Exhibit 10.42
LEASE
BETWEEN
AMERICAN PREPAID PROFESSIONAL SERVICES, INC.,
AS TENANT
AND
200 WEST XXXXXXX OWNER LLC,
AS LANDLORD
000 XXXX XXXXXXX XXXXXXXXX, XXXXXXX, XXXXXXXX
THE SUBMISSION OF AN UNSIGNED COPY OF THIS DOCUMENT TO TENANT FOR TENANT'S
CONSIDERATION DOES NOT CONSTITUTE AN OFFER TO LEASE THE PREMISES OR AN OPTION TO
OR FOR THE PREMISES. THIS DOCUMENT SHALL BECOME EFFECTIVE AND BINDING ONLY UPON
THE EXECUTION AND DELIVERY OF THIS LEASE BY BOTH LANDLORD AND TENANT.
TABLE OF CONTENTS
PAGE
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ARTICLE 1 BASIC DATA; DEFINITIONS....................................... 1
1.1 Basic Data.............................................. 1
1.2 Additional Definitions.................................. 2
1.3 Enumeration of Exhibits................................. 3
ARTICLE 2 PREMISES AND APPURTENANT RIGHTS............................... 3
2.1 Lease of Premises....................................... 3
2.2 Appurtenant Rights and Reservations..................... 3
ARTICLE 3 BASIC RENT.................................................... 4
3.1 Payment................................................. 4
ARTICLE 4 COMMENCEMENT AND CONDITION.................................... 4
4.1 Commencement Date....................................... 4
4.2 Preparation of the Premises............................. 4
ARTICLE 5 USE OF PREMISES............................................... 4
5.1 Permitted Use........................................... 4
5.2 Installations and Alterations by Tenant................. 5
5.3 Extra Hazardous Use..................................... 6
5.4 Hazardous Materials..................................... 6
ARTICLE 6 ASSIGNMENT AND SUBLETTING..................................... 7
6.1 Prohibition............................................. 7
6.2 Acceptance of Rent...................................... 7
6.3 Excess Payments......................................... 8
6.4 Landlord's Recapture Right.............................. 8
6.5 Further Requirements.................................... 8
ARTICLE 7 RESPONSIBILITY FOR REPAIRS AND CONDITION OF PREMISES;
SERVICES TO BE FURNISHED BY LANDLORD.......................... 9
7.1 Landlord Repairs........................................ 9
7.2 Tenant Repairs.......................................... 9
7.3 Floor Load - Heavy Machinery............................ 10
7.4 Utility Services........................................ 10
7.5 Other Services.......................................... 11
7.6 Interruption of Service................................. 12
ARTICLE 8 REAL ESTATE TAXES............................................. 13
8.1 Payments on Account of Real Estate Taxes................ 13
8.2 Abatement............................................... 14
ARTICLE 9 OPERATING AND UTILITY EXPENSES................................ 14
9.1 Definitions............................................. 14
9.2 Tenant's Payment of Operating Expenses.................. 14
9.3 Utility Payments........................................ 15
ARTICLE 10 INDEMNITY AND PUBLIC LIABILITY INSURANCE...................... 15
10.1 Tenant's Indemnity...................................... 15
10.2 Tenant Insurance........................................ 16
10.3 Tenant's Risk........................................... 16
10.4 Waiver of Subrogation................................... 17
ARTICLE 11 FIRE, EMINENT DOMAIN, ETC..................................... 17
11.1 Landlord's Right of Termination......................... 17
11.2 Restoration; Tenant's Right of Termination.............. 17
11.3 Landlord's Insurance.................................... 18
11.4 Abatement of Rent....................................... 18
11.5 Condemnation Award...................................... 19
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ARTICLE 12 HOLDING OVER; SURRENDER....................................... 19
12.1 Holding Oven............................................ 19
12.2 Surrender of Premises................................... 19
ARTICLE 13 RIGHTS OF MORTGAGEES; TRANSFER OF TITLE....................... 20
13.1 Rights of Mortgagees.................................... 20
13.2 Assignment of Rents and Transfer of Title............... 20
13.3 Notice to Mortgagee..................................... 20
ARTICLE 14 DEFAULT; REMEDIES............................................. 21
14.1 Tenant's Default........................................ 21
14.2 Landlord's Remedies..................................... 23
14.3 Additional Rent......................................... 25
14.4 Remedying Defaults...................................... 25
14.5 Remedies Cumulative..................................... 25
14.6 Enforcement Costs....................................... 25
14.7 Waiver.................................................. 25
14.8 Security Deposit........................................ 25
14.9 Landlord's Default...................................... 26
ARTICLE 15 MISCELLANEOUS PROVISIONS...................................... 26
15.1 Rights of Access........................................ 26
15.2 Covenant of Quiet Enjoyment............................. 26
15.3 Landlord's Liability.................................... 26
15.4 Estoppel Certificate.................................... 27
15.5 Brokerage............................................... 27
15.6 Rules and Regulations................................... 27
15.7 Financial Statements.................................... 27
15.8 Substitute Space........................................ 27
15.9 Invalidity of Particular Provisions..................... 27
15.10 Provisions Binding, Etc................................. 27
15.11 Recording............................................... 28
15.12 Notice.................................................. 28
15.13 When Lease Becomes Binding; Entire Agreement;
Modification............................................ 28
15.14 Paragraph Headings and Interpretation of Sections....... 28
15.15 Dispute Resolution...................................... 28
15.16 Waiver of Jury Trial.................................... 29
15.17 Time Is of the Essence.................................. 29
15.18 Multiple Counterparts................................... 29
15.19 Governing Law........................................... 29
EXHIBIT A Location Plan of Premises..................................... A-1
EXHIBIT B Intentionally Omitted......................................... X-x
EXHIBIT C Commencement Date Letter...................................... C-l
EXHIBIT D Operating Expenses............................................ D-1
EXHIBIT E Rules and Regulations of Building............................. E-l
EXHIBIT F Workletter.................................................... F-1
EXHIBIT G Additional Provisions......................................... G-l
EXHIBIT H Cleaning Specifications....................................... H-1
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LEASE
THIS LEASE is dated as of October 15, 2003 between the Landlord and the
Tenant named below, and is of space in the Building described below.
BASIC DATA; DEFINITIONS
BASIC DATA. Each reference in this Lease to any of the following terms
shall be construed to mean the following:
LANDLORD: 200 West Xxxxxxx Owner LLC, a Delaware limited liability company
LANDLORD'S ADDRESS: 000 Xxxx Xxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
TENANT: American Prepaid Professional Services, Inc., a Florida corporation
TENANT'S ADDRESS: 000 Xxxx Xxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
GUARANTOR(S): None.
PROPERTY: The land located in Chicago, Illinois, together with the Building
and other improvements thereon.
BUILDING: The 29-story building commonly known and numbered as 000 Xxxx
Xxxxxxx Xxxxxxxxx.
XXXXXXXX XXXXXXXX XXXX: Agreed to be 468,929 square feet.
PREMISES: The portion of the Building known as Suite No. 900 located on the
9th floor as shown on the location plan attached hereto as EXHIBIT A.
PREMISES RENTABLE AREA: Agreed to be 17,289 square feet.
BASIC RENT: The Basic Rent is as follows:
ANNUAL RENTAL MONTHLY
PERIOD OR MONTHS RATE PER ANNUAL PAYMENT OF
OF TERM SQUARE FOOT BASIC RENT BASIC RENT
---------------- ------------- ----------- ----------
7/1/04-6/30/05 $24.00 $414,936.00 $34,578.00
7/1/05-6/30/06 $24.40 $421,851.60 $35,154.30
7/1/06-6/30/07 $24.80 $428,767.20 $35,730.60
7/1/07-6/30/08 $25.20 $435,682.80 $36,306.90
7/1/08-6/30/09 $25.60 $442,598.40 $36,883.20
7/1/09-10/31/09 $26.00 $149,838.00* $37,459.50
* based on a 4-month period
Notwithstanding anything to the contrary contained in this Lease and provided
that Tenant is not then in default under any of the terms, covenants or
conditions of this Lease beyond any applicable cure periods, Basic Rent and
Escalation Charges (as hereinafter defined) shall xxxxx in full and Tenant shall
have no liability therefor during the first 7 full calendar months of the Term.
(initials)
BASE YEAR: Calendar year 2004
TENANT'S PROPORTIONATE SHARE: 3.6869% (which is based on the ratio of (a)
Premises Rentable Area to (b) Building Rentable Area).
SECURITY DEPOSIT: None.
SCHEDULED COMMENCEMENT DATE: July 1, 2004.
TERM: Five (5) years and four (4) months, commencing on the Commencement
Date (as defined in SECTION 4.1) and expiring at the close of the last day of
the sixty-fourth (64th) full calendar month following the Commencement Date. The
Term shall include any extension thereof that is expressly provided for by this
Lease and that is effected strictly in accordance with this Lease; if no
extension of the Term is expressly provided for by this Lease, no right to
extend the Term shall be implied by this provision.
PERMITTED USES: Executive and general offices.
CONSTRUCTION DEADLINE: N/A.
LANDLORD'S CONTRIBUTION: An amount equal to $380,358.00 (i.e., $22.00 per
square foot of Premises Rentable Area).
LANDLORD'S CONSTRUCTION REPRESENTATIVE: Xxxx Xxxxxxxx
TENANT'S CONSTRUCTION REPRESENTATIVE: Xxxx Xxxxxxxxx
BROKER: MB Real Estate Services, LLC and CB Xxxxxxx Xxxxx, Inc.
1.2 ADDITIONAL DEFINITIONS. When used in Lease, the capitalized terms set
forth below shall bear the meanings set forth below.
ADDITIONAL RENT: All charges and sums payable by Tenant as set forth in
this Lease, other than and in addition to Basic Rent.
BUSINESS DAY: All days except Saturdays, Sundays, New Year's Day, Xxxxxx
Xxxxxx Xxxx Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day,
Christmas Day, and such other days on which landlords of comparable buildings
determine are holidays.
ENVIRONMENTAL CONDITION: Any disposal, release or threat of release of
Hazardous Materials on, from or about the Building or the Property or storage of
Hazardous Materials on, from or about the Building or the Property.
ENVIRONMENTAL LAWS: Any federal, state and/or local statute, ordinance,
bylaw, code, rule and/or regulation now or hereafter enacted, pertaining to any
aspect of the environment or human health, including, without limitation, the
Environmental Protection Act of Illinois, 415 ILCS 5/1 et seq., and state and
local superlien and environmental statutes and ordinances, with implementing
regulations, rules and guidelines, and the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, 42 U.S.C. Section 9601 et seq., the
Resource Conservation and Recovery Act of 1976, 42 U.S.C. Section 6901 et seq.,
the Toxic Substances Control Act, 15 U.S.C. Section 2061 et seq., the Federal
Clean Water Act, 33 U.S.C. Section 1251, and the Federal Clean Air Act, 42
U.S.C. Section 7401 et seq.
ESCALATION CHARGES: The Additional Rent arising pursuant to ARTICLE 8 and
ARTICLE 9 of this Lease.
FORCE MAJEURE: Collectively and individually, strikes or other labor
trouble, fire or other casualty, acts of God, war, terrorist acts, civil
disturbances, governmental preemption of priorities or other controls in
connection with a national or other public emergency or shortages of fuel,
supplies or labor resulting therefrom, or any other cause, whether similar or
dissimilar, beyond the reasonable control of the party required to perform an
obligation, other than the payment of Rent or any Security Deposit.
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HAZARDOUS MATERIALS: Shall mean each and every element, compound, chemical
mixture, contaminant, pollutant, material, waste or other substance which is
defined, determined or identified as hazardous or toxic under any Environmental
Law, including, without limitation, any "oil," "hazardous material," "hazardous
waste," "hazardous substance" or "chemical substance or mixture", as the
foregoing terms (in quotations) are defined in any Environmental Laws.
LAND: The land that constitutes a portion of the Property.
LEASE YEAR: Means each period of one year during the Term commencing on the
Commencement Date or on any anniversary thereof, or, if the Commencement Date
does not fall on the first day of a calendar month, the first Lease Year shall
consist of the partial calendar month following the Commencement Date and the
succeeding twelve full calendar months, and each succeeding Lease Year shall
consist of a one-year period commencing on the first day of the calendar month
following the calendar month in which the Commencement Date fell.
1.3 ENUMERATION OF EXHIBITS. The following Exhibits are a part of this
Lease, are incorporated herein by reference attached hereto, and are to be
treated as a part of this Lease for all purposes: EXHIBIT A - Location Plan of
the Premises; EXHIBIT B - Intentionally omitted; EXHIBIT C - Commencement Date
Letter - Intentionally Omitted; EXHIBIT D - Operating Expenses; EXHIBIT E -
Rules and Regulations; EXHIBIT F - Workletter; EXHIBIT G - Additional
Provisions; and EXHIBIT H - Cleaning Specifications. Undertakings contained in
such Exhibits are agreements on the part of Landlord and Tenant, as the case may
be, to perform the obligations stated therein.
ARTICLE 2
PREMISES AND APPURTENANT RIGHTS
2.1 LEASE OF PREMISES. Landlord hereby leases to Tenant and Tenant hereby
leases from Landlord the Premises for the Term and upon the terms and conditions
hereinafter set forth.
2.2 APPURTENANT RIGHTS AND RESERVATIONS.
(a) Tenant shall have, as appurtenant to the Premises, the
non-exclusive right to use, and permit its invitees to use in common with
Landlord and others, (i) public or common lobbies, hallways, stairways,
elevators and common walkways necessary for access to the Building and the
Premises, and if the portion of the Premises on any floor includes less
than the entire floor, the common toilets, corridors and elevator lobby of
such floor; and (ii) the loading areas, pedestrian sidewalks, landscaped
areas, trash enclosures, and other areas or facilities, if any, which are
located in or on the Property and designated by Landlord from time to time
for the non-exclusive use of tenants and other occupants of the Building
(the "COMMON FACILITIES"); but such rights shall always be subject to
reasonable rules and regulations from time to time established by Landlord
pursuant to SECTION 15.6 (the "RULES AND REGULATIONS") and to the right of
Landlord to designate and change from time to time areas and facilities so
to be used.
(b) Excepted and excluded from the Premises and the Common Facilities
are the ceiling, floor, perimeter walls and exterior windows (except the
inner surface of each thereof), and any space in the Premises used for
shafts, stacks, pipes, conduits, fan rooms, ducts, electric or other
utilities, sinks or other Building facilities, but the entry doors (and
related glass and finish work) to the Premises are a part thereof. Landlord
shall have the right to place in the Premises (but in such manner as to
reduce to a minimum interference with Tenant's use of the Premises)
interior storm windows, sun control devices, utility lines, equipment,
stacks, pipes, conduits, ducts and the like. In the event that Tenant shall
install any hung ceilings or walls in the Premises, Tenant shall install
and maintain, as Landlord may require, proper access panels therein to
afford access to any facilities above the ceiling or within or behind the
walls. Tenant shall be entitled to install any such ceilings or walls only
in compliance with the other terms and conditions of this Lease
(c) Landlord, at its sole cost and expense, shall cause Tenant's name
to be listed on the building directory in the Building lobby.
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ARTICLE 3
BASIC RENT
3.1 PAYMENT.
(a) Tenant agrees to pay the Basic Rent and Additional Rent to
Landlord, or as directed by Landlord, commencing on the Commencement Date,
without offset, abatement (except as provided in SECTION 11.4), deduction
or demand. Basic Rent shall be payable in equal monthly installments, in
advance, on the first day of each and every calendar month during the Term
of this Lease, to Landlord at Landlord's Address or at such other place as
Landlord shall from time to time designate by notice, in lawful money of
the United States. In the event that any installment of Basic Rent or any
regularly scheduled payment of Additional Rent is not paid within five (5)
days following the date due, Tenant shall pay, in addition to any charges
under SECTION 14.4, at Landlord's request an administrative fee equal to 5%
of the overdue payment. Landlord and Tenant agree that all amounts due from
Tenant under or in respect of this Lease, whether labeled Basic Rent,
Escalation Charges, Additional Rent or otherwise, shall be considered as
rental reserved under this Lease for all purposes, including without
limitation regulations promulgated pursuant to the Bankruptcy Code, and
including further without limitation Section 502(b) thereof.
(b) Basic Rent for any partial month shall be pro-rated on a daily
basis, and if the first day on which Tenant must pay Basic Rent shall be
other than the first day of a calendar month, the first payment which
Tenant shall make to Landlord shall be equal to a proportionate part of the
monthly installment of Basic Rent for the partial month from the first day
on which Tenant must pay Basic Rent to the last day of the month in which
such day occurs, plus the installment of Basic Rent for the succeeding
calendar month.
ARTICLE 4
COMMENCEMENT AND CONDITION
4.1 COMMENCEMENT DATE. The "COMMENCEMENT DATE" shall be the Scheduled
Commencement Date set forth in SECTION 1.1.
4.2 PREPARATION OF THE PREMISES.
Tenant shall perform improvements to the Premises in accordance with the
provisions with of SECTION 5.2 of this Lease and the Workletter attached hereto
as EXHIBIT F. The Premises are being leased in their present condition, AS IS,
WITHOUT REPRESENTATION OR WARRANTY by Landlord except as expressly set forth
herein. Tenant acknowledges that it has inspected the Premises and Common
Facilities and has found the same satisfactory.
ARTICLE 5
USE OF PREMISES
5.1 PERMITTED USE.
(a) Tenant agrees that the Premises shall be used and occupied by
Tenant only for Permitted Uses and for no other use without Landlord's
express written consent.
(b) Tenant agrees to conform to the following provisions during the
Term of this Lease:
(i) Tenant shall cause all freight to be delivered to or removed
from the Building and the Premises in accordance with the Rules and
Regulations established by Landlord therefor;
(ii) Tenant will not place on the exterior of the Premises
(including both interior and exterior surfaces of doors and interior
surfaces of windows) or on any part of the Building outside the
Premises, any sign, symbol, advertisement or the like visible to
public view outside of the Premises. Landlord will not
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withhold consent for signs or lettering on the entry doors to the
Premises provided such signs conform to sign standards for the
Building adopted by Landlord in its sole discretion and Tenant has
submitted to Landlord a plan or sketch in reasonable detail (showing,
without limitation, size, color, location, materials and method of
affixation) of the sign to be placed on such entry doors. Landlord
agrees, however, to maintain a tenant directory in the lobby of the
Building (and, in the case of multi-tenant floors, in that floor's
elevator lobby) in which will be placed Tenant's name and the location
of the Premises in the Building;
(iii) Tenant shall not perform any act or carry on any practice
which may injure the Premises, or any other part of the Building, or
cause any offensive odors or loud noise or constitute a nuisance or a
menace to any other tenant or tenants or other persons in the
Building;
(iv) Tenant shall, in its use of the Premises, comply with the
requirements of all applicable governmental laws, rules and
regulations, including, without limitation, the Americans With
Disabilities Act of 1990 and the City of Chicago; and
(v) Tenant shall not abandon the Premises and cease paying Rent
therefor without Landlord's prior written consent, which consent shall
not be unreasonably withheld.
5.2 INSTALLATIONS AND ALTERATIONS BY TENANT.
(a) Tenant shall make no alterations, additions (including, for the
purposes hereof, wall-to-wall carpeting), or improvements (collectively,
"ALTERATIONS") in or to the Premises (including any Alterations necessary
for Tenant's initial occupancy of the Premises) without Landlord's prior
written consent, which consent shall not be unreasonably withheld or
delayed with respect to non-structural Alterations that do not affect or
involve the Building's electrical, plumbing or mechanical systems or any
other Building systems. Any Alterations shall be in accordance with the
Rules and Regulations in effect with respect thereto and with plans and
specifications meeting the requirements set forth in the Rules and
Regulations and approved in advance by Landlord. All work shall (i) be
performed in a good and workmanlike manner and in compliance with all
applicable laws, ordinances and regulations; (ii) be made at Tenant's sole
cost and expense; (iii) become part of the Premises and the property of
Landlord; and (iv) be coordinated with any work being performed by Landlord
in such a manner as not to damage the Building or interfere with the
construction or operation of the Building. At Landlord's request, Tenant
shall, before its work is started, secure assurances satisfactory to
Landlord in its reasonable discretion protecting Landlord against claims
arising out of the furnishing of labor and materials for the Alterations.
If any Alterations shall involve the removal of fixtures, equipment or
other property in the Premises which are not Tenant's Removable Property,
such fixtures, equipment or property shall be promptly replaced by Tenant
at its expense with new fixtures, equipment or property of like utility and
of at least equal quality. Tenant shall promptly reimburse Landlord for all
reasonable costs, including attorneys', architects', engineers', and
consultants' fees, incurred by Landlord in connection with any request from
Tenant pursuant to this SECTION 5.2 in an amount not to exceed 5% of the
hard construction costs of such alterations.
(b) All articles of personal property and all business fixtures,
machinery and equipment and furniture owned or installed by Tenant solely
at its expense in the Premises ("TENANT'S REMOVABLE PROPERLY") shall remain
the property of Tenant and may be removed by Tenant at any time prior to
the expiration or earlier termination of the Term, provided that Tenant, at
its expense, shall repair any damage to the Building caused by such
removal.
(c) Notice is hereby given that Landlord shall not be liable for any
labor or materials furnished or to be furnished to Tenant upon credit, and
that no mechanic's or other lien for any such labor or materials shall
attach to or affect the reversion or other estate or interest of Landlord
in and to the Premises, the Building or the Property. To the maximum extent
permitted by law, before such time as any contractor commences to perform
work on behalf of Tenant, such contractor (and any subcontractors) shall
furnish
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a written statement acknowledging the provisions set forth in the prior
clause. Tenant agrees to pay promptly when due the entire cost of any work
done on behalf of Tenant, its agents, employees or independent contractors,
and not to cause or permit any liens for labor or materials performed or
furnished in connection therewith to attach to all or any part of the
Property and immediately to discharge any such liens which may so attach.
