LEASE
By and Between
XXXXX AVENUE SENIOR HOLDINGS, LLC
("Landlord")
and
MARCAM SOLUTIONS, INC.
("Tenant")
00 XXXXX XXXXXX
XXXXXX, XXXXXXXXXXXXX 00000
TABLE OF CONTENTS
1. TERMS 2
2. PAYMENT OF RENT & ADDITIONAL RENT 4
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3. SECURITY DEPOSIT; ADVANCE DEPOSIT 5
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4. USES; TENANT COVENANTS 10
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5. ENVIRONMENTAL PROVISIONS; RECYCLING. 11
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6. LATE CHARGES; INTEREST 15
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7. REPAIRS AND MAINTENANCE 16
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8. UTILITIES AND SERVICES 17
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9. EXPENSE INCREASES. 19
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10. INCREASES IN REAL ESTATE TAXES 24
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11. ADDITIONAL PROVISIONS; OPERATING COSTS AND REAL ESTATE TAXES 26
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12. TENANT'S INSURANCE 26
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13. LANDLORD'S INSURANCE 27
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14. DAMAGE OR DESTRUCTION 27
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15. MACHINES AND EQUIPMENT; ALTERATIONS AND ADDITIONS: REMOVAL
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OF FIXTURES 30
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16. ACCEPTANCE OF PREMISES 33
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17. TENANT IMPROVEMENTS 33
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18. ACCESS 33
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19. MUTUAL WAIVER OF CLAIMS AND SUBROGATION 34
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20. INDEMNIFICATION 35
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21. ASSIGNMENT AND SUBLETTING 35
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22. ADVERTISING 39
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23. LIENS 40
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24. DEFAULT 40
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25. SUBORDINATION 44
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26. SURRENDER OF POSSESSION 45
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27. NON-WAIVER 45
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28. HOLDOVER 45
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29. CONDEMNATION 46
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30. NOTICES 48
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31. MORTGAGEE PROTECTION 48
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32. COSTS AND ATTORNEYS' FEES 48
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33. BROKERS 48
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34. LANDLORD'S LIABILITY AND DEFAULT 49
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35. ESTOPPEL CERTIFICATES 50
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36. FINANCIAL STATEMENTS 51
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37. TRANSFER OF LANDLORD'S INTEREST 51
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38. RIGHT TO PERFORM 52
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39. [INTENTIONALLY DELETED] 52
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40. SALES AND AUCTIONS 52
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41. NO ACCESS TO ROOF 52
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42. SECURITY 53
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43. AUTHORITY OF TENANT 53
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44. NO ACCORD OR SATISFACTION 53
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45. MODIFICATION FOR LENDER 53
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46. PARKING 53
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47. GENERAL PROVISIONS 54
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48. [INTENTIONALLY DELETED] 57
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49. WAIVER OF JURY TRIAL 57
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50. RENEWAL OPTION 57
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51. RIGHT OF FIRST OFFER. 59
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52. ADDITIONAL SCHEDULES 60
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EXHIBITS
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EXHIBIT A-1 Location and Dimensions of Premises
EXHIBIT A-2 Description of Land
EXHIBIT A-3 Depiction of Unreserved Parking Spaces
EXHIBIT B Declaration of Lease Commencement
EXHIBIT C Construction Exhibit
EXHIBIT D Rules and Regulations
EXHIBIT E Janitorial Specifications
EXHIBIT F Form Estoppel Certificate
EXHIBIT G [Intentionally Deleted]
EXHIBIT H Form of SNDA
LEASE
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THIS LEASE is made this 23rd day of October, 1998, by and between XXXXX
AVENUE SENIOR HOLDINGS, LLC, ("Landlord") c/o Wellsford Real Properties, Inc.,
000 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000, and MARCAM SOLUTIONS, INC. ("Tenant") with
a mailing address of 00 Xxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000.
R E C I T A L S:
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R-1. Landlord (as successor to Xxxxxxx X. Xxxxxxxx, as Trustee of
Xxxxxxxx Holding Trust under Declaration of Trust dated November 20, 1991 and
recorded with the Middlesex County Registry of Deeds in Book 21569, Page 368,
recorded November 27, 1991, record title holder for Xxxxx Research Associates
Limited Partnership, successor in interest to Xxxxxxx X. Xxxxxxxx) and Tenant
are currently parties to that certain Office Lease dated June 13, 1988, as
amended by that certain First Amendment to Lease dated as of October 11, 1989,
that certain Second Amendment to Lease dated as of August 29, 1990, that certain
Third Amendment to Lease dated as of August 29, 1990, that certain Fourth
Amendment to Lease dated as of June 30, 1992, that certain Fifth Amendment to
Lease dated as of May 10, 1993, and that certain Sixth Amendment to Lease dated
as of June 12, 1998 (as amended, the "Original Lease");
R-2. Tenant entered into a Sublease with Saracen Companies, Inc. dated
January 12, 1993, as amended by Amendment No. 1 to Sublease dated August 1,
1995, for an additional 33,277 rentable square feet, as well as a Letter dated
March 29, 1996 and a Letter dated December 4, 1997 for the leasing of additional
rentable square footage in the Premises;
R-3. By Letter of Understanding dated May 13, 1998, Tenant confirmed
that the Original Lease, and the other instruments referenced above constituted
a single direct lease between Landlord and Tenant for 128,398 rentable square
feet, for a Basic Rent of $218,707.11 per month (or $2,624,485.32 per annum) for
the entire Premises, plus Tenant's share of increases in Operating Expenses and
Taxes (which as of such date was stated to equal $1,332.00 per month);
R-4. The aforesaid Sixth Amendment to Lease provided for Tenant's
surrender of possession of a portion of the Premises to Landlord, and the
termination of all leasehold obligations with respect to such surrendered
portion of the Premises; and
R-5. Landlord and Tenant now wish to enter into a new lease agreement to
replace the Original Lease, on the terms and conditions hereinafter set forth.
W I T N E S S E T H :
THAT LANDLORD, for and in consideration of the rents and all other
charges and payments hereunder and of the covenants, agreements, terms,
provisions and conditions to be kept and performed hereunder by Tenant, hereby
grants and conveys to Tenant, and Tenant hereby hires and takes from Landlord, a
leasehold interest in the premises described below ("Premises"), subject to all
matters hereinafter set forth and upon and subject to the covenants, agreements,
terms, provisions and conditions of this Lease for the term hereinafter stated.
1. TERMS.
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1.1 Premises. The Premises demised by this Lease are approximately
102,494 rentable square feet on the first (1st) and second (2nd) floor of the
building located at 00 Xxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 (the
"Building"), together with a nonexclusive right to use parking and other common
areas. The land upon which the Building is situated, which is described in
Exhibit A-2 attached hereto and incorporated herein by reference, shall be
referred to hereinafter as the "Land". The location and dimensions of the
Premises are shown on Exhibit A-1, attached hereto and incorporated herein by
reference. No easement for light or air is incorporated in this Premises. The
rentable area of the Building is 228,250 square feet, and Landlord and Tenant
hereby stipulate that the rentable area of the Building and Premises are as set
forth herein.
1.2 Tenant's Share. "Tenant's Share" shall mean a fraction, the
numerator of which is the total rentable square footage of the Premises, and the
denominator of which is the total rentable square footage of the Building.
Tenant's Share as of the Commencement Date of this Lease shall be Forty-Four and
90/100 percent (44.9%) (calculated as 102,494/228,250). Tenant's Share shall be
adjusted for changes in the total rentable square footage of the Premises and/or
Building, including without limitation changes which may result from any
condemnation of a portion of the Building.
1.3 Lease Term. The term of this Lease (the "Term" or "Lease Term")
shall commence on the "Commencement Date", as defined in Section 1.4, below
(e.g., May 1, 1999), and shall expire seventy-two (72) months thereafter (e.g.,
April 30, 2005) (the "Lease Expiration Date"). Tenant shall be in occupancy of
the Premises prior to the Commencement Date pursuant to the terms of the
Original Lease, which shall continue in full force and effect between the date
of execution of this Lease and the Commencement Date hereunder, provided that on
and as of the Commencement Date hereunder, the Original Lease shall terminate
and cease to be of any further force and effect (except for any obligations
accrued thereunder prior to the Commencement Date hereunder, which accrued
obligations shall survive such termination), and Tenant's occupancy of the
Premises shall thereafter be subject to the terms and conditions of this Lease.
1.4 Commencement Date. The "Commencement Date" shall be May 1, 1999.
Landlord and Tenant hereby agree to execute a Declaration, in the form attached
hereto as Exhibit B, to confirm the Commencement Date. Tenant's failure to
execute said Declaration shall not affect the Commencement Date or the Lease
Expiration Date, as same are determined by the terms of this Lease.
Notwithstanding the foregoing provisions of this Section 1.4, for purposes of
this Lease, the term "Commencement Date" shall also mean any adjusted
Commencement Date which may be established pursuant to the operation of the
provisions of Exhibit C to this Lease.
1.5 Rent. The base rent payable by Tenant hereunder ("Base Rent") is set
forth in this Section 1.5, below. In addition to the Base Rent, Tenant shall pay
(as additional rent) Tenant's Share of Expense Increases as described in Section
9, Tenant's Share of Tax Increases as described in Section 10, and the increases
in Base Rent described in the table set forth below in this Section 1.5, below,
all of which shall be deemed additional rent due under this Lease. The
combination of Base Rent and additional rent as described in this Section 1.5 is
sometimes
collectively referred to in this Lease as "Rent". Base Rent shall be payable
monthly, in advance, on first day of each calendar month of the Term, without
prior notice, demand, deduction or offset, except as expressly set forth to the
contrary herein. The monthly payments of Rent for the Premises (which may be
referred to herein as "Monthly Rent") shall be as follows:
Annual Base Rent
Months Per Square Foot Annual Base Rent Monthly Rent
------ ---------------- ---------------- ------------
1 - 24 $28.00 $2,869,832.00 $239,152.67
25 - 48 $30.00 $3,074,820.00 $256,235.00
49 - 72 $32.00 $3,279,808.00 $273,317.33
1.6 Additional Rent. Any sum owed or reimbursable by Tenant to Landlord
under this Lease (excluding monthly Rent) shall be considered "additional rent"
hereunder, and, except for items of additional rent for which demand is required
pursuant to the express terms of this Lease, shall be payable without demand,
set-off or deduction, except as expressly set forth to the contrary herein. The
items of additional rent described in Section 1.5, above, shall be payable
monthly, in advance, on first day of each calendar month of the Term, together
with Tenant's monthly Rent payment.
1.7 [Intentionally Deleted]
1.8 Notice and Payment Addresses. Any notices under this Lease shall be
governed by the terms of Section 30, below. The notice addresses of the parties
are as follows:
If to Landlord: Xxxxx Avenue Senior Holdings, LLC
c/o Wellsford Real Properties, Inc.
000 Xxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
with a copy to: Xxxxxxxxx & Saas, P.C.
0000 Xxxx-Xxxx Xxxxxxx
Xxxxx 0000
Xxxxxxxx, Xxxxxxxx 00000
If to Tenant: 00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Either party may, upon (10) days' prior written notice to the other, designate a
new address to which all notices hereunder shall be directed.
1.9 Rent Payment Address. Tenant shall send payments of Rent and
additional rent hereunder to Landlord at the following address:
Xxxxx Avenue Deposit Account #00-00-00000
c/o Federal Savings Bank
X.X. Xxx 0000
Xxxxxxx, XX 00000
1.10 Lease Year. Each twelve (12) month period within the Lease Term
shall be referred to herein as a "Lease Year." The first Lease Year shall
commence on the Commencement Date and terminate on the last day of the twelfth
full calendar month after such Commencement Date. Each subsequent Lease Year
shall commence on the date immediately following the last day of the preceding
Lease Year and shall continue for a period of twelve (12) full calendar months,
except that the last Lease Year of the Lease Term shall terminate on the date
this Lease expires or is otherwise terminated.
1.11 Deed of Lease. To the extent required under applicable law to make
this Lease legally effective, this Lease shall constitute a deed of lease.
2. PAYMENT OF RENT & ADDITIONAL RENT.
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Tenant shall pay Landlord the Rent due under this Lease in lawful money
of the United States. Rent (including any monthly estimated payments for
Tenant's Share of Expense Increases and Tax Increases payable in accordance with
this Lease) shall (except for Tenant's Advance Deposit under Section 3.2, below)
be paid in advance on or before the first day of each month, at the address
noted in Section 1.9, or to such other party or at such other place as Landlord
may hereafter from time to time designate in writing. Rent under this Lease for
any partial month at the beginning of the Lease Term shall be prorated based on
the Rent in effect for the first month in which Rent is payable hereunder. All
other payments due under this Lease shall be paid no later than thirty (30) days
after the date Landlord provides Tenant with a written request for payment which
sets forth the amount due. In the event of any dispute concerning the
computation of the amount of any additional rent due, Tenant shall pay the
amount specified by Landlord (under protest, if applicable) pending the
resolution of the dispute, provided such payment shall be without prejudice to
Tenant's right to continue to challenge the disputed computation. In the event
that Tenant successfully challenges the disputed computation, Landlord shall
refund to Tenant the amount of any overpayment of such additional rent, together
with interest from the date paid by Tenant to Landlord until the date repaid by
Landlord to Tenant at the Default Rate (as defined below), within thirty (30)
days after the dispute is finally resolved.
3. SECURITY DEPOSIT; ADVANCE DEPOSIT
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3.1 Security Deposit.
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(a) For purposes of this Lease (1) the term "Cash" shall mean and
refer to cash, cash equivalents, cash on deposit and cash held in short-term
investments and reported as such in Tenant's then-current publicly available
financial statements (or such other financial statements as are required to be
provided by Tenant to Landlord hereunder), and (2) the term "Utilized Allowance"
shall mean that portion of the Improvement Allowance (as such term is defined in
Paragraph 6 of Exhibit C to this Lease) as has been disbursed or funded by
Landlord (determined as of the date of calculation of the Utilized Allowance) in
accordance with the terms and provisions of Exhibit C . In the event that, at
any time after the date of execution of this
Lease, the total amount of Cash held by Tenant falls below Ten Million Dollars
($10,000,000.00), Tenant shall, within ten (10) business days thereafter deliver
to Landlord a security deposit in an amount equal to the "Required Deposit", as
such term is defined in Section 3.1(d), below, in the form of an irrevocable and
unconditional letter of credit, and otherwise in accordance with the
requirements more fully set forth in this Section 3.1, below (the "Security
Deposit"). Upon the posting thereof (if ever), the Security Deposit shall
constitute security for payment of Rent and additional rent and for the
performance of any and all other covenants, agreements and obligations of Tenant
under this Lease. If Tenant defaults (giving effect to all, if any, applicable
notice and right to cure periods) with respect to any covenant or condition of
this Lease, including but not limited to the payment of Rent, additional rent or
any other payment due under this Lease, and the obligation of Tenant to maintain
the Premises and deliver possession thereof back to Landlord at the expiration
or earlier termination of the Lease Term in the condition required herein, then
Landlord may (without any waiver of Tenant's default being deemed to have
occurred) draw upon such letter of credit and apply all or any part of the
proceeds thereof to the payment of any sum in default, or any other sum which
Landlord may be required or reasonably deem necessary to spend or incur by
reason of Tenant's default, or to satisfy in part or in whole any damages
suffered by Landlord as a result of Tenant's default. All amounts drawn by
Landlord shall be held in an interest-bearing account solely for the benefit of
and in the name of Landlord and, after the full and complete application of such
funds by Landlord as permitted pursuant to this Lease, any amount remaining in
such interest-bearing account shall be returned by Landlord to Tenant upon
Tenant's full compliance with the provisions of the immediately following
sentence. In the event of such application of letter of credit proceeds by
Landlord, Tenant shall promptly deposit with Landlord (either in cash or in the
form of an additional letter of credit) the amount necessary to restore the
Security Deposit to the full amount then required under this Lease. The parties
expressly acknowledge and agree that the Security Deposit is not an advance
payment of Rent or additional rent, nor a measure of Landlord's damages in the
event of any default by Tenant. If Tenant shall have fully complied with all of
the covenants and conditions of this Lease, but not otherwise (except as
hereafter provided), the amount of the Security Deposit then held by Landlord
shall be repaid to Tenant (or to the extent then held in the form of a letter of
credit, such letter of credit shall be returned to Tenant) within thirty (30)
days after the expiration or sooner termination of this Lease.
