility or character of the Building. If the Alterations are not performed in
accordance with the terms hereof, Landlord shall have the right, at Landlord's
option, to halt any further Alterations, or to require Tenant to construct the
Alterations as herein required or, in the event that Tenant begins performing
the Alterations without first obtaining Landlord's prior written consent, to
require Tenant to restore the Building to the condition, in which they existed
before such Alterations. Notwithstanding the foregoing, if any mechanic's or
materialmen's lien is filed against the Building or the Land for work claimed to
have been done for, or materials claimed to have been furnished to or for the
benefit of Tenant, such lien shall be discharged of record by Tenant within
fifteen (15) days after the date of filing by the payment thereof or the filing
of any bond required by law. If Tenant shall fail to timely discharge any such
lien, Landlord may (but shall not be obligated to) discharge the same, the cost
of which shall be paid by Tenant within ten (10) days of demand by Landlord.
Such discharge, by Landlord shall not be deemed to waive or release the default
of Tenant in not discharging the same. Neither Landlord's consent to the
Alterations nor anything contained in this Lease shall be deemed to be the
agreement or consent of Landlord to subject Landlord's interest in the Building
or the Land to any mechanic's or materialmen's liens which may be filed in
connection with the Alterations. Tenant shall be entitled to install normal
decorations in the Building without Landlord's prior consent.
13.3. Removal of Alterations. All or any part of the Alterations
whether made with or without the consent of Landlord, shall, at Landlord's
option, either be removed by Tenant at its expense before the expiration of the
Term or shall remain upon the Building and be surrendered therewith at the
Expiration Date or earlier termination of this Lease as the property of Landlord
without disturbance, molestation or injury, provided that Tenant shall have the
right and the obligation to remove any and all removable Alterations which
constitute trade fixtures and detachable furniture prior to the Expiration Date
or earlier termination of this Lease. Notwithstanding the foregoing, Landlord
shall not be entitled to require the removal of any Alteration unless Landlord
advises Tenant in writing, not later than six (6) months before the expiration
of the Term, that removal of that Alteration is required. If Landlord requires
the removal of all or part of the Alterations, Tenant, at its expense, shall
repair any damage to the Building caused by such removal. If Tenant fails to
remove any Alterations which Landlord has requested be removed, then Landlord
may (but shall not be obligated to) remove the same and the cost of such removal
and repair of any damage caused by the same, together with any and all damages
which Landlord may suffer and sustain by reason of the failure of Tenant to
remove the same, shall be charged to and paid by Tenant upon demand.
26
13.4. Landlord Alterations. Landlord shall have no obligation to
make any Alterations in or to the Building, the Common Area or the Land except
as specifically provided in the Work 17 Agreement or otherwise herein. Landlord
hereby reserves the right, from time to time, to erect such scaffolding and
other aids to construction adjacent to and about the Building as Landlord
reasonably deems appropriate, and, subject to Tenant's right of quiet enjoyment,
no such construction or erection shall constitute an eviction, constructive or
otherwise, or permit Tenant any abatement of Rent or other claim.
ARTICLE XIV
SIGNS
14.1. General. Other than building standard door signage at the
entry to the Building, no other sign, advertisement or notice shall be
inscribed, painted, affixed, placed or otherwise displayed by Tenant on any part
of the Land or the outside or the inside (including, without limitation, the
windows) of the Building without the prior written consent of Landlord, except
that a sign which displays Tenant's "corporate logo" shall be permitted in the
reception area of the Building. Any other permitted signs shall be installed and
maintained by Landlord at Tenant's sole expense. Landlord shall have the right
to prohibit any sign, advertisement, notice or statement to the public by Tenant
which, in Landlord's opinion, tends to impair the reputation or desirability of
the Building. If any prohibited sign, advertisement or notice is nevertheless
exhibited by Tenant, Landlord shall have the right to remove the same, and
Tenant shall pay any and all expenses incurred by Landlord in such removal,
together with interest thereon at the Interest Rate, upon demand.
14.2. Building Sign. Notwithstanding the foregoing, provided the
same is in accordance with applicable zoning and other laws and regulations and
with private restrictions of record, Tenant shall have the right, at its sole
expense, to install on the exterior facade of the Building a sign displaying the
"corporate logo" of Tenant ("Tenant's Sign"), provided that (i) the design,
fabrication, lighting, location and manner of installation of Tenant's Sign
shall be subject to Landlord's prior written approval, to be granted or withheld
in Landlord's sole discretion; (ii) the installation of Tenant's Sign shall not
damage or otherwise adversely affect the structure or any component of the
Building or invalidate or impair the coverage of any warranty applicable to the
same; (iii) in installing Tenant's Sign, Tenant shall be subject to Section 13.2
as if such installation were the installation of Alterations, (iv) after
installing Tenant's Sign, Tenant, at its own expense, shall maintain Tenant's
Sign in good condition and repair at all times, as needed, (v) upon termination
of this Lease, Tenant shall remove Tenant's Sign from the Building in accordance
with Section 13.3 as if Tenant's Sign were Alterations which Landlord required
Tenant to remove, and (vi) Tenant's indemnification set forth in Section 19.2
shall extend to all matters arising from or related to Tenant's installation,
maintenance and removal of Tenant's Sign. The size of Tenants sign shall be
Tenant's pro rata share (based upon rentable area) of the total sign area
permitted for the Corporate park. Landlord acknowledges that the design,
fabrication. lighting, and manner of installation of Tenant's exterior signage
existing as of the Date of Lease at Tenant's location on Firstfield Road in
Gaithersburg, Maryland is acceptable for installation at the Building. Tenant,
at its own expense, shall obtain all permits and approvals from the applicable
authorities, including, without limitation, Xxxxxxxxxx County, required for the
installation of Tenant's Sign. All reasonable costs incurred by Landlord in
regard to the installation of the Tenant's Sign, including, but not limited to,
the costs to review plans and
27
specifications and to oversee or inspect the installation, shall be reimbursed
by Tenant to Landlord within fifteen (15) days after written request by
Landlord. The rights provided for in this Section 14.2 shall not run in favor of
any assignee or subtenant of Tenant except for a permitted assignee, or a
permitted subtenant of the entire Building, pursuant to Section 11.3. In the
event of an assignment or subletting which is not pursuant to Section 11.3,
Tenant shall remove Tenant's Sign in the manner specified in clause (v) above as
if this Lease had terminated.
ARTICLE XV
TENANT'S EQUIPMENT AND PROPERTY
15.1. Moving Tenant's Property. Any and all damage or injury to the
Building or Common Area caused by moving the property of Tenant into or out of
the Building, or due to the same being in the Building, shall be repaired by
Tenant, at Tenant's expense. Any furniture, equipment or other bulky matter of
any description shall be delivered only through the designated delivery entrance
in the Building (if any), or by such other means as Landlord may is reasonably
approve, at such times as may be reasonably designated by Landlord. The moving
of furniture, equipment, and other materials into the Building upon Tenant's
initially taking occupancy of the Building shall be subject to the observation
and general supervision of Landlord. Thereafter, Tenant shall give Landlord at
least five (5) days' notice (oral or written) prior to moving any bulky
furniture, equipment or other materials into or out of the Building so that
Landlord may again observe and generally supervise the moving. In no event,
however, shall Landlord be responsible for any damages to or charges for moving
the same, Tenant shall promptly remove from the Building Common Area any of
Tenant's furniture, equipment or other property there deposited.
15.2. Installing and Operating Tenant's Equipment. Without first
obtaining the written consent of Landlord, to be granted or withheld in
Landlord's sole, discretion, Tenant shall not install or operate in the Building
(i) any electrically operated equipment or other machinery, other than standard
office and laboratory equipment that does not require wiring, cooling or other
service in excess of Building standards, (ii) any equipment of any kind or
nature whatsoever which will require any changes, replacements or additions to,
or material changes in the use of any water, heating, plumbing, air conditioning
or electrical system of the Building, or (iii) any equipment which causes the
floor load to exceed the design limits. Landlord's consent to such installation
or operation may be conditioned upon the payment by Tenant of additional
compensation for any additional power, wiring, cooling or other service or
Alterations that may result from such equipment. Machines and equipment which
cause noise or vibration that may be transmitted to the structure of the
Building or to any space therein so as to be objectionable to Landlord or any
other tenants or occupants of the Corporate Park shall not be installed by
Tenant and Landlord shall use reasonable efforts to uniformly enforce such rule
in Building II.
15.3. Rooftop Equipment. Tenant shall have the right, at its own
expense, to install on the roof of the Building such HVAC package units as may
be required under the Plans to furnish heating, ventilation, and air
conditioning to the Building and, if in accordance with applicable zoning and
other laws and regulations and with private restrictions of record, one (1)
antenna or satellite dish (collectively, the "Rooftop Equipment"), provided that
(i) the design, size, shape, location, and manner of installation of the Rooftop
Equipment shall be subject to Landlord's prior written approval, to be granted
or denied in Landlord's sole discretion and the Rooftop
28
Equipment shall be adequately screened from view by an enclosure constructed of
such materials as may be reasonably specified by Landlord; (ii) the installation
of the Rooftop Equipment shall not damage or otherwise adversely affect the roof
or any other component of the Building or invalidate or impair the coverage of
any warranty applicable to the same, (iii) in installing the Rooftop Equipment,
Tenant shall be subject to Section 13.2 as if such installation were the
installation of Alterations; (iv) after installing the Rooftop Equipment,
Tenant, at its own expense, shall maintain the Rooftop Equipment in good
condition. and repair at all times, (v) Tenant's operation of any rooftop
antenna or satellite dish shall not interfere with the operation of
communications equipment elsewhere in, on, or near the Building, (vi) upon
termination of this Lease, the Rooftop Equipment shall be subject to removal
from the Building in compliance with Section 13.3 as if the Rooftop Equipment
were Alterations, (vii) Tenant's indemnification set forth in Section 19.2 shall
extend to all matters arising from or related to Tenant's installation, use,
maintenance, and removal of the Rooftop Equipment, and (viii) Tenant shall use
the Rooftop Equipment solely for its own use and benefit and shall not grant to
any third party the right to use the Rooftop Equipment. Tenant, at its own
expense, shall obtain all permits and approvals from the applicable authorities,
including, without limitation, Xxxxxxxxxx County, required for the Rooftop
Equipment. Landlord shall reasonably cooperate in those efforts. All reasonable
costs incurred by Landlord in regard to the installation of the Rooftop
Equipment, including, without limitation, the costs to seek permits and
approvals, review plans and specifications, and oversee or inspect the
installation, shall be reimbursed by Tenant to Landlord within fifteen (15) days
after written request by Landlord. Any costs incurred by Tenant in connection
with any rooftop antenna or satellite dish shall not be payable from the Tenant
Improvement Allowance.
15.4. Outside Generator. Tenant shall also have the right, at its
own expense, to install outside the Building an electrical generator to provide
emergency power in the event that the system supplying electricity to the
Building fails (the "Outdoor Generator"). All of the provisions of Section 15.3
applicable to the Rooftop Equipment shall equally apply to the Outdoor
Generator.
ARTICLE XVI
RIGHT OF ENTRY
Tenant shall permit Landlord or its Agents, upon twenty-four (24) hours
notice (except in an emergency, in which event no notice shall be required), to
enter the Building, without charge therefor to Landlord and without diminution
of Rent: (i) to examine, inspect and protect the Building; (ii) to make such
repairs or perform such maintenance which in the reasonable judgment of Landlord
may be deemed necessary or desirable; (iii) to exhibit the same to prospective
purchasers of the Building or to present or future Mortgagees; or, (iv) during
the last six (6) months of the Term, to exhibit the same to prospective tenants
and erect on or outside the Building, a suitable sign indicating that space is
available within the Building. In connection with such entry rights of Landlord,
Tenant shall provide Landlord and its Agents with access cards or an access code
in order to enter all of the Building despite any additional security system
that Tenant may install.
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ARTICLE XVII
INSURANCE
17.1. Insurance Rating. Tenant shall not conduct or permit any
activity or place any equipment or material in or about the Building or the
Common Area which will increase the rate of property or other insurance carried
by Landlord on the Building or Common Area. If any increase in the rate of
insurance is stated by any insurance company or by the applicable insurance
rating bureau to be due to any activity, equipment or material of Tenant in or
about the Building or the Common Area, such statement shall be conclusive
evidence that the increase in such rate is due to the same and as a result
thereof and provided that Landlord has delivered a copy of such statement to
Tenant in accordance with the provisions of Section 27.6 hereof, Tenant shall
pay such increase to Landlord upon demand.
17.2. Tenant's Liability Insurance. Tenant shall, at its sole
expense, procure and maintain throughout the Term a commercial general liability
policy insuring against claims, demands or actions arising out of or in
connection with: (i) the Building; (ii) the condition of the Building; (iii)
Tenant's operations in, and maintenance and use of the Building, and (iv)
Tenant's liability assumed under this Lease. Such insurance shall have such
minimum limits as are reasonably required by Landlord, but in no event less than
a combined single limit of Two Million Dollars ($2,000,000.00) per occurrence
and Three Million Dollars ($3,000,000) in the aggregate for death, bodily
injury, and property damage.
17.3. Tenant's Property Insurance. Tenant shall, at its sole
expense, procure and maintain throughout the Term a property insurance policy
(written on an "All Risk" basis) insuring all of Tenant's personal property,
including, but not limited to, equipment, furniture, fixtures, and furnishings,
for not less than the full replacement cost of these items. All proceeds of such
insurance shall be used to repair or replace these items.