If, notwithstanding the foregoing, any lien is filed against all or any
part of the Property for work claimed to have been done for, or materials
claimed to have been furnished to, Tenant or its agents, employees or
independent contractors, Tenant, at its sole cost and expense, shall cause
such lien to be dissolved promptly after receipt of notice that such lien
has been filed, by the payment thereof or by the filing of a bond
sufficient to accomplish the foregoing. If Tenant shall fail to discharge
any such lien, Landlord may, at its option, discharge such lien and treat
the cost thereof (including reasonable attorneys' fees incurred in
connection therewith) as Additional Rent payable upon demand, it being
expressly agreed that such discharge by Landlord shall not be deemed to
waive or release the Event of Default in not discharging such lien. Tenant
shall indemnify and hold Landlord harmless from and against any and all
expenses, liens, claims, liabilities and damages based on or arising,
directly or indirectly, by reason of the making of any alterations,
additions or improvements by or on behalf of Tenant to the Premises under
this Section, which obligation shall survive the expiration or termination
of this Lease.
(d) In the course of any work being performed by Tenant (including,
without limitation, the "field installation" of any Tenant's Removable
Property), Tenant agrees to use labor compatible with that being employed
by Landlord for work in the Building or on the Property or other buildings
owned by Landlord or its affiliates (which term, for purposes hereof, shall
include, without limitation, entities which control or are under common
control with or are controlled by Landlord or, if Landlord is a partnership
or limited liability company, by any partner or member of Landlord) and not
to employ or permit the use of any labor or otherwise take any action which
might result in a labor dispute involving personnel providing services in
the Building or on the Property pursuant to arrangements made by Landlord.
5.3 EXTRA HAZARDOUS USE. Tenant covenants and agrees mat Tenant will not do
or permit anything to be done in or upon the Premises, or bring in anything or
keep anything therein, which shall increase the rate of property or liability
insurance on the Premises or the Property above the standard rate applicable to
Premises being occupied for the Permitted Uses. If the premium or rates payable
with respect to any policy or policies of insurance carried by or on behalf of
Landlord with respect to the Property increases as a result of any act or
activity on or use of the Premises during the Term or payment by the insurer of
any claim arising from any act or neglect of Tenant, its employees, agents,
contractors or invitees, Tenant shall pay such increase, from time to time,
within fifteen (15) days after demand therefor by Landlord, as Additional Rent.
5.4 HAZARDOUS MATERIALS.
(a) Tenant may use chemicals such as adhesives, lubricants, ink,
solvents and cleaning fluids of the kind and in amounts and in the manner
customarily found and used in business offices in order to conduct its
business at the Premises and to maintain and operate the business machines
located in the Premises, provided Tenant complies with all applicable
Environmental Laws. Tenant shall not use, store, handle, treat, transport,
release or dispose of any other Hazardous Materials on or about the
Premises or the Property without Landlord's prior written consent, which
Landlord may withhold or condition in Landlord's sole discretion.
(b) Any handling, treatment, transportation, storage, disposal or use
of Hazardous Materials by Tenant in or about the Premises or the Property
and Tenant's use of the Premises shall comply with all applicable
Environmental Laws. Tenant shall, within ten (10) Business Days of
Landlord's written request therefor, disclose in writing all Hazardous
Materials that are being used by Tenant in the Premises, the nature of such
use and the manner of storage and disposal. Without Landlord's prior
written consent, Tenant shall not conduct any sampling or investigation of
soil or groundwater on the Property to determine the presence of any
constituents therein.
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(c) Tenant shall indemnify, defend upon demand with counsel reasonably
acceptable to Landlord, and hold Landlord harmless from and against, any
liabilities, losses claims, damages, interest, penalties, fines, attorneys'
fees, experts' fees, court costs, remediation costs, and other expenses
which result from the use, storage, handling, treatment, transportation,
release, threat of release or disposal of Hazardous Materials in or about
the Premises or the Property by Tenant or Tenant's agents, employees,
contractors or invitees. The provisions of this PARAGRAPH (C) shall survive
the expiration or earlier termination of this Lease.
(d) Tenant shall give written notice to Landlord as soon as reasonably
practicable of (i) any communication received by Tenant from any
governmental authority concerning Hazardous Materials which relates to the
Premises or the Property, and (ii) any Environmental Condition of which
Tenant is aware.
ARTICLE 6
ASSIGNMENT AND SUBLETTING
6.1 PROHIBITION.
(a) Tenant covenants and agrees that neither this Lease nor the term
and estate hereby granted, nor any interest herein or therein, will be
assigned, mortgaged, pledged, encumbered or otherwise transferred, whether
voluntarily, involuntarily, by operation of law or otherwise, and that
neither the Premises nor any part thereof will be encumbered in any manner
by reason of any act or omission on the part of Tenant, or used or occupied
or permitted to be used or occupied, by anyone other than Tenant, or for
any use or purpose other than a Permitted Use, or be sublet (which term,
without limitation, shall include granting of concessions, licenses and the
like) in whole or in part, or be offered or advertised for assignment or
subletting by Tenant or any person acting on behalf of Tenant, without, in
each case, the prior written consent of Landlord which consent shall not be
unreasonably withheld, conditioned or delayed. Without limiting the
foregoing, any agreement pursuant to which: (x) Tenant is relieved from the
obligation to pay, or a third party agrees to pay on Tenant's behalf, all
or any portion of the Basic Rent or Additional Rent under this Lease;
and/or (y) a third party undertakes or is granted by or on behalf of Tenant
the right to assign or attempt to assign this Lease or sublet or attempt to
sublet all or any portion of the Premises, shall for all purposes hereof be
deemed to be an assignment of this Lease and subject to the provisions of
this ARTICLE 6. The provisions of this PARAGRAPH (A) shall apply to a
transfer (by one or more transfers) of a controlling portion of or interest
in the stock or partnership or membership interests or other evidences of
equity interests of Tenant as if such transfer were an assignment of this
Lease; provided that if equity interests in Tenant at any time are or
become traded on a public stock exchange, the transfer of equity interests
in Tenant on a public stock exchange shall not be deemed an assignment
within the meaning of this Article.
(b) The provisions of PARAGRAPH (A) shall not apply to either (x)
transactions with an entity into or with which Tenant is merged or
consolidated, or to which all or substantially all of Tenant's assets are
transferred, or (y) transactions with any entity which controls or is
controlled by Tenant or is under common control with Tenant; provided that
in any such event: (i) the successor to Tenant has a net worth, computed in
accordance with generally accepted accounting principles consistently
applied, at least equal to the greater of (1) the net worth of Tenant
immediately prior to such merger, consolidation or transfer, or (2) the net
worth of Tenant herein named on the date of this Lease, (ii) proof
satisfactory to Landlord of such net worth shall have been delivered to
Landlord at least ten (10) days prior to the effective date of any such
transaction, and (iii) the assignee agrees directly with Landlord, by
written instrument in form satisfactory to Landlord in its reasonable
discretion, to be bound by all the obligations of Tenant hereunder,
including, without limitation, the covenant against further assignment and
subletting.
6.2 ACCEPTANCE OF RENT. If this Lease be assigned, or if the Premises or
any part thereof be sublet or occupied by anyone other than Tenant, whether or
not in violation of the terms and conditions of the Lease, Landlord may, at any
time and from time to time, collect rent and other charges from the assignee,
subtenant or occupant, and apply the net amount collected
7
to the rent and other charges herein reserved, but no such assignment,
subletting, occupancy, collection or modification of any provisions of this
Lease shall be deemed a waiver of this covenant, or the acceptance of the
assignee, subtenant or occupant as a tenant or a release of Tenant from the
further performance of covenants on the part of Tenant to be performed
hereunder. Any consent by Landlord to a particular assignment, subletting or
occupancy or other act for which Landlord's consent is required under PARAGRAPH
(A) of SECTION 6.1 shall not in any way diminish the prohibition stated in
PARAGRAPH (A) of SECTION 6.1 as to any further such assignment, subletting or
occupancy or other act or the continuing liability of the original named Tenant.
No assignment or subletting hereunder shall relieve Tenant from its obligations
hereunder, and Tenant shall remain fully and primarily liable therefor. Landlord
may revoke any consent by Landlord to a particular assignment, subletting or
occupancy if the assignment or sublease does not provide that the assignee,
subtenant or other occupant agrees to be independently bound by and upon all of
the covenants, agreements, terms, provisions and conditions set forth in this
Lease on the part of Tenant to be kept and performed.
6.3 EXCESS PAYMENTS. If Tenant assigns this Lease or sublets the Premises
or any portion thereof, Tenant shall pay to Landlord as Additional Rent fifty
percent (50%) of the amount, if any, by which (a) any and all compensation
received by Tenant as a result of such assignment or subletting, net of (i)
reasonable expenses actually incurred by Tenant in connection with such
assignment or subletting (prorated over the term of the assignment or
subletting) and (ii) any amounts paid/reimbursed to Landlord pursuant to SECTION
6.5 below, exceeds (b) in the case of an assignment, the Basic Rent and
Additional Rent under this Lease, and in the case of a subletting, the portion
of the Basic Rent and Additional Rent allocable to the portion of the Premises
subject to such subletting. Such payments shall be made on the date the
corresponding payments under this Lease are due. Notwithstanding the foregoing,
the provisions of this Section shall impose no obligation on Landlord to
consent to an assignment of this Lease or a subletting of all or a portion of
the Premises.
6.4 LANDLORD'S RECAPTURE RIGHT. Notwithstanding anything herein to the
contrary, in addition to withholding or granting consent with respect to any
proposed assignment of this Lease or proposed sublease of all or a portion of
the Premises, Landlord shall have the right, to be exercised in writing within
thirty (30) days after written notice from Tenant seeking Landlord's consent to
assign this Lease or sublease all or any portion of the Premises, to terminate
this Lease (in the event of a proposed assignment) or recapture that portion of
the Premises to be subleased (in the event of a proposed sublease). In the case
of a proposed assignment, this Lease shall terminate as of the date (the
"RECAPTURE DATE") which is the later of (a) thirty (30) days after the date of
Landlord's election, and (b) the proposed effective date of such assignment or
sublease, as if such date were the last day of the Term of this Lease. If
Landlord exercises the rights under this Section in connection with a proposed
sublease, this Lease shall be deemed amended to eliminate the proposed sublease
premises from the Premises as of the Recapture Date, and thereafter all Basic
Rent and Escalation Charges shall be appropriately prorated to reflect the
reduction of the Premises as of the Recapture Date.
6.5 FURTHER REQUIREMENTS. Tenant shall reimburse Landlord within ten (10)
days following Landlord's invoice therefor, as Additional Rent, for any
reasonable out-of-pocket costs (including reasonable attorneys' fees and
expenses) incurred by Landlord in connection with any actual or proposed
assignment or sublease or other act described in PARAGRAPH (A) of SECTION 6.1,
whether or not consummated, including the costs of making investigations as to
the acceptability of the proposed assignee or subtenant. Any sublease to which
Landlord gives its consent shall not be valid unless and until Tenant and the
sublessee execute a consent agreement in form and substance satisfactory to
Landlord in its reasonable discretion and a fully executed counterpart of such
sublease has been delivered to Landlord. Any sublease shall provide that: (i)
the term of the sublease ends no later than one day before the last day of the
Term of this Lease; (ii) such sublease is subject and subordinate to this Lease;
(iii) Landlord may enforce the provisions of the sublease, including collection
of rents; and (iv) in the event of termination of this Lease or reentry or
repossession of the Premises by Landlord, Landlord may, at its sole discretion
and option, take over all of the right, title and interest of Tenant, as
sublessor, under such sublease, and such subtenant shall, at Landlord's option,
attorn to Landlord, but nevertheless Landlord shall not (A) be liable for any
previous act or omission of Tenant under such sublease; (B) be subject to any
defense or offset previously accrued in favor of the subtenant against Tenant;
or (C) be bound by any previous modification of such sublease made without
Landlord's written consent or by any previous prepayment of more than one
month's rent.
8
ARTICLE 7
RESPONSIBILITY FOR REPAIRS AND CONDITION OF PREMISES; SERVICES TO BE
FURNISHED BY LANDLORD
7.1 LANDLORD REPAIRS.
(a) Except as otherwise provided in this Lease, Landlord agrees to
keep in good order, condition and repair the roof, public areas, exterior
walls (including exterior glass) and structure of the Building (including
all plumbing, mechanical and electrical systems installed by Landlord, but
specifically excluding any supplemental beating, ventilation or air
conditioning equipment or systems installed at Tenant's request or as a
result of Tenant's requirements in excess of Building standard design
criteria), all insofar as they affect the Premises, except that Landlord
shall in no event be responsible to Tenant for the repair of glass in the
Premises, the doors (or related glass and finish work) leading to the
Premises, or any condition in the Premises or the Building caused by any
act or neglect of Tenant, its invitees or contractors. Landlord shall also
keep and maintain all Common Facilities in a good and clean order,
condition and repair, free of snow and ice and accumulation of dirt and
rubbish, and shall keep and maintain all landscaped areas on the Property
in a neat and orderly condition. Landlord shall not be responsible to make
any improvements or repairs to the Building other than as expressly in this
SECTION 7.1 provided, unless expressly provided otherwise in this Lease.
(b) Landlord shall never be liable for any failure to make repairs
which Landlord has undertaken to make under the provisions of this SECTION
7.1 or elsewhere in this Lease, unless Tenant has given notice to Landlord
of the need to make such repairs, and Landlord has failed to commence to
make such repairs within a reasonable time after receipt of such notice, or
fails to proceed with reasonable diligence to complete such repairs.
(c) If Landlord shall be required to make any repairs or alterations
to the Premises to comply with any laws or requirements of public
authorities hereafter in effect, or with any directions, rules or
regulations of governmental agencies having or purporting to have
jurisdiction, and if the cost to Landlord of making such repairs or
alterations, together with the cost of other such repairs or alterations
theretofore required, would exceed an amount equal to fifteen months' Basic
Rent in the aggregate, Landlord may (but shall not be required to) elect to
terminate this Lease by giving Tenant notice of its desire to do so, which
notice shall set forth a date not less than ninety (90) days from the
giving of such notice on which this Lease shall terminate with the same
force and effect as if such date were the date originally set forth herein
as the expiration hereof. Tenant may, however, void Landlord's election to
so terminate this Lease by giving Landlord notice, within fifteen days
after the date of Landlord's notice to Tenant, to the effect that Tenant
shall, at Tenant's expense, promptly and diligently cause all such repairs
or alterations to be performed in the Premises, and Tenant shall hold
Landlord harmless from and against any and all costs, expenses, penalties
and/or liabilities (including without limitation reasonable legal fees and
costs) in connection therewith.
7.2 TENANT REPAIRS.
(a) Tenant will keep the Premises and every part thereof neat and
clean, and will maintain the same in good order, condition and repair,
excepting only those repairs and maintenance obligations for which Landlord
is responsible under the terms of this Lease, reasonable wear and tear of
the Premises, and damage by fire or other casualty or as a consequence of
the exercise of the power of eminent domain; and Tenant shall surrender the
Premises, at the end of the Term, in such condition. Without limitation,
Tenant shall comply with all laws, codes and ordinances from time to time
in effect and all directions, rules and regulations of governmental
agencies having jurisdiction, and the standards recommended by the Chicago
Board of Fire Underwriters applicable to Tenant's use and occupancy of the
Premises, and shall, at Tenant's expense, obtain all permits, licenses and
the like required thereby. Subject to SECTION 10.4 regarding waiver of
subrogation, Tenant shall be responsible for the cost of repairs which may
be made necessary by reason of damage to the Building caused by any act or
neglect of Tenant, or its contractors or invitees (including any damage by
fire or other casualty arising therefrom).
9
(b) If repairs are required to be made by Tenant pursuant to the terms
hereof, and Tenant fails to make the repairs within a reasonable time after
receipt of such written notice, Landlord may make or cause such repairs to
be made (but shall not be required to do so), and the provisions of SECTION
14.4 shall be applicable to the costs thereof. Landlord shall not be
responsible to Tenant for any loss or damage whatsoever that may accrue to
Tenant's stock or business by reason of Landlord's making such repairs.
7.3 FLOOR LOAD - HEAVY MACHINERY.
(a) Tenant shall not place a load upon any floor in the Premises
exceeding fifty (50) pounds live load per square foot of usable area of the
Premises. Landlord reserves the right to prescribe the weight and position
of all business machines and mechanical equipment, including safes, which
shall be placed so as to distribute the weight. Business machines and
mechanical equipment shall be placed and maintained by Tenant at Tenant's
expense in settings sufficient, in Landlord's judgment, to absorb and
prevent vibration, noise and annoyance. Tenant shall not move any safe,
heavy machinery, heavy equipment, freight, bulky matter or fixtures into or
out of the Building without Landlord's prior consent, which consent may
include a requirement to provide insurance, naming Landlord as an insured,
in such amounts as Landlord may deem reasonable. Landlord has examined the
Premises and has determined that as of the date hereof, the placement of
Tenant's personal property and equipment do not exceed the floor load
limitation set forth above.
(b) If any such safe, machinery, equipment, freight, bulky matter or
fixtures requires special handling, Tenant agrees to employ only persons
holding a Master Rigger's License to do such work, and that all work in
connection therewith shall comply with applicable laws and regulations. Any
such moving shall be at the sole risk and hazard of Tenant, and Tenant will
exonerate, indemnify and save Landlord harmless against and from any
liability, loss, injury, claim or suit resulting directly or indirectly
from such moving.
7.4 UTILITY SERVICES.
(a) Landlord shall, on all Business Days from 8:00 a.m. to 6:00 p.m.
and on Saturdays from 8:00 a.m. to 1:00 p.m., furnish heating and cooling
as normal seasonal changes may require to provide reasonably comfortable
space temperature and ventilation for occupants of the Premises under
normal business operation at an occupancy of not more than one person per
140 square feet of usable area and an electrical load not exceeding 2.5
xxxxx per usable square foot. If Tenant shall require air conditioning,
heating or ventilation outside the hours and days above specified, Landlord
may furnish such service and Tenant shall pay therefore such charges as may
from time to time be in effect for the Building upon demand as Additional
Rent. As of the date hereof, Landlord's current charge for after-hours air
conditioning, heating and ventilation is $120.00 per hour and is subject to
change from time to time. In the event Tenant introduces into the Premises
personnel or equipment which overloads the capacity of the Building system
or in any other way interferes with the system's ability to perform
adequately its proper functions, supplementary systems may, if and as
needed, at Landlord's option, be provided by Landlord, and the cost of such
supplementary systems shall be payable by Tenant to Landlord upon demand as
Additional Rent.
(b) Tenant agrees in its use of the Premises (i) not to exceed the
electrical standard for the Premises, and (ii) that its total connected
lighting load it will not exceed the maximum from time to time permitted
under applicable governmental regulations. The electrical standard for the
Premises is designed to meet a demand requirement not to exceed 4.78 xxxxx
per usable square foot of the Premises for 120/208 volt, three phase power.
If, without in any way derogating from the foregoing limitation, Tenant
shall require electricity in excess of the requirements set forth above,
Tenant shall notify Landlord and Landlord may (without being obligated to
do so) supply such additional service or equipment at Tenant's sole cost
and expense. Landlord shall purchase and install, at Tenant's expense, all
lamps, tubes, bulbs, starters and ballasts. In order to assure that the
foregoing requirements are not exceeded and to avert possible adverse
effect on the Building's electric system, Tenant shall not, without
Landlord's prior consent, connect any fixtures, appliances or equipment to
the Building's electric
10
distribution system other than personal computers, facsimilie transceivers,
typewriters, pencil sharpeners, adding machines, photocopiers, word and
data processors, clocks, radios, hand-held or desk top calculators,
dictaphones, desktop computers and other similar small electrical equipment
normally found in business offices. All charges to Tenant under this
paragraph shall be due and payable as Additional Rent within thirty (30)
days after receiving Landlord's invoice therefor. Landlord has examined the
Premises and has determined that as of the date hereof, Tenant's equipment
in the Premises does not exceed the limitations set forth above.
(c) From time to time during the Term of this Lease, Landlord shall
have the right to have an independent electrical consultant selected by
Landlord make a survey of Tenant's electric usage, the result of which
survey shall be conclusively binding upon Landlord and Tenant. In the event
that such survey shows that Tenant has exceeded the requirements set forth
in PARAGRAPH (B), in addition to any other rights Landlord may have
hereunder, Tenant shall, upon demand, reimburse Landlord for the cost of
such survey and the cost, as determined by such consultant, of electricity
usage in excess of such requirements as Additional Rent.
(d) Tenant acknowledges that electricity to the Premises is separately
metered and Tenant shall pay the applicable public utility company directly
for all electrical services in the Premises.
7.5 OTHER SERVICES.
Landlord shall also provide:
(a) Passenger elevator service from the existing passenger elevator
system in common with Landlord and others entitled thereto.
(b) Warm water for lavatory purposes and cold water (at temperatures
supplied by the city in which the Property is located) for drinking,
lavatory and toilet purposes. If Tenant uses water for any purpose other
than for ordinary lavatory and drinking purposes, Landlord may assess a
reasonable charge for the additional water so used, or install a water
meter and thereby measure Tenant's water consumption for all purposes. In
the latter event, Tenant shall pay the cost of the meter and the cost of
installation thereof as Additional Rent upon demand and shall keep such
meter and installation equipment in good working order and repair. Tenant
agrees to pay for water consumed, as shown on such meter, together with the
sewer charge based on such meter charges, as and when bills are rendered,
and in the event Tenant fails timely to make any such payment, Landlord may
pay such charges and collect the same from Tenant upon demand as Additional
Rent.
(c) Cleaning and janitorial services to the Premises, provided the
same are kept in order by Tenant, substantially in accordance with the
cleaning standards from time to time in effect for the Building. The
cleaning specifications for the Building as of the date hereof are attached
hereto as EXHIBIT H. and remain subject to change from time to time.
(d) Access to the Premises at all times, subject to security
precautions from time to time in effect, if any, and subject always to
restrictions based on emergency conditions.