(b) The letter of credit to be delivered by Tenant to Landlord
under Section 3.1(a), above (the "Letter of Credit"), shall be (1) in form and
substance satisfactory to Landlord in its sole discretion; (2) at all times in
the amount of the Security Deposit, and shall permit multiple draws without a
corresponding reduction in the amount of the Letter of Credit; (3) issued by a
commercial bank reasonably acceptable to Landlord and located either (i) in the
Boston metropolitan area, (ii) in Manhattan, New York, or (iii) in Northern New
Jersey; (4) made payable to, and expressly transferable and assignable at no
charge by, the owner from time to time of the Building (which
transfer/assignment shall be conditioned only upon the execution by such owner
of a customary form written transfer/assignment document in connection
therewith); (5) payable at sight upon presentment to a local branch of the
issuer of a simple sight draft accompanied by a notarized certificate stating
either that Tenant is in default (giving effect to all, if any, applicable
notice and right to cure periods) under this Lease or that Landlord is otherwise
permitted to draw upon such Letter of Credit under the express terms of this
Lease, and the amount that Landlord is owed (or is permitted to draw) in
connection therewith; (6) a term of not less than one year; and (7) at least
thirty (30) days prior to the then-current expiration date of such Letter of
Credit, either (A) renewed (or automatically and unconditionally extended)
from time to time through the sixtieth (60th) day after expiration of the Lease
Term, or (B) replaced with cash in the amount of the Security Deposit then
required under this Lease, or (C) replaced with a substitute letter of credit in
the full amount of the Security Deposit then required under this Lease and
satisfying all requirements of this Section 3.1. If Lessor assigns or transfers
the Security Deposit to any assignee or transferee of the Building or Landlord's
right, title and interest therein, then, immediately upon such assignment or
transfer, such assignee or transferee shall be and become liable as "Landlord"
hereunder for the return of the Security Deposit (as and to the extent provided
herein), and Landlord shall thereupon be released from all liability for the
return thereof. Notwithstanding anything in this Lease to the contrary, any
grace period or cure periods which are otherwise applicable under Section 24,
hereof, shall not apply to any of the foregoing, and, specifically, if Tenant
fails to comply with the requirements of subsection (7), above, Landlord shall
have the immediate right to draw upon the Letter of Credit in full and hold the
proceeds thereof as a cash Security Deposit hereunder. If Landlord exercises
such right to draw upon the Letter of Credit, such cash shall be deposited in an
interest-bearing account solely for the benefit of and in the name of Landlord,
and such cash, together with all interest thereon, to the extent not applied
pursuant to the provisions of this Section 3.1, shall be returned to Tenant upon
Landlord's receipt of a substitute letter of credit in the full amount of the
Security Deposit then required and satisfying the requirements of this Section
3.1.
(c) Each Letter of Credit provided as a Security Deposit
hereunder shall be issued by a commercial bank that has a credit rating with
respect to certificates of deposit, short term deposits or commercial paper of
at least P-2 (or equivalent) by Xxxxx'x Investor Service, Inc., or at least A-2
(or equivalent) by Standard & Poor's Corporation. If the issuer's credit rating
is reduced below P-2 (or equivalent) by Xxxxx'x Investor Service, Inc., or at
least A-2 (or equivalent) by Standard & Poor's Corporation, or if the financial
condition of the issuer changes in any other materially adverse way, then
Landlord shall have the right to require that Tenant obtain from a different
issuer a substitute letter of credit that complies in all respects with the
requirements of this Section, and Tenant's failure to obtain such substitute
letter of credit within ten (10) business days after Landlord's written demand
therefor (with no other notice, or grace or cure period being applicable
thereto) shall entitle Landlord to immediately draw upon the existing Letter of
Credit in full, without any further notice to Tenant. In the event that any
issuer of a Letter of Credit held by Landlord is placed into receivership or
conservatorship by the Federal Deposit Insurance Corporation, or any successor
or similar entity, then, effective as of the date such receivership or
conservatorship commences, said Letter of Credit shall be deemed not to meet the
requirements of this Section, and, within ten (10) business days thereof, Tenant
shall replace such Letter of Credit with cash, a substitute letter of credit
satisfying the requirements of this Section 3.1 or other collateral acceptable
to Lessor in its sole and absolute discretion (and Tenant's failure to do so
shall constitute an Event of Default under this Lease (with no other notice, or
grace or cure period being applicable thereto). Any failure or refusal of the
issuer to honor the Letter of Credit shall be at Tenant's sole risk and shall
not relieve Tenant of its obligations hereunder with respect to the Security
Deposit.
(d) If the Tenant is required by the Terms hereof to post a
Security Deposit, the amount to be posted by Tenant (herein referred to as the
"Required Deposit") shall be as follows:
Lease Year Required Deposit
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1 100% of the Utilized Allowance
2 5/6 of the Utilized Allowance
3 2/3 of the Utilized Allowance
4 1/2 of the Utilized Allowance
5 1/3 of the Utilized Allowance
6 1/6 of the Utilized Allowance
To the extent Tenant has posted a Security Deposit hereunder, and provided
Tenant is not then in Default hereunder and there is not then outstanding any
breach of this Lease which, with the giving of notice or the passage of time or
both would constitute a Default under the terms of this Lease, Tenant shall have
the right, commencing on the first day of each Lease Year hereunder, to seek a
reduction in the amount of the Security Deposit so that the same does not exceed
the Required Deposit amount for the applicable time period. By way of example,
if (i) Tenant posts a $1,024,940 Security Deposit during the first Lease Year,
and (ii) Tenant is not, at the time of such reduction, in Default or breach of
this Lease, Tenant shall have the right to reduce the Security Deposit to
$854,116.67 effective as of the first day of the second Lease Year. Any such
reduction of the Security Deposit shall be effected by Tenant's presentation of
a substitute Letter of Credit for the reduced amount accompanied by Tenant's
written certification to Landlord (1) that Tenant is not in Default of this
Lease, and that, to the best of Tenant's knowledge, no event has occurred which,
with the giving of notice or the passage of time or both, would constitute a
Default under the terms of this Lease, and (2) that Tenant is therefore
authorized to reduce the Letter of Credit in the amount requested; and provided
such conditions are met, Landlord will, upon its receipt of the Tenant's Letter
of Credit in the amount of the Required Deposit, return the Letter of Credit
held by Landlord with respect to the previous Lease Year to Tenant for
cancellation. Any reduction in the Security Deposit pursuant to this Section
3.1(d) shall be effective as of the thirtieth (30th) day after Tenant has
delivered materials to Landlord substantiating such reduction in accordance with
this subsection to the reasonable satisfaction of Landlord.
(e) In addition to the reduction provisions set forth in Section
3.1(d), above, and provided Tenant is not then in Default hereunder and there is
not then outstanding any breach of this Lease by Tenant which, with the giving
of notice or the passage of time or both would constitute a Default under the
terms of this Lease, if at any time after Tenant has posted a Security Deposit
hereunder, Tenant achieves or surpasses the financial criteria described below
as the "Minimum Financial Performance Standard", then Tenant shall be entitled
to the return of its Security Deposit until such time (if ever) as the total
amount of Cash held by Tenant is again reduced below Ten Million and 00/100
Dollars ($10,000,000.00), at which time Tenant shall again be required to post a
Security Deposit in an amount equal to the Required Deposit as of such date. For
purposes of this provision, the "Minimum Financial Performance Standard" shall
mean (i) Tenant's achievement operating profitability (e.g., net income derived
solely from Tenant's operations and exclusive of any extraordinary or
non-recurring transactions such as sales of assets, etc.) for four (4)
consecutive fiscal quarters, commencing after that fiscal quarter in which the
total amount of Cash held by Tenant again exceeded Ten Million Dollars
($10,000,000.00) after being reduced below such amount, and (ii) maintenance by
Tenant of a minimum Cash balance of Ten Million Dollars ($10,000,000.00) or more
at all times during the four (4) consecutive fiscal quarters described in the
preceding clause (i). Examples of this calculation are set forth in Section 3.2,
below.
(f) Tenant shall be obligated to notify Landlord in writing of
its Cash balance on a monthly basis, in the form of a written certification (the
"Cash Certification") (i) stating the amount of Tenant's Cash balance as of the
first day of the second month preceding the month in which such Cash
Certification is given, and (ii) certifying that Tenant's Cash balance for the
immediately preceding month did not fall below Ten Million Dollars
($10,000,000.00) at any time during the immediately preceding month, which Cash
Certification will be certified to Landlord by Tenant's chief financial officer
and delivered to Landlord together with the payments of monthly Base Rent
contemplated herein. For example, together with Tenant's monthly Rent for the
month of September 2001 (due on September 1, 2001), Tenant will provide a Cash
Certification setting forth Tenant's Cash Balance as of July 1, 2001, and
certifying to Landlord that Tenant's Cash balance during the month of August
2001 did not fall below Ten Million Dollars ($10,000,000). In addition, if,
after Tenant's Cash balance has fallen below Ten Million Dollars
($10,000,000.00), Tenant seeks to establish that it has met and satisfied the
Minimum Financial Performance Standard in order to secure the return of its
Security Deposit, Tenant shall be obligated to provide Landlord with financial
statements certified to Landlord by Tenant's chief financial officer or
otherwise prepared (and certified to Landlord by) an independent certified
public accountant, providing financial disclosure sufficient in Landlord's
reasonable judgment to establish Tenant's operating profitability and
achievement of the Minimum Financial Performance Standard. Tenant agrees that
Landlord will have the right, subject to the last sentence of this Section
3.1(f), to review Tenant's financial and banking records to confirm the accuracy
of any Cash Certification, provided that the applicable records for any month
will not be required to be provided by Tenant until thirty (30) days after the
end of such month. Landlord agrees that the financial statements which form a
part of Tenant's publicly filed Form 10Q, together with the applicable Cash
Certifications for the relevant period, will be deemed sufficient to satisfy the
foregoing reporting requirements for establishing Tenant's achievement of the
Minimum Financial Performance Standard, assuming the applicable financial
criteria are met. If Tenant fails to provide any Cash Certification in a timely
fashion, and such failure continues for five (5) business days after Landlord's
written notice of such failure to Tenant, Tenant shall be deemed to have failed
to maintain the required $10,000,000 cash balance for the period with respect to
which such Cash Certification was required, and Landlord shall thereupon have
the right to require Tenant to post the Security Deposit (if Tenant has not
already done so) or to decline a requested return of the Security Deposit for
such period. In addition, any false certification made by Tenant under this
Section 3.1(f) (which shall be deemed to include Tenant's failure to notify
Landlord promptly if its Cash balance falls below $10,000,000 during any month),
shall constitute a default by Tenant under this Lease. Landlord acknowledges and
agrees that any financial reports or certifications provided to Landlord
pursuant to this Section 3.1(f) which are not public information (e.g., not
disclosed in any SEC filings made by Tenant and otherwise not publicly available
information) shall be held in confidence by Landlord and not disclosed to any
party (other than Landlord's lender) except to the extent required by lawful
process (such as court order, subpoena or document production request) or other
applicable legal requirements.
3.2 Examples of Security Deposit Reduction Provisions. By way of example
only, and not of limitation, the following examples reflect the intent of the
parties with respect to Section 3.1, above:
(i) If Tenant reports financially on a calendar year basis,
Tenant's Cash balance is reduced below $10,000,000 on September 26, 1999 (as
reflected in Tenant's Cash
Certification dated October 1, 1999), Tenant shall post the Required Deposit on
or before October 10, 1999 (being ten (10) business days after September 26,
1999). If (1) Tenant's Cash balance then remains under $10,000,000 until
February 1, 2001, at which time it again exceeds $10,000,000 for the balance of
the Term of this Lease, (2) Tenant first achieves operating profitability for an
entire fiscal quarter in the third quarter of 2001, and (3) Tenant continues to
maintain operating profitability for the balance of the Term of this Lease, then
Tenant shall be entitled to the return of its Security Deposit as of July 1,
2002.
(ii) If Tenant reports financially on a calendar year basis,
Tenant's Cash balance is reduced below $10,000,000 on September 26, 1999 (as
reflected in Tenant's Cash Certification dated October 1, 1999), Tenant shall
post the Required Deposit on or before October 10, 1999 (being ten (10) business
days after September 26, 1999). If (1) Tenant's Cash balance then remains under
$10,000,000 until February 1, 2001, at which time it again exceeds $10,000,000
until January 15, 2002, at which time it is again reduced below $10,000,000, (2)
Tenant's Cash balance then remains under $10,000,000 until February 15, 2002, at
which time it again exceeds $10,000,000 for the balance of the Term of this
Lease, (3) Tenant first achieves operating profitability for an entire fiscal
quarter in the second quarter of 2001, and continues thereafter to maintain
operating profitability for the balance of the Term of this Lease, then Tenant
shall be entitled to the return of its Security Deposit as of April 1, 2003.
3.3 Separate Account. Landlord shall not be obligated to hold the
Security Deposit or Advance Deposit (if any) in a separate account from other
Building or project funds.
4. USES; TENANT COVENANTS.
-----------------------
4.1 Permitted Uses. The Premises are to be used only for general office
and administrative purposes ("Permitted Uses"), and for no other business or
purpose.
4.2 Other General Use Covenants.
----------------------------
4.2.1 Tenant shall not commit or allow to be committed any waste
upon the Premises, nor any public or private nuisance nor any other act which
disturbs the quiet enjoyment of any other tenant in the Building. If any of the
Tenant's office machines or equipment or other activities within the Premises
involve unusual volume or vibration and disturb any other tenant in the
Building, then Tenant shall provide adequate insulation, or take such other
action, as may be necessary to eliminate the noise or disturbance.