17.4. Requirements of Insurance Coverage. All such insurance
required to be carried by Tenant herein shall be with an insurance company
licensed to do business in the State of Maryland and approved by Landlord. Such
insurance shall (i) contain an endorsement that such policy shall remain in full
force and effect notwithstanding that the insured has released its right of
action against any party before the occurrence of a loss; and (ii) provide that
the policy shall not be canceled, materially amended or failed to be renewed
without at least thirty (30) days' prior written notice, [ten (10) days if due
to non-payment of premium] to Landlord and, at Landlord's request, any
Mortgagee. In addition, Tenant's commercial general liability policy shall name
Landlord and Landlord's Mortgagee, or any successor or assign thereof that
Landlord shall designate in writing, as additional insured parties. On or before
the Commencement Date and, thereafter not less than thirty (30) days before the
expiration date of any insurance policy required to be maintained under this
Article XVII, an original of such policy (including any renewal or replacement
policy) or a certified copy or certificate of insurance thereof, together with
evidence satisfactory to Landlord of the payment of all premiums for such
policy, shall be delivered to Landlord and, at Landlord's request, to any
Mortgagee.
17.5. Landlord's Insurance. Landlord shall procure and maintain
during the Term: (i) a commercial general public liability insurance against
claims for bodily injury, death or property damage, occurring on, in or about
the Land in a combined single limit of not less than Two
30
Million Dollars ($2,000,000) per occurrence and Three Million Dollars
($3,000,000.00) in the aggregate, (ii) an "all-risk" policy of property
insurance insuring the Building for not less than its full replacement cost,
exclusive of excavations, footings and foundation below the lowest floor level,
and (iii) a policy of rent loss insurance with respect to the Building providing
coverage in the amount of one year's Basic Rent. Notwithstanding the foregoing,
Landlord's property insurance shall not be required to cover the Items required
to be covered by Tenant's property insurance under Section 17.3. Tenant shall
pay for the cost of the insurance which Landlord is required to maintain under
this Section, as well as any other insurance which Landlord elects to maintain
with respect to the Building and/or Corporate Park (collectively, "Insurance
Premiums"), as follows:
(a) Prior to the Commencement Date and prior to the first
day of each Calendar Year thereafter during the Term, Landlord shall submit to
Tenant an estimate of the Insurance Premiums expected to be incurred by Landlord
during the upcoming Calendar Year and a statement of Tenant's Proportionate
Share of such estimated annual Insurance Premiums. In addition to the Basic
Rent, Tenant shall pay to Landlord, beginning on the Commencement Date and
continuing on the first day of each month thereafter during each Calendar Year,
one-twelfth (1/12) of Tenant's Proportionate Share of annual Insurance Premiums
as set forth in Landlord's statement. However, if the Commencement Date is a day
other than the first day of a calendar month, then the installment of Insurance
Premiums for the first month of the Term shall be pro rated on the basis of a
thirty (30) day month. If Landlord fails to give Tenant notice of its estimated
payments due under this Section for any Calendar Year, then Tenant shall
continue making monthly estimated payments in accordance with the estimate for
the previous Calendar Year until a new estimate is provided, When the new
estimate is provided. Tenant's monthly estimated payments shall be adjusted in
accordance with the new estimate and if any deficiency exists in the payments
already made for the Calendar Year in question, the deficiency shall be paid
with the next monthly installment of Basic Rent. No delay by Landlord in
providing any estimate under this Section or any statement under Section 7.5(b)
shall excuse Tenant from paying Tenant's Proportionate Share of Insurance
Premiums for any period within the Term. The initial amount of Tenant's
estimated monthly payments of Insurance Premiums shall be Three Hundred Seventy
and 13/100 Dollars ($370.13) per month.
(b) Within ninety (90) days after the end of each
Calendar Year or as soon thereafter as reasonably practicable, Landlord shall
submit a statement to Tenant showing the actual Insurance Premiums incurred by
Landlord for such Calendar Year and the amount of Tenant's Proportionate Share
of such actual Insurance Premiums. If, for any Calendar Year, Tenant's estimated
payments exceeded Tenant's Proportionate Share of actual Insurance Premiums,
Tenant shall receive a credit in the amount of the overpayment toward Tenant's
next monthly payment of Insurance Premiums. If, for any Calendar Year, Tenant's
estimated monthly payments were less than Tenant's Proportionate Share of actual
Insurance Premiums, then Tenant shall pay the total amount of such deficiency to
Landlord within thirty (30) days after receipt of the statement from Landlord.
Landlord's and Tenant's obligations with respect to any overpayment or
underpayment of Tenant's Proportionate Share of Insurance Premiums shall survive
the expiration or termination of this Lease.
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(c) If Landlord carries any separate policy of insurance
covering just the Building (and not the entire Corporate Park), Tenant shall pay
all of the Insurance Premiums for such policy (and not just Tenant's
Proportionate Share) in the same manner as is provided above.
(d) Despite the foregoing, Landlord may, upon thirty (30)
days prior written notice to Tenant, require Tenant to pay Insurance Premiums at
such time, as they are due and payable to the insurance company or in such a
manner as is required of Landlord by any Mortgagee, whether such payments be in
lump-sum or other installments.
17.6. Waiver of Subrogation. Each party hereby releases the other
party from any and all liability for loss or damage to property owned by the
releasing party caused by the act or omission of the other party, its agents,
officers or employees, to the extent such loss or damage is covered by the
property insurance required to be maintained by the releasing party under this
Article XVII, whether or not such insurance is, in fact, so maintained; provided
that such release (i) shall not apply to the extent of any deductible provided
for by the releasing party's policy of property insurance, up to a maximum
amount of Twenty-Five Thousand Dollars ($25,000), and (ii) shall be effective
only as to a loss or damage occurring while the appropriate policy of insurance
of the releasing party provides that such release shall not impair the
effectiveness of such policy or the insured's ability to recover thereunder.
Each party shall use reasonable efforts to have a clause to such effect included
in the insurance policies required to be maintained hereunder and shall promptly
notify the other in writing if such clause cannot be included in any such
policy.
ARTICLE XVIII
SERVICES AND UTILITIES
18.1. Intentionally Omitted
18.2. Interruption of Services. Landlord shall not be liable for,
nor shall there by any abatement of Rent or constructive eviction for, the
failure to furnish or the delay or suspension in furnishing any of the services,
either ordinary or extraordinary, required under this Article, whether caused by
breakdown, maintenance, repair, strikes, scarcity of labor or materials, acts of
God or any other cause whatsoever, unless caused by the gross negligence or
willful misconduct of Landlord or its Agents. In the event of any interruption
of services or utilities solely resulting from any negligence or intentional
misconduct by Landlord which renders Tenant unable to make reasonable use of the
Building for a period of more than four (4) consecutive business days or more
than an aggregate of five (5) business days in any Calendar Year, all Rent for
the Building shall xxxxx until the use is restored to Tenant of the Building.
18.3. Separate Billing. Separate meters have been installed, or will
be installed as part of the Tenant Work, to measure water, sewer and other
utility consumption in the Building. Tenant shall pay the charges for such
consumption to Landlord or, at Landlord's election, directly to the provider of
the respective utility.
18.4. Utility Charges. In addition to electricity, all telephone,
gas, heat and other utility service used by Tenant in the Building shall be paid
for by Tenant.
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18.5. Security; Access. No installation by Landlord of any security
or alarm system for the Building and no engagement by Landlord of a professional
security service for the Building (in the event that Landlord determines, in its
sole discretion, to engage such a service) shall in any way increase Landlord's
liability for occurrences and/or consequences which such a system or service are
designed to detect or avert and Tenant shall look solely to its insurer for
claims for damages or injury to any property. Tenant shall have the right to
install its own security system for all or any portion of the Building at its
sole cost. All employees will be issued an electronic card or conventional key
for the door entry system utilized in the Building at Tenant's expense which
will allow access to the Building after hours. Tenant and its Agents shall have
access to the Building twenty-four (24) hours per day, seven (7) days per week.
ARTICLE XIX
LIABILITY OF LANDLORD
19.1. No Liability. Landlord and its Agents shall not be liable to
Tenant or its Agents for, and Tenant, for itself and its Agents, does hereby
release Landlord and its Agents from, liability for any damage, compensation or
claim arising from (i) the necessity of repairing any portion of the Building or
the Common Area or any structural defects thereto (subject to the provisions of
Section 27.1 below); (ii) any interruption in the use of the Building or the
Common Area (subject to the provisions of Sections 18.2 and 21.1); (iii) fire or
other casualty; (iv) personal or property injury, damage or loss caused by other
than fire or other casualty and resulting from the use or operation (by
Landlord, Tenant, or any other person whomsoever) of the Building or the Common
Area (subject to the indemnity provisions below); (v) intentionally omitted;
(vi) robbery, assault or theft; or (vii) any leakage in the Building from water,
rain, snow or other cause whatsoever, except to the extent that such events,
other than that described in clause (iii) to the extent covered by insurance,
result from the gross negligence or willful misconduct of Landlord. Subject to
Tenant's right of quiet enjoyment hereunder, no such occurrence shall give rise
to constructive eviction. Any goods, automobiles, property or personal effects
stored or placed by Tenant or its Agents in or about the Building or the Common
Area shall be at the sole risk of Tenant, and Landlord and its Agents shall not
in any manner be held responsible therefor. Except to the extent expressly
prohibited by law, Landlord and Tenant each waive any claim it might have
against the other or its respective Agents for any consequential damages
sustained by such waiving party arising out of the loss or damage to any person
or property. With respect to any provision of this Lease which provides, in
effect, that Landlord shall not unreasonably withhold, condition or delay any
consent or approval, Tenant shall in no event be entitled to make any claim for
money damages in excess of One Hundred Thousand Dollars ($100,000) (the "Damage
Limit") based upon any claim or assertion by Tenant that Landlord has
unreasonably withheld, conditioned or delayed any such consent or approval in
any particular instance, except the Damage Limit shall not apply to the failure
of Landlord to comply with the decision rendered by the arbitrator pursuant to
Section 19.4 below as soon as practicable following Landlord's receipt (or
refusal of receipt) of written notice of the decision. Nothing in this Section
shall be deemed to limit Tenant's right to pursue an action or proceeding to
enforce any such provision by specific performance, injunction or declaratory
judgment.
19.2. Tenant's Indemnity. Subject to Section 17.6, Tenant shall
indemnify and hold harmless Landlord and its Agents from and against any and all
damage, claim, liability, cost or expense (including, without limitation,
reasonable attorney's or other professionals' fees) of
33
every kind and nature (including, without limitation, those arising from any
injury or damage to any person, property or business, and those, arising from
Tenant's failure to comply with all applicable provisions of the ADA) incurred
by or claimed against Landlord or its Agents as a result or arising out of
Tenant's or its Agents' use and occupancy of the Building or the Common Area or
from Tenant's breach of this Lease, except if caused by the negligence or
intentional misconduct of Landlord or its Agents or property manager. The
provisions of this Section shall survive expiration or other termination of this
Lease. Notwithstanding the foregoing or any other provision of this Lease, in no
event shall Tenant have any liability for any indirect, consequential, exemplary
or punitive damages under this Lease.
19.3. Landlord's Indemnity. Subject to Section 17.6, Landlord shall
indemnify and hold harmless Tenant and its Agents from and against any and all
damage, claim, liability, cost or expense (including, without limitation,
reasonable attorneys' or other professionals' fees) of every kind and nature
(including, without limitation, those arising from any injury or damage to any
person, property or business) incurred by or claimed against Tenant or its
Agents as a result or arising out of Landlord's or its Agents' management and
maintenance of the Building or the Common Area or from Landlord's breach of this
Lease, except if caused by the negligence or intentional misconduct of Tenant or
its Agents. The provisions of this Section shall survive expiration or other
termination of this Lease. Notwithstanding the foregoing or any other provision
of this Lease, in no event shall Landlord have any liability for any in, direct,
consequential, exemplary or punitive damages under this Lease.