Landlord shall provide one or more attendants in or about the lobby of the
Building which service shall be consistent with that of buildings
comparable to the Building in the West Loop of downtown Chicago, and the
costs of such services shall constitute Operating Expenses in accordance
with the provisions of ARTICLE 9 hereof. Tenant expressly acknowledges and
agrees that, if provided: (i) such attendants shall not serve as police
officers, and will be unarmed, and will not be trained in situations
involving potentially physical confrontation; and (ii) such attendants will
be solely an amenity to tenants of the Building for purposes such as
assisting visitors and invitees of tenants and others in the Building,
monitoring fire control and alarm equipment, and summoning emergency
services to the Building as and when needed, and not for the purpose of
securing any individual tenant premises or guaranteeing the physical safety
of Tenant's
11
Premises or of Tenant's employees, agents, contractors or invitees. If and
to the extent that Tenant desires to provide security for the Premises or
for such persons or their property, Tenant shall be responsible for so
doing, after having first consulted with Landlord and after obtaining
Landlord's consent, which shall not be unreasonably withheld. Except to the
extent caused by the gross negligence or willful misconduct of Landlord,
Landlord expressly disclaims any and all responsibility and/or liability
for the physical safety of Tenant's property, and for that of Tenant's
employees, agents, contractors and invitees, and, without in any way
limiting the operation of ARTICLE 10 hereof, Tenant, for itself and its
agents, contractors, invitees and employees, hereby expressly waives any
claim, action, cause of action or other right which may accrue or arise as
a result of any damage or injury to the person or property of Tenant or any
such agent, invitee, contractor or employee, except to the extent caused by
the gross negligence or willful misconduct of Landlord. Tenant agrees that,
as between Landlord and Tenant, it is Tenant's responsibility to advise its
employees, agents, contractors and invitees as to necessary and appropriate
safety precautions.
7.6 INTERRUPTION OF SERVICE.
(a) Landlord reserves the right to curtail, suspend, interrupt and/or
stop the supply of water, sewage, electrical current, cleaning, and other
services, and to curtail, suspend, interrupt and/or stop use of entrances
and/or lobbies serving access to the Building, or other portions of the
Property, without thereby incurring any liability to Tenant, when necessary
by reason of accident or emergency, or for repairs, alterations,
replacements or improvements in the judgment of Landlord reasonably
exercised desirable or necessary, or when prevented from supplying such
services or use due to any act or neglect of Tenant or Tenant's agents
employees, contractors or invitees or any person claiming by, through or
under Tenant or by Force Majeure, including, but not limited to, strikes,
lockouts, difficulty in obtaining materials, accidents, laws or orders, or
inability, by exercise of reasonable diligence, to obtain electricity,
water, gas, steam, coal, oil or other suitable fuel or power. Except as set
forth in PARAGRAPH (B) below, no diminution or abatement of rent or other
compensation, nor any direct, indirect or consequential damages shall or
will be claimed by Tenant as a result of, nor shall this Lease or any of
the obligations of Tenant be affected or reduced by reason of, any such
interruption, curtailment, suspension or stoppage in the furnishing of the
foregoing services or use, irrespective of the cause thereof. Except as set
forth in PARAGRAPH (B) below, failure or omission on the part of Landlord
to furnish any of the foregoing services or use as provided in this
paragraph shall not be construed as an eviction of Tenant, actual or
constructive, nor entitle Tenant to an abatement of rent, nor to render the
Landlord liable in damages, nor release Tenant from prompt fulfillment of
any of its covenants under this Lease.
(b) Notwithstanding anything contained in this Lease to the contrary,
if (i) an interruption or curtailment, suspension or stoppage of an
Essential Service (as said term is hereinafter defined) shall occur, except
any of the same due to any act or neglect of Tenant or Tenant's agents
employees, contractors or invitees or any person claiming by, through or
under Tenant (any such interruption of an Essential Service being
hereinafter referred to as a "SERVICE INTERRUPTION"), and (ii) such Service
Interruption occurs or continues as a result of the negligence or a
wrongful conduct of the Landlord or Landlord's agents, servants, employees
or contractors, and (iii) such Service Interruption continues for more than
five (5) consecutive Business Days after Landlord shall have received
notice thereof from Tenant, and (iv) as a result of such Service
Interruption, the conduct of Tenant's normal operations in the Premises are
materially and adversely affected, then there shall be an abatement of one
day's Basic Rent and Escalation Charges for each day during which such
Service Interruption continues after such five (5) Business Day period;
provided, however, that if any part of the Premises is reasonably useable
for Tenant's normal business operations or if Tenant conducts all or any
part of its operations in any portion of the Premises notwithstanding such
Service Interruption, then the amount of each daily abatement of Basic Rent
and Escalation Charges shall only be proportionate to the nature and extent
of the interruption of Tenant's normal operations or ability to use the
Premises. In the event of a (a) Service Interruption that continues for 180
days after Landlord shall have received notice thereof from Tenant, and (b)
occurs or continues as a result of the negligence or a wrongful conduct of
the Landlord or Landlord's agents, servants, employees or contractors, and
(c) as a result of
12
such Service Interruption, the conduct of Tenant's normal operations in the
Premises are materially and adversely affected, and (d) such Service
Interruption is not being diligently remedied by Landlord, Tenant, as its
sole remedy, shall have the right to elect to terminate this Lease within
ten (10) days after the expiration of said one hundred eighty (180) day
period by delivering written notice thereof to Landlord. The rights granted
to Tenant under this PARAGRAPH (B) shall be Tenant's sole and exclusive
remedy resulting from a failure of Landlord to provide services, and
Landlord shall not otherwise be liable for any loss or damage suffered or
sustained by Tenant resulting from any failure or cessation of services.
For purposes hereof, the term "ESSENTIAL SERVICES" shall mean the following
services: access to the Premises, water and sewer/septic service and
electricity, but only to the extent that Landlord has an obligation to
provide same to Tenant under this Lease. Any abatement of Basic Rent under
this paragraph shall apply only with respect to Basic Rent allocable to the
period after each of the conditions set forth in subsections (i) through
(iv) hereof shall have been satisfied and only during such times as each of
such conditions shall exist.
ARTICLE 8
REAL ESTATE TAXES
8.1 PAYMENTS ON ACCOUNT OF REAL ESTATE TAXES.
(a) "TAX YEAR" shall mean a twelve-month period commencing on January
1 and falling wholly or partially within the Term, and "TAXES" shall mean
(i) all taxes, assessments (special or otherwise), levies, fees and all
other government levies, exactions and charges of every kind and nature,
general and special, ordinary and extraordinary, foreseen and unforeseen,
which are, at any time prior to or during the Term, imposed or levied upon
or assessed against the Property or any portion thereof, or against any
Basic Rent, Additional Rent or other rent of any kind or nature payable to
Landlord by anyone on account of the ownership, leasing or operation of the
Property, or which arise on account of or in respect of the ownership,
development, leasing, operation or use of the Property or any portion
thereof; (ii) all gross receipts taxes or similar taxes imposed or levied
upon, assessed against or measured by any Basic Rent, Additional Rent or
other rent of any kind or nature or other sum payable to Landlord by anyone
on account of the ownership, development, leasing, operation, or use of the
Property or any portion thereof; (iii) all value added, use and similar
taxes at any time levied, assessed or payable on account of the ownership,
development, leasing, operation, or use of the Property or any portion
thereof; and (iv) reasonable expenses of any proceeding for abatement of
any of the foregoing items included in Taxes, but the amount of special
taxes or special assessments included in Taxes shall be limited to the
amount of the installment (plus any interest, other than penalty interest,
payable thereon) of such special tax or special assessment required to be
paid during the year in respect of which such Taxes are being determined.
There shall be excluded from Taxes all income, estate, succession,
inheritance and transfer taxes of Landlord; provided, however, that if at
any time during the Term the present system of ad valorem taxation of real
property shall be changed so that a capital levy, franchise, income,
profits, sales, rental, use and occupancy, or other tax or charge shall in
whole or in part be substituted for, or added to, such ad valorem tax and
levied against, or be payable by, Landlord with respect to the Property or
any portion thereof, such tax or charge shall be included in the term
"TAXES" for the purposes of this Article.
(b) Tenant shall pay to Landlord as Additional Rent for Taxes an
amount equal to Tenant's Proportionate Share of the increase in Taxes for
any calendar year over Taxes for the Base Year. If the calendar year is
only partially within the Term, the payment to be made by Tenant shall be
proportionately reduced. The obligation of Tenant to make this payment
shall survive the expiration or other termination of the Lease. The tax and
assessment bills used in calculating Tenant's obligation for Additional
Rent for Taxes in each calendar year shall be those which become due for
payment during such calendar year, without regard to the period for which
the tax assessment is levied or assessed and without regard to whether or
not the Lease was in existence during such period. If, however, there is a
change in the time payment of taxes during the term of the Lease which
would result in Tenant paying taxes allocable to a
13
period longer or shorter than the term of the Lease, the tax payments for
the last calendar year shall be equitably adjusted so that the period for
which Tenant pays taxes is the of the same duration as the term of the
Lease (though it may not be the same period of time).
(c) Estimated payments by Tenant on account of Taxes shall be made on
the first day of each and every calendar month during the Term of this
Lease, in the fashion herein provided for the payment of Basic Rent. The
monthly amount so to be paid to Landlord shall be sufficient to provide
Landlord by the time real estate tax payments are due with a sum equal to
Tenant's required payment, as reasonably estimated by Landlord from time to
time, on account of Taxes for the then current Tax Year. Promptly after
receipt by Landlord of bills for such Taxes, Landlord shall advise Tenant
of the amount thereof and the computation of Tenant's payment on account
thereof. If estimated payments theretofore made by Tenant for the Tax Year
covered by such bills exceed the required payment on account thereof for
such Tax Year, Landlord shall credit the amount of overpayment against
subsequent obligations of Tenant on account of Taxes (or promptly refund
such overpayment if the Term of this Lease has ended and Tenant has no
further obligation to Landlord); but if the required payments on account
thereof for such Tax Year are greater than estimated payments theretofore
made on account thereof for such Tax Year, Tenant shall pay the difference
to Landlord within thirty (30) days after being so advised by Landlord, and
the obligation to make such payment for any period within the Term shall
survive expiration of the Term.
8.2 ABATEMENT If Landlord contests the amount of any taxes or assessments,
the attorneys fees and expenses incurred in conducting such a contest shall
be considered a part of the tax payment for the purposes of this provision. If
the result of such a contest if to defer the time of payment of taxes to a later
date or to obligate the Landlord to pay any additional taxes or assessments in
the year in which the tax or assessment was originally due, Taxes shall be
recalculated and Tenant shall pay the additional amount due. In the event of a
reduction of Taxes for which Tenant has paid its Proportionate Share of the
increase in Taxes over the Taxes for the Base Year, Tenant shall receive a
credit (or refund in the event this Lease has terminated) for Tenant's
Proportionate Share of such reduction in the increase of Taxes over Taxes for
the Base Year. Tenant shall have the right to examine the tax and assessment
bills on written request. Tenant shall have the right to examine the tax and
assessment bills on written request.
ARTICLE 9
OPERATING AND UTILITY EXPENSES
9.1 DEFINITIONS. "OPERATING YEAR" shall mean each calendar year all or any
part of which falls within the Term, and "OPERATING EXPENSES" shall mean the
aggregate costs and expenses incurred by Landlord with respect to the operation,
administration, cleaning, repair, maintenance and management of the Property,
all as set forth in EXHIBIT D attached hereto, provided that if during any
portion of the Operating Year for which Operating Expenses are being computed,
less than all of the Building was occupied by tenants or Landlord was not
supplying all tenants with the services being supplied under this Lease, actual
Operating Expenses incurred shall be extrapolated reasonably by Landlord on an
item by item basis to the estimated Operating Expenses that would have been
incurred if the Building were fully occupied for such Operating Year and such
services were being supplied to all tenants, and such extrapolated amount shall,
for the purposes hereof, be deemed to be the Operating Expenses for such
Operating Year.
9.2 TENANT'S PAYMENT OF OPERATING EXPENSES.
(a) Tenant shall pay to Landlord as Additional Rent for Operating
Expense, an amount equal to Tenant's Proportionate Share of the increase,
if any, in Operating Expenses over Operating Expenses for the Base Year. If
the calendar year is only partially within the Term, the payment to be made
by Tenant shall be proportionately reduced. The obligation of Tenant to
make this payment shall survive the expiration or other termination of the
Lease.
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(b) Estimated payments by Tenant on account of Operating Expenses
shall be made on the first day of each and every calendar month during the
Term of this Lease, in the fashion herein provided for the payment of
Basic Rent. The monthly amount to be paid to Landlord shall be sufficient
to provide Landlord by the end of each Operating Year a sum equal to
Tenant's required payment, as reasonably estimated by Landlord from time to
time during each Operating Year, on account of Operating Expenses for such
Operating Year. After the end of each Operating Year, Landlord shall submit
to Tenant a reasonably detailed accounting of Operating Expenses for such
Operating Year. If estimated payments theretofore made for such Operating
Year by Tenant exceed Tenant's required payment on account thereof for such
Operating Year according to such statement, Landlord shall credit the
amount of overpayment against subsequent obligations of Tenant with respect
to Operating Expenses (or promptly refund such overpayment if the Term of
this Lease has ended and Tenant has no further obligation to Landlord); but
if the required payments on account thereof for such Operating Year are
greater than the estimated payments (if any) theretofore made on account
thereof for such Operating Year, Tenant shall make payment to Landlord
within thirty (30) days after being so advised by Landlord, and the
obligation to make such payment for any period within the Term shall
survive expiration of the Term.
(c) Tenant shall have the right to have a CPA licensed in the state in
which the audit occurs examine, copy and audit Landlord's books and records
establishing Operating Expenses for any Operating Year for a period of six
(6) months following the date that Tenant receives the statement of
Operating Expenses for such Operating Year from Landlord. Tenant shall give
Landlord not less than thirty (30) days prior notice of its intention to
examine and audit such books and records, and such examination and audit
shall take place at such place within the continental United States as
Landlord routinely maintains such books and records, unless Landlord elects
to have such examination and audit take place in another location
designated by Landlord in the city and state in which the Property is
located. All costs of the examination and audit shall be borne by Tenant;
provided, however, that if such examination and audit establishes that the
actual Operating Expenses for the Operating Year in question are less than
the amount set forth as the annual Operating Expenses on the annual
statement delivered to Tenant by at least five percent (5%), then Landlord
shall pay the reasonable costs of such examination and audit. If, pursuant
to the audit, the payments made for such Operating Year by Tenant exceed
Tenant's required payment on account thereof for such Operating Year,
Landlord shall credit the amount of overpayment against subsequent
obligations of Tenant with respect to Operating Expenses (or promptly
refund such overpayment if the Term of this Lease has ended and Tenant has
no further obligation to Landlord); but, if the payments made by Tenant for
such Operating Year are less than Tenant's required payment as established
by the examination and audit, Tenant shall pay the deficiency to Landlord
within thirty (30) days after conclusion of the examination and audit, and
the obligation to make such payment for any period within the Term shall
survive expiration of the Term. If Tenant does not elect to exercise its
right to examine and audit Landlord's books and records for any Operating
Year within the time period provided for by this paragraph, Tenant shall
have no further right to challenge Landlord's statement of Operating
Expenses.
9.3 UTILITY PAYMENTS. Tenant shall be responsible for the payment of all
utilities used and consumed in the Premises. If Landlord separately meters the
Premises directly to the applicable utility company, as provided in Section 7.4
above, Tenant shall pay all such charges directly to the utility company on or
before the date when due. The obligation to pay for electricity used and
consumed in the Premises during the last month of the Term hereof shall survive
expiration of the Term.
ARTICLE 10
INDEMNITY AND PUBLIC LIABILITY INSURANCE
10.1 TENANT'S INDEMNITY. Except to the extent arising from the gross
negligence or willful misconduct of Landlord or its agents or employees, Tenant
agrees to indemnify and save harmless Landlord and Landlord's partners, members,
shareholders, officers, directors, managers, employees, agents and contractors
and any Holder from and against all claims, losses,
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cost, damages, liability or expenses of whatever nature arising: (i) from any
accident, injury or damage whatsoever to any person, or to the property of any
person, occurring in or about the Premises; (ii) from any accident, injury or
damage whatsoever to any person, or to the property of any person, occurring
outside of the Premises but on or about the Property, where such accident,
damage or injury results or is claimed to have resulted from any act or omission
on the part of Tenant or Tenant's agents, employees, contractors, invitees or
sublessees; or (iii) the use or occupancy of the Premises or of any business
conducted therein or any thing or work whatsoever done or any condition created
(other than by Landlord) in or about the Premises, and, in any case, occurring
after the Commencement Date (or such earlier date as of which Tenant takes
possession of the Premises) until the expiration of the Term of this Lease and
thereafter so long as Tenant is in occupancy of any part of the Premises. This
indemnity and hold harmless agreement shall include indemnity against all
losses, costs, damages, expenses and liabilities incurred in or in connection
with any such claim or any proceeding brought thereon, including, without
limitation, reasonable attorneys' fees and costs. The provisions of this SECTION
10.1 shall survive the expiration or earlier termination of this Lease.
10.2 TENANT INSURANCE. Tenant agrees to maintain in full force from the
date upon which Tenant first enters the Premises for any reason, throughout the
Term of this Lease, and thereafter so long as Tenant is in occupancy of any part
of the Premises, (a) a policy of commercial general liability and property
damage insurance (including broad form contractual liability, independent
contractor's hazard and completed operations coverage) in at least the amounts
of $3,000,000 per occurrence/$4,000,000 aggregate (combined single limit) for
property damage, bodily injury or death, or such commercially reasonably greater
amounts as Landlord in its reasonable discretion shall from time to time
request, under which Tenant is named as an insured and Landlord, and, at
Landlord's request, Landlord's property manager, any Holder, and such other
persons as Landlord reasonably may request are named as additional insureds, and
under which the insurer agrees to indemnify and hold Landlord and such other
additional named insureds harmless from and against all cost, expense and/or
liability arising out of or based upon any and all claims, accidents, injuries
and damages set forth in SECTION 10.1 and (b) "all-risk" property insurance on a
"replacement cost" basis, insuring Tenant's Removable Property and any
Alterations made by Tenant pursuant to SECTION 5.2, to the extent that the same
have not become the property of Landlord. Tenant may satisfy such insurance
requirements by including the Premises in a so-called "blanket" and/or
"umbrella" insurance policy, provided that the amount of coverage allocated to
the Premises pursuant to a "per location" endorsement shall fulfill the
requirements set forth herein. Tenant's insurance shall be primary to, and not
contributory with any insurance carried by Landlord, whose insurance shall be
considered excess only. Each policy required hereunder shall be non-cancelable
and non-amendable with respect to Landlord and Landlord's said designees without
thirty (30) days' prior notice, shall be written on an "occurrence" basis, and a
duplicate original or certificates thereof satisfactory to Landlord, together
with a photocopy of the entire policy, shall be delivered to Landlord. The
policies of insurance required to be maintained by Tenant hereunder shall be
issued by companies domiciled in the United States and qualified and licensed to
conduct business in the state in which the Property is located, and shall be
rated A:X or better in the most current issue of Best's Insurance Reports.
Tenant's insurance policies shall not include deductibles in excess of Five
Thousand Dollars ($5,000.00).
10.3 TENANT'S RISK. Tenant agrees to use and occupy the Premises and to use
such other portions of the Property as Tenant is herein given the right to use
at Tenant's own risk. Landlord shall not be liable to Tenant, its employees,
agents, invitees or contractors for any damage, injury, loss, compensation, or
claim (including, but not limited to, claims for the interruption of or loss to
Tenant's business) based on, arising out of or resulting from any cause
whatsoever, including, but not limited to, repairs to any portion of the
Premises or the Property, any fire, robbery, theft, mysterious disappearance
and/or any other crime or casualty, the actions of any other tenants of the
Building or of any other person or persons, or any leakage in any part or
portion of the Premises or the Building, or from water, rain or snow that may
leak into, or flow from any part of the Premises or the Building, or from
drains, pipes or plumbing fixtures in the Building, unless due to the gross
negligence or willful misconduct of Landlord or Landlord's agents, contractors
or employees. Any goods, property or personal effects stored or placed in or
about the Premises shall be at the sole risk of Tenant, and neither Landlord nor
Landlord's insurers shall in any manner be held responsible therefor. Landlord
shall not be responsible or liable to Tenant, or to those claiming by, through
or under Tenant, for any loss or damage that may be occasioned by or through the
acts or omissions of persons occupying adjoining premises
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or any part of the premises adjacent to or connecting with the Premises or any
part of the Property or otherwise. Notwithstanding the foregoing, Landlord shall
not be released from liability for any injury, loss, damages or liability to the
extent arising from any gross negligence or willful misconduct of Landlord, its
servants, employees or agents acting within the scope of their authority on or
about the Premises; provided, however, that in no event shall Landlord, its
servants, employees or agents have any liability to Tenant based on any loss
with respect to or interruption in the operation of Tenant's business. The
provisions of this SECTION 10.3 shall be applicable from and after the execution
of this Lease and until the end of the Term of this Lease, and during such
further period as Tenant may use or be in occupancy of any part of the Premises
or of the Building.
10.4 WAIVER OF SUBROGATION. The parties hereto shall each procure an
appropriate clause in, or endorsement on, any property insurance policy on the
Premises or any personal property, fixtures or equipment located thereon or
therein, pursuant to which the insurer waives subrogation or consents to a
waiver of right of recovery in favor of either party, its respective agents or
employees. Having obtained such clauses and/or endorsements, each party hereby
agrees that it will not make any claim against or seek to recover from the other
or its agents or employees for any loss or damage to its property or the
property of others resulting from fire or other perils covered by such property
insurance regardless of the cause or origin of such loss or damage, including,
but not limited to, the negligence of such other party or its agents or
employees.
ARTICLE 11
FIRE, EMINENT DOMAIN, ETC.