4.2.2 Except as provided below with respect to Landlord's
responsibility to ensure that Landlord's Work (as defined in Exhibit C)complies
with applicable building codes and the Americans With Disabilities Act ("ADA")
in existence on the date that Landlord's Work is Substantially Complete, Tenant
will, at its own cost, promptly comply with and carry out all orders,
requirements or conditions now or hereafter imposed upon it by the ordinances,
laws, rules, orders, and/or regulations of the State in which the Premises are
located and the federal government and any other federal, state or local
governmental authority, or public or quasi-public authority, having jurisdiction
over the Premises to the extent relating to the manner of Tenant's occupation or
use of the Premises, the conduct of Tenant's business therein, or the
construction of any improvements or alterations therein by (or at the request
of) Tenant,
including all present and future laws, orders and regulations regarding
recycling of trash and smoking in the workplace, and all building and life
safety codes applicable to Tenant's alterations. The foregoing notwithstanding,
to the extent that any such orders, requirements or conditions relate to the
compliance of the Premises (or any portion thereof) with applicable building
codes, regulations, or laws which were in effect prior to Tenant's occupancy of
the Premises pursuant to the Original Lease or which pertain to the Building as
a whole, or the land upon which same is located, either of which require
Landlord to make modifications thereto (the "Compliance Laws") and the design or
installation of the item(s) whose compliance with such Compliance Laws is at
issue was Landlord's responsibility under this Lease, then Landlord shall be
responsible for the compliance of such item(s) with such Compliance Laws,
including but not limited to, costs of compliance of Landlord's Work (if any)
with the physical accessibility requirements of the ADA in existence on the date
that Landlord's Work is Substantially Complete; provided, however, if the
Compliance Laws require Landlord to make modifications to the Building, the
Land, or the Premises, because of any improvements made by the Tenant (including
without limitation Tenant's Work) or because of any particular use made of the
Premises by Tenant which is not in the nature of customary general office use,
all such costs shall be paid by Tenant. Tenant, at Tenant's cost, shall be
responsible for ensuring that Tenant's policies and business operations with
respect to the Premises comply with the ADA, and that Tenant's Work (and that
Landlord's Work solely to the extent designed by Tenant's architect) complies
with the ADA.
4.2.3 Tenant shall observe such reasonable rules and regulations
as may be adopted and made available to Tenant by Landlord from time to time for
the safety, care and cleanliness of the Premises or the Building and for the
preservation of good order therein. The initial rules and regulations for the
Building are attached as Exhibit D hereto and made a part hereof by this
reference (as the same may be amended in accordance herewith, the "Rules and
Regulations"). Landlord shall have the right from time to time to make
reasonable modifications to the Rules and Regulations, provided (i) such
modifications shall only be applicable to Tenant if communicated to Tenant in
writing at least ten (10) days prior to the effective date of such modification,
(ii) such modified Rules and Regulations shall not materially modify any
economic obligations of Tenant hereunder, and (iii) in the event of any
irreconcilable conflict between the terms of this Lease and the terms of the
Rules and Regulations (as amended), the terms of this Lease shall be
controlling. Landlord shall not be responsible to Tenant for the nonperformance
of any of said rules and regulations by any other tenants or occupants of the
Building.
4.2.4 No act shall be done or knowingly permitted by Tenant, or
its agents, employees and/or contractors, in or about the Premises that is
unlawful or that will increase the existing rate of insurance on the Building.
To Landlord's knowledge, general office use is neither unlawful, nor will it
result in any increase in the existing rate of insurance in the Building. In the
event the existing rate of insurance is increased because of any breach by
Tenant of this covenant, Tenant shall pay to Landlord any and all fines,
penalties, and/or increases in insurance premiums resulting from such breach.
5. ENVIRONMENTAL PROVISIONS; RECYCLING.
------------------------------------
5.1 General. Tenant agrees to comply with any and all Environmental Laws
(defined below) in connection with (1) Tenant's use of the Premises, (2) any
assignment, sublease or license of the Premises or any part thereof, (3) any
termination of this Lease and
surrender of possession upon a default by Tenant hereunder, (4) any corporate
reorganization, consolidation, recomposition or similar change in Tenant's
organization, (5) any acts, omissions and other activities of Tenant in or on
the Building and Land, and/or (6) any other fact or circumstance the existence
and continuation of which imposes upon Tenant the obligation to so comply
therewith.
5.2 Tenant's Warranties and Covenants. During the Term and any Renewal
Term of this Lease, Tenant warrants, represents and covenants to and with
Landlord as follows:
5.2.1 The Premises will not, as the result of any acts or
omissions of Tenant, contain (A) asbestos in any form, (B) urea formaldehyde
foam insulation, (C) transformers or other equipment which contain dielectric
fluid containing levels of polychlorinated biphenyls in excess of fifty (50)
parts per million, or (D) any flammable explosives, radioactive materials,
hazardous materials, hazardous wastes, hazardous, controlled or toxic
substances, or any pollutant or contaminant, or related materials defined in or
controlled pursuant to the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended (42 U.S.C. Sections 9601 et seq.), the
Hazardous Materials Transportation Act, as amended (49 U.S.C. Sections 1801 et
seq.), the Resource Conservation and Recovery Act, as amended (42 U.S.C.
Sections 9601 et seq.), the Federal Water Pollution Control Act (33 U.S.C.
Section 1251 et seq.), the Clean Air Act (42 U.S.C. Section 7401 et seq.), and
in the regulations adopted and publications promulgated pursuant thereto, and
any and all other federal, state and local laws, rules and regulations or orders
pertaining to health, the environment and/or Hazardous Materials (collectively,
"Environmental Laws") (the substances described in (A), (B), (C) or (D) above
being hereinafter collectively referred to as "Hazardous Materials"); (ii)
except as specifically permitted by this Lease, the Premises will never be used
by Tenant for any activities involving, directly or indirectly, the use,
generation, treatment, transportation, storage or disposal of any Hazardous
Materials.
5.2.2 Tenant (A) shall comply in the operation of its business,
and in its use and occupancy of the Premises, with all Environmental Laws, (B)
shall not store, utilize, generate, treat, transport or dispose of (or permit or
acquiesce in the storage, utilization, generation, transportation, treatment or
disposal of) any Hazardous Materials on or from the Premises, and (C) shall
cause its employees, agents, contractors, assignees, sublessees, licensees and
(while within the Premises) invitees and business visitors to comply with the
representations, warranties and covenants herein contained. For all purposes of
this Section 5, references to "Tenant" shall be deemed to include acts and
omissions committed by Tenant and Tenant's agents, employees, contractors,
subcontractors, assignees, sublessees, licensees and, while within the Premises,
invitees and business visitors.
5.2.3 In the event of any storage, presence, utilization,
generation, transportation, treatment or disposal of Hazardous Materials by
Tenant in, on or about the Premises, Building and/or Land, or in the event of
any Hazardous Materials Release (as hereinafter defined)for which Tenant bears
responsibility under the provisions of this Section 5, Tenant shall, at the
direction of Landlord or any federal, state, or local authority or other
governmental authority, remove or cause the removal of any such Hazardous
Materials and rectify any such Hazardous Materials Release, and otherwise comply
or cause compliance with the laws, rules, regulations or orders of such
authority, all at the expense of Tenant, including without limitation, the
undertaking and completion of all investigations, studies, sampling and
testing and all remedial, removal and other actions necessary to clean up and
remove all such Hazardous Materials, on, from or affecting the Premises. If
Tenant shall fail to proceed with such removal or otherwise comply with such
laws, rules, regulations or orders within the cure period permitted under the
applicable law, regulation or order, the same shall constitute a default under
Section 23 hereof, and Landlord may, but shall not be obligated to, do whatever
is necessary to eliminate such Hazardous Materials from the Premises or
otherwise comply with the applicable law, rule, regulation or order, acting
either in its own name or in the name of Tenant pursuant to this Section, and
the cost thereof shall be borne by Tenant and thereupon become due and payable
as additional rent hereunder. Tenant shall give to Landlord and its agents and
employees access to the Premises for such purposes and hereby specifically
grants to Landlord a license to remove the Hazardous Materials and otherwise
comply with such applicable laws, rules, regulations or orders, acting either in
its own name or in the name of the Tenant pursuant to this Section.
5.2.4 Tenant hereby indemnifies and holds Landlord and each of
its shareholders, subsidiaries, affiliates, officers, directors, partners,
employees, agents and trustees, and any receiver, trustee or other fiduciary
appointed for the Building, harmless from, against, for and in respect of, any
and all damages, losses, settlement payments, obligations, liabilities, claims,
actions or causes of actions, encumbrances, fines, penalties, and costs and
expenses suffered, sustained, incurred or required to be paid by any such
indemnified party (including, without limitation, reasonable fees and
disbursements or attorneys, engineers, laboratories, contractors and
consultants) because of, or arising out of or relating to (A) the violation by
Tenant (or any of its agents, employees, contractors and, while within the
Premises, invitees) of any of its representations, warranties and covenants
under this Section 5, and (B) any Environmental Liabilities (as hereinbelow
defined) in connection with the Premises for which Tenant is responsible under
the terms of this Section 5 of the Lease. For purposes of this indemnification
clause, "Environmental Liabilities" shall include all costs and liabilities with
respect to the future presence, removal, utilization, generation, storage,
transportation, disposal or treatment of any Hazardous Materials or any release,
spill, leak, pumping, pouring, emitting, emptying, discharge, injection,
escaping, leaching, dumping or disposing into the environment (air, land or
water) of any Hazardous Materials (each a "Hazardous Materials Release"),
including without limitation, cleanups, remedial and response actions, remedial
investigations and feasibility studies, permits and licenses required by, or
undertaken in order to comply with the requirements of, any federal, state or
local law, regulation, or agency or court, any damages for injury to person,
property or natural resources, claims of governmental agencies or third parties
for cleanup costs and costs of removal, discharge, and satisfaction of all
liens, encumbrances and restrictions on the Premises relating to the foregoing.
The foregoing indemnification and the responsibilities of Tenant under this
Section 5 shall survive the termination or expiration of this Lease.
5.2.5 Tenant shall promptly notify Landlord in writing of the
occurrence of any Hazardous Materials Release or any pending or threatened
regulatory actions known to Tenant, or any claims made by any governmental
authority or third party, relating to any Hazardous Materials or Hazardous
Materials Release on or from, the Premises and shall promptly furnish Landlord
with copies of any correspondence or legal pleadings or documents in connection
therewith. Landlord shall have the right, but shall not be obligated, to notify
any governmental authority of any state of facts which may come to its attention
with respect to any Hazardous Materials or Hazardous Materials Release on or
from the Premises.
5.2.6 Upon expiration of the Term or any Renewal Term, as
applicable, Tenant shall deliver the Premises to Landlord free of any and all
Hazardous Materials and any liens, encumbrances and restrictions relating to
Environmental Liabilities, to the extent Tenant was otherwise responsible
therefor.
5.3 Permitted Materials. Notwithstanding Section 5.2 to the contrary,
but subject to clauses (i) and (ii) of this Section 5.3, below, Tenant shall be
permitted to temporarily store reasonable amounts of Hazardous Materials that
are used in the ordinary course of Tenant's operation of the Permitted Use (the
"Permitted Materials") provided (i) such Permitted Materials are properly used,
stored and disposed of in a manner and location meeting the requirements of all
Environmental Laws and (ii) all Permitted Materials shall be approved in advance
by Landlord with the exception those materials typically used in the operation
of standard office equipment or for cleaning purposes, such as office cleaners,
printing toners and the like, and which are used stored and disposed of in
accordance with all applicable Environmental Laws (which common materials shall
not require special written approval by Landlord). Any use, storage and disposal
of Permitted Materials shall be subject to all of the terms of this Section 5
(except for the terms prohibiting same), and Tenant shall be responsible for
obtaining any required permits and paying any fees and providing any testing
required by any governmental agency with respect to any Permitted Materials. If
said Permitted Materials are not being stored, used, or disposed of in
compliance with all applicable laws, then Tenant shall immediately take such
corrective action as requested by Landlord. Should Tenant fail to take such
corrective action within forty-eight (48) hours (or such lesser time period as
may be appropriate in the event of Emergency (as defined herein), Landlord shall
have the right to perform such work on Tenant's behalf and at Tenant's sole
expense, and Tenant shall promptly reimburse Landlord for any and all reasonable
costs associated with said work.
5.4 Landlord's Covenants. If, during the Lease Term, (a) Landlord
introduces Hazardous Materials in, on or under the Building or Land, or
otherwise violates the requirements of any Environmental Laws, or (b) Hazardous
Materials contamination in, on or under the Building or Land which existed prior
to Tenant's taking occupancy of the Premises is discovered, or (c) Hazardous
Materials contamination is discovered in, on or under the Building or Land and
in each case described in clauses (a), (b) and (c) of this Section 5.4, such
contamination is not the responsibility of Tenant pursuant to Sections 5.2 and
5.3, above, then as between Landlord and Tenant, Landlord shall be responsible
for making a prompt assessment of the scope and nature of the problem, and for
taking remedial action, in conjunction (if appropriate) with applicable federal,
state or local authorities; and in the event the presence of such Hazardous
Materials was caused by Landlord, or its authorized agents, employees or
contractors, Landlord shall be responsible for the cost to remediate any such
contamination and/or correct any such violation, and for all fines, penalties
and other actual damages arising therefrom. The foregoing is without prejudice
to Landlord's right to seek recovery of damages or losses from the parties at
fault in any Hazardous Materials Release.
5.5 Recycling Regulations. Tenant shall comply with all orders,
requirements and con ditions now or hereafter imposed by any ordinances, laws,
orders and/or regulations (hereinafter collectively called "regulations") of any
governmental body having jurisdiction over the Premises or the Building, whether
required of Landlord or otherwise, regarding the collection, sorting, separation
and recycling of waste products, garbage, refuse and trash
(hereinafter collectively called "waste products") including but not limited to
the separation of such waste products into receptacles reasonably approved by
Landlord and the removal of such receptacles in accordance with any collection
schedules prescribed by such regulations. Landlord reserves the right (a) to
refuse to accept from Tenant any waste products that are not prepared for
collection in accordance with any such regulations, and (b) to require Tenant to
pay all costs, expenses, fines, penalties or damages that may be imposed on
Landlord or Tenant by reason of Tenant's failure to comply with any such
regulations.
5.6 Medical Wastes.
---------------
5.6.1 To the extent Tenant's Permitted Use of the Premises in any way
involves the handling, use, disposal and/ or processing of medical waste,
including but not limited to (A) human or animal tissue, blood, urine and/or
other bodily fluids, materials and/or biological byproducts, and (B) medical
supplies (such as, but not limited to, used syringes, gauze and bandages, etc.)
(hereinafter, collectively, "Medical Waste"), Tenant shall be solely responsible
for the proper use, storage, removal and disposal of same from the Premises.