19.4. Mandatory Binding Arbitration. The parties desire to provide a
mechanism to promptly resolve disputes arising by reason of Tenant's contention
that Landlord has unreasonably withhold, delayed or conditioned its consent or
approval in any instance where this Lease expressly requires that such consent
of approval not be unreasonably withheld, delayed or conditioned. Consequently,
if, at any time and for any reason, Tenant believes that Landlord has
unreasonably withheld, delayed or conditioned its consent or approval under this
Lease, in contravention of the express terms of this Lease, Tenant may send
written notice to Landlord requiring that such dispute be submitted to binding
arbitration by a single arbitrator in accordance with the rules of the American
Arbitration Association. To be effective, such notice by Tenant shall be given
within thirty (30) days following Tenant's receipt (or refusal of receipt) of
Landlord's written notice denying consent to or disapproving the matter at issue
or setting forth Landlord's conditions to the consent or approval of such
matter. The arbitrator shall be an experienced real estate attorney in the
Washington, D.C. metropolitan area, who is in active practice. Absent mutual
consent of Landlord and Tenant, neither such attorney nor his firm shall do any
work for either Landlord or Tenant, or any individual owning more than ten
percent (10%) of the ownership interests in Landlord or Tenant. In the event
that Landlord and Tenant are unable mutually to agree upon the arbitrator within
five (5) business days following written request from Tenant to appoint the
arbitrator, then the American Arbitration Association (or any successor
organization, or if none, such organization or party generally recognized in the
Washington, D.C. metropolitan area as having succeeded to the American
Arbitration Association) shall be required to appoint as soon as possible an
arbitrator who shall qualify in accordance with the requirements set forth in
the two immediately preceding sentences. Any arbitrator serving hereunder shall
consider the proposed action by Tenant and the basis upon which Landlord has
withheld or conditioned its consent or approval and Landlord and Tenant shall
submit to each other and to the arbitrator, within five (5) business days
following notice to
34
Landlord and Tenant of the arbitrator's designation, a written statement of
their respective positions. At a mutually agreeable time, not less than three
(3) or more than ten (10) business days after the statements are required to be
submitted, the arbitrator shall hold a hearing not to exceed five (5) hours in
duration unless the parties otherwise mutually agree. At the hearing each party
shall present its arguments. The arbitrator shall determine the matter and issue
a written decision setting forth the reasons for his or her determination no
later than ten (10) business days following the hearing. The decision of the
arbitrator shall be binding upon Landlord and Tenant shall be non-appealable,
and may be enforced by the parties in a court of law or equity. Should the
arbitrator agree that Landlord has acted reasonably, Tenant shall pay all costs
of the arbitrator and, if necessary, all costs (including reasonable attorneys
fees and court costs) to enforce the arbitrator's decision. Should the
arbitrator agree that Landlord has failed to act reasonably, Landlord shall pay
all costs of the arbitrator and, if necessary, all costs (including reasonable
attorneys fees and court costs) to enforce the arbitrator's decision. Each party
shall bear its own legal fees in connection with the arbitration.
ARTICLE XX
RULES AND REGULATIONS
Tenant and its Agents shall at all times abide by and observe the Rules
and Regulations and any reasonable amendments thereto that may be promulgated
from time to time by Landlord for the operation and maintenance of the Corporate
Park and the Common Area, and the Rules and Regulations shall be deemed to be
covenants of the Lease to be performed and/or observed by Tenant. Except to the
extent set forth herein, nothing contained in this Lease shall be construed to
impose upon Landlord any duty of obligation to enforce the Rules and Regulations
or the terms or provisions contained in any other Lease against any other tenant
or occupant of the Corporate Park. Landlord shall not be liable to Tenant for
any violation by any party of the Rules and Regulations or the terms of any
other building lease. If there is any inconsistency between this Lease and the
Rules and Regulations, this Lease shall govern. Landlord reserves the right
reasonably to amend and modify the Rules and Regulations as it deems necessary
upon prior written notice to Tenant. All Rules and Regulations that may be
enforced by Landlord against Tenant shall be uniformly enforced among all of the
tenants at the Corporate Park. Landlord shall use its reasonable efforts to
enforce all of the Rules and Regulations against other tenants whose breach of
such Rules and Regulations adversely affect the use of the Building or the
Common Areas by Tenant or its Permittees.
ARTICLE XXI
DAMAGE; CONDEMNATION
21.1. Damage to the Premises. If the Building shall be damaged by
fire or other cause, Landlord shall diligently, and as soon as practicable after
such damage occurs, repair such damage at the expense of Landlord, except as
otherwise provided in this Section 21.1 and provided, however, that Landlord
shall only be obligated to repair such damage to the extent of proceeds of
insurance actually received by Landlord (reduced by any proceeds retained
pursuant to the rights of any Mortgagee). Notwithstanding the foregoing, (i) if
the Building is damaged by fire or other cause to such an extent that, in
Landlord's reasonable judgment, (a) the damage cannot be substantially repaired
within two hundred seventy (270) days after the date of such damage, or (b)
insurance proceeds and other funds available to Landlord are not sufficient to
35
reasonably repair such damage, or (ii) if the Building is damaged during the
last two (2) Lease Years of the Term, then Landlord may terminate this Lease by
giving written notice to Tenant within ninety (90) days from the date of such
damage and the termination shall be effective as of the date of the notice.
Further, if the Building is damaged by fire or other cause during the last Lease
Year of the Term and more than thirty percent (30%) of the rentable area of the
Building is rendered untenantable by such damage, Tenant may terminate this
Lease by giving written notice to Landlord within ninety (90) days from the date
of such damage and the termination shall be effective as of the date of the
notice. If this Lease shall be terminated under this Section 21.1, the Rent
shall be apportioned and paid to the date of such termination. If this Lease
shall not be terminated and the damage required to be repaired by Landlord is
not repaired to such an extent that the Building is tenantable for the conduct
of the Permitted Use within two hundred seventy (270) days from the date of such
damage, Tenant, within thirty (30) days from the expiration of such two hundred
seventy day (270) period, may terminate this Lease by notice to Landlord. During
the period that Tenant is deprived of the use of the damaged portion of the
Building, Rent for such portion shall xxxxx proportionately, provided that if by
reason of the fire or other casualty Tenant is unable reasonably to conduct its
business within the undamaged portion of the Building, all Rent shall xxxxx as
if the entire Building were untenantable. Any abatement of Rent under this
Section shall continue until the first to occur of (1) expiration of fifteen
(15) days following completion by Landlord of the repair or restoration of the
Building or the date Landlord would have completed the repair or restoration in
the absence of any delay caused by Tenant, or (2) the date Tenant resumes
conduct of its business operations within all or any substantial portion of the
Building (provided that the abatement shall terminate proportionately as Tenant
re-occupies any portion of the Building that Tenant was forced to vacate by
reason of the casualty). Notwithstanding anything in this Section 21.1 to the
contrary, Landlord shall not be required to rebuild, replace or repair any
damage to the Tenant Work, any Alterations made by Tenant, or any other items
required to be covered by Tenant's property insurance under Section 17.3.
Instead, unless this Lease terminates in accordance with this Section 21.1,
Tenant shall diligently, and as soon as practicable after such damage occurs,
repair such damage at the expense of Tenant and the proceeds of Tenant's
property insurance shall be made available for this purpose.
21.2. Condemnation. If the whole or a Substantial Part of the
Building shall be taken or condemned by any governmental or quasi-governmental
authority for any public or quasi-public use or purpose (including, without
limitation, sale under threat of such a taking) or if any portion of the Common
Areas shall be taken resulting in the inability of Tenant to reasonably access
the Building and the Parking Facilities, or if the Parking Facilities shall be
taken and not promptly replaced with reasonably comparable and adequate parking
facilities, then the Term shall cease and terminate as of the date when title
vests in such governmental or quasi-governmental authority, and Rent shall be
prorated to the date when title vests in such governmental or quasi-governmental
authority. If less than a Substantial Part of the Building is taken or condemned
by any governmental or quasi-governmental authority for any public or
quasi-public use or purpose (including, without limitation, sale under threat of
such a taking), Basic Rent and Tenant's Proportionate Share shall be reduced by
the ratio that the portion so taken bears to the rentable square footage of the
Building before such taking, effective as of the date when title vests in such
governmental or quasi-governmental authority, and this Lease shall otherwise
continue in full force and effect. Tenant shall have no claim against Landlord
(or otherwise) as a result of such taking, and Tenant hereby agrees to make no
claim against the condemning authority for any
36
portion of the amount that may be awarded as compensation or damages as a result
of such taking; provided, however, that Tenant may, to the extent allowed by
law, claim an award for moving expenses and for the taking of any of Tenant's
property [other than its leasehold interest in the Building, but including the
value, of the unamortized portion of any Tenant Work (loss the unamortized
portion of the Tenant Improvement Allowance) and the unamortized portion of
Alterations or fixtures installed by Tenant in the Building] which does not,
under the term of this Lease, become the property of Landlord at the termination
hereof, as long as such claim is separate and distinct from any claim of
Landlord and does not diminish Landlord's award.
ARTICLE XXII
DEFAULT OF TENANT
22.1. Events of Default. Each of the following shall constitute an
Event of Default: (i) Tenant fails to pay Rent within five (5) business days
after written notice from Landlord, provided that no such notice shall be
required if at least two (2) such notices shall have been given during the same
Lease Year; (ii) Tenant fails to observe or perform any other term, condition or
covenant herein binding upon or obligating Tenant within thirty (30) days after
written notice from Landlord (or such longer period of time as may be reasonably
necessary to cure the default, provided that: (a) Tenant has commenced good
faith and diligent efforts to cure the default within the initial thirty (30)
day period, (b) Tenant continuously pursues those efforts thereafter, to the end
that the default may be cured at the earliest practicable time, and (c) in all
events, the default shall be cured within sixty (60) days after Landlord's
original notice); (iii) Tenant abandons or vacates the Building for a period in
excess of one hundred twenty (120) days; (iv) Tenant makes or consents to a
general assignment for the benefit of creditors or a common law composition of
creditors, or a receiver is appointed for the Building or all or substantially
all of Tenant's asset; or (v) Tenant files a voluntary petition any bankruptcy
or insolvency proceeding, or an involuntary petition in any bankruptcy or
insolvency proceeding is filed against Tenant and is not discharged by Tenant
within sixty (60) days of such filing.
22.2. Landlord's Remedies. Upon the occurrence of an Event of
Default, Landlord may, at its option, without further notice or demand to
Tenant, in addition to all other rights and remedies provided in this Lease, at
law or in equity:
(i) Terminate this Lease and Tenant's right of possession
of the Building and recover all damages to which Landlord is entitled under law,
specifically including, without limitation, all of Landlord's expenses of
reletting the Building (including, without limitation, rental concessions to new
tenants, repairs, Alterations, reasonable legal fees, and, to the extent
applicable to the portion of the relet term which coincides with the Term of
this Lease which would have remained had this Lease not been terminated,
brokerage commissions). If Landlord elects to terminate this Lease, every
obligation of the parties shall cease as of the date of such termination, except
that Tenant shall remain liable for payment of Rent and performance of all other
terms and conditions of this Lease to the date of termination;
(ii) Terminate Tenant's right of possession of the
Building without terminating this Lease, in which event Landlord may, but shall
not be obligated to, relet the Building, or any part thereof, for the account of
Tenant, for such rent and term and upon such other conditions as are acceptable
to Landlord, in its sole and absolute discretion. For purposes
37
of such reletting, Landlord is authorized to redecorate, repair, alter and
improve the Building to the extent Landlord, in its sole, discretion, deems
necessary. Until Landlord relets the Building, Tenant shall remain obligated to
pay Rent to Landlord as provided in this Lease. If and when the Building is
relet and if a sufficient sum is not realized from such reletting after payment
of all Landlord's expenses of reletting (including, without limitation, rental
concessions to new tenants, repairs, Alterations, reasonable legal fees and as
limited above, brokerage commissions) to satisfy the payment of Rent due under
this Lease for any month, Tenant shall pay Landlord any such deficiency upon
demand. Tenant agrees that Landlord may file suit to recover any sums due
Landlord under this Section from time to time and that such suit or recovery of
any amount due Landlord shall not be any defense to any subsequent action
brought for any amount not previously reduced to judgment in favor of Landlord.
Notwithstanding the foregoing, Landlord agrees to use commercially reasonable
efforts to relet the Building following a termination of Tenant's fight of
possession. Landlord shall be deemed to have satisfied this obligation if it
lists the Building for reletting with a reputable commercial leasing broker.
(iii) Terminate this Lease and Tenant's right of possession
of the Building, and recover from Tenant the net present value of the
difference, if any between (a) the Rent due from the date of termination until
the Expiration Date less (b) the then fair rental value of the Building, such
difference, if any, to be discounted at six percent (6%) per annum;
(iv) Re-enter and repossess the Building and remove all
persons and effect, therefrom, by summary proceeding, ejectment or other legal
action. Landlord shall have no liability by reason of any such re-entry,
repossession or removal.
22.3. Rights Upon Possession. If Landlord takes possession of the
Building pursuant to this Article, with or without terminating this Lease,
Landlord may, at its option, enter into the Building, remove Tenant's
Alterations, signs, personal property, equipment and other evidences of tenancy,
and store them at Tenant's risk and expense or dispose of them as Landlord may
see fit, and take and hold possession of the Building; provided, however, that
if Landlord elects to take possession only without terminating this Lease, such
entry and possession shall not terminate this Lease or release Tenant or any
Guarantor, in whole or in part, from the obligation to pay the Rent reserved
hereunder for the full Term or from any other obligation under this Lease or any
guaranty thereof.
22.4. No Waiver. If Landlord shall institute proceedings against
Tenant and a compromise or settlement thereof shall be made, the same shall not
constitute a waiver of any other covenant, condition or agreement herein
contained, nor of any of Landlord's rights hereunder. No waiver by Landlord or
Tenant of any breach shall operate as a waiver of such covenant, condition or
agreement, or of any subsequent breach thereof. No payment of Rent by Tenant or
acceptance of Rent by Landlord shall operate as a waiver of any breach or
default by Tenant under this Lease. No payment by Tenant or receipt by Landlord
of a lesser amount than the monthly installment of Rent herein stipulated shall
be deemed to be other than a payment on account of the earliest unpaid Rent, nor
shall any endorsement or statement on any check or communication accompanying a
check for the payment of 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 to pursue any other remedy provided in this
Lease. No payment by Tenant shall be deemed to constitute an accord or
satisfaction, or preclude
38
Tenant recovering from Landlord amounts paid in error. No re-entry by Landlord,
and no acceptance by Landlord of keys from Tenant, shall be considered an
acceptance of a surrender of this Lease or the Building hereunder demised.