11.1 LANDLORD'S RIGHT OF TERMINATION. If the Premises or the Building are
substantially damaged by fixed or casualty (the term "substantially damaged"
meaning damage of such a character that the same cannot, in the ordinary course,
reasonably be expected to be repaired within ninety (90) days from the time that
repair work would commence), or if any part of the Building is taken by any
exercise of the right of eminent domain, then Landlord shall have the right to
terminate this Lease (even if Landlord's entire interest in the Premises may
have been divested) by giving notice of Landlord's election so to do within
ninety (90) days after the occurrence of such casualty or the effective date of
such taking, whereupon this Lease shall terminate thirty (30) days after the
date of such notice with the same force and effect as if such date were the date
originally established as the expiration date hereof. Landlord shall deliver to
Tenant a notice ("DAMAGE NOTICE") advising Tenant of Landlord's estimate of the
time required to substantially complete Landlord's Restoration Work (as
hereinafter defined).
11.2 RESTORATION; TENANT'S RIGHT OF TERMINATION.
(a) If the Premises or the Building are damaged by fire or other
casualty, and this Lease is not terminated pursuant to SECTION 11.1,
Landlord shall thereafter use reasonable efforts to restore the Building
and the Premises to proper condition for Tenant's use and occupation
(excluding Tenant's Restoration Work, as defined below), provided that
Landlord's obligation shall be limited to the amount of insurance proceeds
available therefor, and Landlord shall not be obligated to commence
restoration until Landlord has received the insurance proceeds ("LANDLORD'S
RESTORATION WORK"). Landlord's Restoration Work shall not include, and
Tenant shall be solely responsible for, the repair and restoring, at
Tenant's sole cost and expense, of Tenant Alterations necessary for
Tenant's initial occupancy of the Premises, any Alterations made by Tenant
pursuant to SECTION 5.2, and Tenant's Removable Property ("TENANT'S
RESTORATION WORK")). Notwithstanding anything to the contrary contained
herein, if in Landlord's sole discretion, it would be appropriate for
safety reasons, health reasons or the efficient operation or restoration of
the Building or the Premises for Landlord to perform all or a portion of
Tenant's Restoration Work on behalf of Tenant, then (x) Landlord shall give
Tenant a notice specifying the portion of Tenant's Restoration Work to be
performed by Landlord (the "SPECIFIED RESTORATION WORK"), (y) Landlord
shall perform the Specified Restoration Work, and (z) Tenant shall pay to
Landlord within ten (10) days following the giving of Landlord's written
demand therefor the cost of such Specified Restoration Work.
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(b) Landlord shall not carry any insurance on Tenant's Removable
Property or on the Alterations that constitute part of Tenant's Restoration
Work and shall not be obligated to repair or replace Tenant's Removable
Property or such Alterations (whether or not installed by or at the expense
of Landlord). Tenant shall look solely to its insurance for recovery of any
damage to or loss of Tenant's Removable Property or any Alterations. Tenant
shall notify Landlord promptly of any casualty in the Premises. In the
event of a partial or total destruction of the Premises, Tenant shall as
soon as practicable (but no later than five (5) Business Days after
receiving a notice from Landlord) remove any and all of Tenant's Removable
Property from the Premises or the portion thereof destroyed, as the case
may be, and if Tenant does not promptly so remove Tenant's Removable
Property, Landlord, at Tenant's expense, may discard the same or may remove
Tenant's Removable Property to a public warehouse for deposit or retain the
same in its own possession and at its discretion may sell the same at
either public auction or private sale, the proceeds of which shall be
applied first to the expenses of removal, storage and sale, second to any
sums owed by Tenant to Landlord, with any balance remaining to be paid to
Tenant; if the expenses of such removal, storage and sale shall exceed the
proceeds of any sale, Tenant shall pay such excess to Landlord upon demand.
Tenant shall be solely responsible for arranging for any visits to the
Premises by Tenant's insurance adjuster that may be desired by Tenant prior
to the removal of Tenant's Removable Property by Tenant or Landlord, as
provided in this SECTION 11.2(B), or the performance by Landlord of
Landlord's Restoration Work or the Specified Restoration Work and Landlord
shall be under no obligation to delay the performance of same, nor shall
Landlord have any liability to Tenant in the event that Tenant fails to do
so. Tenant shall promptly permit Landlord access to the Premises for the
purpose of performing Landlord's Restoration Work and, if applicable, the
Specified Restoration Work.
(c) If, for any reason the Premises or the Building are substantially
damaged (as defined in SECTION 11.1 above), Tenant shall have the right to
terminate this Lease by giving notice to Landlord thereof within thirty
(30) days after receipt of Landlord's Damage Notice. Further, if Landlord's
Restoration Work shall not be substantially completed within six months
after the expiration of the ninety-day period referred to in SECTION 11.1
(which six-month period may be extended for such periods of time as
Landlord is prevented from proceeding with or completing Landlord's
Restoration Work due to Force Majeure, but in no event for more than an
additional three months), Tenant shall have the right to terminate this
Lease by giving notice to Landlord thereof within thirty (30) days after
the expiration of such period (as so extended) provided Landlord's
Restoration Work is not completed within such period. This Lease shall
cease and come to an end without further liability or obligation on the
part of either party thirty (30) days after such giving of notice by Tenant
unless, within such thirty-day period, Landlord substantially completes
Landlord's Restoration Work. Such right of termination shall be Tenant's
sole and exclusive remedy at law or in equity for Landlord's failure so to
complete Landlord's Restoration Work, and time shall be of the essence with
respect thereto.
11.3 LANDLORD'S INSURANCE. Landlord agrees to maintain in full force and
effect, during the Term of this Lease, property damage insurance with such
deductibles and in such amounts as may from time to time be carried by
reasonably prudent owners of similar buildings in the area in which the Property
is located, provided that in no event shall Landlord be required to carry other
than fire and extended coverage insurance or insurance in amounts greater than
80% of the actual insurable cash value of the Building (excluding footings and
foundations). Landlord may satisfy such insurance requirements by including the
Property in a so-called "blanket" insurance policy, provided that the amount of
coverage allocated to the Property shall fulfill the foregoing requirements.
11.4 ABATEMENT OF RENT. If the Premises or the Building are damaged by fire
or other casualty, Basic Rent and Escalation Charges payable by Tenant shall
xxxxx proportionately for the period from the date of such fire or other
casualty until the earlier of (a) the date that Landlord substantially completes
Landlord's Restoration Work (provided, that if Landlord would have completed
Landlord's Restoration Work at an earlier date but for Tenant having failed to
cooperate with Landlord in effecting such Work or collecting insurance proceeds,
then the Premises shall be deemed to have been repaired and restored on such
earlier date and the abatement shall cease), or (b) the date Tenant or any
subtenant reoccupies any portion of the Premises (in which case the Basic Rent
and Escalation Charges allocable to such reoccupied
18
portion shall be payable by Tenant from the date of such occupancy).
Notwithstanding any provision contained in this Lease to the contrary, (i) there
shall be no abatement with respect to any portion of the Premises which has not
been rendered untenantable by reason of fire or other casualty and which is
accessible, whether or not other portions of the Premises are untenantable, and
(ii) any abatement of Basic Rent or Escalation Charges applicable to any portion
of the Premises which was rendered untenantable by reason of a casualty shall
cease on the earliest of the dates referred to in clauses (a) or (b) of the
preceding sentence provided such portion is accessible, whether or not other
portions of the Premises remain untenantable. Landlord's determination of the
date Landlord's Restoration Work to the Premises shall have been substantially
completed shall be controlling unless Tenant disputes same by notice to Landlord
given within ten (10) days after such determination by Landlord, and pending
resolution of such dispute, Tenant shall pay Basic Rent and Escalation Charges
in accordance with Landlord's determination. Notwithstanding the foregoing, if
by reason of any act or omission by Tenant, any subtenant or any of their
respective partners, directors, officers, servants, employees, agents or
contractors, Landlord, any Mortgagee shall be unable to collect all of the
insurance proceeds (including, without limitation, rent insurance proceeds)
applicable to the casualty, then, without prejudice to any other remedies which
may be available against Tenant, there shall be no abatement of Basic Rent or of
Escalation Charges. If the Premises shall be affected by any exercise of the
power of eminent domain, Basic Rent and Escalation Charges payable by Tenant
shall be justly and equitably abated and reduced according to the nature and
extent of the loss of use thereof suffered by Tenant. In no event shall Landlord
have any liability for damages to Tenant for inconvenience, annoyance, or
interruption of business arising from any fire or other casualty or eminent
domain.
11.5 CONDEMNATION AWARD. Landlord shall have and hereby reserves and
excepts, and Tenant hereby grants and assigns to Landlord, all rights to recover
for damages to the Property and the leasehold interest hereby created, and to
compensation accrued or hereafter to accrue by reason of any taking, by exercise
of the right of eminent domain, and by way of confirming the foregoing, Tenant
hereby grants and assigns, and covenants with Landlord to grant and assign to
Landlord, all rights to such damages or compensation, and covenants to deliver
such further assignments and assurances thereof as Landlord may from time to
time request. Nothing contained herein shall be construed to prevent Tenant from
prosecuting in any condemnation proceedings a claim for the value of any of
Tenant's Removable Property installed in the Premises by Tenant at Tenant's
expense and for relocation expenses, provided that such action shall not affect
the amount of compensation otherwise recoverable by Landlord from the
taking authority.
ARTICLE 12
HOLDING OVER; SURRENDER
12.1 HOLDING OVER. Any holding over by Tenant after the expiration of the
Term of this Lease for a period of 90 days or less shall be treated as a daily
tenancy at sufferance at a Basic Rent equal to 150% of the Basic Rent then in
effect plus Escalation Charges and other Additional Rent herein provided
(prorated on a daily basis), and Tenant shall not be liable for consequential
damages in connection therewith. From and after the 91st day of the holdover,
(a) Tenant shall pay to Landlord all damages, direct and/or indirect, sustained
by reason of any such holding over and (b) such holdover shall constitute a
month-to-month tenancy at the rate of 150% of the Basic Rent and Escalation
Charges payable during the last year of the Term; provided, however, at
Landlord's option, such holdover shall constitute a renewal of one (1) year at
the rate of 125% of the Basic Rent and Escalation Charges payable during the
last year of the Term. In all other respects, any holding over shall be on the
terms and conditions set forth in this Lease as far as applicable.
12.2 SURRENDER OF PREMISES. Upon the expiration or earlier termination of
the Term of this Lease, Tenant shall peaceably quit and surrender to Landlord
the Premises in neat and clean condition and in good order, condition and
repair, together with all alterations, additions and improvements which may have
been made or installed in, on or to the Premises prior to or during the Term of
this Lease (except as hereinafter provided), excepting only ordinary wear and
use and damage by fire or other casualty for which, under other provisions of
this Lease, Tenant has no responsibility to repair or restore. Tenant shall
remove all of Tenant's Removable Property, all wiring and cabling installed by
Tenant prior to or during the Term and, to the extent
19
specified by Landlord, all alterations and additions made by Tenant and all
partitions wholly within the Premises unless installed initially by Landlord in
preparing the Premises for Tenant's occupancy; and shall repair any damages to
the Premises or the Building caused by such removal. Any Tenant's Removable
Property which shall remain in the Building or on the Premises after the
expiration or termination of the Term of this Lease shall be deemed conclusively
to have been abandoned, and either may be retained by Landlord as its property
or may be disposed of in such manner as Landlord may see fit, at Tenant's sole
cost and expense. At Tenant's written request delivered at the time Tenant
requests Landlord's approval of any Tenant Alterations, Landlord shall notify
Tenant which portions, if any, of such Tenant Alterations (including, but not
limited to, wiring and cabling) must be removed by Tenant at the expiration or
earlier termination of the Term. At the end of the Term, Tenant shall not be
required to remove any wiring or cabling existing in the Premises as of the date
hereof.
ARTICLE 13
RIGHTS OF MORTGAGEES; TRANSFER OF TITLE
13.1 RIGHTS OF MORTGAGEES.
(a) This Lease shall be subordinate to any mortgage, deed of trust or
ground lease or similar encumbrance (collectively, a "MORTGAGE", and the
holder thereof from time to time the "HOLDER") from time to time
encumbering the Premises, whether executed and delivered prior to or
subsequent to the date of this Lease, unless the Holder shall elect
otherwise. If this Lease is subordinate to any Mortgage and the Holder or
any other party shall succeed to the interest of Landlord pursuant to the
Mortgage (such Holder or other party, a "SUCCESSOR"), at the election of
the Successor, Tenant shall attorn to the Successor and this Lease shall
continue in full force and effect between the Successor and Tenant. Not
more than fifteen (15) days after Landlord's written request, Tenant agrees
to execute such instruments of subordination or attornment in confirmation
of the foregoing agreement as the Successor reasonably may request.
(b) Notwithstanding the foregoing, if this Lease is subordinate to a
Mortgage as aforesaid, then upon the written request of Tenant, Landlord
agrees to use commercially reasonable efforts to obtain the Holder's
written agreement that, subject to such reasonable qualifications as the
Holder may impose, in the event that the Holder or any other party shall
succeed to the interest of Landlord hereunder pursuant to such Mortgage, so
long as no Event of Default exists hereunder, Tenant's right to possession
of the Premises shall not be disturbed and Tenant's other rights hereunder
shall not be adversely affected by any foreclosure of such Mortgage. For
purposes hereof, the term "commercially reasonable efforts" shall not
include the payment of any sum of money or the consent to less favorable
terms and conditions with respect to the obligations or indebtedness
secured or created by the Mortgage. In the event that, despite using
commercially reasonable efforts, Landlord is unable to obtain such an
agreement, then this Lease nonetheless shall be subordinate as aforesaid.
13.2 ASSIGNMENT OF RENTS AND TRANSFER OF TITLE.
(a) With reference to any assignment by Landlord of Landlord's
interest in this Lease, or the rents payable hereunder, conditional in
nature or otherwise, which assignment is made to the holder of a mortgage
on property which includes the Premises, Tenant agrees that the execution
thereof by Landlord, and the acceptance thereof by the holder of such
mortgage shall never be treated as an assumption by such holder of any of
the obligations of Landlord hereunder unless such holder shall, by notice
sent to Tenant, specifically otherwise elect and, except as aforesaid, such
holder shall be treated as having assumed Landlord's obligations hereunder
only upon foreclosure of such holder's mortgage and the taking of
possession of the Premises.
(b) In the event of any transfer of title to the Property by Landlord,
Landlord shall thereafter be entirely freed and relieved from the
performance and observance of all covenants and obligations hereunder.
13.3 NOTICE TO MORTGAGEE. After receiving notice from Landlord of any
Holder of a Mortgage which includes the Premises, no notice from Tenant to
Landlord alleging any default
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by Landlord shall be effective unless and until a copy of the same is given to
such Holder (provided Tenant shall have been furnished with the name and address
of such Holder), and the curing of any of Landlord's defaults by such Holder
shall be treated as performance by Landlord.
ARTICLE 14
DEFAULT; REMEDIES
14.1 TENANT'S DEFAULT.
(a) If at any time subsequent to the date of this Lease any one or
more of the following events (herein referred to as an "EVENT OF DEFAULT")
shall occur:
(i) Tenant shall fail to pay the Basic Rent, Escalation Charges
or any other Additional Rent hereunder when due and such failure shall
continue for three (3) Business Days after notice to Tenant from
Landlord; or
(ii) Tenant shall neglect or fail to perform or observe any other
covenant herein contained on Tenant's part to be performed or observed
and Tenant shall fail to remedy the same within thirty (30) days after
notice to Tenant specifying such neglect or failure, or if such
failure is of such a nature that Tenant cannot reasonably remedy the
same within such thirty (30) day period, Tenant shall fail to commence
promptly (and in any event within such thirty (30) day period) to
remedy the same and to prosecute such remedy to completion with
diligence and continuity (and in any event, within ninety (90) days
after the notice described in this SUBPARAGRAPH (II)); or
(iii) Tenant's leasehold interest in the Premises shall be taken
on execution or by other process of law directed against Tenant; or
(iv) Tenant shall make an assignment for the benefit of creditors
or shall be adjudicated insolvent, or shall file any petition or
answer seeking any reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief for itself
under any present or future Federal, State or other statute, law or
regulation for the relief of debtors (other than the Bankruptcy Code,
as hereinafter defined), or shall seek or consent to or acquiesce in
the appointment of any trustee, receiver or liquidator of Tenant or of
all or any substantial part of its properties, or shall admit in
writing its inability to pay its debts generally as they become due;
or
(v) An Event of Bankruptcy (as hereinafter defined) shall occur
with respect to Tenant; or
(vi) A petition shall be filed against Tenant under any law
(including, but not limited to, the Bankruptcy Code) seeking any
reorganization, arrangement, composition, readjustment, liquidation,
dissolution, or similar relief under any present or future Federal,
State or other statute, law or regulation and shall remain undismissed
or unstayed for an aggregate of sixty (60) days (whether or not
consecutive), or if any trustee, conservator, receiver or liquidator
of Tenant or of all or any substantial part of its properties shall be
appointed without the consent or acquiescence of Tenant and such
appointment shall remain unvacated or unstayed for an aggregate of
sixty (60) days (whether or not consecutive);
(vii) If: (x) Tenant shall fail to pay the Basic Rent, Escalation
Charges or any other Additional Rent hereunder when due or shall fail
to perform or observe any other covenant herein contained on Tenant's
part to be performed or observed and Tenant shall cure any such
failure within the applicable grace period set forth in clauses (i) or
(ii) above; or (y) an Event of Default of the kind set forth in
clauses (i) or (ii) above shall occur and Landlord shall, in its sole
discretion, permit Tenant to cure such Event of Default after the
applicable grace period has expired; and the same or a similar failure
shall occur more than once within the next 365 days (whether or not
such similar failure is cured within the applicable grace period); or
21
(viii) The occurrence of any of the events described in
PARAGRAPHS (A)(IV)-(A)(VI) with respect to any guarantor of all or any
portions of Tenant's obligations under this Lease;
then in any such case Landlord may terminate this Lease as hereinafter provided
and exercise any other rights or remedies available under this Lease, at law or
in equity.
(b) For purposes of CLAUSE (A)(V) above, an "EVENT OF BANKRUPTCY"
means the filing of a voluntary petition by Tenant, or the entry of an
order for relief against Tenant, under Chapter 7, 11, or 13 of the
Bankruptcy Code, and the term "BANKRUPTCY CODE" means 11 U.S.C. Section
101, et seq.. If an Event of Bankruptcy occurs, then the trustee of
Tenant's bankruptcy estate or Tenant as debtor-in-possession may (subject
to final approval of the court) assume this Lease, and may subsequently
assign it, only if it does the following within sixty (60) days after the
date of the filing of the voluntary petition, the entry of the order for
relief (or such additional time as a court of competent jurisdiction may
grant, for cause, upon a motion made within the original sixty-day
period):
(i) file a motion to assume the Lease with the appropriate court;
(ii) satisfy all of the following conditions, which Landlord and
Tenant acknowledge to be commercially reasonable:
(A) cure all Events of Default of Tenant under this Lease or
provide Landlord with Adequate Assurance (as defined below) that
it will (x) cure all monetary Events of Default of Tenant
hereunder within ten (10) days from the date of the assumption;
and (y) cure all non-monetary Events of Default of Tenant
hereunder within thirty (30) days from the date of the
assumption;
(B) compensate Landlord and any other person or entity, or
provide Landlord with Adequate Assurance that within ten (10)
days after the date of the assumption, it will compensate
Landlord and such other person or entity, for any pecuniary loss
that Landlord and such other person or entity incurred as a
result of any Event of Default, the trustee, or the
debtor-in-possession;
(C) provide Landlord with Adequate Assurance of Future
Performance (as defined below) of all of TENANT'S obligations
under this Lease; and
(D) deliver to Landlord a written statement that the
conditions herein have been satisfied.
(c) For purposes only of the foregoing PARAGRAPH (B), and in addition
to any other requirements under the Bankruptcy Code, any future federal
bankruptcy law and applicable case law, "ADEQUATE ASSURANCE" means at least
meeting the following conditions, which Landlord and Tenant acknowledge to
be commercially reasonable:
(i) entering an order segregating sufficient cash to pay Landlord
and any other person or entity under PARAGRAPH (B) above, and
(ii) granting to Landlord a valid first lien and security
interest (in form acceptable to Landlord) in all property comprising
the Tenant's "property of the estate," as that term is defined in
Section 541 of the Bankruptcy Code, located on, used at or relating to
the Premises, which lien and security interest secures the trustee's
or debtor-in-possession's obligation to cure the monetary and
nonmonetary defaults under the Lease within the periods set forth in
PARAGRAPH (B) above.
(d) For purposes only of PARAGRAPH (B) above, and in addition to any
other requirements under the Bankruptcy Code, any future federal
bankruptcy law and applicable case law, "ADEQUATE ASSURANCE OF FUTURE
PERFORMANCE" means at least
22
meeting the following conditions, which Landlord and Tenant acknowledge to
be commercially reasonable;
(i) the trustee or debtor-in-possession depositing with Landlord,
as security for the timely payment of rent and other monetary
obligations, an amount equal to the sum of two (2) months' Basic Rent
plus an amount equal to two (2) months' installments on account of
Escalation Charges;
(ii) the trustee or the debtor-in-possession agreeing to pay in
advance, on each day that the Basic Rent is payable, the monthly
installments on account of Escalation Charges;
(iii) the trustee or debtor-in-possession providing adequate
assurance of the source of the rent and other consideration due under
this Lease;
(iv) Tenant's bankruptcy estate and the trustee or
debtor-in-possession providing Adequate Assurance of the feasibility
of the bankruptcy estate (and any successor after the conclusion of
the Tenant's bankruptcy proceedings) continuing to have sufficient
unencumbered assets after the payment of all secured obligations and
administrative expenses to assure Landlord that the bankruptcy estate
(and any successor after the conclusion of the Tenant's bankruptcy
proceedings) will have sufficient funds to fulfill Tenant's
obligations hereunder.