Tenant shall make arrangements with a reputable and duly licensed disposal
company or contractor for the proper disposal of Medical Waste, in accordance
with lawfully permitted methods of Medical Waste disposal, and Tenant shall pay
all costs associated with such disposal. Tenant shall not place any Medical
Waste in any of the Common Areas without Landlord's prior consent. In its
processing, use and disposal of Medical Waste, Tenant shall comply with all
applicable laws, regulations and ordinances governing the generation, use,
processing and disposal thereof, as well as any additional requirements which
Landlord may reasonably establish from time to time by written notice to Tenant.
5.6.2 Tenant shall bear all costs and liability resulting from the
presence of Medical Waste which is caused or permitted by Tenant (or Tenant's
agents, employees or contractors) in, on or under the Premises, the Building or
the Land (including without limitation, liability arising from the
transportation of Medical Waste to or from the Premises, Building and/or Land
and the cleanup of Medical Waste therefrom.)
5.6.3 Tenant shall indemnify Landlord, its agents, employees or
contractors, from and against any and all claims, losses, damages, liabilities
and expenses (including reasonable attorneys' fees) incurred, suffered or
sustained by (or brought against) Landlord arising from or associated with: (i)
the acts or omissions of Tenant, its agents, employees or contractors with
respect to the presence of Medical Waste at the Premises, the Building and/or
the Land (including without limitation, liability arising from the
transportation of Medical Waste to or from the Premises or the cleanup of
Medical Waste); (ii) the storage and disposal of Medical Waste by Tenant, its
agents, employees or contractors; or (iii) Tenant's operations at the Premises
related to the processing, use and disposal of Medical Waste. This
indemnification shall survive termination of the Lease.]
6. LATE CHARGES; INTEREST.
-----------------------
6.1 Late Charge. Tenant hereby acknowledges that late payment to
Landlord of Base Rent or additional rent will cause Landlord to incur
administrative costs and loss of investment income not contemplated by this
Lease, the exact amount of which will be extremely difficult to ascertain. If
any Rent or additional rent due from Tenant is not received by Landlord or
Landlord's designated agent within ten (10) business days after the date due,
then Tenant shall pay to Landlord a late charge equal to five percent (5%) of
such overdue amount, plus any attorneys' fees and costs incurred by Landlord by
reason of Tenant's failure to pay Rent and other charges when due hereunder;
provided, however, Landlord agrees to waive the first (1st) such late charge
arising during any Lease Year during the Term, up to a maximum of five (5) such
waivers during the Term, provided that Landlord receives such overdue Base Rent,
additional rent, or other sum within ten (10) business days after the date
Landlord provides Tenant with a written notice that such payment of Rent,
additional rent or other charges is overdue. Landlord's acceptance of such late
charges shall not constitute a waiver of Tenant's default with respect to such
overdue amount or estop Landlord from exercising any of the other rights and
remedies granted hereunder in respect thereof, unless and solely to the extent
Tenant has completely cured the applicable default (including payment of the
underlying amount due plus all late charges and interest accrued in respect
thereof) before Landlord's commencement of the exercise of such remedies
pursuant to Section 24 of this Lease, or Landlord accepts Tenant's cure of such
default thereafter in writing.
6.2 Interest. In addition to the administrative late charge provided for
under Section 6.1, above, if any Rent or additional rent due from Tenant to
Landlord is not paid within ten (10) business days after the date due (if Tenant
was not assessed a late charge by virtue of such late payment) or thirty (30)
days after the date due (if Tenant was assessed a late charge by virtue of such
late payment), such unpaid amount shall bear interest from the date originally
due until the date paid at an annual rate of interest (the "Default Rate") equal
to the lesser of (a) the Prime Rate plus three percent (3%) or (b) the highest
annual rate of interest permitted under applicable law. Landlord's acceptance of
such interest shall not constitute a waiver of Tenant's default with respect to
such overdue amount or estop Landlord from exercising any of the other rights
and remedies granted hereunder in respect thereof, unless and solely to the
extent Tenant has completely cured the applicable default (including payment of
the underlying amount due plus all late charges and interest accrued in respect
thereof) before Landlord's commencement of the exercise of such remedies
pursuant to Section 24 of this Lease, or Landlord accepts Tenant's cure of such
default thereafter in writing. The term "Prime Rate" shall mean the "Prime Rate"
of interest as published from time to time in the Wall Street Journal, or if not
so published, then the "Prime Rate" as established from time to time by the bank
in which Landlord maintains its bank accounts with respect to the Building.
7. REPAIRS AND MAINTENANCE.
------------------------
7.1 Landlord's Responsibilities. Landlord shall maintain or cause to be
maintained, and after receiving notice or actual knowledge of the need for
repair, shall repair all structural and non-structural portions of the Building
Systems (as hereafter defined), Common Areas (as hereafter defined) and
Structural Elements (as hereafter defined), provided that, to the extent any of
such maintenance or repairs is rendered necessary by the negligence or willful
misconduct of Tenant, its agents, customers, employees, independent contractors,
guests or (while within the Premises) invitees, Tenant shall be obligated to
reimburse Landlord for all costs sustained by Landlord in connection therewith
to the extent such costs are not covered by the fire and casualty insurance
maintained, or required to be maintained, by Landlord on the Building, which
reimbursement shall be due no later than ten (10) days after Landlord's written
demand. For the purposes of this Section 7, "Building Systems" shall mean the
mechanical, electrical, plumbing, and HVAC systems serving the Building and
located outside of the confines of the Premises;
"Common Areas" shall mean those areas of the Building which are available for
the non-exclusive use of any tenant of the Building, including without
limitation parking areas, lobbies, elevators, restrooms, stairs, corridors,
janitor's closets, and electrical and telephone closets; and "Structural
Elements" shall mean the structural components of the Building's base building
improvements, including structural components which integrate with the interior
tenant improvements within the Premises, including without limitation the roof,
foundations, exterior structural walls and other load-bearing elements of the
Building.
7.2 Tenant's Responsibilities. Except for (i) repairs to Building
Systems, Common Areas and Structural Elements, (ii) warranty repairs related to
Landlord's Work (if any), (iii) janitorial and cleaning services to the extent
provided by or through Landlord under Section 8.2, below, and (iv) repairs to
the interior of the Premises to the extent the same are rendered necessary by
the negligence or willful misconduct of Landlord and its agents, employees and
independent contractors, and are not covered by the fire and casualty insurance
maintained, or required to be maintained, by Tenant under this Lease, Tenant
shall be responsible (at Tenant's sole expense) for repairs and maintenance to
the interior of the Premises.
7.3 Notification Requirements. Landlord shall be under no obligation to
inspect the Premises. Tenant shall promptly report in writing to Landlord any
defective condition in the Premises actually known to Tenant which Landlord is
required to repair, and failure to so report such defects shall excuse any delay
by Landlord in commencing and completing such repair to the extent the same
would otherwise be Landlord's responsibility under this Lease. In addition, if
Tenant fails to report a defective condition within the Premises promptly, and
such failure results in any incremental additional repair expense, Tenant shall
be responsible for such incremental additional expense.
7.4 Expenses. All expenses incurred by Landlord pursuant to this Section
7 (to the extent not payable directly by Tenant as above provided) will be
included within "Operating Costs" as defined in Section 9, below, to the extent
not excluded under Section 9.6.
8. UTILITIES AND SERVICES.
-----------------------
8.1 Hours of Service. From 8:00 a.m. to 6:00 p.m. on weekdays and from
8:00 a.m. to 1:00 p.m. on Saturday (collectively "Normal Business Hours") (but
excluding the following holidays: New Year's Day, Xxxxxx Xxxxxx Xxxx'x Birthday,
President's Day, Patriot's Day, Memorial Day, Independence Day, Labor Day,
Columbus Day, Veterans Day, Thanksgiving Day, Christmas Day and any holiday
designated as such by an Executive Order of the President of the United States
or by Act of Congress, herein collectively referred to as "Holidays"), Landlord
shall furnish (i) electricity to the Premises for lighting and for the operation
of normal and customary office machines, heating, ventilation and
air-conditioning ("HVAC") service, (ii) hot and cold water to common area
restrooms, and (iii) if applicable, elevator service. Landlord shall also
provide for toilet cleaning and supply, common area and in-suite janitorial
services, and window washing (collectively "Janitorial Services") on weekdays
(excluding Holidays) in accordance with the specifications set forth in Exhibit
E. Landlord shall also provide electrical service (excluding HVAC), hot and cold
water and at least one elevator (if applicable), as above provided, at all times
other than Normal Business Hours. The cost of all of the foregoing services
furnished by Landlord shall constitute Operating Costs and shall be payable as
provided in Section 9 of this Lease.
8.2 Additional HVAC Service. If requested by Tenant, Landlord shall
furnish HVAC service at times other than Normal Business Hours and the cost of
such services as established from time to time by Landlord shall be paid by
Tenant as additional rent, payable as provided in Section 2. If the quantity or
kind of utilities or services furnished by Landlord to the Premises to meet
Tenant's requirements is excessive or abnormal relative to the utilities and
services consumed by office tenants generally, as determined by engineering
surveys conducted by a licensed third party engineer selected by Landlord at
Landlord's expense, Tenant shall reimburse Landlord upon demand for the
additional cost resulting from Tenant's excessive or abnormal consumption.
8.3 Additional Provisions. Except as specifically provided in Section
8.5, below, and except for actual damages caused by the gross negligence or
willful misconduct of Landlord, its agents, employees and contractors and not
covered by the fire and casualty insurance maintained, or required to be
maintained, by Tenant under this Lease, Landlord shall not be liable to Tenant
for any loss, injury or damage to property, or loss of income or other business
loss, caused by or resulting from any variation, interruption, or failure of
such services due to any cause whatsoever, or from failure to make any repairs
or perform any maintenance . In addition, Landlord shall not be liable to Tenant
for (a) any damage to the Premises, (b) any loss, damage or injury to any
property therein or thereon, (c) any claims for the interruption of or loss to
Tenant's business or (d) for any indirect damages or consequential losses, to
the extent occasioned by bursting, rupture, leakage or overflow of any plumbing
or other pipes, other water leakage or flooding, or other similar causes in,
above, upon or about the Premises or the Building. If any public utility or
governmental body shall require Landlord or Tenant to restrict the consumption
of any utility or reduce any service to the Premises or the Building, Landlord
and Tenant shall comply with such requirements, without any abatement or
reduction of the Rent, additional rent or other sums payable by Tenant
hereunder.
8.4 Measurement of Tenant's Electrical Consumption. Landlord reserves
the right (i) to install electrical measurement devices or submeters to measure
Tenant's electrical consumption precisely or (ii) to determine Tenant's
electrical consumption by engineering surveys (to the extent that Landlord does
not install separate electrical measurement devices), which surveys shall be
based on the actual electrical consumption for the Building in which the
Premises is located. Such engineering surveys will be conducted by a licensed
third party engineer selected by Landlord whose findings will be determinative
except as hereafter provided, and such survey(s) will be conducted in accordance
with reasonable and sound engineering practices.
8.5 Interruption in Services. Section 8.3, above, to the contrary
notwithstanding, in the event that (i) the supply of hot and cold water, HVAC
Service, electricity and/or (if applicable) elevator service for a minimum of
one (1) elevator (hereinafter, each an "Essential Service" and collectively
"Essential Services") is interrupted as a result of the negligence or willful
misconduct of Landlord, or its agents, employees or contractors (and not as a
result of any cause beyond Landlord's reasonable control, such as a general
electrical outage or blackout),
and (ii) such interruption continues for a period exceeding five (5)
consecutive business days after Tenant first notifies Landlord of such
interruption, and (iii) as a result thereof Tenant is unable to and does not in
fact conduct business from the Premises or any portion thereof, then from and
after such fifth (5th) consecutive business day, Tenant shall be entitled to
xxxxx its Base
Rent and additional rent obligations hereunder as to the Premises or portion
thereof which is not usable (and is in fact not used) until such time as the
applicable Essential Service(s) are restored. The foregoing shall constitute
Tenant's sole and exclusive remedy in the event of an interruption of services
to the Premises. In addition, if Landlord fails promptly to commence, and to use
diligent efforts thereafter, to cure (or to cause the applicable utility
provider to cure) the applicable interruption or failure (even if not caused by
Landlord's negligence or misconduct), then Tenant shall have the right to
exercise its right of self-help as more fully set forth in Section 34, below
(subject to any provisions therein requiring notice and the opportunity to
cure), and all reasonable expenses incurred by Tenant in the exercise of such
right shall be recoverable by Tenant from Landlord.
9. EXPENSE INCREASES.
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9.1 Defined. For each calendar year or portion thereof during the Term,
Tenant shall pay as additional rent to Landlord an amount (hereinafter referred
to as "Expense Increases") equal to the difference between:
(A) Tenant's Share of Operating Costs (defined in Section 9.5,
below) for such calendar year; and
(B) Tenant's Share of Operating Costs for the "Operating Costs
Base Year" (defined in Section 9.2, below).
9.2 Base Year. For all purposes hereof, the "Operating Costs Base Year"
shall be Calendar Year 1999.
9.3 Estimated Payments. Tenant shall make monthly installment payments
on an estimated basis toward Tenant's Share of Expense Increases, in an amount
equal to one-twelfth (1/12th) of Landlord's estimate of Tenant's Share of
Expense Increases for the then-current calendar year, respectively. Tenant's
obligation to make monthly installment payments toward Tenant's Share of Expense
Increases shall not commence until the first (1st) day of the thirteenth (13th)
month of the Term. The foregoing estimate(s) shall based on Landlord's
reasonable estimate of Expense Increases for such calendar year (which shall not
exceed 105% of the prior year's Expense Increases in the absence of evidence
that a larger estimate is warranted). Landlord shall endeavor to communicate
such estimate to Tenant on or before the date Landlord provides Tenant with the
Expense Statement referenced in Section 9.4, below, provided that until Landlord
provides such estimate to Tenant, Tenant's estimated payments will be based upon
the prior year's estimate. If at any time or times during such calendar year, it
appears to Landlord that Tenant's Share of Expense Increases for such calendar
year will vary from Landlord's estimate by more than five percent (5%) on an
annualized basis, Landlord may, by written notice to Tenant, revise its estimate
for such calendar year and Tenant's estimated payments hereunder for such
calendar year shall thereupon be based on such revised estimate.
9.4 Annual Reconciliation. Within approximately one hundred twenty (120)
days after the end of each calendar year after the Operating Costs Base Year,
Landlord shall provide to Tenant a statement (the "Expense Statement") setting
forth Operating Costs for such calendar year and Tenant's Share of Expense
Increases for such year, calculated in accordance with Section 9.1, above.