22.5. Right of Landlord to Cure Tenant's Default. If an Event of
Default shall occur, then Landlord may (but shall not be obligated to) make such
payment or do such act to cure the Event of Default, and charge the amount of
the expense thereof, together with interest thereon at the Interest Rate, to
Tenant. Such payment shall be due and payable upon demand; however, the making
of such payment or the taking of such action by Landlord shall not be deemed to
cure the Event of Default or to stop Landlord from the pursuit of any remedy to
which Landlord would otherwise be entitled. Any such payment made by Landlord on
Tenant's behalf shall bear interest until paid at the Interest Rate.
22.6. Late Payment. If Tenant fails to pay any Rent within five (5)
days after such Rent becomes due and payable, Tenant shall pay to Landlord a
late charge of five percent (5%) of the amount of such overdue Rent. In
addition, any such late Rent payment shall bear interest from the date such Rent
became due and payable to the date of payment thereof by Tenant at the Interest
Rate. Such late charge and interest shall be due and payable within five (5)
days after written demand therefor from Landlord. Despite the foregoing, no such
late charge or interest shall be payable by Tenant on any late payment of Rent
in the event Tenant remits to Landlord the late payment within five (5) days
following written notice to Tenant that Landlord has failed to timely receive
any payment to which Landlord is entitled under this Lease. However, in the
event Tenant is late more than once in any period of twelve (12) consecutive
months, the preceding sentence shall not apply and Landlord shall be entitled to
the late charge and interest us provided above, in the case of each late payment
following the first such late payment within the twelve (12) month period,
without the necessity of written notice.
ARTICLE XXIII
MORTGAGES
23.1. Subordination. This Lease shall be subject and subordinate to
all ground or underlying leases and to any Mortgage(s) which may now or
hereafter affect the Land and to all renewals, modifications, consolidations,
replacements and extensions thereof, provided that the Mortgagee agrees in
writing, in a commercially reasonable form, that, in the event of foreclosure or
deed in lieu of foreclosure under the Mortgage, it shall not terminate this
Lease during the Term so long as no Event of Default exists under this Lease
(such agreement being referred to as an "SNDA"). Without limiting the generality
of the preceding sentence, Tenant agrees that an SNDA substantially in the form
attached to and made a part of this Lease as Exhibit F is commercially
reasonable and will be satisfactory to Tenant. Within thirty (30) days after
the: Date of Lease, Landlord, shall obtain an SNDA in conformance with this
Section from the existing Mortgagee with respect to the Land. If Landlord fails
to do so, Tenant's sole recourse shall be to terminate this Lease, in which
event Landlord shall promptly return to Tenant any prepaid Rent and the Security
Deposit previously received by Landlord and Landlord shall reimburse Tenant for
its actual out of pocket expenses for the negotiation of this Lease and the
preparation of Tenant Plans under the Work Agreement, not to exceed Twenty-Five
Thousand Dollars ($25,000) in the aggregate and thereafter the parties shall be
relieved of all further liability under this Lease. In the event of foreclosure
of a Mortgage, Tenant shall attorn to and
39
recognize the purchaser at foreclosure as Landlord under this Lease and such
agreement shall be set forth in the SNDA. Tenant shall promptly execute and
deliver the SNDA upon request by Landlord. Despite anything contained in this
Section, before any foreclosure sale under a Mortgage, the Mortgagee shall have
the absolute right to subordinate the Mortgage to this Lease.
23.2. Mortgage Protection. Tenant agrees to give any Mortgagee by
certified mail, return receipt requested, a copy of any notice of default served
upon Landlord, provided that Tenant has been given prior written notice of the
address of such Mortgagee. Tenant further agrees that if Landlord shall have
failed to cure such default within the time provided for in this Lease, then
Mortgagee shall have an additional thirty (30) days within which to cure such
default; provided, however, that if such default cannot be reasonably cured
within thirty (30) days, then such Mortgagee shall have such additional time as
may be necessary to cure such default so long as Mortgagee has commenced and is
diligently pursuing the remedies necessary to cure such default (including,
without limitation, the commencement of foreclosure proceedings, if necessary),
in which event this Lease shall not be terminated or Rent abated while such
remedies are being so diligently pursued. In the event of the sale of the Land
or the Building by foreclosure or deed in lieu thereof, the Mortgagor, or
purchaser at such sale shall be responsible for the return of the Security
Deposit only to the extent that such Mortgagee or purchaser actually received
the Security Deposit.
ARTICLE XXIV
SURRENDER, HOLDING OVER
24.1. Surrender of the Building. Tenant shall peaceably surrender
the Building to Landlord on the Expiration Date or earlier termination of this
Lease, in broom-clean condition and in as good condition as when Tenant took
possession, including, without limitation, the repair of any damage to the
Building caused by the removal of any of Tenant's personal property, Alterations
or trade fixtures from the Building, except for reasonable wear and tear and
loss by fire, condemnation or other casualty. Any of Tenant's personal property
left on or in the Building or the Common Area after the Expiration Date or
earlier termination of this Lease shall be deemed to be abandoned, and, at
Landlord's option, title thereto shall pass to Landlord under this Lease. Tenant
shall remove said property within five (5) days of notification or Landlord
shall remove or store the property at Tenant's expense.
24.2. Holding Over. In the event that Tenant shall not immediately
surrender the Building to Landlord on the Expiration Date or earlier termination
of this Lease, Tenant shall be deemed to be a month to month tenant upon all of
the terms and provisions of this Lease except that the monthly Basic Rent shall
be 150% of the monthly Basic Rent in effect during the last month of the Term.
Notwithstanding the foregoing, if Tenant shall hold over after the Expiration
Date or earlier termination of this Lease, and Landlord shall desire to regain
possession of the Building, then Landlord may forthwith re-enter and take
possession of the Building, by any legal process in force in the State of
Maryland. Tenant shall indemnify Landlord against all liabilities and damages
sustained by Landlord by reason of Tenant's holding over in the Building. Such
indemnity shall survive the termination of this Lease.
40
ARTICLE XXV
QUIET ENJOYMENT
Landlord covenants that if Tenant shall pay Rent and perform all of the
terms and conditions of this Lease to be performed by Tenant, Tenant shall,
during the Term, peaceably and quietly occupy and enjoy possession of the
Building without molestation or hindrance by Landlord or any party claiming
through or under Landlord, subject to the provisions of this Lease, any Mortgage
to which this Lease is subordinate (provided that an SNDA is provided), and the
Permitted Title Exceptions. Tenant acknowledges and agrees that this Lease is or
will be subject and subordinate to a declaration of easements, conditions, and
restrictions applicable to the Crown Pointe Corporate Park and to a separate
subdivision plat of record for the Land.
ARTICLE XXVI
HAZARDOUS MATERIALS
26.1. Definition. As used in this Lease, the term "Hazardous
Material" means any flammable items, explosives, radioactive materials,
hazardous or toxic substances, materials or wastes or related materials,
including any substances defined as or included in the definition of "hazardous
substances", "hazardous wastes", "infectious wastes", "hazardous materials" or
"toxic substances" now or subsequently regulated under any federal, state or
local laws, regulations or ordinances, including, without limitation, oil,
petroleum-based products, paints, solvents, lead, cyanide, DDT, printing inks,
acids, pesticides, ammonia compounds and other chemical products, asbestos, PCBs
and similar compounds, and including any different products and materials which
are subsequently found to have adverse effects on the environment or the health
and safety of persons, but excluding small quantities of chemicals and
substances ordinarily used in an office environment (such as cleaning supplies,
copier toner, office supplies, etc.) provided that such chemicals and substances
are used, stored and disposed of in accordance with any applicable laws and
regulations.
26.2. General Prohibition. Tenant shall not cause or permit any
Hazardous Material to be generated, produced, brought upon, used, stored,
treated, discharged, released, spilled or disposed of on, in, under or about the
Building, the Common Area, or the Land (collectively the "Property") by Tenant,
its affiliates, agents, employees, contractors, subtenants, assignees or
invitees. Tenant shall indemnify, defend and hold harmless Landlord, its
members, officers, employees, and agents, from and against any and all actions
(including, without limitation, remedial or enforcement actions of any kind,
administrative or judicial proceedings, and orders or judgments arising out of
or resulting therefrom), costs, claims, damages (including without limitation,
inspection costs, monitoring costs, attorneys', consultants', and experts' fees,
court costs and amounts paid in settlement of any claims or actions), fines,
forfeitures or other civil, administrative or criminal penalties, injunctive or
other relief (whether or not based upon personal injury, property damage, or
contamination of, or adverse effects upon, the environment, water tables or
natural resources), liabilities or losses (including, without limitation,
reduction of value of the Land) arising from a breach of this prohibition by
Tenant, its affiliates, agents. employees, contractors, subtenants, assignees or
invitees.
26.3. Notice. In the event that Hazardous Materials are discovered
upon, in, or under the Land, and any governmental agency or entity having
jurisdiction over the Land requires the removal of such Hazardous Materials,
Tenant shall be responsible for removing those Hazardous Materials arising out
of or related to a breach of the prohibition contained in Section 26.2 by Tenant
or its affiliates, agents, employees, contractors, subtenants, Assignees or
invitees but not
41
those of its predecessors. Notwithstanding the foregoing, Tenant shall not take
any remedial action in or about the Land or any portion thereof without first
notifying Landlord of Tenant's intention to do so and affording Landlord the
opportunity to protect Landlord's interest with respect thereto. Tenant
immediately shall notify Landlord in writing of; (i) any spill, release,
discharge or disposal of any Hazardous Material in, on or under the Land or any
portion thereof, (ii) any enforcement, cleanup, removal or other governmental or
regulatory action instituted, contemplated, or threatened (if Tenant has, notice
thereof) pursuant to any laws respecting Hazardous Materials; (iii) any claim
made or threatened by any person against Tenant or the Land or any portion
thereof relating to damage, contribution, cost recovery, compensation, loss or
injury resulting from or claimed to result from any Hazardous Materials; and
(iv) any reports made to any governmental agency or entity arising out of or in
connection with any Hazardous Materials in, on under or about or removed from
the Land or any portion thereof, including any complaints, notices, warnings,
reports or asserted violations in connection therewith. Tenant also shall supply
to Landlord as promptly as possible, and in any event within five (5) days after
Tenant first receives or sends the same, copies of all claims, reports,
complaints, notices, warnings or asserted violations relating in any way to the
Building, the Land or Tenant's use or occupancy thereof.
26.4. Landlord's Representation. Landlord represents and warrants
that, to its actual knowledge, based solely upon the `"Environmental Report"
(defined below) and without additional investigation or inquiry, the Land does
not contain any Hazardous Material in violation of applicable laws or
governmental regulations as of the Date of Lease. Landlord shall indemnify,
defend, and hold harmless Tenant and its directors, employees and agents from
all losses and other claims, actions, damages costs and expenses of every kind,
including reasonable attorneys', experts' and consultants' fees and costs,
incurred at any time and arising from or in connection with the breach of the
warranty set forth in this Section. "Environmental Report" means the following
report prepared by X.X.X., X.X. with respect to the Property: Phase I
Environmental Site Assessment, X.X.X., X.X. Project #A98120091, dated January
18, 1999.
26.5. Survival. The obligations of Landlord and Tenant under this
Article XXVI shall survive termination of this Lease.
ARTICLE XXVII
MISCELLANEOUS
27.1. No Representations by Landlord. Tenant acknowledges that
neither Landlord or its Agents nor any broker has made any representation or
promise with respect to the Building, the Land or the Common Area, except as
herein expressly set forth, and no rights, privileges, easements or licenses are
acquired by Tenant except as herein expressly set forth. Tenant, by taking
possession of the Building, shall accept the Building "AS IS" subject to
completion of work as specified in the Work Agreement, any latent defects
discovered within the first six (6) months of occupancy and the written "punch
list" which will be signed by Landlord and Tenant prior to Tenant's occupancy of
the Building, and such taking of possession shall be conclusive evidence that
the Building is in good and satisfactory condition at the time of such taking of
possession.
42
27.2. No Partnership. Nothing contained in the Lease shall be deemed
or construed to create a partnership or joint venture of or between Landlord and
Tenant, or to create any other relationship between Landlord and Tenant other
than that of landlord and tenant.
27.3. Brokers. Landlord recognizes Brokers as the sole brokers
procuring this Lease and shall pay Brokers a commission therefor pursuant to a
separate agreement between Brokers and Landlord. Landlord and Tenant each
represents and warrants to the other that it has not employed any broker, agent
or finder other than Brokers relating to this Lease. Landlord shall indemnify
and hold Tenant harmless, and Tenant shall indemnify and hold Landlord harmless,
from and against any claim for brokerage or other commission arising from or out
of any breach of the indemnitor's representation and warranty.