(e) If the trustee or the debtor-in-possession assumes the Lease under
PARAGRAPH (B) above and applicable bankruptcy law, it may assign its
interest in this Lease only if the proposed assignee first provides
Landlord with Adequate Assurance of Future Performance of all of Tenant's
obligations under the Lease, and if Landlord determines, in the exercise of
its reasonable business judgment, that the assignment of this Lease will
not breach any other lease, or any mortgage, financing agreement, or other
agreement relating to the Property by which Landlord or the Property is
then bound (and Landlord shall not be required to obtain consents or
waivers from any third party required under any lease, mortgage, financing
agreement, or other such agreement by which Landlord is then bound).
(f) For purposes only of PARAGRAPH (E) above, and in addition to any
other requirements under the Bankruptcy Code, any future federal bankruptcy
law and applicable case law, "ADEQUATE ASSURANCE OF FUTURE PERFORMANCE"
means at least the satisfaction of the following conditions, which Landlord
and Tenant acknowledge to be commercially reasonable:
(i) the proposed assignee submitting a current financial
statement, audited by a certified public accountant, that allows a net
worth and working capital in amounts determined in the reasonable
business judgment of Landlord to be sufficient to assure the future
performance by the assignee of Tenant's obligation under this Lease;
and
(ii) if requested by Landlord in the exercise of its reasonable
business judgment, the proposed assignee obtaining a guarantee (in
form and substance satisfactory to Landlord) from one or more persons
who satisfy Landlord's standards of creditworthiness.
14.2 LANDLORD'S REMEDIES. Upon the occurrence of an Event of Default:
(a) Landlord may terminate this Lease by serving written notice on
Tenant of Landlord's election to do so, and may thereafter forthwith
proceed to recover possession of the Premises (together with all
alterations, installations, improvements, additions, and other physical
changes to the Premises) in accordance with the laws of the State of
Illinois. If Landlord elects to terminate this Lease, Landlord shall be
entitled to recover forthwith as damages a sum of money equal to the total
of (i) the cost of recovering the Premises, (ii) the unpaid Basic Rent,
Escalation Charges and other sums payable hereunder earned at the time of
termination, plus interest thereon at the rate set forth in Section 14.4,
(iii) the present value of the balance of the Basic Rent, Escalation
Charges and other sums payable hereunder and other amounts owed hereunder
for the remainder
23
of the Term, less the fair market value of the Basic Rent, Escalation
Charges and other sums payable hereunder for the Premises for said period
(also reduced to present value), and (iv) any other sum of money and
damages owed by Tenant to Landlord; or
(b) Landlord may terminate Tenant's right to possession of the
Premises without terminating the Lease and Landlord may forthwith proceed
to recover possession of the Premises in accordance with the laws of the
State of Illinois. If Landlord elects to terminate Tenant's right to
possession without terminating the Lease, Tenant shall remain liable for
all Basic Rent, Escalation Charges and other sums payable hereunder and
other charges due hereunder and for all costs incurred by Landlord in
recovering possession of the Premises. Landlord shall thereafter use
reasonable efforts to relet the Premises for such rent, for such term
(whether greater or less than the remaining Term of this Lease) and upon
such terms and conditions as Landlord shall find acceptable. For the
purposes of reletting the Premises, Landlord may decorate and/or make any
repairs, changes, alterations or additions as may be reasonably necessary.
Landlord shall not be required to give priority to its efforts to relet the
Premises over its efforts to relet any other vacant space in the Building.
If Landlord succeeds in reletting the Premises, the Net Rental (as
hereinafter defined) from time to time received by Landlord therefrom over
the remaining term of this Lease shall be applied to reduce Tenant's
obligations to Landlord hereunder. The term "NET RENTAL" shall, for
purposes hereof, mean the gross rental actually received by Landlord from
such reletting less the amount of all costs incurred by Landlord in
connection with such reletting (including, without limitation, broker's
fees, attorneys' fees, costs of preparing the Premises for occupancy and
any inducements granted to the new tenant). Tenant shall timely pay all
amounts owed to Landlord during the Term. No delivery or recovery of any
amount due Landlord pursuant to this Lease shall be any defense in any
action to recover any amount not theretofore reduced to judgment in favor
of Landlord, nor shall the reletting pursuant to this Section 14.2 be
construed as an election on the part of Landlord to terminate this Lease
unless a written notice of such intention shall be given to Tenant by
Landlord. Notwithstanding any such reletting without termination, Landlord
may at any time thereafter elect to terminate this Lease for such previous
breach or Event of Default. If Landlord does in fact relet the Premises,
Tenant shall not be entitled to any rentals or other consideration from
such reletting, if any, that exceed any amounts owed by Tenant to Landlord;
or
(c) Landlord may, without judicial process and without having any
liability therefor, enter upon the Premises and do whatever Tenant is
obligated to do under the terms of this Lease and Tenant agrees to
reimburse Landlord on demand for any expenses which Landlord may incur in
effecting compliance with Tenant's obligations under this Lease, and Tenant
further agrees that Landlord shall not be liable for any damages resulting
to Tenant from such action, WHETHER CAUSED BY THE NEGLIGENCE OF LANDLORD OR
OTHERWISE.
(d) Landlord shall not be required to serve Tenant with any notices or
demands as a prerequisite to its exercise of any of its rights or remedies
under this Lease, other than those notices and demands specifically
required under this Lease. Tenant expressly waives the service of any
statutory demand or notice which is a prerequisite to Landlord's
commencement of eviction proceedings against Tenant, including demands and
notices specified in 735 ILCS Sections 5/9-209 and 5/9-210, it being agreed
that the notices delivered by Landlord pursuant to SECTION 14.1 above shall
constitute such statutory demands and notices.
(e) In the event Landlord has repossessed the Premises in accordance
with this Lease and/or in accordance with applicable law, and in the
further event that any property is found remaining upon the Premises at the
time of such repossession of the Premises by Landlord, then Landlord may
remove and store in any warehouse, at Tenant's cost, or, in Landlord's sole
discretion, Landlord may deem abandoned by Tenant and dispose of in
accordance with applicable law, any property found upon the Premises at the
time of such re-entry of the Premises by Landlord or termination of
Tenant's right to the Premises. The provisions of this Section 14.2 will
be construed consistent with Illinois law, so that remedies of Landlord
herein described are available to Landlord to the full extent but only to
the extent that they are not invalid or unenforceable under Illinois law.
24
14.3 ADDITIONAL RENT. If Tenant shall fail to pay when due any sums under
this Lease designated as an Escalation Charge or other Additional Rent, Landlord
shall have the same rights and remedies as Landlord has hereunder for failure to
pay Basic Rent.
14.4 REMEDYING DEFAULTS. Landlord shall have the right, but shall not be
required, to pay such sums or do any act which requires the expenditure of
monies which may be necessary or appropriate by reason of the failure or neglect
of Tenant to perform any of the provisions of this Lease, and in the event of
the exercise of such right by Landlord, Tenant agrees to pay to Landlord
forthwith upon demand all such sums, together with interest thereon at a rate
equal to 3% plus the prime rate published from time to time in The Wall Street
Journal or its successor publication (but in no event more than 12% per annum),
as Additional Rent. Any payment of Basic Rent, Escalation Charges or other sums
payable hereunder not paid when due shall, at the option of Landlord, bear
interest at a rate equal to 3% plus the prime rate published from time to time
in The Wall Street Journal or its successor publication (but in no event more
than 12% per annum) from the due date thereof and shall be payable forthwith on
demand by Landlord, as Additional Rent.
14.5 REMEDIES CUMULATIVE. The specified remedies to which Landlord may
resort hereunder are not intended to be exclusive of any remedies or means of
redress to which Landlord may at any time be entitled lawfully, and Landlord may
invoke any remedy (including the remedy of specific performance) allowed at law
or in equity as if specific remedies were not herein provided for.
14.6 ENFORCEMENT COSTS. Tenant shall pay all costs and expenses (including,
without limitation, attorneys' fees and expenses at both the trial and appellate
levels) incurred by or on behalf of Landlord in connection with the successful
enforcement of any rights of Landlord or obligations of Tenant hereunder,
whether or not occasioned by an Event of Default.
14.7 WAIVER. Failure on the part of Landlord or Tenant to complain of any
action or non-action on the part of the other, no matter how long the same may
continue, shall never be a waiver by Tenant or Landlord, respectively, of any of
the other's rights hereunder. Further, no waiver at any time of any of the
provisions hereof by Landlord or Tenant shall be construed as a waiver of any of
the other provisions hereof, and a waiver at any time of any of the provisions
hereof shall not be construed as a waiver at any subsequent time of the same
provisions. The consent or approval of Landlord or Tenant to or of any action by
the other requiring such consent or approval shall not be construed to waive or
render unnecessary Landlord's or Tenant's consent or approval to or of any
subsequent similar act by the other. No payment by Tenant, or acceptance by
Landlord, of a lesser amount than shall be due from Tenant to Landlord shall be
treated otherwise than as a payment on account of the earliest installment of
any payment due from Tenant under the provisions hereof. The acceptance by
Landlord of a check for a lesser amount with an endorsement or statement
thereon, or upon any letter accompanying such check, that such lesser amount is
payment in full, shall be given no effect, and Landlord may accept such check
without prejudice to any other rights or remedies which Landlord may have
against Tenant.
14.8 SECURITY DEPOSIT. If a security deposit is specified in SECTION 1.1
hereof, Tenant agrees that the same will be paid upon execution and delivery of
this Lease, and that Landlord shall hold the same throughout the Term of this
Lease as security for the performance by Tenant of all obligations on the part
of Tenant hereunder. Landlord shall have the right from time to time, without
prejudice to any other remedy Landlord may have on account thereof, to apply
such deposit, or any part thereof, to Landlord's damages arising from, or to
cure, any Event of Default. If Landlord shall so apply any or all of such
deposit, Tenant shall immediately upon demand deposit with Landlord the amount
so applied to be held as security hereunder. Landlord shall return the deposit,
or so much thereof as shall not have theretofore been applied in accordance with
the terms of this Section, to Tenant on the expiration or earlier termination of
the Term of this Lease and surrender of possession of the Premises by Tenant to
Landlord at such time, provided that there is then existing no Event of Default
(nor any circumstance which, with the passage of time or the giving of notice,
or both, would constitute an Event of Default). While Landlord holds such
deposit, Landlord shall have no obligation to pay interest on the same and shall
have the right to commingle the same with Landlord's other funds. If Landlord
conveys Landlord's interest under this Lease, the deposit, or any part thereof
not previously applied, may be turned over by Landlord to Landlord's grantee,
and, if so turned over, Tenant agrees to look solely to such grantee for proper
application of the deposit in accordance with the
25
terms of this Section, and the return thereof in accordance herewith. The holder
of a mortgage shall not be responsible to Tenant for the return or application
of any such deposit, whether or not it succeeds to the position of Landlord
hereunder, unless such deposit shall have been received in hand by such holder.
14.9 LANDLORD'S DEFAULT. Landlord shall in no event be in default under
this Lease unless Landlord shall neglect or fail to perform any of its
obligations hereunder and shall fail to remedy the same within thirty (30) days
after notice to Landlord specifying such neglect or failure, or if such failure
is of such a nature that Landlord cannot reasonably remedy the same within such
thirty (30) day period, Landlord shall fail to commence promptly (and in any
event within such thirty (30) day period) to remedy the same and to prosecute
such remedy to completion with diligence and continuity.
ARTICLE 15
MISCELLANEOUS PROVISIONS
15.1 RIGHTS OF ACCESS. Landlord, its agents, contractors and employees
shall have the right to enter the Premises at all reasonable hours with
reasonable prior notice (except in the event of an emergency, in which event no
notice shall be required) for the purpose of inspecting the Premises, doing
maintenance or making repairs or otherwise exercising its rights or fulfilling
its obligations under this Lease, and Landlord also shall have the right to make
access available at all reasonable hours to prospective or existing mortgagees,
purchasers or tenants of any part of the Property.
15.2 COVENANT OF QUIET ENJOYMENT. Subject to the terms and conditions of
this Lease, on payment of the Basic Rent and Escalation Charges and other
Additional Rent and observing, keeping and performing all of the other terms and
conditions of this Lease on Tenant's part to be observed, kept and performed,
Tenant shall lawfully, peaceably and quietly enjoy the Premises during the term
hereof, without hindrance or ejection by any persons lawfully claiming under
Landlord to have title to the Premises superior to Tenant. The foregoing
covenant of quiet enjoyment is in lieu of any other covenant, express or
implied.
15.3 LANDLORD'S LIABILITY.
(a) Tenant agrees to look solely to Landlord's equity interest in the
Property at the time of recovery for recovery of any judgment against
Landlord, and agrees that neither Landlord, its partners, members or their
officers, agents and employees nor any successor of Landlord, its partners,
members or their officers, agents and employees shall be personally liable
for any such judgment, or for the payment of any monetary obligation to
Tenant. The provision contained in the foregoing sentence is not intended
to, and shall not, limit any right that Tenant might otherwise have to
obtain injunctive relief against Landlord or any successor of Landlord, or
to take any action not involving the personal liability of Landlord or any
successor of Landlord to respond in monetary damages from Landlord's assets
other than Landlord's equity interest in the Property.
(b) In no event shall Landlord ever be liable to Tenant for any loss
of business or any other indirect or consequential damages suffered by
Tenant from whatever cause.
(c) Where provision is made in this Lease for Landlord's consent, and
Tenant shall request such consent, and Landlord shall fail or refuse to
give such consent, Tenant shall not be entitled to any damages for any
withholding by Landlord of its consent, it being intended that Tenant's
sole remedy shall be an action for specific performance or injunction, and
that such remedy shall be available only in those cases where Landlord has
expressly agreed in writing not to unreasonably withhold its consent.
Furthermore, whenever Tenant requests Landlord's consent or approval
(whether or not provided for herein), Tenant shall pay to Landlord, on
demand, as Additional Rent, any reasonable expenses incurred by Landlord
(including without limitation reasonable attorneys' fees and costs, if
any) in connection therewith.
(d) Any repairs or restoration required or permitted to be made by
Landlord under this Lease may be made during normal business hours, and
Landlord shall have no
26
liability for damages to Tenant for inconvenience, annoyance or
interruption of business arising therefrom.
15.4 ESTOPPEL CERTIFICATE. Tenant shall, at any time and from time to time,
upon not less than ten (10) business days prior written notice by Landlord,
execute, acknowledge and deliver to Landlord an estoppel certificate containing
such statements of fact as Landlord reasonably requests.
15.5 BROKERAGE. Tenant warrants and represents that Tenant has dealt with
no broker in connection with the consummation of this Lease other than Broker,
and, in the event of any brokerage claims against Landlord predicated upon prior
dealings with Tenant, Tenant agrees to defend the same and indemnify Landlord
against any such claim (except any claim by Broker).
15.6 RULES AND REGULATIONS. Tenant shall abide by the Rules and Regulations
from time to time established by Landlord, it being agreed that such Rules and
Regulations will be established and applied by Landlord in a non-discriminatory
fashion, such that all Rules and Regulations shall be generally applicable to
other tenants of the Building of similar nature to the Tenant named herein.
Landlord agrees to use reasonable efforts to insure that any such Rules and
Regulations are uniformly enforced, but Landlord shall not be liable to Tenant
for violation of the same by any other tenant or occupant of the Building, or
persons having business with them. In the event that there shall be a conflict
between such Rules and Regulations and the provisions of this Lease, the
provisions of this Lease shall control. The Rules and Regulations currently in
effect are set forth in EXHIBIT E.
15.7 FINANCIAL STATEMENTS. Tenant shall, at any time and from time to time
but in no event more frequently man once per twelve month period, upon not less
than ten (10) Business Days' prior written notice by Landlord, deliver to
Landlord Tenant's and each Guarantor's most recently audited, or if not
available, unaudited, financial statements, in form reasonably satisfactory to
Landlord.
15.8 SUBSTITUTE SPACE. If Landlord so requests, Tenant shall vacate the
Premises and relinquish its rights with respect to the same provided that
Landlord shall provide to Tenant substitute space in the Building, such space to
be (i) located above the 9th floor of the Building and (ii) reasonably
comparable in size, layout, finish and utility to the Premises, and further
provided that Landlord shall, at its sole cost and expense, move Tenant and
Tenant's Removable Property from the Premises to such new space in such manner
as will minimize, to the greatest extent practicable, undue interference with
the business or operations of Tenant. Any such substitute space shall, from and
after such relocation, be treated as the Premises demised under this Lease, and
shall be occupied by Tenant under the same terms, provisions and conditions as
are set forth in this Lease. Landlord shall not have the right to relocate
Tenant during the first two years of the Term. Landlord shall reimburse Tenant
for its reasonable out-of-pocket costs in connection with printing and
distributing relocation notices to Tenant's customers and one month's supply of
stationery showing Tenant's new address.
15.9 INVALIDITY OF PARTICULAR PROVISIONS. If any term or provision of this
Lease, or the application thereof to any person or circumstance shall, to any
extent, be invalid or unenforceable, the remainder of this Lease, or the
application of such term or provision to persons or circumstances other than
those as to which it is held invalid or unenforceable, shall not be affected
thereby, and each term and provision of this Lease shall be valid and be
enforced to the fullest extent permitted by law.
15.10 PROVISIONS BINDING, ETC. Except as herein otherwise provided, the
terms hereof shall be binding upon and shall inure to the benefit of the
successors and assigns, respectively, of Landlord and Tenant (except in the case
of Tenant, only such successors and assigns as may be permitted hereunder) and,
if Tenant shall be an individual, upon and to his heirs, executors,
administrators, successors and permitted assigns. Each term and each provision
of this Lease to be performed by Tenant shall be construed to be both a covenant
and a condition. Any reference in this Lease to successors and assigns of Tenant
shall not be construed to constitute a consent to assignment by Tenant. Tenant
represents and warrants that Tenant is not, and the entities or individuals
constituting Tenant or which may own or control Tenant or which may be owned or
controlled by Tenant are not, among the individuals or entities identified on
any list compiled pursuant to Executive Order 13224 for the purpose of
identifying suspected terrorists.
27
15.11 RECORDING. Tenant agrees not to record this Lease, but, if the Term
of this Lease (including any extended term) is seven (7) years or longer, each
party hereto agrees, on the request of the other, to execute a notice of lease
in recordable form and complying with applicable law. In no event shall such
document set forth the rent or other charges payable by Tenant under this
Lease; and any such document shall expressly state that it is executed pursuant
to the provisions contained in this Lease, and is not intended to vary the terms
and conditions of this Lease. At Landlord's request, promptly upon expiration of
or earlier termination of the Term, Tenant shall execute and deliver to Landlord
a release of any document recorded in the real property records for the location
of the Property evidencing this Lease, and Tenant hereby appoints Landlord
Tenant's attorney-in-fact, coupled with an interest, to execute any such
document if Tenant fails to respond to Landlord's request to do so within
fifteen (15) days. The obligations of Tenant under this Section shall survive
the expiration or any earlier termination of the Term.
15.12 NOTICE. All notices or other communications required hereunder shall
be in writing and shall be deemed duly given if delivered in person (with
receipt therefor), if sent by reputable overnight delivery or courier service
(e.g., Federal Express) providing for receipted delivery, or if sent by
certified or registered mail, return receipt requested, postage prepaid, to the
following address:
(a) if to Landlord at Landlord's Address, to the attention of Property
Manager; with a copy to Boston Capital Institutional Advisors LLC, Xxx
Xxxxxx Xxxxx, Xxxxx 0000, Xxxxxx, Xxxxxxxxxxxxx 00000, Attention: Xxxxxxx
X. Xxxxxx, and a copy to Xxxxxxxx X. Xxxxxx, P.C., Xxxxxxx Procter LLP,
Exchange Place, 00 Xxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 and a copy to
Xxxxx X. Xxxxx, Esq., Xxxxx Xxxxxxx, 000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000,
Xxxxxxx, Xxxxxxxx 00000.
(b) if to Tenant, at Tenant's Address, with a copy to the attention of
Xxxxx Xxxxxxxx, CompBenefits Corporation, 000 Xxxxxxx Xxxxx Xxxx, Xxxxx
000, Xxxxxxx, Xxxxxxx 00000.
Where receipt of notice or other communication shall be conclusively
established by either (i) return of a return receipt indicating that the notice
has been delivered; or (ii) return of the letter containing the notice with an
indication from the courier or postal service that the addressee has refused to
accept delivery of the notice. Either party may change its address for the
giving of notices by notice given in accordance with this Section.
15.13 WHEN LEASE BECOMES BINDING; ENTIRE AGREEMENT; MODIFICATION. The
submission of this document for examination and negotiation does not constitute
an offer to lease, or a reservation of, or option for, the Premises, and this
document shall become effective and binding only upon the execution and delivery
hereof by both Landlord and Tenant. This Lease is the entire agreement between
Landlord and Tenant, and this Lease expressly supersedes any negotiations,
considerations, representations and understandings and proposals or other
written documents relating hereto. This Lease may be modified or altered only by
written agreement between Landlord and Tenant, and no act or omission of any
employee or agent of Landlord shall alter, change or modify any of the
provisions hereof.
15.14 PARAGRAPH HEADINGS AND INTERPRETATION OF SECTIONS. The paragraph
headings throughout this instrument are for convenience and reference only, and
the words contained therein shall in no way be held to explain, modify, amplify
or aid in the interpretation, construction or meaning of the provisions of this
Lease. The provisions of this Lease shall be construed as a whole, according to
their common meaning (except where a precise legal interpretation is clearly
evidenced), and not for or against either party. Use in this Lease of the words
"including," "such as" or words of similar import, when followed by any general
term, statement or matter, shall not be construed to limit such term, statement
or matter to the specified item(s), whether or not language of non-limitation,
such as "without limitation" or "including, but not limited to," or words of
similar import, are used with reference thereto, but rather shall be deemed to
refer to all other terms or matters that could fall within a reasonably broad
scope of such term, statement or matter.