Within thirty (30) days after the delivery of such Expense Statement, Tenant
shall pay to Landlord any deficiency between (a) the amount shown as Tenant's
Share of Expense Increases for such calendar year, and (b) any payments made by
Tenant toward such amount in accordance with Section 9.3, above. If the payments
made by Tenant pursuant to Section 9.3 exceed the amount shown in the Expense
Statement as Tenant's Share of Expense Increases for such calendar year, the
excess amount shall be applied against the next payment(s) of Rent or additional
rent coming due hereunder, unless the Lease shall have expired, in which event
Landlord shall refund such excess at the time of its delivery of the Expense
Statement.
9.5 Operating Costs. The term "Operating Costs" shall mean any and all
expenses incurred by Landlord in connection with the operation, management,
maintenance and repair of the Building and the Land, and all easements, rights
and appurtenances thereto, but excluding the expenses identified in Section 9.6,
below. Operating Costs shall include:
(a) the cost of the personal property used in conjunction
therewith;
(b) subject to Section 9.5(l), below, costs to repair and
maintain the Building, Land, Building Systems, Common Areas and Premises (but
excluding repairs to Structural Elements, which shall be Landlord's sole
responsibility, and which are hereinafter referred to as "Structural Repairs");
(c) all expenses paid or incurred by Landlord for electricity,
water, gas, sewer, oil, and other utility services for the Building, and any
utility surcharges imposed;
(d) any other the costs and expenses incurred in connection with
the provision of the utilities and services set forth in Section 8, above,
including without limitation the maintenance, repair and replacement of the
Building Systems furnishing such utilities and/or services;
(e) the cost of Building supplies and materials;
(f) the cost of cleaning and janitorial services in or about the
Premises, the Building (including without limitation common areas) and the Land;
(g) the cost of window glass replacement, repair and cleaning;
(h) the cost of repair and maintenance of the grounds, including
costs of landscaping, gardening and planting, including service or management
contracts with independent contractors, and including security and energy
management services and costs;
(i) costs to achieve compliance with any governmental laws,
rules, orders or regulations in the operation of the Building and the provision
of services hereunder;
(j) utility taxes;
(k) the amount of compensation (including employment taxes,
fringe benefits, salaries, wages, medical, surgical, and general welfare
benefits such as health, accident and group life insurance, pension payments,
payroll taxes, and worker's compensation insurance) paid for all persons who
perform duties in connection with the operation, management,
maintenance and repair of the Building, including building engineers, custodial
staff and similar operating personnel, and including the property manager, but
excluding any executives or other employees of Landlord or its property
management firm who are above the level of property manager, and excluding any
portion of such compensation which is not reasonably allocable to services
performed for the Building;
(l) any capital expenditures incurred to reduce Operating Costs,
to comply with any governmental law, order, regulation or other legal
requirement enacted after the Commencement Date of this Lease, to replace
existing equipment and machinery necessary to the day to day operation of the
Building, or which are capital replacements (i.e., replacements of common area
or common usage Building components and systems in lieu of capital repairs
otherwise required to be made thereto, but excluding capital replacements made
in lieu of Structural Repairs), provided that (i) each such capital expenditures
shall be amortized on a monthly basis over the useful life thereof (not to
exceed one hundred twenty (120) months) at an interest rate of twelve percent
(12%) per annum, and the amount recoverable by Landlord as an Operating Cost in
each year of the Term thereafter occurring (including the year in which such
expenditure is made) shall equal the sum of all such amortization payments
payable during each such year, and (ii) with respect to any capital expenditure
which is incurred solely to reduce Operating Costs, the amount otherwise
recoverable under clause 9.5(l)(i), above, shall be further limited by the
amount of such reduction which is achieved in each applicable year.
(m) cost of premiums for casualty, liability, elevator, xxxxxxx'x
compensation, boiler and machinery, sprinkler leakage, rent loss, use and
occupancy and other insurance;
(n) license, permit and inspection fees;
(o) management fees;
(p) vault space rentals and public space rentals, if any;
(q) the cost of ordinary compliance with Environmental Laws;
(r) personal property taxes;
(s) the cost of operating any fitness facility, conference
facility, transportation service, concierge service, or other similar amenity
furnished generally to tenants of the Building;
(t) the cost of trash removal, including all costs incurred in
connection with waste product recycling pursuant to Section 5.5 (except to the
extent any such costs are charged directly to the tenants);
(u) any local and state governmental or quasi-governmental
surcharges or special charges assessed in connection with the operation and
maintenance of the Building;
(v) the cost of uniforms and dry cleaning for on-site Building
personnel;
(w) the cost of snow and ice removal or prevention;
(x) the cost of telephone, telegraph, postage, stationery
supplies and other materials and expenses required for the routine operation of
the Building;
(y) environmental remediation costs for the common or public
areas of the Building, but only to the extent that the need for such remediation
is not caused by Landlord, its agents or employees;
(z) association assessments or other assessments for project-wide
common area services;
(aa) a share (equal to the percentage computed by a fraction, the
numerator of which is the gross rentable area of the Building and the
denominator of which is the gross rentable area of all constructed buildings
(including the Building) at 00/00/00 Xxxxx Xxxxxx, Xxxxxx, XX 00000 of the cost
to Landlord of operating, repairing and maintaining exterior common areas and
facilities of 00/00/00 Xxxxx Xxxxxx, Xxxxxx, XX 00000 (of which development the
Building is a part) which may not be located entirely on the Land but which are
available for use by the Tenant, including but not limited to snow removal,
landscaping, security and maintenance for common roadways and open areas; and
(bb) any other expense or charge whether or not hereinbefore
described which, in accordance with generally accepted accounting and management
practices, would be considered a reasonable and necessary expense of
maintaining, managing, operating or repairing the Building and/or the Land.
9.6 Exclusions. Notwithstanding the foregoing, Operating Costs shall not
include any of the following: (1) capital expenditures, except those set forth
in item 9.5 (l), above; (2) costs of any special services rendered to individual
tenants (including Tenant), for which a special, separate charge shall be made;
(3) painting, redecorating or other similar work which Landlord performs for
specific tenants, the expenses of which are paid by such tenants or, if paid by
Landlord, do not arise out of necessary repairs recoverable under Section 9.5;
(4) Real Estate Taxes (as defined in Section 10); (5) depreciation or
amortization of costs required to be capitalized in accordance with generally
accepted accounting practices (except as set forth in Section 9.5(l), above);
(6) ground rent, if Landlord's interest in the land upon which the Building is
located derives solely from a ground lease; (7) interest and amortization of
funds borrowed by Landlord (except as specifically provided above); (8) leasing
commissions, and advertising, legal, space planning and construction expenses,
incurred in procuring, negotiating leases with, and installing leasehold
improvements for, tenants or prospective tenants of the Building; (9) salaries,
wages, or other compensation paid to officers or
executives of Landlord (or Landlord's property management firm) in their
capacities as officers and executives; (10) and any other expenses for which
Landlord actually receives direct reimbursement from insurance, condemnation
awards, other tenants or any other source, excluding general payments of Expense
Increases pursuant to this Section 9 by Tenant and other tenants of the
Building.
9.7 Further Adjustment. In the event Landlord shall furnish any utility
or service which is included in the definition of Operating Costs to less than
one hundred percent (100%) of the rentable area of the Building because (i) the
average occupancy level of the Building for the Base Services Year and/or any
subsequent calendar year was less than one hundred percent (100%) of full
occupancy, (ii) any such utility or service is not required by or provided to
one or more of the tenants or occupants of the Building, and such tenant(s)
is(are) not required to contribute its(their) proportionate share thereof, or
(iii) any tenant or occupant is itself obtaining or providing any such utility
or services directly, then the Operating Costs for such year (including the Base
Services Year) shall be adjusted to include all additional costs, expenses and
disbursements that Landlord reasonably determines would have been incurred had
the Building been one hundred percent (100%) occupied during the year in
question and such utilities and services provided to all tenants. The intent of
this Section 9.7 is to ensure that the reimbursement of all Operating Costs is
fair and equitably allocated among the tenants receiving such utilities and
services. In the calculation of Operating Costs hereunder, no expense shall be
charged more than once.
9.8 Allocation of Multi-Building Operating Costs. If and to the extent
the Building is part of a larger project, business park or master development,
and services or items which are within the definition of Operating Costs are
provided to multiple buildings in such project on a shared basis, Landlord shall
allocate to the Building an equitable portion of the Operating Costs arising out
of such services or items, that is, the portion of the total cost of such
services or items which corresponds to the Building's equitable share thereof.
By way of example, landscaping costs which are contracted as an entirety for a
multi-building project shall be allocated on an appropriate basis between all
tenantable buildings in such project.
9.9 Tenant's Right of Review.
9.9.1 Each Expense Statement which Landlord provides to Tenant
pursuant to this Section 9, above, shall be conclusive and binding upon Tenant
unless, within thirty (30) days after Tenant's receipt of the Expense Statement
for a particular calendar year, Tenant provides Landlord with written notice
(the "Review Notice") stating that Tenant is exercising its right to undertake a
more extensive review of the Operating Costs or Real Estate Taxes (hereinafter
"Total Expenses") for the Building for such calendar year. Such review shall
commence within thirty (30) days after Tenant's Review Notice on a mutually
agreeable time and date, at the offices of Landlord (or such other location as
is reasonably designated by Landlord), and shall be completed within thirty (30)
days after commenced. Tenant's review shall take place during Landlord's normal
business hours, and shall be limited to those books and/or documentation which
contain the data for and the method used by Landlord in calculating the Total
Expenses for the Building for the applicable year. Tenant's right to review
Total Expenses for the Building for a particular calendar year shall be a
one-time right for each calendar year.
9.9.2 Tenant shall notify Landlord in writing of the results of
Tenant's review within ten (10) business days after such review is completed. If
Tenant's review demonstrates that Landlord has overstated Total Expenses, but by
less than five percent (5%), then Landlord shall credit the amount of such
overstatement against Tenant's next due payment of Base Rent and additional
rent, and Tenant shall bear the full cost of Tenant's review. If Tenant's review
demonstrates that Landlord has overstated Total Expenses by five percent (5%) or
more, then Landlord shall credit such amount against Tenant's next due payment
of Base Rent and additional rent, and Landlord shall reimburse Tenant the
reasonable and actual costs (including any third party costs) of Tenant's
review, not to exceed Two Thousand Five Hundred Dollars ($2,500.00). If Tenant's
review demonstrates that Landlord has not overstated Total Expenses, then (i)
Landlord shall have the right to invoice Tenant for any amount by which Tenant's
share of Total Expenses was understated, which invoice shall be payable by
Tenant within fifteen (15) days after receipt thereof, (ii) Tenant shall bear
the full cost of Tenant's review, and (iii) Tenant shall reimburse Landlord for
any reasonable and actual third party costs which Landlord incurred in
connection with such review, not to exceed Two Thousand Five Hundred Dollars
($2,500.00). .
9.9.3 If Landlord disputes the results of Tenant's review, and
the parties are unable to reach agreement with regard thereto despite good faith
efforts to do so, Tenant may submit the matter for resolution by binding
arbitration, in accordance with the commercial arbitration rules of the American
Arbitration Association. In no event will Tenant withhold any Base Rent or
additional rent otherwise due under this Lease during the pendency of any such
review (or during the pendency of any dispute with regard to the results of such
review), provided that if Landlord is required to refund any monies paid by
Tenant by virtue of the results of such arbitration, such repayment shall
include interest from the date paid by Tenant until the repaid to Tenant by
Landlord, calculated at the Default Rate.
10. INCREASES IN REAL ESTATE TAXES
------------------------------
10.1 Defined. For each calendar year or portion thereof during the Term,
Tenant shall pay as additional rent to Landlord, without diminution, set-off or
deduction, Tenant's share of an amount (hereinafter referred to as "Tax
Increases") equal to the difference between:
(A) "Tenant's Share" of "Real Estate Taxes" (defined in Section
10.5, below) paid in such calendar year; and
(B) "Tenant's Share" of "Real Estate Taxes" paid in the "Real
Estate Tax Base Year" (defined below.)
10.2 Base Year. For all purposes hereof, the Real Estate Tax Base Year
shall be Calendar Year 1999.
10.3 Estimated Payments. Tenant shall make monthly installment payments
toward Tenant's Share of Tax Increases on an estimated basis, based on
Landlord's reasonable estimate of Tax Increases for such calendar year. Tenant
shall pay Landlord commencing on the first day of the month immediately
following the last day of the Real Estate Tax Base Year, and on the first day of
each month thereafter during the Term, one-twelfth (1/12th) of Landlord's
estimate of Tenant's Share of Tax Increases for the then-current calendar year.
If at any time or times during
such calendar year, it appears to Landlord that Tenant's Share of Tax Increases
for such calendar year will vary from Landlord's estimate by more than five
percent (5%) on an annualized basis, Landlord may, by written notice to Tenant,
revise its estimate for such calendar year and Tenant's estimated payments
hereunder for such calendar year shall thereupon be based on such revised
estimate.
10.4 Annual Reconciliation. Within one hundred twenty (120) days after
the end of each calendar year after the Real Estate Tax Base Year, Landlord
shall provide to Tenant a statement (the "Expense Statement") setting forth the
total Real Estate Taxes for such calendar year and Tenant's Share of Tax
Increases for the applicable year. Within fifteen (15) days after the delivery
of such Expense Statement, Tenant shall pay to Landlord any deficiency between
the amount shown as Tenant's Share of Tax Increases for such calendar year and
the estimated payments made by Tenant toward such amount in accordance with
Section 10.3, above. In the case of excess estimated payments, the excess shall
be applied against estimated payments of Real Estate Taxes for the subsequent
calendar year, unless the Lease shall have expired, in which event Landlord
shall refund such excess, without interest, with the delivery of the Expense
Statement.
10.5 Real Estate Taxes. For purposes of this Lease, "Real Estate Taxes"
shall mean all taxes and assessments, general or special, ordinary or
extraordinary, foreseen or unforeseen, assessed, levied or imposed upon the
Property, or assessed, levied or imposed upon the fixtures, machinery, equipment
or systems in, upon or used in connection with the operation of the Property
under the current or any future taxation or assessment system or modification
of, supplement to, or substitute for such system. Real Estate Taxes (a) shall
include all reasonable expenses (including, but not limited to, attorneys' fees,
disbursements and actual costs) incurred by Landlord in obtaining or attempting
to obtain a reduction of such taxes, rates or assessments, including any legal
fees and costs incurred in connection with contesting or appealing the amounts
or the imposition of any Real Estate Taxes, and (b) shall exclude any franchise,
capital stock, capital, rent, income, profit or similar tax or charge. Landlord
shall pay any special assessment by installments to the extent it has the right
to do so, and in such event, Real Estate Taxes shall include such installments
and interest paid on the unpaid balance of the assessment. In the event Landlord
succeeds in obtaining a reduction of such taxes, rates or assessments, then,
after reimbursement to Landlord of all reasonable expenses (including, but not
limited to, reasonable attorneys' fees, disbursements and actual costs) incurred
by Landlord in obtaining such reduction, Tenant shall be entitled to receive its
proportionate share of the net amount of any refund received or reduction
obtained by Landlord to the extent allocable to the Term of this Lease.