27.4. Estoppel Certificate. Tenant shall, without charge, at any
time and from time to time, within ten (10) days after request therefor by
Landlord, any Mortgagee, any purchaser of the Land or the Building or any other
interested person, execute, acknowledge and deliver to such requesting party a
written estoppel certificate certifying, as of the date of such estoppel
certificate, the following: (i) that this Lease is unmodified and in full force
and effect (or if modified, that the Lease is in full force and effect as
modified end setting forth such modifications); (ii) that the Term has commenced
(and setting forth the Commencement Date and Expiration Date) (or if the Term
has not commenced, setting forth such fact); (iii) if then true, that Tenant is
presently occupying the Building; (iv) the amounts of Base Rent and Additional
Rent currently due and payable by Tenant; (v) that any improvements to the
Building required by the Lease to have been made by Landlord have been made to
the satisfaction of Tenant (or specifying any exceptions thereto); (vi) that
there are no existing set-offs, charges, liens, claims or defenses against the
enforcement of any right hereunder, including, without limitation, Basic Rent or
Additional Rent (or, if alleged, specifying the same in detail); (vii) that no
Basic Rent (except the first installment thereof) has been paid more than thirty
(30) days in advance of its due date; (viii) that Tenant has no knowledge of any
then uncured default by Landlord of its obligations under this Lease (or, if
Tenant has such knowledge, specifying the same in detail); (ix) that Tenant is
not in default; (x) that the address to which notices to Tenant should be sent
is as set forth in the Lease (or, if not, specifying the correct address); and
(xi) any other reasonable factual certifications requested by Landlord. Landlord
agrees to provide similar estoppels within ten (10) days following written
request upon which Tenant or its designee may rely.
27.5. Waiver of Jury Trial. Landlord and Tenant hereby waive trial
by jury in any action, proceeding or counterclaim brought by either of the
parties against the other with respect to any matter whatsoever arising out of
or in any way connected with this Lease, the relationship of Landlord and Tenant
hereunder, Tenant's use or occupancy of the Building, and/or any claim of injury
or damages resulting from this Lease or Tenant's use and occupancy of the
Building. In the event Landlord commences any proceedings for nonpayment of
Rent, Tenant shall not interpose any counterclaims. This shall not, however, be
construed as a waiver of Tenant's right to assert such claims in any separate
action brought by Tenant.
27.6. Notices. All notices or other communications hereunder shall
be in writing and shall be deemed duly given upon actual delivery (or refusal of
delivery) if delivered in person or if mailed by certified or registered mail,
return receipt requested, postage prepaid, or if delivered
43
by commercial courier such as Federal Express, addressed and sent, if to
Landlord to Landlord's Address specified in Section 1.16; or if to Tenant to
Tenant's Address specified in Section 1.17. Landlord and Tenant may from time to
time by written notice to the other designate another address for receipt of
future notices.
27.7. Invalidity of Particular Provisions. If any provisions of this
Lease or the application thereof to any person or circumstances shall to any
extent be invalid or unenforceable, the remainder of this Lease, or the
application of such provision to persons or circumstances other than those to
which it is invalid or unenforceable, shall not be affected thereby, and each
provision of this Lease shall be valid and enforced to the full extent permitted
by law.
27.8. Gender and Number. All terms and words used in this Lease,
regardless of the number or gender in which they are used, shall be deemed to
include any other number or gender as the context may require.
27.9. Benefit and Burden. Subject to the provisions of Article XI
and except as otherwise expressly provided, the provisions of this Lease shall
be binding upon, and shall inure to the benefit of, the parties hereto and each
of their respective representatives, heirs, successors and assigns. Landlord may
freely and fully assign its interest hereunder, and in connection with any such
assignment shall transfer the Security Deposit and any prepaid rent to the
assignee.
27.10. Entire Agreement. This Lease (which includes all of the
Exhibits attached hereto) contains and embodies the entire agreement of the
parties hereto, and no representations, inducements or agreements, oral or
otherwise, between the parties not contained in this Lease shall be of any force
or effect. This Lease (other than the Rules and Regulations, which may be
changed from time to time as provided herein) may not be modified, changed or
terminated in whole or in part in any manner other than by an agreement, in
writing duly signed by Landlord and Tenant.
27.11. Authority.
(i) If either party signs this Lease as a corporation,
the person executing this Lease on behalf of said party hereby represents and
warrants that said party is a duly formed and validly existing corporation, in
good standing, qualified to do business in the State of Maryland, that the
corporation has full power and authority to enter into this Lease and that he or
she is authorized to execute this Lease on behalf of the corporation.
(ii) If either party signs as a limited liability company
or partnership, the person executing this Lease on behalf of said party hereby
represents and warrants that said party is a duly formed, validly existing
limited liability company or partnership, as the case may be, qualified to do
business in the State of Maryland, that the limited liability company or
partnership has full power and authority to enter into this Lease, and that he
or she is authorized to execute this Lease on behalf of the limited liability
company or partnership.
27.13. Attorneys' Fees. If, as a result of any default by either
party in the performance of any of the provisions of this Lease on its part to
be performed, the other party uses the services of any attorney in order to
secure compliance with such provisions or recover damages therefor,
44
of to terminate this Lease or (in the case of Landlord) evict Tenant; the
prevailing party in any legal action brought by either parry against the other
shall be entitled to recover for the fees or its attorneys in such amount as the
court may adjudge reasonable.
27.14. Interpretation. This Lease is governed by the laws of the
State of Maryland, excluding choice of laws principles.
27.15. No Personal Liability: Sale. Neither Landlord nor its Agents,
whether disclosed or undisclosed, shall have any personal liability under any
provision of this Lease. If Landlord defaults in the performance of any of its
obligations hereunder or otherwise, Tenant shall look solely to Landlord's
equity, interest and rights in the Building for satisfaction of Tenant's
remedies on account thereof or in the case of a sale or transfer of the
Building, to the proceeds of sale arising therefrom with respect to any claims
then existing against such transferring landlord as of the date of sale or
transfer. In the event that the original Landlord hereunder, or any successor
owner of the Building, shall sell or convey the Building, all liabilities and
obligations on the part of the original Landlord or such successor owner under
this Lease occurring thereafter shall terminate as of the day of such sale, and
thereupon all such liabilities and obligations shall be binding on the new
owner, except that the transferring Landlord shall remain liable to Tenant for
any prepaid rent or Security Deposit then held by such transferring Landlord
that is not transferred to the new owner. Tenant agrees to attorn to such new
owner. Any successor to Landlord's interest shall not be bound by (i) any
payment of Basic Rent or Additional Rent for more than one (1) month in advance,
except for the payment of the first installment of Basic Rent or (ii) as to any
Mortgagee or any purchaser at foreclosure, any amendment or modification of this
Lease made without the consent of such Mortgagee.
27.16. Time of the Essence. Time is of the essence as to all
obligations contained in this Lease.
27.17. Headings. Captions and headings are for convenience of
reference only, and shall in no event be used to construe or modify the
provisions set forth in this Lease.
27.18. Memorandum of Lease. Tenant shall, if requested by Landlord,
execute and deliver a memorandum of this Lease in recordable form within ten
(10) days after said request. Tenant shall not record such a memorandum or this
Lease without Landlord's consent. The party which requests recordation of a
memorandum of this Lease shall be obligated to pay an costs, fees and taxes, if
any, associated with such recordation.
27.19. Effectiveness. The furnishing of the form of this Lease shall
not constitute an offer and this Lease shall become effective only upon its
execution by and delivery to each party hereto.
27.20. Landlord Lien Waiver. Landlord shall execute and deliver to
Tenant within ten (10) days after written request such evidence of Landlord's
lien waiver as may reasonably be requested in connection with any acquisition or
financing by Tenant of equipment, furniture, furnishings or trade fixtures.
[SIGNATURE PAGE FOLLOWS]
45
IN WITNESS WHEREOF, Landlord and Tenant have executed this
Lease under seal as of the Date of Lease.
WITNESS: LANDLORD:
OXBRIDGE DEVELOPMENT AT
CROWN POINTE, L.C., a
Maryland limited liability
company
/s/
------------------------- ---------------------------
By: /s/ Xxxx X. Xxxxx [SEAL]
Name: Xxxx X. Xxxxx
Title: President
WITNESS: TENANT:
THERIMMUNE RESEARCH
CORPORATION, a Maryland
corporation
/s/
--------------------------- By: /s/ Xxxxx Xxxxxxxx [SEAL]
------------------
Name: Xxxxx Xxxxxxxx
Title: President
46
EXHIBIT A-1
(PLAT SHOWING LAND AND BUILDING)
47
EXHIBIT A-2
(LEGAL DESCRIPTION OF THE LAND)
Lot 7, Block A, as shown on a plat recorded among the Plat Records of Xxxxxxxxxx
County, Maryland in Plat Book 8296, at Plat No. 875.
48
EXHIBIT B
(WORK AGREEMENT)
This Work Agreement is attached to and made a part of the foregoing Lease
Agreement (the "Lease") between OXBRIDGE DEVELOPMENT AT CROWN POINTE, L.C., a
Maryland limited liability company ("Landlord"), and THERIMMUNE RESEARCH
CORPORATION, a Maryland corporation ("Tenant"). The terms used in this Exhibit
that are defined in the Lease shall have the same meanings as provided in the
Lease.
1. General
1.1 Purpose. This Agreement sets forth the terms and conditions
governing the design, permitting and construction of the improvements to be
installed in the Building.
1.2 Tenant's Representative. Tenant acknowledges that Tenant has
appointed Xxxxxx X. Angle as its authorized representative ("Tenant's
Representative") with full power and authority to bind Tenant for all actions
taken with regard to the "Tenant Work" (defined below). Tenant ratifies all
actions and decisions with regard to the Tenant Work that the Tenant's
Representative may have taken prior to the execution of the Lease. Landlord
shall not be obligated to respond to or act upon any plan, drawing, change
order, approval request, or other matter relating to the Tenant Work until it
has been executed by Tenant's Representative.
1.3 Leasehold Improvements.
(a) Existing Improvements: Prior to the Date of Lease,
Landlord, at its sole expense, has constructed the Base Building Improvements.
The Base Building Improvements are composed of the completed Building structure
and other improvements described on Schedule 1 attached to and made a part of
this Agreement. Landlord reserves the right, without the consent of Tenant, to
make changes and modifications to the Base Building Improvements, provided that
such changes do not change the character of the Building or increase the cost to
be paid by Tenant for the Tenant Work. On the Date of Lease, Landlord has
delivered to Tenant and Tenant has accepted from Landlord the Building in its
"as is" and "where is" condition. Tenant acknowledges that prior to the Date of
Lease, Tenant inspected the Building and satisfied itself about its condition.
(b) New Improvements: In addition to the Existing
Improvements, Tenant shall construct and install, at its sole expense (but
subject to application of the Tenant Improvement Allowance provided for in
Section 4 below), all improvements, materials, finishes, equipment and
installations in the Building as are mutually agreed upon by Landlord and Tenant
and shown in the "Tenant Plans" described in Section 2.1 below (the "Tenant
Work"). The Tenant Work will include office improvements within a portion of the
Building comprising approximately 10,000 square feet of rentable area (the
"Office Improvements") and laboratory and animal testing space and other
improvements (the "Remaining Improvements"). Unless otherwise provided in the
Lease or this Agreement, the Tenant Work shall consist solely of
49
interior, non-structural improvements and shall constitute long term
Improvements to the Building which shall not be removed by Tenant.
2. Design of Tenant Work
2.1 Tenant Plans. The Tenant Plans shall consist of the
following:
(a) Space Plan: A plan for the Building prepared by DLV,
LLC (the "Building's Architect') showing, among other things, the partition
layout, door locations, and other general details of the Tenant Work (the "Space
Plan").
(b) Construction Drawings and Specifications: All
construction working drawings, mechanical, electrical and other technical
specifications, finishing details (including wall finishes and colors), details
for the installation of technical and mechanical equipment, and other plans and
information showing or specifying the Tenant Work, as prepared by the Building's
Architect ("Construction Drawings").
2.2 Responsibility. Tenant shall cause the preparation of the
Tenant Plans by the Building's Architect promptly after the Date of Lease.
Tenant shall promptly furnish all necessary information to the Building's
Architect to enable the Building's Architect to prepare the Tenant Plans. The
Tenant Plans shall be subject to the reasonable approval of Landlord as set
forth in Section 2.3.
2.3 Approvals by Landlord.
(a) Promptly after preparation by the Building's
Architect Tenant shall submit the Tenant Plans to Landlord, for Landlord's
approval. Landlord's approval shall not be unreasonably withheld or delayed,
except that Landlord shall have complete discretion with regard to granting or
withholding approval of Tenant Plans to the extent they provide for Tenant Work
which impacts the Building's structure, roof, foundation, exterior walls, or
mechanical systems, is visible from the exterior of the Building, or affects the
Common Area. Landlord will not unreasonably withhold, condition, or delay its
approval of Tenant Plans to the extent that the Tenant Plans provide for Tenant
Work substantially similar to that depicted in the preliminary plans for such
work submitted by Tenant and approved by Landlord prior to the Date of Lease or
which is consistent with the improvements made by Tenant and existing as of the
Date of Lease at Tenant's Firstfield Road location in Gaithersburg, Maryland.