15.15 DISPUTE RESOLUTION. In the event of a dispute between Landlord and
Tenant pursuant to this Lease (other than a dispute relating to the payment of
Basic Rent and Escalation Charges) the parties agree that prior to pursuing
other available remedies (excluding giving
28
notices of default), they will attempt to directly negotiate resolution of their
dispute. If negotiation is unsuccessful, then they agree to participate in at
least three hours of mediation to be facilitated by a mediator mutually
acceptable to them under the mediation procedures set by the mediator. The
mediation session shall be conducted within thirty (30) days of the date on
which the mediator receives the request to mediate. The costs of such mediation
shall be shared equally by the parties.
15.16 WAIVER OF JURY TRIAL. Landlord and Tenant hereby each waive trial by
jury in any action, proceeding or counterclaim brought by either against the
other, on or in respect of any matter whatsoever arising out of or in any way
connected with this Lease, the relationship of Landlord and Tenant or Tenant's
use or occupancy of the Premises.
15.17 TIME IS OF THE ESSENCE. Time is of the essence of each provision of
this Lease.
15.18 MULTIPLE COUNTERPARTS. This Lease may be executed in multiple
counterparts, each of which shall be deemed an original and all of which
together shall constitute one and the same document.
15.19 GOVERNING LAW. This Lease shall be governed by the laws of the State
of Illinois.
29
IN "WITNESS WHEREOF, Landlord and Tenant have caused this Lease to be duly
executed, under seal, by persons hereunto duly authorized, as of the date first
set forth above.
LANDLORD:
200 WEST XXXXXXX OWNER LLC,
A DELAWARE LIMITED LIABILITY COMPANY
By: 000 Xxxx Xxxxxxx Manager LLC, a
Delaware limited liability company,
its Manager
By: MassMutual/Boston Capital Mezzanine
Partners II, L.P., a Delaware limited
partnership, its sole Member and
Manager
By: Boston Mass II, LLC, a Delaware
limited liability company, its
General Partner
By: Xxxxx X. Xxxxxx & Company Inc., a
Massachusetts corporation, a Manager
By: /s/ XXXXXX X. XXXXXX
------------------------------------
Name: XXXXXX X. XXXXXX
Title: MANAGING DIRECTOR
By: Boston Capital Institutional
Advisors LLC, a Delaware limited
liability company, a Manager
By: /s/ XXXX X. XXXXXX
------------------------------------
Name: XXXX X. XXXXXX
Title: EXECUTIVE VICE PRESIDENT
TENANT:
AMERICAN PREPAID PROFESSIONAL SERVICES,
INC., A FLORIDA CORPORATION
By: /s/ XXXXX X. XXXXXXXX
------------------------------------
Name: XXXXX X. XXXXXXXX
Title: EX VP
30
EXHIBIT A
LOCATION PLAN OF PREMISES
A-1
BUILDING:
000 XXXX XXXXXXX XXXX.
XXXXXXX XXXXXXXX
(FLOOR PLAN)
EXHIBIT B
SITE PLAN OF BUILDING
INTENTIONALLY OMITTED
B-1
EXHIBIT C
COMMENCEMENT DATE LETTER
INTENTIONALLY OMITTED
C-1
EXHIBIT D
OPERATING EXPENSES
Operating Expenses shall include the following, without limitation:
1. All expenses incurred by Landlord or Landlord's agents which shall be
directly related to employment of personnel at or below the level of property
manager or general manager, including amounts incurred for wages, salaries and
other compensation for services, payroll, social security, unemployment and
similar taxes, workmen's compensation insurance, disability benefits, pensions,
hospitalization, retirement plans and group insurance, uniforms and working
clothes and the cleaning thereof, and expenses imposed on Landlord or Landlord's
agents pursuant to any collective bargaining agreement for the services of
employees of Landlord or Landlord's agents in connection with the operation,
repair, maintenance, cleaning, management and protection of the Property,
including, without limitation, day and night supervisors, manager, accountants,
bookkeepers, janitors, carpenters, engineers, mechanics, electricians and
plumbers and personnel engaged in supervision of any of the persons mentioned
above; provided that, if any such employee is also employed on other property of
Landlord, such compensation shall be suitably prorated among the Property and
such other properties.
2. The cost of services, utilities, materials and supplies furnished or
used in the operation, repair, maintenance, cleaning, management and protection
of the Property.
3. The cost of replacements for tools and other similar equipment used in
the repair, maintenance, cleaning and protection of the Property, provided that,
in the case of any such equipment used jointly on other property of Landlord,
such costs shall be suitably prorated among the Property and such other
properties.
4. Where the Property is managed by Landlord or an affiliate of Landlord, a
sum equal to the amounts customarily charged by management firms in the Greater
Chicago area for similar properties, but in no event more than three (3%) of
gross annual income for the first two years of the Term and thereafter, in no
event more than five percent (5%) of gross annual income, whether or not
actually paid, or where managed by other than Landlord or an affiliate thereof,
the amounts accrued for management, together with, in either case, amounts
accrued for legal and other professional fees relating to the Property, but
excluding such fees and commissions paid in connection with services rendered
for securing or renewing leases and for matters not related to the normal
administration and operation of the Property.
5. Premiums for insurance against damage or loss to the Property from such
hazards as Landlord shall determine, including, but not by way of limitation,
insurance covering loss of rent attributable to any such hazards, and public
liability insurance.
6. If, during the Term of this Lease, Landlord shall make a capital
expenditure, the total cost of which is not properly includable in Operating
Expenses for the Operating Year in which it was made, there shall nevertheless
be included in such Operating Expenses for the Operating Year in which it was
made and in Operating Expenses for each succeeding Operating Year the annual
charge-off of such capital expenditure. Annual charge-off shall be determined by
dividing the original capital expenditure plus an interest factor, reasonably
determined by Landlord, as being the interest rate then being charged for
long-term mortgages by institutional lenders on like properties within the
locality in which the Property is located, by the number of years of useful life
of the capital expenditure; and the useful life shall be determined reasonably
by Landlord in accordance with generally accepted accounting principles and
practices in effect at the time of making such expenditure.
7. Costs for electricity, water and sewer use charges, gas and other
utilities supplied to the Property and not paid for directly by tenants.
8. Betterment assessments, provided the same are apportioned equally over
the longest period permitted by law, and to the extent, if any, not included in
Taxes.
9. Amounts paid to independent contractors for services, materials and
supplies furnished for the operation, repair, maintenance, cleaning and
protection of the Property.
D-1
Operating Expenses shall not include repairs or other work to the extent
Landlord is reimbursed by insurance or condemnation proceeds; leasing
commissions, advertising and other promotional expenditures, or costs of
renovating or improving space for a prospective tenant, other than ordinary
maintenance provided to all tenants of the Building; attorney's fees, costs and
disbursements and other expenses, all of which are incurred in connection with
negotiation or disputes with tenants, other occupants of the Building or
prospective tenants; Taxes (as defined in Section 8.1(a) of the Lease),
franchise, income or other taxes measured or based upon Landlord's income; costs
associated with the cure or correction of design or construction defects in
connection with the original construction of the Building; costs related to the
removal, cleaning, abatement or remediation of "hazardous materials" in or about
the Building or the Property, except to the extent such removal, cleaning,
abatement or remediation is related to the general repair and maintenance of the
Building or the Property; Landlord's costs of electricity and other services
sold separately to tenants for which Landlord is reimbursed as an additional
charge over and above base rent; depreciation, amortization and interest (except
to the extent such interest is amortized as set forth in item 6. above);
organizational expenses associated with the creation and operation of the entity
which constitutes Landlord; fines, costs, penalties or interest resulting from
the adjudicated negligence or willful misconduct or violation of any
governmental law or ordinance by Landlord; capital expenditures except as set
forth above; or costs with respect to acquisition of major art work, paintings,
sculptures, antiques or other objects of art or other furnishings of an unusual
nature or extraordinary value.
D-2
EXHIBIT E
RULES AND REGULATIONS OF BUILDING
The following regulations are generally applicable:
1. The public sidewalks, entrances, passages, courts, elevators,
vestibules, stairways, corridors or halls shall not be obstructed or encumbered
by Tenant (except as necessary for deliveries) or used for any purpose other
than ingress and egress to and from the Premises.
2. No awnings, curtains, blinds, shades, screens or other projections shall
be attached to or hung in, or used in connection with, any window of the
Premises or any outside wall of the Building, unless previously approved in
writing by Landlord. Such awnings, curtains, blinds, shades, screens or other
projections must be of a quality, type, design and color, and attached in the
manner, approved by Landlord.
3. No show cases or other articles shall be put in front of or affixed to
any part of the exterior of the Building, nor, if the Building is occupied by
more than one tenant, displayed through interior windows into the atrium of the
Building, nor placed in the halls, corridors or vestibules, provided that show
cases or articles may be displayed through interior windows into the atrium of
the Building (if any) with Landlord's prior written approval, such approval not
to be unreasonably withheld or delayed so long as such display does not adverse
affect the aesthetic integrity of the Building.
4. The water and wash closets and other plumbing fixtures shall not be used
for any purposes other than those for which they were designed and constructed,
and no sweepings, rubbish, rags, acids or like substances shall be deposited
therein. All damages resulting from any misuse of the fixtures shall be borne by
the Tenant.
5. Tenant shall not use the Premises or any part thereof or permit the
Premises or any part thereof to be used as a public employment bureau or for the
sale of property of any kind at auction, except in connection with Tenant's
business.
6. Tenant must, upon the termination of its tenancy, return to the Landlord
all locks, cylinders and keys to offices and toilet rooms of the Premises.
7. Landlord reserves the right to exclude from the Building after business
hours and at all hours on days other than Business Days all persons connected
with or calling upon the Tenant who do not present a pass to the Building signed
by the Tenant or who are not escorted in the Building by an employee of Tenant.
Tenant shall be responsible for all persons for whom it issues any such pass and
shall be liable to the Landlord for all wrongful acts of such persons.
8. The requirements of Tenant will be attended to only upon application at
the Building Management Office. Employees of Landlord shall not perform any work
or do anything outside of their regular duties, unless under special
instructions from the office of the Landlord.
9. There shall not be used in any space in the Building, or in the public
halls of the Building, either by Tenant or by jobbers or others, in the delivery
or receipt of merchandise, any hand trucks, except those equipped with rubber
tires and side guards.
10. No bicycles, vehicles or animals of any kind shall be brought into or
kept in or about the Premises, except for seeing eye dogs.
11. No tenant shall make, or permit to be made, any unseemly or disturbing
noises or disturb or interfere with occupants of this or any neighboring
building or premises or those having business with them whether by use of any
musical instrument, radio, talking machine, unmusical noise, or in any other
way. No tenant shall throw anything out of the doors, windows or skylights or
down the passageways.
12. The Premises shall not be used for lodging or sleeping or for any
immoral or illegal purpose.
E-1
13. No smoking shall be permitted in the Premises or the Building. Smoking
shall only be permitted in smoking areas outside of the Building which have been
designated by the Landlord.
14. Landlord shall have the right, exercisable without notice and without
liability to any tenant, to change the name and street address of the Building.
15. Tenant shall not use the name of the Building for any purpose other
than Tenant's business address; Tenant shall not use the name of the Building
for Tenant's business address after Tenant vacates the Premises; nor shall
Tenant use any picture or likeness of the Building in any circulars, notices,
advertisements or correspondence.
16. No article which is explosive or inherently dangerous is allowed in the
Building.
17. Tenant shall not represent itself as being associated with any company
or corporation by which the Building may be known.
18. Room-to-room canvasses to solicit business from other tenants of the
Building are not permitted; Tenant shall not advertise the business, profession
or activities of Tenant conducted in the Building in any manner which violates
any code of ethics by any recognized association or organization pertaining to
such business, profession or activities.
19. Tenant shall not waste electricity, water or air-conditioning and shall
cooperate fully with Landlord to assure the most effective and efficient
operation of the Building's heating and air-conditioning systems.
20. No locks or similar devices shall be attached to any door except by
Landlord and Landlord shall have the right to retain a key to all such locks.
Tenant may not install any locks without Landlord's prior approval, which
approval shall not be unreasonably withheld.
21. Except with the prior approval of Landlord, all cleaning, repairing,
janitorial, decorating, painting or other services and work in and about the
Premises shall be done only by authorized Building personnel.
21. To the extent permitted by law, Tenant shall not cause or permit
picketing or other activity which would interfere with the business of Landlord
or any other tenant or occupant of the Building, or distribution of written
materials involving its employees in or about the Building, except in those
locations and subject to time and other limitations as to which Landlord may
give prior written consent.
22. Tenant shall not xxxx, otherwise prepare or sell any food or beverages
in or from the Premises or use the Premises for housing accommodations or
lodging or sleeping purposes except that Tenant may install and maintain vending
machines, coffee/beverage stations and food warming equipment and eating
facilities for the benefit of its employees or guests, provide the same are
maintained in compliance with applicable laws and regulations and do not disturb
other tenants in the Building with odor, refuse or pests.
23. Tenant shall not permit the use of any apparatus for sound production
or transmission in such manner that the sound so transmitted or produced shall
be audible or vibrations therefrom shall be detectable beyond the Premises; nor
permit objectionable odors or vapors to emanate from the Premises.
24. No floor covering shall be affixed to any floor in the Premises by
means of glue or other adhesive without Landlord's prior written consent not to
be unreasonably withheld.
25. Tenant shall only use the freight elevator for mail carts, dollies and
other similar devices for delivering material between floors that Tenant may
occupy.
26. The rules and regulations set forth in Attachment I to this Exhibit,
which is by this reference made a part hereof, are applicable to any Alterations
being undertaken by or for Tenant in the Premises pursuant to Section 5.2 of the
Lease.
E-2
ATTACHMENT I TO EXHIBIT E
RULES AND REGULATIONS FOR TENANT ALTERATIONS
A. General
1. All Alterations made by Tenant in, to or about the Premises shall be
made in accordance with the requirements of this Exhibit and by contractors or
mechanics approved by Landlord.
2. Tenant shall, prior to the commencement of any work, submit for
Landlord's written approval, complete plans for the Alterations, with full
details and specifications for all of the Alterations, in compliance with
Section D below.
3. Alterations must comply with the Building Code applicable to the
Property and the requirements, rules and regulations and any other governmental
agencies having jurisdiction.
4. No work shall be permitted to commence before Tenant obtains and
furnishes to Landlord copies of all necessary licenses and permits from all
governmental authorities having jurisdiction.
5. All demolition, removals or other categories of work that may
inconvenience other tenants or disturb Building operations, must be scheduled
and performed before or after normal business hours, and Tenant shall provide
Landlord with at least 24 hours' notice prior to proceeding with such work.
6. All inquiries, submissions, approvals and all other matters shall be
processed through Landlord's property manager.
7. All work, if performed by a contractor or subcontractor, shall be
subject to reasonable supervision and inspection by Landlord's representative.
Such supervision and inspection shall be at Tenant's sole expense and Tenant
shall pay Landlord's reasonable charges for such supervision and inspection (in
an amount not to exceed 5% of the hard construction costs of such work) as
Additional Rent within thirty (30) days after receiving Landlord's invoice
therefor.
B. Prior to Commencement of Work
1. Tenant shall submit to the Building manager a request to perform the
work. The request shall include the following enclosures:
(i) A list of Tenant's contractors and/or subcontractors for
Landlord's approval.
(ii) Four complete sets of plans and specifications properly stamped
by a registered architect or professional engineer.
(iii) A properly executed building permit application form.
(iv) Four executed copies of the Insurance Requirements Agreement in
the form attached to this Exhibit as Attachment II and made a
part hereof from Tenant's contractor and, if requested by
Landlord, from the contractor's subcontractors.
(v) Contractor's and subcontractor's insurance certificates,
including an indemnity in accordance with the Insurance
Requirements Agreement.
2. Landlord will return the following to Tenant:
(i) Two sets of plans approved or a disapproved with specific
comments as to the reasons therefor (such approval or comments
shall not constitute a waiver of approval of governmental
authorities).
E-3
(ii) Two fully executed copies of the Insurance Requirements
Agreement.
3. Landlord's approval of the plans, drawings, specifications or other
submissions in respect of any Alterations shall create no liability or
responsibility on the part of Landlord for their completeness, design
sufficiency or compliance with requirements of any applicable laws, rules or
regulations of any governmental or quasi-governmental agency, board or
authority.
4. Tenant shall obtain a building permit from the Building Department and
necessary permits from other governmental agencies. Tenant shall be responsible
for keeping current all permits. Tenant shall submit copies of all approved
plans and permits to Landlord and shall post the original permit on the Premises
prior to the commencement of any work.
C. Requirements and Procedures
1. All structural and floor loading requirements shall be subject to the
prior approval of Landlord's structural engineer.
2. All mechanical (HVAC, plumbing and sprinkler) and electrical
requirements shall be subject to the approval of Landlord's mechanical and
electrical engineers and all mechanical and electrical work shall be performed
by contractors who are engaged by Landlord in constructing, operating or
maintaining the Building. When necessary, Landlord will require engineering and
shop drawings, which drawings must be approved by Landlord before work is
started. Drawings are to be prepared by Tenant and all approvals shall be
obtained by Tenant.
3. Elevator service for construction work shall be charged to Tenant at
standard Building rates after normal business hours. Prior arrangements for
elevator use shall be made with Building manager by Tenant. No material or
equipment shall be carried under or on top of elevators. If an operating
engineer is required by any union regulations, such engineer shall be paid for
by Tenant after normal business hours.
4. If shutdown of risers and mains for electrical, HVAC, sprinkler and
plumbing work is required, such work shall be supervised by Landlord's
representative. No work will be performed in Building mechanical equipment rooms
without Landlord's approval and under Landlord's supervision.
5. Tenant's contractor shall:
(i) have a superintendent or xxxxxxx on the Premises at all times;
(ii) police the job at all times, continually keeping the Premises
orderly;
(iii) maintain cleanliness and protection of all areas, including
elevators and lobbies.
(iv) protect the front and top of all peripheral HVAC units and
thoroughly clean them at the completion of work;
(v) block off supply and return grills, diffusers and ducts to keep
dust from entering into the Building air conditioning system; and
(vi) avoid the disturbance of other tenants.
6. If Tenant's contractor is negligent in any of its responsibilities,
Tenant shall be charged for corrective work.
7. All equipment and installations must be equal to the standards generally
in effect with respect to the remainder of the Building. Any deviation from such
standards will be permitted only if indicated or specified on the plans and
specifications and approved by Landlord.
E-4
8. A properly executed air balancing report signed by a professional
engineer shall be submitted to Landlord upon the completion of all HVAC work.
9. Upon completion of the Alterations, Tenant shall submit to Landlord a
permanent certificate of occupancy and final approval by the other governmental
agencies having jurisdiction.
10. Tenant shall submit to Landlord a final "as-built" set of drawings
showing all items of the Alterations in full detail.
11. Additional and differing provisions in the Lease, if any, will be
applicable and will take precedence.
D. Standards for Plans and Specifications.
Whenever Tenant shall be required by the terms of the Lease (including this
Exhibit) to submit plans to Landlord in connection with any Alterations, such
plans shall include at least the following:
1. Floor plan indicating location of partitions and doors (details required
of partition and door types).
2. Location of standard electrical convenience outlets and telephone
outlets.
3. Location and details of special electrical outlets; e.g., photocopiers,
etc.
4. Reflected ceiling plan showing layout of standard ceiling and lighting
fixtures. Partitions to be shown lightly with switches located indicating
fixtures to be controlled.
5. Locations and details of special ceiling conditions, lighting fixtures,
speakers, etc.
6. Location and specifications of floor-covering, paint or paneling with
paint colors referenced to standard color system.
7. Finish schedule plan indicating wall covering, paint, or paneling with
paint colors referenced to standard color system.
8. Details and specifications of special millwork, glass partitions,
rolling doors and grilles, blackboards, shelves, etc.
9. Hardware schedule indicating door number keyed to plan, size, hardware
required including butts, latchsets or locksets, closures, stops, and any
special items such as thresholds, soundproofing, etc. Keying schedule is
required.
10. Verified dimensions of all built-in equipment (file cabinets, lockers,
plan files, etc.)
11. Location and weights of storage files.
12. Location of any special soundproofing requirements.
13. Location and details of special floor areas exceeding 50 pounds of live
load per square foot.
14. All structural, mechanical, plumbing and electrical drawings, to be
prepared by the base building consulting engineers, necessary to complete the
Premises in accordance with Tenant's Plans.
15. All drawings to be uniform size (30" x 46") and shall incorporate the
standard project electrical and plumbing symbols and be at a scale of 1/8" = 1'
or larger.
16. All drawings shall be stamped by an architect (or, where applicable, an
engineer) licensed in the jurisdiction in which the Property is located and
without limiting
E-5
the foregoing, shall be sufficient in all respects for submission to applicable
authorization in connection with a building permit application.
E-6
ATTACHMENT II TO EXHIBIT E
CONTRACTOR'S INSURANCE REQUIREMENTS
Building: 000 Xxxx Xxxxxxx Xxxxxx; Xxxxxxx, Xxxxxxxx
Landlord: 000 Xxxx Xxxxxxx Xxxxx, LLC
Tenant: American Prepaid Professional Services, Inc.
Premises: Suite 900 on the 9th floor of the Building
The undersigned contractor or subcontractor ("CONTRACTOR") has been hired by the
tenant named above (hereinafter called "TENANT") of the Building named above (or
by Tenant's contractor) to perform certain work ("WORK") for Tenant in the
Premises identified above. Contractor and Tenant have requested the landlord
named above ("LANDLORD") to grant Contractor access to the Building and its
facilities in connection with the performance of the Work, and Landlord agrees
to grant such access to Contractor upon and subject to the following terms and
conditions:
1. Contractor agrees to indemnify and save harmless Landlord and its
respective officers, employees and agents and their affiliates, subsidiaries and
partners, and each of them, from and with respect to any claims, demands, suits,
liabilities, losses and expenses, including reasonable attorneys' fees, arising
out of or in connection with the Work (and/or imposed by law upon any or all of
them) because of personal injuries, bodily injury (including death at any time
resulting therefrom) and loss of or damage to property, including consequential
damages, whether such injuries to person or property are claimed to be due to
negligence of the Contractor, Tenant, Landlord or any other party entitled to be
indemnified as aforesaid except to the extent specifically prohibited by law
(and any such prohibition shall not void this Agreement but shall be applied
only to the minimum extent required by law).