10.6 Project Taxes. To the extent the Building and/or Land is part of a
larger project or development, Landlord shall have the right (but not the
obligation) to allocate to the Building an appropriate portion of those Real
Estate Taxes which are incurred with respect to the project as a whole. By way
of example, except to the extent there are separate tax assessments for each
such building, taxes for a multi-building project shall be allocated on an
appropriate basis between all tenantable buildings in the project.
11. ADDITIONAL PROVISIONS; OPERATING COSTS AND REAL ESTATE TAXES.
-------------------------------------------------------------
11.1 Partial Year; End of Term. To the extent Real Estate Taxes, and/or
any items of Operating Costs, cannot more accurately be determined for any
partial calendar year of the Term by a method other than proration, the parties
agree that such determination shall be made by multiplying the amount thereof
for the full calendar year by a fraction, the numerator of which is the number
of days during such partial calendar year falling within the Term and the
denominator of which is 365. If this Lease terminates on a day other than the
last day of a calendar year, the amount of any adjustment to Tenant's Share of
Expense Increases and Tax Increases with respect to the calendar year in which
such termination occurs shall be prorated on the basis which the number of days
from the commencement of such calendar year to and including such termination
date bears to 365; and any amount payable by Landlord to Tenant or Tenant to
Landlord with respect to such adjustment shall be payable within thirty (30)
days after delivery by Landlord to Tenant of the applicable Expense Statement
with respect to such calendar year.
11.2 Other Taxes. In addition to Tenant's Share of both Expense
Increases and Tax Increases: (a) Tenant shall pay to Landlord (in accordance
with Section 1.5, above) Tenant's Share of any taxes imposed upon the Premises,
the Building, the Land or the rents payable hereunder in the nature of a sales
or use tax or other levy (but not including any income or franchise tax, net
profits tax, estate tax, inheritance tax or payroll tax); and (b) Tenant shall
pay, prior to delinquency, all personal property taxes payable with respect to
all property of Tenant located in the Premises or the Building and shall provide
promptly, upon request of Landlord, written proof of such payment.
11.3 Timing of Estimates. If Landlord does not determine its estimate
for the then current calendar year of Tenant's Share of Expense Increases and/or
Tax Increases until February 1 or later, Tenant shall continue to make such
payments at the prior calendar year's rate, and in such event, Tenant's first
such estimated payment installment after such estimate is first made or updated
shall include, retroactively, any increases in the monthly estimated payments
applicable since January 1 of the same calendar year.
12. TENANT'S INSURANCE.
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12.1 Coverage Requirements. Tenant shall during the Term of this Lease,
procure at its expense and keep in force the following insurance: (i) Commercial
general liability insurance naming the Landlord and Landlord's managing agent as
additional insureds against any and all claims for bodily injury and property
damage occurring in or about the Premises. Such insurance shall have a combined
single limit of not less than One Million Dollars ($1,000,000) per occurrence
with a Two Million Dollar ($2,000,000) aggregate limit and excess umbrella
liability insurance in the amount of Two Million Dollars ($2,000,000). If Tenant
has other locations that it owns or leases, the policy shall include an
aggregate limit per location endorsement. Such liability insurance shall be
primary and not contributing to any insurance available to Landlord and
Landlord's insurance shall be in excess thereto. In no event shall the limits of
such insurance be considered as limiting the liability of Tenant under this
Lease; (ii) personal property insurance insuring all equipment, trade fixtures,
inventory, fixtures and personal property located within the Premises for perils
covered by the causes of loss -- special form (all risk) and in addition,
coverage for flood, earthquake and boiler and machinery (if applicable), which
insurance shall be
written on a replacement cost basis in an amount equal to one hundred percent
(100%) of the full replacement value of the aggregate of the foregoing; (iii)
workers' compensation insurance in accordance with statutory laws and employers'
liability insurance with a limit of not less than One Hundred Thousand Dollars
($100,000) per employee and Five Hundred Thousand Dollars ($500,000) per
occurrence; (iv) business interruption and/or loss of rental insurance in an
amount equal to at least to twelve (12) months of Base Rent payable by Tenant
hereunder, and which shall not contain a deductible greater than an amount equal
to seventy-two (72) hours of the Rent in effect at such time (or an equivalent
amount expressed in dollars), and which shall name Landlord as an additional
insured; and (v) such other insurance as may be required by Landlord's
beneficiaries or mortgagees of any deed of trust or mortgage encumbering the
Premises, or as is reasonable and customary for first class office buildings in
the area in which the Building is located.
12.2 Rating; Certificates; Cancellation. The policies required to be
maintained by Tenant shall be with companies rated A:X or better in the most
current issue of Best's Insurance Reports, and licensed to do business in the
state in which the Premises are located and domiciled in the USA. Except as
provided in Section 12.1, above, any deductible amounts under any insurance
policies required hereunder shall not exceed Ten Thousand Dollars ($10,000).
Evidence of insurance (certificates and copies of the policies may be required)
shall be delivered to Landlord prior to the Commencement Date. Each policy of
insurance shall provide notification to Landlord at least thirty (30) days prior
to any cancellation or modification. Tenant shall have the right to provide
insurance coverage which it is obligated to carry pursuant to the terms hereof
in a blanket policy, provided such blanket policy expressly affords coverage to
the Premises and to Landlord as required by this Lease.
13. LANDLORD'S INSURANCE.
---------------------
At all times during the Lease Term, Landlord will maintain (a) fire and
extended coverage insurance covering the Building, in an amount sufficient to
prevent Landlord from being a co-insurer under its policies of insurance, and
(b) public liability and property damage insurance in an amount customary for
properties which are comparable to the Building, as determined by Landlord in
its sole but reasonable discretion. Landlord shall also have the right to obtain
such other types and amounts of insurance coverage on the Building and
Landlord's liability in connection with the Building as Landlord determines is
customary or advisable for a first class office building in the Boston
metropolitan area. Tenant acknowledges and agrees that all premiums for
insurance obtained by Landlord pursuant to this Section 13 shall be included
within "Operating Costs", as such term is defined in Section 9, above.
14. DAMAGE OR DESTRUCTION.
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14.1 Damage Repair.
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14.1.1 If the Premises shall be destroyed or rendered
untenantable, either wholly or in part, by fire or other casualty, then, unless
this Lease is terminated for reasons permitted pursuant to Sections 14.2 and/or
14.5, below, Landlord shall, within thirty (30) days after the date of such
casualty, provide Tenant with Landlord's good faith written estimate (the
"Estimate") of how long it will take to repair or restore the Premises.
14.1.2 If the Estimate indicates that Landlord will require less
than one hundred eighty (180) days after the date of such casualty to perform
such repairs or restoration, then this Lease shall continue in full force and
effect, and Landlord shall, promptly after adjusting the insurance claim and
obtaining governmental approvals for reconstruction, commence and diligently
prosecute to completion the restoration of the Premises to their previous
condition, subject to Section 14.4 below and subject to Force Majeure (as
defined herein) or delay caused by Tenant. Pending substantial completion of
such restoration, the Rent shall be abated in the same proportion as the
untenantable portion of the Premises bears to the whole thereof.
14.1.3 If Landlord indicates within the Estimate that it will
require in excess of one hundred eighty (180) days after the date of such
casualty to fully repair or restore the Premises in accordance herewith, then
within thirty (30) days after Landlord delivers Tenant the Estimate, either
Landlord or Tenant shall have the right to terminate this Lease by written
notice to the other, which termination shall be effective as of the date of such
notice of termination, and all liabilities and obligations of Landlord and
Tenant thereafter accruing shall terminate and be of no legal force and effect.
14.1.4 If neither party elects to terminate the Lease, as
aforesaid, and Landlord fails or declines to exercise any other termination
right pursuant to this Section 14, Landlord shall, promptly after adjusting the
insurance claim and obtaining governmental approvals for reconstruction,
commence and diligently prosecute to completion such restoration. If such
restoration is not substantially completed within one hundred eighty (180) days
after the date of the casualty (or such longer period as was referenced in the
Estimate, if applicable), then for a period of up to thirty (30) days after the
expiration of such period (but in all events no later than the date Landlord
substantially completes its restoration of the Premises), Tenant shall have the
right to terminate this Lease upon thirty (30) days prior written notice to
Landlord; provided, however, that if Landlord completes such restoration prior
to the end of the thirty (30) day notice period, Tenant's notice of termination
shall be deemed rescinded and ineffective for all purposes, and this Lease shall
continue in full force and effect. The provisions of this Section are in lieu of
any statutory termination provisions allowable in the event of casualty damage.
14.2 Termination for Material or Uninsured Damages. If (i) the Building
shall be materially destroyed or damaged to the extent that the restoration of
such, in Landlord's judgment, is not economical or feasible, or (ii) the
Building shall be materially destroyed or damaged by any other casualty other
than those covered by such insurance policy, notwithstanding that the Premises
may be unaffected directly by such destruction or damage, or (iii) Landlord's
mortgagee (if any) requires that the proceeds of insurance be applied to reduce
any amounts outstanding under such mortgage, then in any such event, Landlord
may, at its election, terminate this Lease by notice in writing to Tenant within
thirty (30) days after such destruction or damage. Such notice shall be
effective thirty (30) days after receipt thereof by Tenant.
14.3 Business Interruption. Other than rental abatement as and to the
extent provided in Section 14.1, no damages, compensation or claim shall be
payable by Landlord for inconvenience or loss of business arising from
interruption of business, repair or restoration of the Building or Premises.
14.4 Repairs. Landlord's repair obligations, should it elect to repair,
shall be limited to restoration of improvements which are covered by Landlord's
insurance. Tenant acknowledges that any such repairs or restorations shall be
subject to applicable laws and governmental requirements, the requirements of
Landlord's mortgagee (if any), and to delay in the process of adjusting any
insurance claim associated therewith; and neither delays resulting from any of
the foregoing, nor modifications to the Building or to the interior of the
Premises occurring by virtue of the application of such requirements, shall not
constitute a breach of this Lease by Landlord as long as Landlord uses
reasonable efforts to commence and complete such repairs and restorations in a
timely fashion consistent with the pre-existing condition of the applicable
improvements.
14.5 End of Term Casualty. Anything herein to the contrary
notwithstanding, if the Premises are destroyed or damaged during the last
eighteen (18) months of the Lease Term, then either Landlord or Tenant shall
have the right to terminate this Lease upon thirty (30) days prior written
notice to the other, which termination shall be effective on the thirtieth
(30th) day after the other party's receipt of such notice. Such notice must be
delivered within thirty (30) days after such casualty, or shall be deemed
waived.
14.6 Relocation to Interim Space. If all or part of the Premises is
damaged or destroyed by fire or other casualty and neither party elects to
exercise its termination right hereunder (or if no termination rights are
triggered), then Landlord shall have the option, to be exercised by delivering
written notice to Tenant within thirty (30) days after the date of such
casualty, to relocate Tenant to available space in the Building which is
comparable to the Premises (the "Interim Space") for the period during which the
Premises are repaired or restored, provided that (i) Landlord shall pay the
reasonable and actual costs to move Tenant's moveable fixtures, furniture and
equipment into the Interim Space, and out of the Interim Space when the Premises
is repaired, (ii) the square footage of the Interim Space shall not be less than
ninety percent (90%) of the square footage of the Premises unless Tenant agrees
otherwise, (iii) the Interim Space shall be reasonably suitable for the conduct
and operation of Tenant's business, and (iv) upon occupancy of the Interim
Space, Tenant shall pay Landlord Base Rent and additional rent for the Interim
Space as set forth in this Lease, which shall be adjusted to reflect the square
footage of the Interim Space; however, in no event shall the Base Rent and
additional rent for the Interim Space exceed the Base Rent and additional rent
for the Premises. If Landlord exercises the foregoing option, Tenant shall
relocate from the Premises to the Interim Space within thirty (30) days after
receipt of Landlord's notice; and Tenant shall relocate from the
Interim Space to the reconstructed Premises within thirty (30) days after
Landlord notifies Tenant that the repair of the Premises has been substantially
completed.
15. MACHINES AND EQUIPMENT; ALTERATIONS AND ADDITIONS: REMOVAL OF FIXTURES.
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15.1 Floor Load, and Excessive Noise, Vibration, and Electrical Usage.
Tenant shall not, without Landlord's prior consent, place a load upon the floor
of the Premises which exceeds the maximum live load per square foot which
Landlord (or Landlord's architect or engineer) determines (in its good faith
professional judgment) is appropriate for the Building. Tenant will notify
Landlord prior to the installation of any high-density filing systems, or any
unusually heavy equipment or machinery, in the Premises, and all such
installations shall be subject to Landlord's reasonable consent. Business
machines, mechanical equipment and materials belonging to Tenant which cause
vibration, noise, cold, heat or fumes that may be transmitted to the Building or
to any other leased space therein to such a degree as to be objectionable to
Landlord or to any other tenant in the Building shall be placed, maintained,
isolated, stored and/or vented by Tenant (at its expense) so as to absorb and
prevent such vibration, noise, cold, heat or fumes. Landlord shall not be
required to supply electrical current for equipment that requires more than 110
volts, and Tenant will not install or operate in the Premises any electrical or
other equipment whose electrical energy consumption exceeds that of normal
office use, without first obtaining the prior consent in writing of Landlord,
who may condition such consent upon the payment by Tenant of additional rent to
compensate (at cost) for excess consumption of water and/or electricity, excess
wiring and other similar requirements. All changes, replacements or additions to
any base building Systems which may be necessitated by the installation and
operation of such electrical equipment and/or machinery by Tenant shall be
subject to Landlord's consent, and shall be performed under Landlord's direction
at Tenant's expense.
15.2 Alterations - Generally. Tenant may make cosmetic alterations
(i.e., repainting, replacement of carpeting, installation of wall covering,
etc.) to the Premises without Landlord's consent, provided that Landlord is
notified in writing prior to commencement of any such cosmetic alterations and
the same do not diminish the value of the Premises in more than a de minimis
amount. All other alterations, additions and improvements proposed to be made to
the Premises by Tenant (hereinafter, "Alterations") shall be subject to
Landlord's prior written approval, in accordance with the standards hereafter
set forth. In the case of Alterations which are structural or visible from the
exterior of the Premises, such approval may be withheld or conditioned in
Landlord's sole, absolute, and subjective discretion. In the case of all other
Alterations, such consent may not be unreasonably withheld, conditioned, or
delayed. Without limitation, it shall not be unreasonable for Landlord to deny
its consent to any Alterations (a) which would diminish the value of the
leasehold improvements to the Premises in more than a de minimis amount, (b)
which would adversely affect any Building Systems, (c) which would adversely
affect the structural elements of the Building, (d) which would impose on
Landlord any special maintenance, repair, or replacement obligations not within
the scope of those expressly provided for herein, or (e) which would constitute
"non-standard office improvements", meaning improvements which are unusual or
extraordinary for standard office usage, including curved walls, circular rooms,
windowless office areas, vault areas, areas
involving special electrical or fire suppression systems, etc. The foregoing
notwithstanding, (i) Landlord will not withhold its consent to a proposed
Alteration solely on the basis described in clause (d) if Tenant agrees, at the
time of its request for approval or notice of such Alterations, to pay all costs
associated with Landlord's meeting the additional obligations described in
clause (d), and (ii) Landlord will not withhold its consent to a proposed
Alteration solely on the basis described in clause (e) if Tenant agrees, at the
time of its request for approval or notice of such Alterations, to remove such
Alteration(s) and restore the Premises to its condition prior to the
installation thereof, at Tenant's sole expense, upon the expiration or sooner
termination of this Lease. All Alterations (including without limitation
cosmetic alterations) shall be made (1) at Tenant's sole expense, (2) according
to plans and specifications approved in writing by Landlord (to the extent
Landlord's consent is required), (3) in compliance with all applicable laws, (4)
by a licensed contractor, and (5) in a good and workmanlike manner conforming in
quality and design with the Premises existing as of the Commencement Date. In
addition, except for any alterations which Landlord requires Tenant to remove as
a pre-condition to the installation thereof, and except for Tenant's movable
office partitions, furniture, and trade fixtures, all Alterations (including
without limitation cosmetic alterations) made by Tenant shall at once become a
part of the realty and shall be surrendered with the Premises.