(b) Landlord shall approve or disapprove the Tenant
Plans, or any modifications of these materials, within seven (7) business days
following Landlord's receipt of the materials in question. In the event that
Landlord fails to approve or disapprove the Tenant Plans, or any revisions of
these materials, within seven (7) business days after receipt of the same,
Landlord shall be deemed to have approved such materials, provided that, at the
time of submitting the materials to Landlord, Tenant gives Landlord written
notice setting forth the following statement (a "Time Alert Notice"): "This is
to advise you that under the terms of our Work Agreement with you, if you fail
to approve or disapprove these materials in writing within seven (7) business
days after receipt, you will be deemed to have approved these materials." If
Tenant did not give Landlord a Time Alert Notice at the time of submitting the
materials to Landlord, the seven (7) business day period shall not begin to run
until the Time Alert Notice is
50
given to Landlord. Moreover, the seven (7) business day period rendering
Landlord's approval or disapproval of the Space Plan shall in no event commence
until the complete Space Plan has been delivered to Landlord and the seven (7)
business day period for rendering Landlord's approval or disapproval of the
Construction Drawings shall in no event commence until a complete set of the
Construction Drawings has been delivered to Landlord and, in each instance,
notice to that effect has been given by Tenant to Landlord. Despite the
foregoing, Tenant, at its election, may submit the Construction Drawings to
Landlord in two (2) phases - the first phase consisting of the Construction
Drawings for the Office Improvements and the second phase consisting of the
Construction Drawings for the Remaining Improvements. In that case, upon each
such submission by Tenant and notice by Tenant that it has delivered a complete
act of Construction Drawings for the phase in question, the seven (7) business
day period for rendering Landlord's approval of these Construction Drawings
shall run from such submission and notice, provided that a Time Alert Notice has
also been given. In the event that Landlord disapproves any Tenant Plans, or any
revisions of Tenant Plans, within seven (7) business days after receipt, Tenant
shall modify the disapproved materials to satisfy Landlord's reasonable
objections and shall resubmit such materials to Landlord for Landlord's approval
within seven (7) business days after receipt of Landlord's objections.
(c) Any changes, additions, or deletions that Tenant
desires to make to the Tenant Plans or Tenant Work after approval of the Tenant
Plans by Landlord shall also be subject to Landlord's prior written approval.
Such approval shall be governed by the same standards as are applicable to
Landlord's approval of the original Tenant Plans.
(d) Landlord's review and approval of the Tenant Plans
are for Landlord's purposes only and shall not be deemed to constitute any
representation or warranty by Landlord as to the quality, adequacy, or utility
of the Tenant Work, the fitness of the Tenant Work for any particular purpose,
the compliance of the Tenant Work with Governmental Requirements, or any other
matter whatsoever.
3. Construction
3.1 Contractors. The construction of the Tenant Work shall be
competitively bid by Tenant to the following four (4) contractors (the
"Permitted Contractors"): Xxxxx Construction; Corporate Interiors; Xxxx
Construction and Xxxxxxxxx. Tenant shall award the contract for the Tenant Work
to the Permitted Contractor who submitted the lowest responsible bid for the
Tenant Work, as selected by Tenant and approved by Landlord (the "General
Contractor"). All major work to be subcontracted out by the General Contractor
[i.e., work involving subcontracts of Ten Thousand Dollars ($10,000) or more]
shall be performed by bondable and reputable subcontractors approved by
Landlord. Landlord's approval under this Section 3.1 shall not be unreasonably
withheld or delayed.
3.2 Performance of Work
(a) The General Contractor selected to construct the
Tenant Work shall be responsible to obtain all required permits for the work.
51
(b) After Landlord's approval of the Construction
Drawings, Tenant's selection (and Landlord's approval) of the General
Contractor, and Tenant's receipt of all required permits for the Tenant Work,
Tenant shall promptly commence the construction of the Tenant Work and
diligently pursue the same, to Substantial Completion. The Tenant Work shall be
constructed under the supervision and management of Landlord or a representative
of Landlord as Landlord may designate in writing to Tenant ("Landlord's
Representative"). It is expressly recognized that it is the intent of Tenant to
commence occupancy of the Office Improvements on or before March 1, 2001.
Landlord shall use commercially reasonable efforts to assist Tenant to
accomplish its move-in by that date, provided that Landlord shall not be
required to incur any out of pocket expense in rendering such assistance.
(c) Tenant shall cause the Tenant Work to be constructed
and installed (i) in substantial accordance with the approved Construction
Drawings and this Agreement, including, without limitation, Landlord's
Construction Rules and Regulations attached to and made a part of this Agreement
as Schedule 2, (ii) in a good and workmanlike manner, using new materials of
good quality, and (iii) in accordance with all applicable Governmental
Requirements, including, without limitation, the Americans with Disabilities
Act. Landlord shall have no liability for, and Tenant shall hold Landlord
harmless from, any claims by Tenant or others related to any failure or alleged
failure of the Tenant Work to comply with Governmental Requirements. All Tenant
Work, shall be constructed or installed by the General Contractor and any
subcontractors approved by Landlord as set forth in Section 3.1. Landlord and
Landlord's Representative shall have the right (but not the obligation) from
time to time to inspect the Tenant Work as they progress and to advise Tenant of
any variances noted from the requirements of the Lease, this Agreement or
Landlord's Construction Rules and Regulations. All such variances shall be
promptly corrected by Tenant. Any supervision, management, or inspection of the
Tenant Work by Landlord or Landlord's Representative are for the sole benefit of
Landlord. Landlord's supervision, management, and inspection of the Tenant Work
shall in no event be deemed to constitute any representation or warranty by
Landlord as to the quality, adequacy, or utility of the Tenant Work, the fitness
of the Tenant Work for any particular purpose, or the compliance of the Tenant
Work with the Construction Drawings, this Agreement, or applicable Governmental
Requirements.
3.3 Payment. Subject to Section 4 below, Tenant shall promptly pay
all costs of designing, obtaining permits for, and constructing the Tenant Work
(collectively, the "Construction Costs"), as and when the Construction Costs are
due, directly to the parties to whom such payment is due. Tenant shall hold
Landlord harmless from all Construction Costs. The provisions of Section 13.2 of
the Lease shall apply to any mechanic's or materialmen's liens sought to be
imposed against the Building, Land or Corporate Park as a result of the
Construction Costs.
3.4 Change Orders. If Tenant requests any change or addition to
the Tenant Work after Landlord's approval of the Construction Drawings for the
same, Landlord shall respond to Tenant's request within seven (7) business days
after it has been received. If Landlord approves such request, Tenant shall bear
the full cost of such change order and no delay in Substantial Completion of the
Tenant Work due to the change order shall delay the Commencement Date under the
Lease.
52
3.5 Substantial Completion. "Substantial Completion" of each phase
of the Tenant Work shall be conclusively deemed to have occurred as soon as that
phase has been constructed in accordance with the approved Construction Drawings
and approved change orders and is ready to be utilized for its intended purpose,
as certified by the Building's Architect, after consultation with Tenant's
architect. The issuance of a temporary certificate of occupancy by the proper
governmental entity shall be required for Substantial Completion and, if
granted, shall be deemed conclusive evidence that Substantial Completion has
occurred. Tenant shall obtain a temporary certificate of occupancy for each
phase of the Tenant Work. Upon Substantial Completion of all of the Tenant Work,
Tenant shall obtain a final certificate of occupancy for the Building. The cost
of obtaining the certificates of occupancy shall be payable from the Tenant
Improvement Allowance. Notwithstanding the above, Substantial Completion shall
be deemed to have occurred even though punch list item remain to be completed in
the Tenant Work, the lack of completion of which will not materially interfere
with the Permitted Use of the Building. It is understood that the Commencement
Date under the Lease is a fixed date and that no delay in Substantial Completion
shall result in any extension of the Commencement Date.
3.6 Phased Construction. As contemplated in Section 2.3(b) above,
at Tenant's election, the design and construction of the Tenant Work may take
place in two (2) separate phases, i.e., one phase involving the Office
Improvements and the other phase involving the Remaining Improvements. If Tenant
elects to proceed in this fashion, the provisions of this Section 3 shall be
deemed to apply to each of the separate phases as and when it is undertaken.
3.7 Landlord's Fee. Tenant shall pay to Landlord, as complete
compensation for Landlord's coordination and oversight of the Tenant Work, a fee
equal to two percent (2%) of the first One Million Dollars ($1,000,000) of
Construction Costs incurred by Tenant and one (1) percent (1%) of all additional
Construction Costs incurred by Tenant ("Landlord's Fee"). Landlord's Fee shall
be paid to Landlord in installments, with each installment being due and payable
at the time each disbursement of the Tenant Improvement Allowance is paid to
Tenant under Section 4. Each installment of Landlord's Fee shall be in the
amount of the applicable percentage of Landlord's Fee multiplied by the
Construction Costs submitted for payment from the Tenant Improvement Allowance
and shall be deducted from each payment of the Tenant Improvement Allowance due
to Tenant. In the event that the total Construction Costs exceed the Tenant
improvement Allowance, the balance of Landlord's Fee for the Office Improvements
shall be paid to Landlord within thirty (30) days after Substantial Completion
of the Office Improvements and the balance of Landlord's Fee for the Remaining
Improvements shall be paid to Landlord within thirty (30) days after Substantial
Completion of the Remaining improvements. In all events, however, the entire
outstanding balance of Landlord's Fee shall be paid to Landlord no later than
thirty (30) days after the Commencement Date. If the total Construction Costs
have not been finally determined as of that date, the balance of Landlord's Fee
shall nevertheless be paid to Landlord on such date on the, basis of a
reasonable estimate of the final Construction Costs and an adjustment shall be
made as between Landlord and Tenant when the final Construction Costs have been
determined. Landlord may pay from the retainage which it holds under Section 4
any portion of Landlord's Fee which is due and payable. Any failure by Tenant to
pay Landlord's Fee when due and payable under this Agreement shall constitute an
Event of default under the Lease, subject to the notice and cure provisions of
clause (i) of Section 22.1 of the Lease.
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4. Tenant Improvement Allowance. Tenant shall receive an allowance against
the cost of designing, obtaining permits for, and constructing the Tenant Work
in the amount of Twenty-Five Dollars ($25.00) per rentable square foot contained
within the Building [for a total allowance of Six Hundred Fifty-Three Thousand
One Hundred Seventy-Five Dollars ($653,175.00] (the "Tenant Improvement
Allowance"). The Tenant Improvement Allowance shall be paid to Tenant or its
designee as the construction of the Tenant Work progresses and in proportion to
the, completion of such work, subject to retainage as provided for below and to
deduction for Landlord's Fee as provided in Section 3.7. Each payment to Tenant
or its designee shall be made within thirty (30) days after written request for
payment by Tenant (such request not to be made more often than monthly),
provided that (a) Landlord's Representative shall have the right to inspect the
Tenant Work performed within that period and Landlord shall have the right to
withhold payment for any defective or incomplete work noted, and (b) all
progress payments in connection with the Tenant Work shall be subject to a ten
percent (10%) retainage by Landlord until fifty (50%) of the Tenant Work has
been completed and a five percent (50%) retainage by Landlord until Substantial
Completion of the Tenant Work has occurred. Each request for payment shall be
accompanied by (i) a copy of the invoice or paid receipt in the case of design
or permitting expenses, (ii) the General Contractor's requisition for payment to
Tenant in the case of construction work, setting forth in reasonable detail the
costs of the Tenant Work incurred to the date of such submission and the amount
of those costs paid to date, and (iii) for all costs other than permitting
expenses, mechanics lien waivers duly executed by all parties supplying labor,
materials, or services with respect to the Tenant Work, waiving all claims for
mechanics' or materialmens' liens for all work, materials, or services furnished
to the Building except for the work, materials, or services which are the
subject of the current request for payment. All payments of the Tenant
Improvement Allowance made by Landlord to Tenant shall be deemed to have been
made in trust, for application only to the Construction Costs. At Landlord's
option, all checks may be made jointly payable to Tenant and the General
Contractor or other party furnishing, labor, materials, or services for the
Tenant Work, as the case maybe. The costs subject to payment from the Tenant
Improvement Allowance shall not include any interest or other costs of financing
or any overhead charge, construction management fee, or other fee to Tenant or
any affiliate of Tenant, but shall include Landlord's Fee as provided in Section
3.7. Upon Substantial Completion of the Tenant Work and provided that no Event
of Default exists under the Lease (and no event has occurred and is continuing
which would constitute an Event of Default upon the giving of notice or the
passage of time), the retainage held back by Landlord from the Tenant
Improvement Allowance shall be paid to Tenant, less any unpaid balance of
Landlord's Fee (which shall be retained by Landlord) and if the total
Construction Costs, (plus Landlord's Fee) are less than the Tenant Improvement
Allowance, the balance of the Tenant Improvement Allowance shall be credited by
Landlord to the first installment or installments of Basic Rent coming due under
the Lease until the Tenant Improvement Allowance is exhausted. If the total
costs of the Tenant Work (plus Landlord's Fee) are in excess of the Tenant
Improvement Allowance, the excess costs shall be borne solely by Tenant and any
outstanding balance of Landlord's Fee shall be paid by Tenant to Landlord as
provided in Section 3.7.
5. Removal of Specialized Tenant Improvements. Tenant Work which Landlord
reasonably determines is specialized to Tenant's use and occupancy of the
Building shall, at the election of Landlord, exercised by written notice to
Tenant not later than six (6) months before the Expiration Date of the Lease, be
removed by Tenant at its expense before the expiration of the
54
Term. Any other Tenant Work not so elected by Landlord to be removed shall
remain within the Building and be surrendered on the Expiration Date or earlier
date of termination of this Lease as the property of Landlord without
disturbance, molestation or injury. If Landlord requires the removal of all or
part of the specialized Tenant Work, Tenant, at its expense, shall repair any
damage to the Building caused by such removal. If Tenant fails to remove any
specialized Tenant Work upon Landlord's request made consistent with the above
provisions, then Landlord may (but shall not be obligated to) remove the same
and the cost of such removal and repair of any damage caused by the same,
together with any and all damages which Landlord may suffer and sustain by
reason of the failure of Tenant to remove the same, shall be charged to Tenant
and paid upon demand. Upon failure of Tenant to make such payment Landlord may
drawn upon the Security Deposit for the payment. This Section shall survive
termination of the Lease.