2. Contractor shall provide and maintain at its own expense, until
completion of the Work, the following insurance:
(a) Workmen's Compensation and Employers, Liability Insurance covering
each and every xxxxxxx employed in, about or upon the Work, as provided for in
each and every statute applicable to Workmen's Compensation and Employers'
Liability Insurance.
(b) Comprehensive General Liability Insurance including coverages for
Protective and Contractual Liability (to specifically include coverage for the
indemnification clause of this Agreement) for not less than the following
limits:
Personal Injury:
$3,000,000 per person
$10,000,000 per
occurrence
Property Damage:
$3,000,000 per occurrence $3,000,000 aggregate
(c) Comprehensive Automobile Liability Insurance (covering all owned,
non-owned and/or hired motor vehicles to be used in connection with the Work)
for not less than the following limits:
Bodily Injury:
$1,000,000 per person
$1,000,000 per occurrence
Property Damage:
$1,000,000 per occurrence
Contractor shall furnish a certificate from its insurance carrier or
carriers to the Building office before commencing the Work, showing that it has
complied with the above requirements regarding insurance and providing that the
insurer will give Landlord ten (10) days' prior written notice of the
cancellation of any of the foregoing policies.
E-7
3. Contractor shall require all of its subcontractors engaged in the Work
to provide the following insurance:
(a) Comprehensive General Liability Insurance including Protective and
Contractual Liability coverages with limits of liability at least equal to the
limits stated in paragraph 2(b).
(b) Comprehensive Automobile Liability Insurance (covering all owned,
non-owned and/or hired motor vehicles to be used in connection with the Work)
with limits of liability at least equal to the limits stated in paragraph 2(c).
Upon the request of Landlord, Contractor shall require all of its
subcontractors engaged in the Work to execute an Insurance Requirements
agreement in the same form as this Agreement.
Agreed to and executed this day of ______, 20__.
Contractor:
By:
------------------------------------
By:
------------------------------------
By:
------------------------------------
E-8
EXHIBIT F
WORKLETTER
1. ACCEPTANCE OF PREMISES; WORKLETTER. Tenant accepts the Premises in "as
is" condition. The performance by Tenant of the construction of the initial
Tenant Alterations and the payment by Landlord of Landlord's Contribution shall
be governed by the terms of this workletter ("WORKLETTER") and the Lease.
2. SPACE PLANS.
(a) PREPARATION AND DELIVERY. Tenant shall deliver to Landlord a space
plan prepared by a design consultant reasonably acceptable to Landlord (the
"ARCHITECT") depicting improvements to be installed in the Premises (the
"SPACE PLANS").
(b) APPROVAL PROCESS. Landlord shall notify Tenant in writing whether
it approves of the submitted Space Plans within five (5) days after
Tenant's submission thereof. If Landlord disapproves of such Space Plans,
then Landlord shall notify Tenant thereof specifying in reasonable detail
the reasons for such disapproval, in which case Tenant shall, within five
(5) Business Days after such notice, revise such Space Plans in accordance
with Landlord's objections and submit to Landlord for its review and
approval. Landlord shall notify Tenant in writing whether it approves of
the resubmitted Space Plans within three (3) Business Days after its
receipt thereof. This process shall be repeated until the Space Plans have
been finally approved by Landlord and Tenant.
3. WORKING DRAWINGS.
(a) PREPARATION AND DELIVERY. Tenant shall provide to Landlord for its
approval final working drawings, prepared by the Architect, of all
improvements that Tenant proposes to install in the Premises as part of the
Work (as hereinafter defined); such working drawings shall include the
partition layout, ceiling plan, electrical outlets and switches, telephone
outlets, drawings for any modifications to the mechanical and plumbing
systems of the Building, and detailed plans and specifications for the
construction of the improvements called for under this Workletter in
accordance with all applicable Laws.
(b) APPROVAL PROCESS. Landlord shall notify Tenant in writing whether
it approves of the submitted working drawings within five (5) Business Days
after Tenant's submission thereof. If Landlord disapproves of such working
drawings, then Landlord shall notify Tenant in writing thereof specifying
in reasonable detail the reasons for such disapproval, in which case Tenant
shall, within five (5) Business Days after such notice, revise such working
drawings in accordance with Landlord's objections and submit the revised
working drawings to Landlord for its review and approval. Landlord shall
notify Tenant in writing whether it approves of the resubmitted working
drawings within five (5) Business Days after its receipt thereof. This
process shall be repeated until the working drawings have been finally
approved by Tenant and Landlord.
4. LANDLORD'S APPROVAL; PERFORMANCE OF WORK. If any of Tenant's proposed
construction work will affect the Building's structure or systems of the
Building, including but not limited to electrical, mechanical life safety and
HVAC (collectively, "Building's Systems"), then the working drawings pertaining
thereto must be approved by Landlord's engineer. Landlord's approval of such
working drawings shall not be unreasonably withheld, delayed or conditioned,
provided that (1) they comply with all laws, (2) the improvements depicted
thereon do not adversely affect (in the reasonable discretion of Landlord) the
Building's structure or the Building's Systems (including the Building's
restrooms or mechanical rooms), the exterior appearance of the Building, or the
appearance of the Building's Common Facilities, (3) such working drawings are
sufficiently detailed to allow construction of the improvements in a good and
workmanlike manner, and (4) the improvements depicted thereon conform to the
rules and regulations promulgated from time to time by Landlord for the
construction of Tenant Alterations. As used herein, "WORKING DRAWINGS" shall
mean the final working drawings approved by Landlord, as amended from time to
time by any approved changes thereto, and
F-1
"WORK" shall mean all improvements to be constructed in accordance with and as
indicated on the Working Drawings, together with any work required by
governmental authorities to be made to other areas of the Building as a result
of the improvements indicated by the Working Drawings. Landlord's approval of
the Working Drawings shall not be a representation or warranty of Landlord that
such drawings are adequate for any use or comply with any Law, but shall merely
be the consent of Landlord thereto. After the Working Drawings have been
approved, and Tenant has complied with all the terms and conditions set forth
herein and the insurance requirements attached to this Workletter, Tenant shall
cause the Work to be performed substantially in accordance with the Working
Drawings and the provisions of SECTION 5.2 of the Lease and the Rules and
Regulations for Tenant Alterations promulgated by Landlord from time to time,
except to the extent such provisions are inconsistent with this Workletter.
Tenant shall have the right to competitively bid the Work; provided, however,
the contractors and subcontractors shall be subject to Landlord's reasonable
approval.
5. CHANGE ORDERS. Tenant may initiate changes in the Work. Each such change
must receive the prior written approval of Landlord, such approval not to be
unreasonably withheld, delayed or conditioned; however, if such requested change
would adversely affect (in the reasonable discretion of Landlord) (a) the
Building's structure or the Building's Systems (including the Building's
restrooms or mechanical rooms), (b) the exterior appearance of the Building, or
(c) the appearance of the Building's Common Facilities, Landlord may withhold
its consent in its sole and absolute discretion. Tenant shall, upon completion
of the Work, furnish Landlord with an accurate architectural "as-built" plan of
the Work as constructed, which plan shall be incorporated into this Workletter
by this reference for all purposes.
6. EXCESS COSTS. The entire cost of performing the Work (including design
of the Work and preparation of the Working Drawings, architectural fees and
expenses, costs of construction labor and materials, electrical usage during
construction, additional janitorial services, general tenant signage, related
taxes and insurance costs, and the construction supervision fee referenced in
SECTION 7 of this Workletter, all of which costs are herein collectively called
the "TOTAL CONSTRUCTION COSTS") in excess of the Landlord's Contribution
{hereinafter defined) shall be paid by Tenant. Tenant shall not be charged by
Landlord for hoisting, security or elevator operator service during normal
business hours.
7. LANDLORD'S CONTRIBUTION. Landlord shall provide to Tenant a construction
allowance (the "Landlord's Contribution") in the amount of $380,358.00 (i.e.,
$22.00 per square foot in the Premises). Landlord shall disburse up to
$207,468.00 (i.e. $12.00 per square foot in the Premises) of the Landlord's
Contribution within thirty (30) days following Tenant's request therefor, at any
time following the full execution and delivery of this Lease by all parties.
Additionally, up to $172,890.00 (i.e. $10.00 per square foot in the Premises),
being the balance of the Landlord's Contribution, shall be paid to the general
contractor and architect in period disbursements, within 20 days following
receipt by Landlord of each of the following with respect to the portion of the
Work reflected in each disbursement: (1) receipted bills covering all labor and
materials expended and used in such portion of the Work; (2) a sworn
contractor's affidavit from the construction manager and a request to disburse
from Tenant; (3) contractor's, subcontractor's, and materials supplier's lien
waivers for such portion of the Work; and (4) the certification of Tenant and
its architect that such portion of the Work has been completed in a good and
workmanlike manner in accordance with approved plans, and in accordance with
applicable Laws. Such portion of the Landlord's Contribution shall be disbursed
in the amount reflected on the receipted bills meeting the requirements above.
Prior to the final disbursement of the Landlord's Contribution, Tenant shall
provide Landlord with full and final lien waivers for all Work, and Tenant shall
provide Landlord with as-built plans of the Work within 90 days after completion
of the Work. Tenant shall reimburse Landlord for the reasonable actual costs or
expenses actually incurred by Landlord, if any, for third party review of
Tenant's Space Plans, Working Drawings or the Work within thirty (30) days
following Landlord's demand therefor. Notwithstanding anything herein to the
contrary, Landlord shall not be obligated to disburse any portion of the
Landlord's Contribution during the continuance of an uncured Event of Default
under the Lease, and Landlord's obligation to disburse shall only resume when
and if such Event of Default is cured. The Landlord's Contribution must be used
within twelve (12) months following the Commencement Date or shall be deemed
forfeited with no further obligation by Landlord with respect thereto.
(initials)
F-2
8. CONSTRUCTION REPRESENTATIVES. Landlord's Construction Representative and
Tenant's Construction Representative for coordination of construction and
approval of the Tenant Alterations and any change orders will be as set forth in
SECTION 1.1 of the Lease, provided that either party may change its
representative upon written notice to the other.
(initials)
F-3
EXHIBIT G
ADDITIONAL PROVISIONS
I. EXTENSION OPTION.
A. Landlord hereby grants to Tenant an option to extend the Term of this
Lease ("Extension Option") on terms, conditions and provisions to be negotiated
by Landlord and Tenant for one (1) period of five (5) years (the "Extension
Period"), which Extension Period shall commence on the date immediately
following the last day of the initial Term.
B. Tenant's Extension Option shall be exercisable by written notice
("Tenant's Extension Notice") from Tenant to Landlord given no later than twelve
(12) months prior to the expiration of the initial Term, time being of the
essence. If not so exercised, Tenant's Extension Option shall thereupon expire.
C. The Basic Rent during the Extension Period shall equal the "Fair Market
Rental Rate" as hereinafter defined. Tenant shall continue to pay Escalation
Charges for the Premises during the Extension Period in accordance with the
terms of this Lease. For purposes of this Lease, the "Fair Market Rental Rate"
shall mean the rent at which the Premises would be leased for the extension of
the Term, in its then-existing condition, in an arms-length transaction between
a willing landlord and tenant in the office space market existing in the West
Loop area of downtown Chicago, Illinois (taking into account the location of the
Building in such submarket) on the applicable date, taking into account all
relevant facts and considerations, including base rents, rent escalations, rent
abatements, allowances (such as tenant improvements, space planning, working
drawing and moving allowances), commissions, operating expenses, real estate
taxes and other economic terms contained in recently signed leases for premises
of similar size, location and configuration in comparable buildings in the such
submarket (taking into account the location of the Building in such submarket).
The Landlord and Tenant hereby agree that the creditworthiness of tenants shall
be a relevant factor in determining Fair Market Rental Rate hereunder. Landlord
and Tenant shall negotiate the Basic Rent and Escalation Charges for the
Premises applicable to the Extension Period in good faith for a period of thirty
(30) days following Landlord's receipt of Tenant's Extension Notice. If Landlord
and Tenant are unable to agree in writing within said thirty (30) day period, on
the Basic Rent and Escalation Charges for the Premises payable during the
Extension Period, either party, by delivery of written notice (an "ARBITRATION
NOTICE") to the other within ten (10) days following the expiration of the
aforesaid thirty (30) day period, shall have the right to cause the Basic Rent
and Escalation Charges to be determined by arbitration pursuant to Paragraph F.
below. In the event neither party timely delivers an Arbitration Notice,
Tenant's Extension Option shall be null and void and of no force or effect.
D. Tenant may only exercise its Extension Option and an exercise thereof
shall only be effective, if at the time of Tenant's exercise of the Extension
Option and on the commencement date of the Extension Period, this Lease is in
full force and effect and no event or circumstance exists which, with the giving
of notice or the passage of time, or both, could constitute a default by Tenant
under this Lease, and, inasmuch as the Extension Option is intended only for the
original Tenant named in this Lease, at least one full floor in the Building is
then occupied by the original Tenant herein, and Tenant has not assigned this
Lease. Without limitation of the foregoing, no sublessee or assignee shall be
entitled to exercise the Extension Option.
E. Upon the agreement by Landlord and Tenant as to the terms, conditions
and provisions applicable to the Extension Period, at the request of either
party hereto and within thirty (30) days after such request, Landlord and Tenant
shall enter into a written amendment to this Lease confirming the terms,
conditions and provisions applicable to the Extension Period as determined in
accordance with the provisions of this Section I, with such revisions to the
Basic Rent and Escalation Charges provisions of this Lease as may be necessary.
F. If either party timely delivers an Arbitration Notice to the other,
within five (5) business days following delivery of the Arbitration Notice,
Landlord and Tenant shall each simultaneously submit to each other in a sealed
envelope its good faith estimate of the Fair Market Rental Rate. If the higher
of such estimate is not more than one hundred five percent
G-1
(105%) of the lower of such estimates, then the Fair Market Rental Rate shall
be the mean average of the two estimates.
If Landlord and Tenant are unable to resolve the determination of the Fair
Market Rental Rate by exchange of estimates, then within five (5) business days
after the exchange of estimates, each of the parties shall select an appraiser.
If the two appraisers are unable to agree upon either the Landlord's or the
Tenant's estimate of the Fair Market Rental Rate within fifteen (15) days after
the appointment of fee second appraiser, the two appraisers shall jointly
nominate and appoint a third appraiser within fifteen (15) days after the
expiration of the previous fifteen (15) day period and give written notice of
such appointment to both parties. Once the appraisers have been selected as
provided above, then, as soon as thereafter as practicable, but in any case
within thirty (30) days, the appraisers shall select one of the two estimates of
the Fair Market Rental Rate submitted by Landlord and Tenant, and the estimate
so selected by a majority of the appraisers shall be the Fair Market Rental Rate
for the Extension Period. The decision of the appraisers of the Fair Market
Rental Rate shall be submitted in writing to, and be final and binding on,
Landlord and Tenant. Each appraiser shall afford both parties a hearing and the
right to submit evidence, with the privilege of cross examination in connection
with its determination of the Fair Market Rental Rate. In the event any
appraiser appointed as aforesaid shall die or become unable or unwilling to act
before completion of the appraisal, such appraiser's successor shall be
appointed in the same manner as provided above. Any appraiser appointed
hereunder shall (i) be independent of both parties (and of all persons and
entities with an interest in either party); (ii) have not less than five (5)
years' experience in the appraisal of real property in the Chicago metropolitan
area; and (iii) hold the professional designation M.A.I. or if the designation
M.A.I. ceases to exist, a comparable designation from an equivalent professional
appraiser organization. All appraisal fees and expenses shall be borne equally
by the parties.
II. RIGHT OF FIRST OFFER
Landlord hereby grants to Tenant the continuous right of first offer to
lease any and all space located on the 8th or 10th floors of the Building (each
such space referred to herein as an "Offer Space") on the terms and conditions
hereinafter set forth:
A. Prior to offering the Offer Space to the public for lease, Landlord
shall give Tenant written notice (an "Offer Notice") of the date of commencement
of the term of the demise (the "Offer Space Commencement Date"), the location
and square footage thereof, and the rental rate and other economic terms
applicable to such Offer Space, which shall be at the Fair Market Rental Rate as
defined in Section C below as reasonably determined by Landlord. The Offer Space
Commencement Date shall not be less than ninety (90) days after the date on
which Landlord and Tenant execute an amendment documenting the demise of the
Offer Space, which amendment shall be fully executed and delivered within
forty-five (45) days after the Offer Notice is given by Landlord.
B. Tenant's right to lease the Offer Space from Landlord shall be
exercisable by written notice from Tenant to Landlord of Tenant's election to
exercise said right given not later than five (5) business days after Landlord's
Offer Notice is given, time being of the essence. Tenant may not elect to lease
less than the entire area of Offer Space described in Landlord's Offer Notice.
If Tenant does not timely exercise its option to lease the entire Offer Space,
Tenant's right to lease the Offer Space shall thereupon expire and Landlord
shall have the right to lease the Offer Space to a third party; provided,
however, in the event Landlord does not enter into a new lease with a third
party for the Offer Space within twenty-four (24) months following the date
Landlord's Office Notice is given, Tenant shall once again have a right of first
offer with respect to such Offer Space on such terms and otherwise as set forth
in this SECTION II.
C. The Basic Rent for the Offer Space shall equal the "Fair Market Rental
Rate" as hereinafter defined and Tenant shall to pay Escalation Charges for the
Offer Space on the terms set forth in this Lease. For purposes of determining
Rent for the Offer Space, the "Fair Market Rental Rate" shall mean the rent at
which the Offer Space would be leased for the term set forth in the Offer
Notice, in its then-existing condition, in an arms-length transaction between a
willing landlord, and tenant in the office space market existing in the West
Loop area of downtown Chicago, Illinois (taking into account the location of the
Building in such submarket) on the applicable date, taking into account all
relevant facts and considerations, including base rents, rent escalations, rent
abatements, allowances (such as tenant improvements, space
G-2
planning, working drawing and moving allowances), commissions, operating
expenses, real estate taxes and other economic terms contained in recently
signed leases for premises of similar size, location and configuration in
comparable buildings in the such submarket (taking into account the location of
the Building in such submarket). The Landlord and Tenant hereby agree that the
creditworthiness of tenants shall be a relevant factor in determining Fair
Market Rental Rate hereunder.
D. Tenant may only exercise its right to lease the Offer Space, and an
exercise thereof shall only be effective, if at the time of Tenant's exercise of
said right and on the Offer Space Commencement Date, this Lease is in full force
and effect and Tenant is not in default under this Lease and (inasmuch as such
options are intended only for the benefit of the original named Tenant), the
entire Premises is occupied by the original named Tenant. In addition to the
condition set forth in the first sentence of this subparagraph (D), if Tenant is
in default under this Lease within thirty (30) days prior to the Offer Space
Commencement Date, and has not cured such default prior to said Offer Space
Commencement Date, then, at Landlord's option, Tenant's right to exercise its
option may be terminated and rendered null and void by notice thereof from
Landlord to Tenant. No sublessee or assignee shall be entitled to exercise such
option.
E. If Tenant has validly exercised its right to lease the Offer Space,
then, effective as of the Offer Space Commencement Date, such Offer Space shall
be included in the Premises, subject to all of the terms, conditions and
provisions of this Lease, except as follows:
(i) The Premises Rentable Area shall be increased by the rentable
area of the Offer Space, and Tenant's Proportionate Share shall be
increased in a corresponding manner;
(ii) The term of the demise covering such Offer Space shall
commence on the Offer Space Commencement Date and shall expire on the
date set forth in the Offer Notice;
(iii) The monthly Basic Rent for such Offer Space shall be at the
rental rate set forth in the Offer Notice;
(iv) Such other terms shall be included as are reasonably
required to conform to the terms upon which Landlord was prepared to
lease the Offer Space to a third party; and
(v) Landlord shall perform and/or pay the cost of tenant
improvements in the Offer Space to the same extent as described in
the Offer Notice.
F. If Tenant has validly exercised its right to lease the Offer Space, at
the request of either party hereto, Landlord and Tenant shall enter into a
written amendment to this Lease confirming the terms, conditions and provisions
applicable to such Offer Space as determined in accordance herewith.
G. If Landlord should be unable on the Offer Space Commencement Date to
deliver possession of all or any portion of the Offer Space to be delivered on
such Offer Space Commencement Date despite Landlord's exercise of good faith and
reasonable efforts to do so, Landlord shall not be subject to any liability for
failure to deliver possession. Such failure to deliver possession shall not
affect either the validity of this Lease or the obligations of either Landlord
or Tenant hereunder or be construed to extend the expiration of the Term of this
Lease either as to such Offer Space or the balance of the Premises; provided,
however, that under such circumstances, Rent shall not commence as to such Offer
Space until Landlord is able to deliver possession, and Tenant shall
nevertheless have the right to rescend its exercise its right to lease the Offer
Space if Landlord is unable to deliver possession of all or any portion of the
Offer Space on the date which is 120 days after the original Office Space
Commencement Date, subject to extension for events of force majeure and delays
caused by Tenant.
H. Tenant's right of first offer is expressly subject and subordinate to
the expansion and renewal rights now or hereafter existing of other tenants in
the Building to lease the Offer Space.
G-3
III. STORAGE SPACE
At Tenant's request and to the extent available (as determined by Landlord
in its sole discretion), in addition to the office portion of the Premises,
Landlord shall lease to Tenant storage space (the "Storage Space") of a size and
in an area in the Building designated by Landlord and reasonably acceptable to
Tenant. Landlord shall have the right, by delivery of 60 days prior written
notice, to relocate Tenant's Storage Space to other storage space in the
Building of comparable size, utility and access to the original Storage Space.