15.3 Removal of Alterations. Upon the expiration or sooner termination
of the Lease Term, Tenant shall, at Tenant's expense, diligently remove all
Alterations made by Tenant after the Commencement Date and designated by
Landlord or agreed to by Tenant, as the case may be, to be removed at the time
of Landlord's approval or Tenant's request for approval or notice thereof (or
otherwise required to be removed by Tenant pursuant to Exhibit C). Tenant shall
repair any damage to the Premises caused by such removal and, except as
otherwise provided herein, restore the applicable portion of the Premises to its
condition prior to such Alteration. Tenant shall remove all of its movable
property and trade fixtures at the expiration or earlier termination of this
Lease, and shall pay to Landlord the cost of repairing any damage to the
Premises or Building resulting from such removal. In no event shall Tenant
remove any portion of Landlord's Work except in connection with a permitted
Alteration hereunder. All items of Tenant's movable property, trade fixtures and
personal property that are not removed from the Premises or the Building by
Tenant at the termination of this Lease (or at any time when Landlord has the
right of reentry due to a Tenant default) shall be deemed abandoned and become
the exclusive property of Landlord, without further notice to or demand upon
Tenant. Tenant's obligations under these Sections 15.2 and 15.3 shall survive
the expiration or termination of this Lease.
15.4 Additional Covenants Regarding Alterations.
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15.4.1 Tenant shall be responsible for and shall pay when due all
costs associated with the preparation of plans and the performance of
Alterations, and the same shall be performed in a lien-free, first-class, and
good and workmanlike manner, and in accordance with applicable codes and
requirements, including the requirements of the Americans with Disabilities Act
("ADA"). Failure by Tenant to pay the costs associated with Alterations on a
timely basis so as to avoid the assertion of any statutory and/or common law
lien against the Premises or the Building shall constitute a default by Tenant
for all purposes of this Lease. Unless otherwise approved by Landlord, Tenant
shall only use new, first-class materials in connection with
Alterations. All contractors and subcontractors performing any work on behalf of
Tenant within the Premises shall be subject to Landlord's approval, licensed to
do business in jurisdiction within which the Premises is located, and for work
involving a cost in excess of $10,000, shall be bonded (or at Landlord's sole
option, bondable).
15.4.2 Tenant shall ensure that all contractors and
subcontractors performing Alterations are insured in amounts required by law and
reasonably acceptable to Landlord. Alterations may not commence, nor may Tenant
permit its contractors and subcontractors to commence or continue any such work,
until all required insurance has been obtained, and, if Landlord requests, until
certificates of such insurance have been delivered to Landlord. Such insurance
policies shall name the Landlord, Landlord's property manager, and Landlord's
mortgagee(s) as additional insureds. Such certificates of insurance shall
provide that no change or cancellation of such insurance coverage shall be
undertaken without thirty (30) days' prior written notice to Landlord. In the
event Tenant employs a contractor or subcontractor to perform all or part of any
Alterations, Tenant shall purchase, or cause its contractor to carry, General
Contractor's and Subcontractor's Required Minimum Coverages and Limits of
Liability as follows, which coverages shall be in amounts required by law and
reasonably acceptable to Landlord and in addition to any and all insurance
required to be procured by Tenant pursuant to the terms of this Lease: Worker's
Compensation, Employer's Liability Insurance, any insurance required by any
Employee Benefit Act (or similar statute), Comprehensive General Liability
Insurance (including Contractor's Protective Liability), Comprehensive
Automotive Liability Insurance, and Builder's Risk insurance.
15.4.3 Tenant agrees that Landlord and its agents and managers
will have the right to inspect any Alterations made by Tenant's contractor(s)
and subcontractor(s), and Tenant agrees to cooperate with Landlord to facilitate
such inspections. In the performance of Alterations in accordance with this
Lease, Tenant shall cause its contractor to use reasonable and diligent efforts
not to interfere with ongoing operations in the Building. Tenant's contractor
shall be responsible for all utility costs associated with the performance of
Alterations and shall either supply its own electricity and other utilities, or
shall reimburse Landlord for all utility consumption associated with such work.
Tenant shall cause its contractor(s) to keep all construction areas clean and
free of trash and debris and shall otherwise comply with any other reasonable
rules and regulations established by Landlord with regard to construction
activities within the Building. Tenant's construction contract shall indemnify
Tenant and Landlord from damages, losses and expenses associated with the acts
and omissions of Tenant's contractor, its agents, employees and subcontractors.
To the extent that any Alterations involve construction work which affects any
exterior portions of the Building or Common Areas, Landlord may impose
additional requirements as a condition of its approval of such Alterations to
ensure that Tenant restores all affected areas of the Building's exterior and/or
common areas to their original condition upon completion and otherwise protects
and restores all affected work areas within the Building (including any portions
of the Common Areas of the Building) utilized or affected in performing such
Alterations.
15.4.4 Tenant shall provide to Landlord copies of all
applications for permits, copies of all governmental inspection reports and/or
certificates, and any and all notices or violations communicated to Tenant or
its contractors by applicable governmental authorities,
promptly upon receipt and/or submission thereof, as the case may be. Tenant
agrees to comply (or to cause its contractors to comply) with all applicable
federal, state and local laws, regulations and ordinances in the performance of
Alterations, and to promptly rectify any violations of such laws caused by the
acts or omission of Tenant, its employees, agents and/or contractors, and Tenant
shall be responsible for any non-compliance by Tenant or its agents, employees
and contractors. Tenant and its contractor performing Alterations shall (a)
provide copies of warranties for Alterations and the materials and equipment
which are incorporated into the Building and Premises in connection therewith,
(b) provide to Landlord all operating and maintenance manuals for all equipment
and materials incorporated into the Building and/or Premises as part of any
Alterations, and (c) either assign to Landlord, or enforce on Landlord's behalf,
all such warranties to the extent repairs and/or maintenance on warranted items
would be covered by such warranties and are otherwise Landlord's responsibility
under this Lease.
16. ACCEPTANCE OF PREMISES.
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Tenant acknowledges that it is currently in possession of the Premises,
and Tenant agrees to accept continued possession of the Premises in its current
"as-is, where-is" condition.
17. TENANT IMPROVEMENTS.
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Exhibit C provides for Landlord to make available to Tenant a
"Refurbishment Allowance" in an amount equal to $10.00 per rentable square foot
of the Premises (or $1,024,940 total), which Tenant acknowledges and agrees that
it shall be obligated to utilize (i) prior to expiration of (or earlier
termination of) the Term, and (ii) solely for purposes of improvements to the
Premises (which may include repainting, recarpeting, and/or any other
alterations permitted by the terms of this Lease, as more fully set forth in
Exhibit C). If Tenant fails to utilize the entire Refurbishment Allowance prior
to expiration of (or earlier termination of) the Term, Landlord's obligation to
make available to Tenant any remaining unused portion thereof shall fully and
forever cease, and be deemed fully satisfied. Any refurbishments or other
improvements to be performed by Tenant to the Premises pursuant hereto shall be
treated as Alterations to the Premises and thus governed by Article 15, above,
to the extent not specifically addressed in Exhibit C hereto.
18. ACCESS.
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Tenant shall permit Landlord and its agents to enter the Premises at all
reasonable times and (except in cases of Emergency, as defined herein) upon
reasonable prior notice, not to exceed two (2) business days: to inspect the
same; to show the Premises to prospective tenants, or interested parties such as
prospective lenders and purchasers; to exercise its rights under Section 48; to
clean, repair, alter or improve the Premises or the Building; to discharge
Tenant's obligations when Tenant has failed to do so within any applicable grace
period provided for herein; to post notices of non-responsibility and similar
notices and "For Sale" signs and to place "For Lease" signs upon or adjacent to
the Building or the Premises at any time within the twelve (12) month period
prior to the expiration of the Lease Term or at any time after the premises has
been vacated by Tenant; or for any other legitimate business purpose. Tenant
shall permit Landlord and its agents to enter the Premises at any time, and
without notice, in the event of an Emergency. When reasonably necessary,
Landlord may temporarily close entrances, doors, corridors, elevators or other
facilities without liability to Tenant by reason of such closure. Landlord, in
the exercise of all of its rights under this Section 18, shall use commercially
reasonable efforts to minimize disruption of Tenant's use and occupancy of the
Premises.
19. MUTUAL WAIVER OF CLAIMS AND SUBROGATION.
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19.1 Tenant. Notwithstanding anything to the contrary in this Lease,
whether the loss or damage is due to the negligence of Landlord or Landlord's
agents or employees, or any other cause, Tenant hereby releases Landlord and
Landlord's agents and employees from responsibility for and waives its entire
claim of recovery for (i) any and all loss or damage to the personal property of
Tenant located in the Building, including, without limitation, the Building
itself and such property as may be attached to the Building itself, arising out
of any of the perils which are covered by Tenant's property insurance policy,
with extended coverage endorsements which Tenant is required to obtain under the
applicable provisions of this Lease, whether or not actually obtained, or (ii)
loss resulting from business interruption or loss of rental income, at the
Premises, arising out of any of the perils which may be covered by the business
interruption or by the loss of rental income insurance policy held by Tenant.
19.2 Landlord. Notwithstanding anything to the contrary in this Lease,
whether the loss or damage is due to the negligence of Tenant or Tenant's agents
or employees, or any other cause, Landlord hereby releases Tenant and Tenant's
agents and employees from responsibility for and waives its entire claim of
recovery for any and all loss or damage to the personal property of Landlord
located in the Building, including, without limitation, the Building itself and
such property as may be attached to the Building itself, arising out of any of
the perils which are covered by Landlord's property insurance policy which
Landlord is required to obtain under the applicable provisions of this Lease,
whether or not actually obtained.
19.3 Carriers. Landlord and Tenant shall each cause its respective
insurance carrier(s) to consent to such waiver of all rights of subrogation
against the other, and to issue an endorsement to all policies of insurance
obtained by such party confirming that the foregoing release and waiver will not
invalidate such policies.
20. INDEMNIFICATION.
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20.1 Tenant's Indemnity. Tenant shall indemnify and hold harmless
Landlord, its agents, employees, officers, directors, partners and shareholders
from and against any and all third party liabilities, judgments, demands, causes
of action, claims, losses, damages, costs and expenses, including reasonable
attorneys' fees and costs, asserted against Landlord by third parties or
sustained in connection with any third party claims for injury or death to
persons or damage to property against Landlord, by third parties and arising out
of the use, occupancy, conduct, or operation of the Premises by, or the willful
misconduct or negligence of, Tenant, its officers, contractors, licensees,
agents, servants, employees, or (while within the Premises) its guests or
invitees, or caused by any failure of Tenant to comply with the terms of this
Lease.
This indemnification shall survive termination of this Lease. This provision
shall not be construed to make Tenant responsible for loss, damage, liability or
expense resulting from injuries or death to third parties or to the property of
third parties to the extent caused by the negligence of Landlord, or its
officers, contractors, licensees, agents, employees or invitees.
20.2 Landlord's Indemnity. Landlord shall indemnify and hold harmless
Tenant, its agents, employees, officers, directors, partners and shareholders
from and against any and all third party liabilities, judgments, demands, causes
of action, claims, losses, damages, costs and expenses, including reasonable
attorneys' fees and costs, asserted against Tenant by third parties or sustained
by Tenant in connection with any third party claims for injury or death to
persons or damage to property, and arising out of the use, occupancy, conduct,
operation, or management of the Building by, or the willful misconduct or
negligence of, Landlord, its officers, contractors, licensees, agents, servants,
or employees, or caused by any failure of Landlord to comply with the terms of
this Lease. This indemnification shall survive termination of this Lease. This
provision shall not be construed to make Landlord responsible for loss, damage,
liability or expense resulting from injuries or death to third parties or to the
property of third parties to the extent caused by the negligence of Tenant, or
its officers, contractors, licensees, agents, employees or invitees, or by the
acts or omission of any other tenants or occupants of the Building.
21. ASSIGNMENT AND SUBLETTING.
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21.1 Consent Required. Subject to the terms of this Article 21, Tenant
shall not assign, encumber, mortgage, pledge, license, hypothecate or otherwise
transfer the Premises or this Lease, or sublease all or any part of the
Premises, or permit the use or occupancy of the Premises by any party other than
Tenant, without the prior written consent of Landlord, which shall not be
unreasonably withheld as more fully set forth below.
21.2 Procedure.
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21.2.1 Tenant must request Landlord's consent to any such
assignment or sublease in writing at least thirty (30) days prior to the
commencement date of the proposed sublease or assignment, which written request
(a "Proposal Notice") must include (1) the name and address of the proposed
assignee or subtenant, (2) the nature and character of the business of the
proposed assignee or subtenant, (3) financial information (including financial
statements) of the proposed assignee or subtenant, (4) the proposed effective
date of the assignment or sublease, which shall be not less than thirty (30)
days thereafter, and (5) a copy of the proposed sublease or assignment
agreement. Tenant shall also reasonable and diligent efforts to provide any
additional information Landlord reasonably requests regarding such proposed
assignment or subletting. Within thirty (30) days after Landlord receives
Tenant's Proposal Notice (with all required information included), but subject
to Section 21.5, below, Landlord shall have the option (i) to grant its consent
to such proposed assignment or subletting, or (ii) to deny its consent to such
proposed assignment or subletting on a reasonable basis. If Landlord does not
exercise one of the above options (or the termination right set forth in Section
21.5, below) within thirty (30) days after Landlord receives such Proposal
Notice, then Tenant may assign or sublease the Premises upon the terms stated in
the Proposal Notice.
21.2.2 Section 21.2.1 and 21.5, below, to the contrary
notwithstanding, Tenant shall have the right to sublet up to ten percent (10%)
of the net rentable area of the Premises (in the aggregate), for periods not in
excess of one (1) year, before a proposed sublease triggers Landlord's right of
termination under clause 21.5, but any such sublease(s) shall nevertheless be
subject to Landlord's approval, which shall not be unreasonably withheld as
provided herein.