55
SCHEDULE 1 TO WORK AGREEMENT
BUILDING SHELL DEFINITION - CROWN POINTE I
Structure Steel frame, slab on grade, 250 lb/sq. ft. capacity. Steel
joist roof.
Exterior Block and brick facade. Insulated solex ribbon glass windows
and curtain wall.
Column Spacing 30' x 40' (average)
Ceiling Height Up to 18 feet in unfinished areas.
Roof Ballasted EPDM with a ten (10) year warranty.
HVAC Structure is designed to accommodate Tenant furnished rooftop
package unit system(s) and ceiling hung electric unit heaters.
Electrical Systems Single electrical service entrance with single pad-mounted
transformer outside of Building. Electrical room sized to
accommodate multiple tenant requirements.
Fire Safety Fire sprinkler alarm system by code. Installed FPA 231 system,
can be upgraded to FEPA, 231C, Class 4 for high rack storage.
Plumbing: Sub slab waste line provided, water will be distributed from
centrally located water room.
Window Coverings 1 inch slat venetian blinds to be paid for from the Tenant
Improvement Allowance.
56
SCHEDULE 2 TO WORK AGREEMENT
LANDLORD'S
CONSTRUCTION RULES AND REGULATIONS
The following rules and regulations are made a part of the terms and conditions
of this Agreement.
1. No smoking, eating or drinking are allowed in the building or directly
outside of the building; except in work area, contractor office or
areas specifically designated by Landlord. Workers will not litter
while at the job site. All related litter must be disposed of daily.
2. No loud music is allowed in the construction areas. Doors to spaces on
occupied floors shall be closed at all times.
3. Areas under construction, as well as storage areas, and all unoccupied
space are to be kept clean and orderly. They are to be secured when
unattended.
4. Contractor is to use only designated areas for working, loading and
unloading, trash containment and removal.
5. Construction personnel are confined to those areas in which related
work is in progress. They will not be allowed to congregate an grounds.
6. The area around the trash dumpster and parking areas are to be kept
clean by contractor.
7. Contractor must use an approved vendor for all roof work to maintain
roof warranty.
8. No alcoholic beverages, etc. allowed on the property.
9. Construction personnel is prohibited to travel on landscaped areas.
10. No owner supplied material is to leave the job site.
11. Contractor's failure to remove material or clean up work area will
result in Landlord performing the work, and holding the Contractor
liable for such costs.
12. All/any burning, welding, hammer or core drilling, and any other
extremely noisy or messy jobs must be prearranged through the
management office prior to doing the work and will only be permitted
before 7:30 am, and after 6:00 p.m.
13. Under no circumstances will any work be performed on the base building
MEP system or life support systems without prior approval of the
management office: (i.e., Fire Sprinkler System, Smoke Detector System,
Water Supply System, Sanitary/Storm System, Main Electrical
Distribution System, etc.). All equipment rooms must be attended at all
times during work. If the area is left unattended, it is to be secured.
57
14. All fire alarm inspections must be, scheduled 48 hours in advance, and
coordinated through Landlord. Inspections must be conducted before 7:30
a.m. or after 6:00 p.m. on weekdays only. Any inspections scheduled for
the weekends arc subject to the engineer's salary at 1.5 times his
regular pay with a four hour minimum.
15. The general contractor will provide a qualified representative for the
full duration of his or any of his subcontractors' daily activities
within the building. This representative will be equipped with a pager.
16. Identification will be required for all construction personnel.
17. All work, material delivery and building access before 7:30 a.m. or
after 6:00 p.m. and on weekends or holidays must be coordinated with
the building management three (3) days in advance.
18. All construction personnel shall park in the area designated by
Landlord.
19. Any contractor acting in a less than professional manner will be
removed from the project and prohibited future access (i.e., use of
profanity).
20. Contractor is responsible for securing as materials and tools as well
as that of its subcontractor.
21. All blueprints and change orders must be furnished to and approved by
Landlord.
22. No work will be accepted as complete or final without a final punchlist
and inspection approval by Landlord.
23. Contractor and all employees, as well as subcontractors and their
employees, must be properly trained and certified for work they
perform.
24. Prior to the commencement of construction, a certificate of insurance
with a general aggregate sum of $2,000,000.00 must be issued to
Landlord, naming Landlord as additional insured.
25. All tenant keying must meet our base building requirements. Landlord
will provide the responsible party with the necessary confidential
information. Advance notice of all keying specifications must be
submitted to Landlord.
26. All penetrations into the slab that are more than 3/4" must be x-rayed.
Landlord must be notified in advance of any x-rays being performed on
the premises. These x-rays can only be scheduled when the building is
closed.
27. The property's trash dumpster may NOT be used for construction
purposes. Any special arrangements must be coordinated with Landlord.
28. All cosmetic detail changes or upgrades to existing perimeter columns
and walls will be at the sole expense of the general contractor.
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29. It is the general contractor's responsibility to cover all smoke
detector devices located in a construction area prior to commencing
work daily. Landlord will uncover all devices at the end of each day.
Landlord will fine the general contractor if fire alarms are
accidentally activated due to their negligence.
30. The general contractor must submit a lighting schedule and an air
balance report to Landlord prior to the completion of construction.
31. Prior to the completion of the punchlist, the general contractor must
furnish Landlord with as-built drawings and any extra materials for
future repairs and maintenance of the space.
32. Landlord reserves the right to amend or rescind the Construction Rules
and Regulations at our sole discretion without prior notice.
BREACH OF ANY OF THE ABOVE RULES AND REGULATIONS MAY RESULT IN THE PERSON OR
CONTRACTOR INVOLVED BEING TERMINATED FROM WORKING IN THE BUILDING. NO CONTRACTOR
OR ITS SUBCONTRACTORS SHALL BE PERMITTED TO START WORK UNTIL THE APPROPRIATE
CERTIFICATES OF INSURANCE HAVE BEEN SUBMITTED AND APPROVED BY LANDLORD.
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EXHIBIT C
(EXISTING TITLE MATTERS)
60
EXHIBIT D
(IRREVOCABLE STAND-BY LETTER OF CREDIT)
(Date)
Our Letter of Credit No. ______________
To:
[INSERT NAME AND ADDRESS OF LANDLORD]
Gentlemen:
We hereby authorize you to draw on us for the account of
____________________ [INSERT NAME OF TENANT], ____________________ [INSERT
ADDRESS OF TENANT], the amount of ____________________ Dollars ($__________)
[INSERT ORIGINAL AMOUNT OF SECURITY DEPOSIT], available by your draft at sight
accompanied by:
1. The original of, and all amendments to, this letter of credit.
2. A written statement executed by a purported member, officer,
manager, or other purported authorized representative of Oxbridge Development At
Crown Pointe, L.C., or of any transferee of this letter of credit, setting forth
as follows:
"Landlord is entitled to draw upon Letter of Credit No. _____ [INSERT
NUMBER OF THIS LETTER OF CREDIT] issued by __________ [INSERT NAME OF
BANK ISSUING THIS LETTER OF CREDIT] pursuant to the terms of the Lease
Agreement, dated __________, 2000, [INSERT DATE OF THE LEASE] between
Oxbridge Development At Crown Pointe, L.C., as Landlord, and TherImmune
Corporation, as Tenant, as may be amended from time to time, for
promises located at 000 Xxxxxxxxxxxx Xxxxx, Xxxxxxxxxxxx, Xxxxxxxx."
Drafts must be drawn and negotiated at our offices located at [INSERT
ADDRESS OF OFFICES LOCATED IN WASHINGTON, D.C. METROPOLITAN AREA] not later than
_______________ [INSERT DITTO WHICH IS NOT LESS THAN ONE YEAR FROM DATE OF
issuance]. However, the expiration date of this letter of credit shall be
automatically extended for consecutive one (1) year periods unless we give you
written notice of our intention not to extend this letter of credit at least
thirty (30) days before any then current expiration date. Any such notice shall
be sent to you by certified mail, postage prepaid, return receipt requested, at
your address set forth above or such other address as you may advise us of in
writing. If we notify you in accordance with this paragraph that we will not
extend the expiration date of this letter of credit, then, on or before the then
current expiration date, you may draw upon us for an amount not to exceed the
unused balance of this letter of credit, provided that the draft is accompanied
by the documents specified in paragraphs no. 1 and 2 above.
61
This credit is subject to the "Uniform Customs and Practice for
Documentary Credits, 1993 Revision, International Chamber of Commerce, Brochure
No. 500."
We hereby engage with you that all drafts drawn under and within the
terms and the amount of this credit, and accompanied by the documents specified
herein, will be duly honored upon presentation to us.
This letter of credit shall be binding upon our successors and assigns
and shall inure to the benefit of your successors and assigns and shall be
transferable by you or your successors and assigns.
Very truly yours,
[INSERT NAME OF BANK]
By:____________________
Name: _________________
Title: __________________
62
EXHIBIT E
(RULES AND REGULATIONS)
1. No part or the whole of the sidewalks, plaza areas, entrances,
passages, exterior corridors or courts of the Building or the Land shall be
obstructed or encumbered by Tenant or used for any purpose other than ingress
and egress to and from the Building.
2. No awnings or other projections shall be attached to the
exterior walls of the Building. No skylights, window, door or transom of the
Building shall be covered or obstructed by Tenant, and no window shade, blind,
curtain, screen, storm window, awning or other material shall be installed or
placed on any window or in any window of Building except as approved in writing
by Landlord. If Landlord has installed or hereafter installs any shade, blind or
curtain in the Building, Tenant shall not remove the same without first
obtaining Landlord's written consent thereto.
3. No showcases or other articles shall be put in front of or
affixed to any part of the exterior of the Building, nor placed in the Common
Area.
4. Tenant shall not place or permit its Agents to place any trash
or other objects anywhere within the Building or the Land other than the trash
receptacles designated by Landlord.
5. The water and wash closets and other plumbing fixtures shall
not be used for any purposes other than those for which they were constructed,
and no sweepings, rubbish bags or other substances (including, without
limitation, coffee grounds) shall be thrown therein.
6. Tenant shall not xxxx, paint, drill into or in any way deface
any part of the Building. No boring, cutting or stringing of wires shall be
permitted, except for picture hanging and other ordinary decorating purposes.
7. No cooking shall be done or permitted in the Building by
Tenant or its Agents except that Tenant may install and use microwave ovens.
Tenant shall not cause of permit any unusual or objectionable odors to emanate
from the Building.
8. Tenant shall not make or permit any unseemly or disturbing
noises or disturb or interfere with other tenants of the neighboring buildings
by the use of any musical instrument, radio, television set, other audio device,
unmusical noise, whistling, singing or in any other way.
9. Nothing shall be thrown out of any doors, windows or
skylights.
10. No additional locks or bolts of any kind shall be placed upon
any of the doors or windows of the Building, nor shall any changes be made in
locks or the mechanism thereof without prior notice to and the approval of
Landlord, provided that Tenant may install separate locks and/or a security
system in its computer room. Tenant shall, upon the termination of its Lease,
return to Landlord all keys to the Building and other areas furnished to, or
otherwise
63
procured by, Tenant. In the event of the loss of any such keys, Tenant shall pay
Landlord the cost of replacement keys.
11. Tenant shall not use or occupy or permit any portion of the
Building to be used or occupied for the storage, manufacture or sale of liquor,
narcotics or drugs, other than pharmaceutical drugs manufactured, stored,
handled, or used in connection with Tenant's research, testing and development
activities conducted within its laboratories in the Building, provided that all
such manufacturing, storage, handling, and use shall be in accordance, with
Governmental Requirements. Tenant shall not engage or pay any employee in the
Building except those actually working for Tenant in the Building. The Building
shall not be used, or permitted to be used, for lodging or sleeping or for any
immoral or illegal purpose.
12. Intentionally omitted.
13. Landlord reserves the right to control and operate the Common
Area in such manner as it deems best for the benefit of the Corporate Park
tenants.
14. Tenant shall use its best efforts to see that all entrance
doors (if applicable) are locked and all lights and office equipment within the
Building are turned off, and Landlord shall have no responsibility relating
thereto.
15. Corporate Park employees shall not be required to perform any
work outside of their regular duties unless under specific instructions from
Landlord.
16. Vending, canvassing, soliciting and peddling in the Building
are prohibited, and Tenant shall cooperate in seeking their prevention.
17. No animals of any kind shall be brought into or kept about the
Land or the Building by Tenant or its Agents, except (a) seeing eye dogs, and
(b) mice, ferrets, guinea pigs, rats, and hamsters used in connection with
Tenant's testing and laboratory work.
18. No vending machines shall be permitted to be placed or
installed in any part of the Building by Tenant without the permission of
Landlord.
19. The Building has been designated as a non-smoking area.
Tenant, its servants, employees, officers, agents, customers, licensees,
visitors, suppliers, or any other person reasonably controlled by Tenant must
adhere to the no-smoking policy.