If Tenant leases the Storage Space from Landlord, the Storage Space shall
constitute part of the Premises; provided, however, Landlord shall not be
obligated to furnish any Building services with respect to the Storage Space
other than freight elevator service in common with other tenants in the Building
on a first come, first served basis, and Building standard electric lighting,
and Tenant shall accept the Storage Space in its "as is" condition. Throughout
the initial Term, Tenant shall pay Basic Rent for the Storage Space on a monthly
basis at the annual rate of $20.00 per square foot, and Tenant shall not be
obligated to pay Escalation Charges with respect to the Storage Space.
G-4
EXHIBIT H
CLEANING SPECIFICATIONS
SERVICE TO TENANT AREAS FREQUENCY
----------------------- ---------
Empty all waste baskets and trash containers and remove refuse to 5/week
trash disposal area.
Clean exterior surfaces of waste baskets and trash containers to 2/month
remove any residue.
Empty, clean and damp wipe all ash trays and cigarette urns. 5/week
Dust all mid-range furniture, file cabinets and desktops. 5/week
High dusting. 1/week
Low dusting. 1/week
Clean and disinfect telephones. 1/week
Damp wipe sink/coffee bar areas. 5/week
Spot clean all glass, polished chrome and aluminum, brass, bronze 1/week
and stainless steal to remove dirt, fingerprints and smudges.
Wipe all doors facing, doors, light switch and receptacle covers, 1/month
walls and partitions as needed to remove dust, dirt, smudges, stains
and fingerprints.
Dust all wood paneling to remove dust. 4/year
Vacuum all fabric-covered walls to remove dust. 4/year
Vacuum all upholstered or fabric-covered furniture. 1/month
Damp wipe all vinyl-covered furniture. 1/month
Dust and clean overhead vents to remove dust and dirt. 1/month
Damp wipe door knobs. 1/week
Dust Venetian blinds. 2/year
Clean metal kickplates to remove dust, dirt, stains, smudges and 2/month
scuff and heel marks.
Vacuum high traffic carpeted areas. 5/week
Detail vacuum corners, edges and under furniture. 1/month
Spot clean carpets to remove spills, spots and stains. Normal wear 1/week
and tear accepted.
Dust mop all hard surface floors and wet wipe spots. 3/week
Wet mop all hard surface floors. 1/week
Polish all floor surfaces with a heavy duty commercial buffer. 1/month
Refinish all floor surfaces with two coats of non-skid premium 2/years
quality floor finish.
H-1
FIRST AMENDMENT TO LEASE
THIS FIRST AMENDMENT TO LEASE (this "AMENDMENT") is made as of the 8th day
of September, 2004, by and between 200 WEST XXXXXXX OWNER LLC, a Delaware
limited liability company ("LANDLORD"), and COMPBENEFITS DENTAL AND VISION
COMPANY, a Florida corporation ("TENANT").
RECITALS
A. WHEREAS, Landlord and Tenant (formerly known as American Prepaid
Professional Services, Inc.) have entered into that certain lease dated October
15, 2003 (the "LEASE"), leasing to Tenant certain premises in the building
situated on the real estate located at 000 Xxxx Xxxxxxx Xxxxxxxxx, Xxxxxxx,
Xxxxxxxx (the "LAND") and known as 200 West Xxxxxxx (the "BUILDING");
B. WHEREAS, pursuant to the Lease, Tenant is currently leasing 17,289
rentable square feet of space on the 9th floor of the Building commonly known as
Suite 900, for a term expiring on October 31, 2009 (the "TERMINATION DATE") (the
"ORIGINAL PREMISES"); and
C. WHEREAS, Tenant has requested that additional space containing
approximately 5,123 rentable square feet (the "EXPANSION PREMISES RENTABLE
AREA") on the 7th floor of the Building commonly known as Suite 750 and depicted
on EXHIBIT A attached hereto (the "EXPANSION PREMISES") be added to the Original
Premises and that the Lease be appropriately amended, and Landlord is willing to
do the same on the following terms and conditions.
NOW, THEREFORE, in consideration of the mutual covenants contained herein
and other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, Landlord and Tenant hereby amend the Lease as follows:
1. DEFINITIONS. The capitalized terms used herein shall have the same
definitions and meanings as set forth in the Lease unless otherwise defined
herein or modified by the provisions hereof. In addition, terms not defined in
the Lease but defined herein will, when delineated with initial capital letters,
have the meanings ascribed thereto in this Amendment. Terms and phrases that are
not delineated herein shall have the meanings commonly ascribed thereto.
2. EXPANSION. Effective as of the Expansion Effective Date (defined below),
the Premises Rentable Area, as defined in the Lease, is increased from 17,289
rentable square feet on the 9th floor to 22,412 rentable square feet on the 7th
and 9th floors by the addition of the Expansion Premises, and from and after the
Expansion Effective Date, the Original Premises and the Expansion Premises,
collectively, shall be deemed the Premises, as defined in the Lease. The Term
for the Expansion Premises shall commence on the Expansion Effective Date and
end on the Termination Date. The Expansion Premises is subject to all the terms
and conditions of the Lease except as expressly modified herein and except that
Tenant shall not be entitled to receive any allowances, abatements or other
financial concessions granted with respect to the Original Premises unless such
allowances, abatements and other financial concessions are expressly
provided for herein with respect to Expansion Premises. The "EXPANSION EFFECTIVE
DATE" shall be October 1, 2004; provided, however, the Expansion Effective Date
shall be delayed to the extent that Landlord fails to deliver possession of the
Expansion Premises for any reason (other than delays by Tenant), including but
not limited to, holding over by prior occupants. Any such delay in the Expansion
Effective Date shall not subject Landlord to any liability for any loss or
damage resulting therefrom. Notwithstanding anything to the contrary contained
herein, in the event the Expansion Effective Date has not occurred on or before
November 1, 2004 (the "Outside Delivery Date") for any reason other than any
delay caused by Tenant or an event of Force Majeure, Tenant, as its sole remedy,
shall have the right to terminate the Lease with respect to the Expansion
Premises by giving Landlord written notice of termination on or before the
earlier to occur of (i) 5 Business Days following the Outside Delivery Date and
(ii) the date on which Landlord delivers the Expansion Premises to Tenant vacant
and free of any other tenancy.
3. BASIC RENT. Tenant shall continue to pay Basic Rent for the Original
Premises in accordance with the terms of the Lease through the Termination Date.
Effective as of the Expansion Effective Date, the schedule of Basic Rent for the
Expansion Premises through the Termination Date is as follows:
ANNUAL RENTAL RATE MONTHLY BASIC
PERIOD PER SQUARE FOOT ANNUAL BASIC RENT RENT
------ ------------------ ----------------- -------------
10/1/04-6/30/05 $24.00 $ 92,214.00* $10,246.00
7/1/05-6/30/06 $24.40 $125,001.24 $10,416.77
7/1/06-6/30/07 $24.80 $127,050.36 $10,587.53
7/1/07-6/30/08 $25.20 $129,099.60 $10,758.30
7/1/08-6/30/09 $25.60 $131,148.84 $10,929.07
7/1/09-10/31/09 $26.00 $ 44,399.32** $11,099.83
* based on a 9-month period
** based on a 4-month period
Notwithstanding anything to the contrary contained in the Lease, as amended
hereby, and provided that Tenant is not then in default under any of the terms,
covenants or conditions of the Lease, as amended hereby, beyond any applicable
cure periods, Basic Rent and Escalation Charges (as defined in the Lease)
attributable to the Expansion Premises shall xxxxx in full, and Tenant shall
have no liability therefore, until April 19, 2005, at which time Tenant shall
commence the payment of Basic Rent and Escalation Charges for the Expansion
Premises in accordance with the terms of this Amendment.
All such Basic Rent shall be payable in accordance with the terms of the Lease.
4. ESCALATION CHARGES. Tenant shall continue to pay Escalation Charges for
the Original Premises in accordance with the terms of the Lease. In addition,
from and after April 19, 2005 through the Termination Date, Tenant shall pay
Escalation Charges for the Expansion Premises, and Tenant's Proportionate Share
for the Expansion Premises shall be
2
1.0925% (which is based on the Expansion Premises Rentable Area divided by the
Building Rentable Area). All such Escalation Charges shall be payable in
accordance with the terms of the Lease.
5. PERFORMANCE OF WORK. Tenant accepts the Expansion Premises in "as is"
condition, without representation or warranty by Landlord, except as set forth
herein. Except as expressly set forth herein, Landlord shall not be obligated to
make any improvements or alterations to the Expansion Premises, the Original
Premises or the Building in connection with this Amendment, and any alterations
or improvements to the Original Premises and the Expansion Premises shall be
performed by Tenant at its sole cost and expense in compliance with the
provisions of the Lease, except as expressly provided in the work letter
attached hereto as EXHIBIT B. Landlord, at its sole cost and expense, shall
demise the Expansion Premises and shall bring the Building's electrical,
life-safety, and heating, ventilation and air conditioning systems to the
perimeter of the Expansion Premises.
6. LIMITATION OF LIABILITY. Landlord shall have no personal liability under
the Lease, as amended hereby; Landlord's liability shall be as set forth in
Section 15.3 of the Lease.
7. NO OFFER. The submission of this Amendment to Tenant shall not be
construed as an offer, nor shall Tenant have any rights under this Amendment
unless Landlord executes a copy of this Amendment and delivers it to Tenant.
8. INCORPORATION OF LEASE TERMS; CONFLICT. With the exception of those
matters set forth in this Amendment, Tenant's leasing of the Premises (i.e., the
Original Premises and the Expansion Premises) shall be subject to all terms,
covenants and conditions of the Lease. In the event of any conflict or
inconsistency between the terms of this Amendment and the terms of the Lease,
the terms of this Amendment shall control.
9. RATIFICATION. Tenant hereby ratifies and confirms Tenant's obligations
under the Lease, and Tenant hereby represents and warrants to Landlord that
Tenant has no defenses thereto. Tenant hereby further confirms and ratifies
that, as of the date of this Amendment, the Lease is and remains in good
standing and in full force and effect.
10. MISCELLANEOUS. The Lease and this Amendment shall be construed as one
instrument. In that regard, the Lease and this Amendment, including all exhibits
and addenda to each such document, constitute the entire agreement between the
parties relative to the subject matter hereof and thereof and supersede all
prior and contemporaneous agreements and understandings of Landlord and Tenant
in connection therewith. There have been no additional oral or written
representations or agreements by and between Landlord and Tenant. This Amendment
inures to the benefit of and shall be binding upon Landlord and Tenant and their
respective successors and permitted assigns. The recitals to this Amendment are
hereby incorporated as if fully set forth herein.
11. MULTIPLE COUNTERPARTS. To facilitate execution hereof, this Amendment
may be executed in one or more counterparts as may be convenient or required,
and an executed copy hereof delivered by facsimile shall have the effect of an
original, executed instrument. All
3
counterparts hereof shall collectively constitute a single instrument; but in
making proof of this Amendment, it shall not be necessary to produce or account
for more than one such counterpart. It shall not be necessary for the signature
of, or on behalf of, each party hereto, or that the signature of all persons
required to bind any such party, appear on each counterpart hereof. Each
signature page to any counterpart hereof may be detached from such counterpart
without impairing the legal effect of the signatures thereon and thereafter
attached to another counterpart hereof identical thereto except having attached
to it additional signature pages.
12. NO CONSTRUCTION AGAINST DRAFTSMAN. No inference in favor of or against
any party shall be drawn from the fact that such party has drafted any provision
of this Amendment or that such provisions have been drafted on behalf of said
party.
13. BROKER. Landlord and Tenant each warrant to the other that it has not
dealt with any broker or agent, other than MB Real Estate Services LLC and CB
Xxxxxxx Xxxxx, Inc., in connection with the negotiation or execution of the
Lease. Tenant and Landlord shall each indemnify the other against all costs,
expenses, attorneys' fees, and other liability for commissions or other
compensation claimed by any broker or agent claiming the same by, through, or
under the indemnifying party.
4
This Amendment is executed by the undersigned as of the date first above
written.
LANDLORD:
200 WEST XXXXXXX OWNER LLC,
A DELAWARE LIMITED LIABILITY COMPANY
By: 000 Xxxx Xxxxxxx Manager LLC,
a Delaware limited liability company,
its Manager
By: MassMutual/Boston Capital Mezzanine
Partners II, L.P., a Delaware
limited partnership, its sole Member
and Manager
By: Boston Mass II, LLC, a Delaware
limited liability company, its
General Partner
By: Babson Capital Management LLC, a
Delaware limited liability company,
a Manager
By: /s/ XXXXXX X. XXXXXX
------------------------------------
Name: XXXXXX X. XXXXXX
Title: MANAGING DIRECTOR
By: Boston Capital Institutional
Advisors LLC, a Delaware limited
liability company, a Manager
By: /s/ XXXX X. XXXXXX
------------------------------------
Name: XXXX X. XXXXXX
Title: EXECUTIVE VICE PRESIDENT
TENANT:
COMPBENEFITS DENTAL AND VISION COMPANY,
A FLORIDA CORPORATION
By: /s/ XXXXX X. XXXXXXXX
------------------------------------
Name: XXXXX X. XXXXXXXX
Title: Ex VP
5
EXHIBIT A
OUTLINE AND LOCATION OF THE EXPANSION PREMISES
(FLOOR PLAN)
000 XXXX XXXXXXX XXXX.
XXXXXXX XXXXXXXX
A-1
EXHIBIT B
WORKLETTER
1. ACCEPTANCE OF EXPANSION PREMISES; WORKLETTER. Subject to the provisions
set forth in Section 5 of the Amendment, Tenant accepts the Expansion Premises
in "as is" condition. The performance by Tenant of the construction of the
initial Tenant Alterations in the Expansion Premises and the payment by Landlord
of Landlord's Expansion Premises Contribution (as defined hereinafter) shall be
governed by the terms of this workletter ("WORKLETTER") and the Lease.
2. SPACE PLANS.
(a) PREPARATION AND DELIVERY. Tenant shall deliver to Landlord a space
plan for the Expansion Premises prepared by a design consultant reasonably
acceptable to Landlord (the "ARCHITECT") depicting improvements to be
installed in the Expansion Premises (the "SPACE PLANS").
(B) APPROVAL PROCESS. Landlord shall notify Tenant in writing whether
it approves of the submitted Space Plans within five (5) days after
Tenant's submission thereof. If Landlord disapproves of such Space Plans,
then Landlord shall notify Tenant thereof specifying in reasonable detail
the reasons for such disapproval, in which case Tenant shall, within three
(3) Business Days after such notice, revise such Space Plans in accordance
with Landlord's objections and submit to Landlord for its review and
approval. Landlord shall notify Tenant in writing whether it approves of
the resubmitted Space Plans within three (3) Business Days after its
receipt thereof. This process shall be repeated until the Space Plans have
been finally approved by Landlord and Tenant.
3. WORKING DRAWINGS.
(a) PREPARATION AND DELIVERY. Tenant shall provide to Landlord for its
approval final working drawings, prepared by the Architect, of all
improvements that Tenant proposes to install in the Expansion Premises as
part of the Work (as hereinafter defined); such working drawings shall
include the partition layout, ceiling plan, electrical outlets and
switches, telephone outlets, drawings for any modifications to the
mechanical and plumbing systems of the Building, and detailed plans and
specifications for the construction of the improvements called for under
this Workletter in accordance with all applicable Laws.
(b) APPROVAL PROCESS. Landlord shall notify Tenant in writing whether
it approves of the submitted working drawings within five (5) Business Days
after Tenant's submission thereof. If Landlord disapproves of such working
drawings, then Landlord shall notify Tenant in writing thereof specifying
in
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reasonable detail the reasons for such disapproval, in which case Tenant
shall, within five (5) Business Days after such notice, revise such working
drawings in accordance with Landlord's objections and submit the revised
working drawings to Landlord for its review and approval. Landlord shall
notify Tenant in writing whether it approves of the resubmitted working
drawings within five (5) Business Days after its receipt thereof. This
process shall be repeated until the working drawings have been finally
approved by Tenant and Landlord.
4. LANDLORD'S APPROVAL; PERFORMANCE OF WORK. If any of Tenant's proposed
construction work will affect the Building's structure or systems of the
Building, including but not limited to electrical, mechanical life safety and
HVAC (collectively, "BUILDING'S SYSTEMS"), then the working drawings pertaining
thereto must be approved by Landlord's engineer. Landlord's approval of such
working drawings shall not be unreasonably withheld, delayed or conditioned,
provided that (1) they comply with all laws, (2) the improvements depicted
thereon do not adversely affect (in the reasonable discretion of Landlord) the
Building's structure or the Building's Systems (including the Building's
restrooms or mechanical rooms), the exterior appearance of the Building, or the
appearance of the Building's Common Facilities, (3) such working drawings are
sufficiently detailed to allow construction of the improvements in a good and
workmanlike manner, and (4) the improvements depicted thereon conform to the
rules and regulations promulgated from time to time by Landlord for the
construction of Tenant Alterations. As used herein, "WORKING DRAWINGS" shall
mean the final working drawings approved by Landlord, as amended from time to
time by any approved changes thereto, and "WORK" shall mean all improvements to
be constructed in accordance with and as indicated on the Working Drawings,
together with any work required by governmental authorities to be made to other
areas of the Building as a result of the improvements indicated by the Working
Drawings. Landlord's approval of the Working Drawings shall not be a
representation or warranty of Landlord that such drawings are adequate for any
use or comply with any Law, but shall merely be the consent of Landlord thereto.
After the Working Drawings have been approved, and Tenant has complied with all
the terms and conditions set forth herein and the insurance requirements
attached to this Workletter, Tenant shall cause the Work to be performed
substantially in accordance with the Working Drawings and the provisions of
SECTION 5.2 of the Lease and the Rules and Regulations for Tenant Alterations
promulgated by Landlord from time to time, except to the extent such provisions
are inconsistent with this Workletter. Tenant shall have the right to
competitively bid the Work; provided, however, the contractors and
subcontractors shall be subject to Landlord's reasonable approval.
5. CHANGE ORDERS. Tenant may initiate changes in the Work. Each such change
must receive the prior written approval of Landlord, such approval not to be
unreasonably withheld, delayed or conditioned; however, if such requested change
would adversely affect (in the reasonable discretion of Landlord) (a) the
Building's structure or the Building's Systems (including the Building's
restrooms or mechanical rooms), (b) the exterior appearance of the Building, or
(c) the appearance of the Building's Common Facilities, Landlord may withhold
its consent in its sole and absolute discretion. Tenant
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shall, upon completion of the Work, furnish Landlord with an accurate
architectural "as-built" plan of the Work as constructed, which plan shall be
incorporated into this Workletter by this reference for all purposes.
6. EXCESS COSTS. The entire cost of performing the Work (including design
of the Work and preparation of the Working Drawings, architectural fees and
expenses, costs of construction labor and materials, electrical usage during
construction, additional janitorial services, general tenant signage, related
taxes and insurance costs, and the review fees referenced in SECTION 7 of this
Workletter, all of which costs are herein collectively called the "TOTAL
CONSTRUCTION COSTS") in excess of the Landlord's Expansion Premises Contribution
(hereinafter defined) shall be paid by Tenant. Tenant shall not be charged by
Landlord for hoisting, security or elevator operator service during normal
business hours.
7. LANDLORD'S EXPANSION PREMISES CONTRIBUTION. Landlord shall provide to
Tenant a construction allowance (the "LANDLORD'S EXPANSION PREMISES
CONTRIBUTION") in the amount of $107,070.70 (i.e., $20.90 per square foot in the
Expansion Premises). Landlord shall disburse the Landlord's Expansion Premises
Contribution within thirty (30) days following Tenant's request therefor, at any
time following the full execution and delivery of this Lease by all parties, to
the general contractor in periodic disbursements, within 20 days following
receipt by Landlord of each of the following with respect to the portion of the
Work reflected in each disbursement: (1) receipted bills covering all labor and
materials expended and used in such portion of the Work; (2) a sworn
contractor's affidavit from the construction manager and a request to disburse
from Tenant; (3) contractor's, subcontractor's, and materials supplier's lien
waivers for such portion of the Work; and (4) the certification of Tenant and
its architect that such portion of the Work has been completed in a good and
workmanlike manner in accordance with approved plans, and in accordance with
applicable Laws. The Landlord's Expansion Premises Contribution shall be
disbursed in the amount reflected on the receipted bills meeting the
requirements above. Prior to the final disbursement of the Landlord's Expansion
Premises Contribution, Tenant shall provide Landlord with full and final lien
waivers for all Work, and Tenant shall provide Landlord with as-built plans of
the Work within 90 days after completion of the Work. Tenant shall reimburse
Landlord for the reasonable actual costs or expenses actually incurred by
Landlord, if any, for third party review of Tenant's Space Plans, Working
Drawings or the Work within thirty (30) days following Landlord's demand
therefor. Notwithstanding anything herein to the contrary, Landlord shall not be
obligated to disburse any portion of the Landlord's Expansion Premises
Contribution during the continuance of an uncured Event of Default under the
Lease, as amended by the Amendment to which this Workletter is attached, and
Landlord's obligation to disburse shall only resume when and if such Event of
Default is cured. In the event the Landlord's Expansion Premises Contribution
exceeds the Total Construction Costs, up to $61,476.00 (i.e., $12.00 per square
foot in the Expansion Premises) of the Landlord's Expansion Premises
Contribution unused after payment of the Total Construction Costs shall be
applied to the payments of Rent next due under the Lease; provided, however, any
portion of the Landlord's Expansion Premises Contribution not disbursed within
twelve
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(12) months following the Expansion Effective Date shall be deemed forfeited
with no further obligation by Landlord with respect thereto.
8. CONSTRUCTION REPRESENTATIVES. Landlord's Construction Representative and
Tenant's Construction Representative for coordination of construction and
approval of the Tenant Alterations in the Expansion Premises and any change
orders will be as set forth in SECTION 1.1 of the Lease, provided that either
party may change its representative upon written notice to the other.
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