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EXHIBIT F
(FORM OF SNDA)
SUBORDINATION, NON-DISTRUBANCE AND
ATTORNMENT AGREEMENT
THIS AGREEMENT is made as of this _____ day of __________, 2000 by and
among ____________________ a __________ having an office and place of business
at ____________________ ("Lender"), __________, a {Insert State} corporation,
whose address is __________, ("Landlord"), and __________, having an office at
__________, ("Tenant").
WITNESSETH
WHEREAS, Tenant has entered into a certain lease (the "Lease") dated
with Landlord covering premises (the "Premises") within a certain building known
as located in {Insert State} (a conformed copy of said Lease has been delivered
to Lender); and
WHEREAS, Lender has made a certain loan to Landlord, which loan is
secured by the mortgages (the "Mortgages") more particularly described in
Exhibit A annexed here to and affecting the premises known as , in the {Insert
City & County}, City, County and State of {Insert State}; and
WHEREAS, Lender has been requested by Tenant and by Landlord to enter
into a non-disturbance agreement with Tenant;
NOW, THEREFORE, in consideration of the premises and mutual covenants
hereinafter contained, the parties hereto mutually covenant and agree as
follows:
1. The Lease and any extensions, renewals, replacements or
modifications thereof, and all of the right, title and interest of
Tenant thereunder in and to the Premises are and shall be subject and
subordinate to the Mortgages and to all of the terms and conditions
contained therein, and to any renewals, modifications, replacements,
consolidations and extensions thereof.
2. Lender consents to the Lease and, in the event Lender comes
into possession of or acquires title to the Premises as a result of the
foreclosure or other enforcement of the Mortgages or the notes secured
by the Mortgages, or as a result of any other means, Lender agrees
that, so long as Tenant is not then in default hereunder or under the
Lease, Lender will recognize Tenant and will not disturb Tenant in its
possession of the Premises for any reason other than one which would
entitle Landlord to terminate the Lease under its terms.
3. Tenant agrees with Lender that if the interests of Landlord in
the Premises shall be transferred to and owned by Lender by reason of
foreclosure or other proceedings brought by it, or any other manner, or
shall be conveyed thereafter by Lender or shall be conveyed pursuant to
a foreclosure sale of the Premises, Tenant shall be bound to Lender
under all of the terms, covenants and conditions of the
65
Lease for the balance of the term thereof remaining and any extensions
or renewals thereof which may be effected in accordance with any option
therefor in the Lease, with the same, force and effect as if Lender
were the landlord under the Lease, and Tenant does hereby attorn to
Lender as its landlord, said attornment to be effective and
self-operative without the execution of any further instruments on the
part of any of the parties hereto immediately upon Lender succeeding to
the interest of Landlord in the Premises. Tenant agrees, however, upon
the election of and written demand by Lender within twenty (20) days
after Lender receives title to the Premises, to execute an instrument
in confirmation of the foregoing provisions, satisfactory to Lender, in
which Tenant shall acknowledge such attornment and shall set forth the
terms and conditions of its tenancy.
4. Tenant agrees with Lender that if Lender shall succeed to the
interest of Landlord under the Lease, Lender shall not be (a) liable
for any action or omission of any prior landlord under the Lease,
except to the extent set forth in the last sentence of this section, or
(b) subject to any offsets or defenses which Tenant might have, against
any prior landlord, or (c) bound by any rent or additional rent which
Tenant might have paid for more than the current month to any prior
landlord, or (d) bound by any security deposit which Tenant may have
paid to any prior Landlord, unless such deposit is in an escrow fund
available to Lender or has otherwise been transferred to such Lender,
or (e) bound by an amendment or modification of the Lease made without
Lender's written consent, or (f) bound by any notice of termination
given by Landlord to Tenant without Lender's written consent thereto,
or (g) personally liable under the Lease and Lender's liability under
the Lease shall be limited to the ownership interest of Lender in the
Promises. Tenant further agrees with Lender that Tenant will not
voluntarily subordinate the Lease to any lien or encumbrance without
Lender's written Consent. Nothing herein shall be deemed to constitute
a release by Tenant of Lender or any purchaser to whom Tenant attorns
pursuant to Paragraph 3 hereof with respect to the required performance
by Lender or such purchaser of any obligation, duty or covenant of
Landlord under the Lease arising from and after the date Lender or any
such purchaser shall obtain possession of or title to the Premises.
5. In the event that Landlord shall default in the performance or
observance of any of the terms, conditions or agreements in the Lease,
Tenant shall give written notice thereof to Lender and Lender shall
have the right (but not the obligation) to cure such default. Tenant
shall not take any action with respect to such default under the Lease,
including, without limitation, any action in order to terminate,
rescind, or void the Lease or to withhold any rental thereunder, for a
period of 10 days after receipt of such written notice by Lender with
respect to any such default capable of being cured by the payment of
money and for a period of 30 days after receipt of such written notice
by Lender with respect to any other such default (provided, that in the
case, of any default which cannot be cured by the payment of money and)
cannot with diligence be cured within such 30-day period because of the
nature of such default or because Lender requires time to obtain
possession of the Premises in order to cure the default, if Lender
shall
66
proceed promptly to attempt to obtain possession of the Premises, where
possession is required, and to cure the same and thereafter shall
prosecute the curing of such default with diligence and continuity,
then the time within which such default may be cured shall be extended
for such period as may be necessary to complete the curing of the same
with diligence and continuity).
6. Landlord has agreed in the mortgages that the rentals payable
under the Lease shall be paid directly by Tenant to Lender upon the
occurrence of a default by Landlord under the Mortgages. Accordingly,
after notice is given by Lender to Tenant that the rentals under the
Lease should be paid to Lender, Tenant shall pay to Lender, or in
accordance with the directions of Lender, all rentals and other moneys
due and to become due to Landlord under the Lease, or amounts equal
thereto. Tenant shall have no responsibility to ascertain whether such
demand by Lender is permitted under the Mortgages, Landlord hereby
waives any right, claim or demand it may now or hereafter have against
Tenant by reason of such payment to Lender, and any such payment to
Lender shall discharge the obligations of Tenant to make such payment
to Landlord.
7. Tenant declares, agrees and acknowledges that:
a. Lender, in making disbursements pursuant to any
agreement relating to the Loan, is under no obligation or duty to, nor
has Lender represented that it will, see to the application of such
proceeds by the person or persons to whom Lender disburses such
proceeds, and any application or use of such proceeds for purposes
other than those provided for in such agreement shall not defeat the
subordination herein made in whole, or in part; and
b. It intentionally and unconditionally waives,
relinquishes and subordinates the Lease and its leasehold interest
thereunder in favor of the lien or charge of the Mortgages, and that in
consideration of this waiver, relinquishment and subordination,
specific loans and advances are being and will be made by Lender to
Landlord and, as part and parcel thereof, specific monetary and other
obligations are being and will be entered into by Landlord and Lender
which would not be made or entered into but for said reliance upon this
waiver, relinquishment and subordination.
8. This Agreement shall bind and inure to the benefit of the
parties hereto, their successors and assigns. As used herein the term
"Tenant" shall include Tenant, its successors and assigns; the words
"foreclosure" and "foreclosure sale" as used herein shall be deemed to
include the acquisition of Landlord's estate in the Premises by
voluntary deed (or assignment) in lieu of foreclosure; and the word
"Lender" shall include the Lender herein specifically named and any of
its successors, participants and assigns, including anyone who shall
have succeeded to Landlord's interest in the Premises by, through or
under foreclosure of the Mortgage.
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9. All notices, consents and other communications pursuant to the
provisions of this Agreement shall be in writing and shall be sent by
registered or certified mail, return receipt requested, or by a
reputable commercial overnight carrier that provides a receipt, such as
Federal Express or Airborne, and shall be deemed given when postmarked
and addressed as follows:
If to Lender: With a copy to:
If to Tenant: If to Landlord: or to such other address as
shall from time to time have been designated by written notice by such
party to the other parties as herein provided.
10. This Agreement shall be the whole and only agreement between
the patties hereto with regard to the subordination of the Lease and
the leasehold interest of Tenant thereunder to the lien or charge of
the Mortgages in favor of Lender, and shall supersede and control any
prior agreements as to such, or any subordination, including, but not
limited to, those provisions, if any, contained in the Lease, which
provide for the subordination of the Lease and the leasehold interest
of Tenant thereunder to a deed or deeds of trust or to a mortgage or
mortgages to be thereafter executed, and shall not be modified or
amended and no provision herein shall be waived except in writing by
the party against whom enforcement of any such modification or
amendment is sought. The use of the neuter gender in this Agreement
shall be deemed to include any other gender, and words in the singular
number shall be held to include the plural, when the sense requires. In
the event any one or more of the provisions of this Agreement shall for
any reason be held to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not
affect any other provision of this Agreement, but this Agreement shall
be construed as if such invalid, illegal or unenforceable provision had
never been contained herein. This Agreement shall be governed by and
construed in accordance with the laws of the {Insert State}.
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IN WITNESS WHEREOF the parties hereto have placed their hands and seals
the day and year first above written.
Signed and acknowledged in TENANT:
the presence of us
________________________ By: _____________________________
Typed Name:
Title:
LANDLORD:
________________________ By: _____________________________
Typed Name:
Title:
________________________ By: _____________________________
Typed Name:
Title:
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EXHIBIT F
(FORM OF SNDA)
SUBORDINATION, NON-DISTRUBANCE AND
ATTORNMENT AGREEMENT
THIS AGREEMENT is made as of this 31st day of October, 2000 by and
among Branch Banking & Trust Company of Virginia having an office and place of
business at 0000 Xxxxxx Xxxxx Xxxx #000 Xxxxxxxxxx, Xxxxxxxx ("Lender"),
Oxbridge Development at Crown Pointe, L.C., a Maryland limited liability
company, whose address is 000 Xxxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxxxx, Xxxxxxxx
("Landlord"), and Therimmune Research Corporation, having an office at 000
Xxxxxxxxxxxx Xxxxx, Xxxxxxxxxxxx, Xxxxxxxx ("Tenant").
WITNESSETH
WHEREAS, Tenant has entered into a certain lease (the "Lease") dated
10-26-00 Landlord covering premises (the "Premises") within a certain building
known as 000 Xxxxxxxxxxxx Xxxxx, located in Gaithersburg, Maryland (a conformed
copy of said Lease has been delivered to Lender); and
WHEREAS, Lender has made a certain loan to Landlord, which loan is
secured by the mortgages (the "Mortgages") more particularly described in
Exhibit A annexed here to and affecting the premises known as 000 Xxxxxxxxxxxx
Xxxxx, Xxxxxxxxxxxx, Xxxxxxxx; and
WHEREAS, Lender has been requested by Tenant and by Landlord to enter
into a non-disturbance agreement with Tenant;
NOW, THEREFORE, in consideration of the premises and mutual covenants
hereinafter contained, the parties hereto mutually covenant and agree as
follows:
1. The Lease and any extensions, renewals, replacements or
modifications thereof, and all of the right, title and interest of
Tenant thereunder in and to the Premises are and shall be subject and
subordinate to the Mortgages and to all of the terms and conditions
contained therein, and to any renewals, modifications, replacements,
consolidations and extensions thereof.
2. Lender consents to the Lease and, in the event Lender comes
into possession of or acquires title to the Premises as a result of the
foreclosure or other enforcement of the Mortgages or the notes secured
by the Mortgages, or as a result of any other means, Lender agrees
that, so long as Tenant is not then in default hereunder or under the
Lease, Lender will recognize Tenant and will not disturb Tenant in its
possession of the Premises for any reason other than one which would
entitle Landlord to terminate the Lease under its terms.
3. Tenant agrees with Lender that if the interests of Landlord in
the Premises shall be transferred to and owned by Lender by reason of
foreclosure or other proceedings brought by it, or any other manner, or
shall be conveyed thereafter by
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Lender or shall be conveyed pursuant to a foreclosure sale of the
Premises, Tenant shall be bound to Lender under all of the terms,
covenants and conditions of the Lease for the balance of the term
thereof remaining and any extensions or renewals thereof which may be
effected in accordance with any option therefor in the Lease, with the
same, force and effect as if Lender were the landlord under the Lease,
and Tenant does hereby attorn to Lender as its landlord, said
attornment to be effective and self-operative without the execution of
any further instruments on the part of any of the parties hereto
immediately upon Lender succeeding to the interest of Landlord in the
Premises. Tenant agrees, however, upon the election of and written
demand by Lender within twenty (20) days after Lender receives title to
the Premises, to execute an instrument in confirmation of the foregoing
provisions, satisfactory to Lender, in which Tenant shall acknowledge
such attornment and shall set forth the terms and conditions of its
tenancy.
IN WITNESS WHEREOF the parties hereto have placed their hands and seals
the day and year first above written.
Signed and acknowledged in: LANDLORD: Oxbridge Development at Crown
the presence of us: Pointe, L.L.C.
________________________________ By: ________________________________
Typed Name: Xxxx X. Xxxxx
Title: President
TENANT: THERIMMUNE RESEARCH CORPORATION
________________________________ By: ________________________________
Typed Name: Xxxxxx Xxxxxxxx
Title: President
Lender: Branch Banking and Trust
________________________________ By: ________________________________
Typed Name: Xxxxx Xxxxx
Title: Vice President
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