21.2.3 Without limitation, it shall not be unreasonable for
Landlord to deny its consent to any proposed assignment or sublease if the
proposed assignee or subtenant fails to satisfy any one or more of the following
criteria: (1) if the proposed assignee or sublessee has a net worth less than
that of the Tenant as of the date of execution of this Lease, or it otherwise
appears that the proposed assignee or subtenant may be unable to meet its
financial and other obligations under this Lease after such assignment or
sublease; (2) if the proposed assignee or subtenant proposes to use the Premises
for a purpose which is not a general office or administrative use; (3) if the
proposed assignee or subtenant has a history of landlord/tenant, debtor/creditor
or other contractual problems (such as, but not limited to, defaults, evictions,
enforcement litigation or other disputes) with Landlord, other landlords and/or
creditors or other contracting parties; (4) if the proposed assignee or
subtenant lacks reasonable prior successful operating experience, which the
parties agree shall mean operating profitability (exclusive of extraordinary
income or charges) for the three (3) consecutive years prior to the date of the
proposed assignment or sublease; (5) if the proposed assignee or subtenant is an
existing tenant, or the affiliate of an existing tenant, in any building owned
or operated by Landlord or any affiliate of Landlord; and/or (6) if the space is
one as to which Landlord has a right of termination under Section 21.5, the
proposed sublease involves, in Landlord's reasonable judgment, a portion of the
Premises which is not independently leasable space (which shall be understood to
mean that, in order to satisfy this criteria, the proposed sublease space must
have a proportion of windowed offices relative to the Rentable Area thereof
which is comparable to the floor as a whole, and cannot lack reasonable means of
ingress, egress or access to the Common Areas, common facilities and/or core
areas of the Building located on such floor of the Building, such as access to
elevators, bathrooms, telephone and electrical closets, etc.) (any space meeting
such criteria being referred to herein as "Independently Leasable Space").
21.3 Conditions. Any subleases and/or assignments hereunder are also
subject to all of the following terms and conditions:
21.3.1 If Landlord approves an assignment or sublease as herein
provided, Tenant shall pay to Landlord, as additional rent due under this Lease,
(i) in the case of an assignment, all sums received by Tenant in consideration
of such assignment, calculated after Tenant has recovered in full from such
consideration its "Transaction Expenses" (as hereafter defined), and (ii) in the
case of a sublease , the amount, if any, by which the rent, any additional rent
and any other sums payable by the subtenant to Tenant under such sublease,
exceeds that portion of the Base Rent plus Costs of Electricity, Expense
Increases and Tax Increases payable by Tenant hereunder which is allocable to
the portion of the Premises which is the subject of such sublease, calculated
after Tenant has recovered in full its Transaction Expenses from such net
amount. The term "Transaction Expenses" shall mean all reasonable and actual
out-of-pocket expenses incurred by Tenant in procuring such assignment or
sublease, including broker
fees and legal fees (if any) paid by Tenant, any improvements which Tenant makes
to the applicable portion of the Premises at Tenant's expense in connection with
such assignment or sublease, and any buy-out of the assignee's or sublessee's
existing lease paid for by Tenant as a part of such transaction. The foregoing
payments shall be made on not less than a monthly basis by Tenant (in the case
of subleases) and in all cases within ten (10) business days after Tenant
receives the applicable consideration from the assignee or subtenant.
21.3.2 No consent to any assignment or sublease shall constitute
a further waiver of the provisions of this section, and all subsequent
assignments or subleases may be made only with the prior written consent of
Landlord. In no event shall any consent by Landlord be construed to permit
reassignment or resubletting by a permitted assignee or sublessee.
21.3.3 The assignee under any assignment of this Lease shall be
fully (and, at landlord's option, directly) liable for all of the obligations of
"Tenant" under this Lease, on a joint and several basis with Tenant. Tenant
shall nevertheless remain fully liable to Landlord for all Lease obligations,
including those accruing after the effective date of such assignment.
21.3.4 Any sublease or assignment shall be subject to the
condition that the sublessee or assignee thereunder shall be bound by all of the
terms, covenants and conditions of this Lease (in the case of a sublease,
insofar as such terms, covenants and conditions relate to the portion of the
Premises subleased and/or the operations and conduct of business by the
sublessee).
21.3.5 Without limitation, any and all guaranties of this Lease
shall be unaffected by such sublease and assignment, and shall remain in full
force and effect for all purposes.
21.3.6 Any assignment or sublease without Landlord's prior
written consent shall be void, and shall, at the option of the Landlord,
constitute a default under this Lease.
21.3.7 Tenant shall pay to Landlord a Two Hundred Fifty and
no/100ths Dollars ($250.00) processing fee, which shall accompany any proposed
assignment or sublease delivered by Tenant to Landlord, and which processing fee
shall be in addition to Landlord's reasonable attorneys fees and out-of-pocket
expenses incurred in connection with Landlord's review of such sublease or
assignment (if any), which shall also be reimbursed by Tenant.
21.3.8 In no event will any assignment, sublease, occupancy
arrangement or other transfer of this Lease be entered into by Tenant on a basis
pursuant to which rental or any other payments payable to Landlord or Tenant
under such arrangement are based in whole or in part on the net income or
profits derived by the assignee, sublessee, transferee or occupant from
operations at the Premises.
21.4 Affiliated Entity; Sale of Business.
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21.4.1 Notwithstanding anything to the contrary in this Lease, so
long as such transfer is not effectuated as part of a transaction or series of
transfers orchestrated in order to effect a transfer of this Lease (or Tenant's
interest herein) in isolation to Tenant's other leasehold
interests and assets, Landlord's shall not unreasonably withhold its consent to
any sublease, assignment or other transfer of this Lease to any other entity
which (i) controls or is controlled by Tenant, or (ii) is controlled by Tenant's
parent company, or (iii) which purchases all or substantially all of the assets
of Tenant, or (iv) which purchases all or substantially all of the stock of
Tenant or (v) which merges with Tenant pursuant to a valid statutory merger;
provided, that (1) the assignee or sublessee is financially able to meet all of
its obligations under the proposed assignment or sublease, and (2) in such
event, (a) except in cases of statutory merger, in which case the surviving
entity in the merger shall be liable as the Tenant under this Lease, Tenant
shall continue to remain fully liable under the Lease, on a joint and several
basis with the assignee or acquiror of such assets or stock, (b) the terms of
any guaranty of this Lease shall remain in full force and effect, unmodified,
and (c) following such sublease or assignment, Tenant shall continue to comply
with all of its obligations under this Lease, including with respect to its
Permitted Use of the Premises, as set forth in Section 4.1, above.
21.4.2 Tenant shall be required to give Landlord written notice
of any sublease or assignment within the scope of Section 21.4.1, above at the
time such transaction is effectuated (and in all events no later than five (5)
business days thereafter. Any other transfer of fifty percent (50%) or more of
the ownership interests (including, without limitation, partnership interests or
stock) in Tenant or of operating control over Tenant (whether by management
agreement, stock sale or other means) shall be deemed to constitute an
assignment of this Lease, and shall be subject to Landlord's consent as
aforesaid.
21.4.3 Notwithstanding the last sentence of Section 21.4.1 to the
contrary, Landlord agrees that the offer and sale by Tenant (or any stockholder
of Tenant) of any stock pursuant to an effective registration statement filed
pursuant to the Securities Act of 1933 (including any initial public offering of
registered stock of the Tenant) or pursuant to and in accordance with the
securities laws of any foreign country governing publicly traded companies and
not in violation of U.S. law, shall not constitute an assignment of this Lease,
and shall not require the consent or approval of Landlord.
21.4.4 Tenant shall not transfer all or substantially all of its
assets to any person or entity unless either (i) this Lease is one of the assets
so transferred to such other person or entity, and the transferee assumes in
writing, for Landlord's benefit, the obligations of Tenant accruing hereunder
from and after the effective date of the transfer, or (ii) the transferee(s)
thereof otherwise delivers to Landlord a written assumption of Tenant's
obligations hereunder.
21.5. Right of Termination. Except for any assignment or sublease
permitted pursuant to Section 21.4, above, in the event of (i) a proposed
assignment of this Lease, (ii) a proposed sublease in excess of one (1) year
involving more than ten percent (10%) of the Premises, Landlord shall have the
right, by notice to Tenant delivered within thirty (30) days after Landlord's
receipt of Tenant's Proposal Notice (and in lieu of the granting or denial of
consent provided for in Section 21.2, above), to terminate this Lease as to all
of the Premises (in the event of an assignment) or as to the subleased portion
of the Premises only (in the event of a sublease), for the balance of the Term.
In the event Landlord shall elect to terminate this Lease in connection with a
proposed assignment or sublease of this Lease as provided above in whole or in
part (as the case may be): (a) this Lease and the term hereof shall terminate
(either as to the
Premises as a whole, or only as to the portion thereof which Tenant is proposing
to sublease, as the case may be) as of the later of (i) the proposed effective
date of such assignment or sublease, as set forth in Tenant's Proposal Notice,
or (ii) thirty (30) days after the date Landlord received Tenant's Proposal
Notice; (b) Tenant shall be released from all liability under the Lease (as to
the Premises as a whole, in the case of an assignment, or as to the terminated
portion of the Premises only, in the case of a partial termination due to
sublease) with respect to the period after the date of termination (other than
obligations and indemnities of Tenant which accrued with respect to the
applicable portion of the Premises prior to the effective date of such
termination, which obligations shall expressly survive such termination or
partial termination of this Lease); (c) all Base Rent, Additional Rent and other
charges shall be prorated to the date of such termination, and appropriately
adjusted if there is only a partial termination; (d) upon such termination date,
Tenant shall surrender the Premises (or the applicable portion thereof) to
Landlord in accordance with Section 26 hereof; and (e) in the case of a partial
termination of this Lease, Landlord shall have the right to separate the portion
of the Premises being terminated from the balance of the Premises, including the
erection of a demising wall and, to the extent necessary under the
circumstances, the separation of any applicable Building Systems.
22. ADVERTISING.
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22.1 Generally. Except as provided below, Tenant shall not display any
sign, graphics, notice, picture, or poster, or any advertising matter
whatsoever, anywhere in or about the Premises or the Building at places visible
from anywhere outside or at the entrance to the Premises without first obtaining
Landlord's written consent thereto, which Landlord may grant or withhold in its
sole discretion. All signage, including interior and exterior signage, shall be
at Tenant's sole expense, and subject to compliance with all applicable laws.
Tenant shall be responsible to maintain any permitted signs and remove the same
at Lease termination. In addition, upon the expiration or earlier of this Lease,
all exterior signs identifying Tenant shall be removed by Tenant at Tenant's
sole expense, and the affected portions of the Building shall be restored by
Tenant. If Tenant shall fail to maintain or remove its signs, as aforesaid,
Landlord may do so at Tenant's cost. Tenant shall be responsible to Landlord for
any damage caused by the installation, use, maintenance or removal of any such
signs.
22.2 Signage Program/ Permitted Signage. Notwithstanding Section 22.1 to
the contrary, lobby and suite identification signage shall be permitted in
accordance with applicable legal requirements and the Landlord's overall signage
program for the Building, subject to Landlord's approval which shall not be
unreasonably withheld (in light of Landlord's overall signage program for the
Building). Generally, Tenant shall be permitted (at Tenant's expense) to install
a standard suite entry sign, and (if applicable) directory identification panels
on that portion of the Building's lobby directory located in the main lobby of
the Building (if any), commensurate with the relative square footage of the
Premises as compared to the square footage of the Building as a whole. Landlord
agrees that Tenant's current signage at the Premises is acceptable to Landlord.
23. LIENS.
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Tenant shall keep the Premises and the Building free from any liens
arising out of any work performed, materials ordered or obligations incurred by
or on behalf of Tenant, and Tenant hereby agrees to indemnify and hold Landlord,
its agents, employees, independent contractors, officers, directors, partners,
and shareholders harmless from any liability, cost or expense for such liens.
Tenant shall cause any such lien imposed to be released of record by payment or
posting of the proper bond acceptable to Landlord within thirty (30) days after
the earlier of notice of intent to impose the lien or written request by
Landlord. If Tenant fails to remove any lien within the prescribed thirty (30)
day period, then Landlord may do so at Tenant's expense and Tenant shall
reimburse Landlord for such amount, including reasonable attorneys' fees and
costs.
24. DEFAULT.
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24.1 Tenant's Default. A default under this Lease by Tenant shall exist
if any of the following occurs:
24.1.1 If Tenant fails to pay Rent, additional rent or any other
sum required to be paid hereunder within ten (10) business days after written
notice from Landlord that such payment was due, but was not paid as of the due
date (provided, however, if Landlord has delivered two (2) such notices to
Tenant in any twelve (12) month period, or four (4) such notices over the Term
of this Lease, whichever first occurs, then any subsequent failure to pay Base
Rent, additional rent or any other sum required to be paid to Landlord hereunder
on or before the due date for such payment shall constitute a default by Tenant
without requirement of such ten (10) business day notice and opportunity to
cure); or
24.1.2 If Tenant fails to perform any term, covenant or condition
of this Lease except those requiring the payment of money to Landlord as set
forth in Section 24.1.1 above, and Tenant fails to cure such breach within
fifteen (15) days after written notice from Landlord where such breach could
reasonably be cured within such fifteen (15) day period; provided, however, that
where such failure could not reasonably be cured within the fifteen (15) day
period, Tenant shall not be considered in default if it commences such
performance within the fifteen (15) day period and diligently thereafter
prosecutes the same to completion, such grace period not to exceed a maximum of
sixty (60) days in the aggregate. If any provisions of this Lease calls for a
shorter or different grace period than that set forth above, then such other
provision shall control over this provision. The foregoing notice and cure
period notwithstanding, Landlord may exercise its self-help rights hereunder
(i.e., Landlord's right to perform any obligation of Tenant which Tenant has
failed to perform hereunder) without any prior notice or upon such shorter
notice as may be reasonable under the circumstances in the event of any one or
more of the following circumstances is present: (i) there exists a reasonable
risk of prosecution of the Landlord unless such obligation is performed sooner
than the stated cure period, (ii) there exists an imminent possibility of danger
to the health or safety of the Landlord, the Tenant, Tenant's invitees, or any
other occupants of, or visitors to, the Building, unless such obligation is
performed sooner than the stated cure period, and/or (iii) the Tenant has
failed to obtain insurance required by this Lease, or such insurance has been
canceled by the insurer without being timely replaced by Tenant, as required
herein.
24.1.3 If Tenant or any guarantor of this Lease shall (i) make an
assignment for the benefit of creditors, (ii) acquiesce in a petition in any
court in any bankruptcy, reorganization, composition, extension or insolvency
proceedings, (iii) seek, consent to or acquiesce in the appointment of any
trustee, receiver or liquidator of Tenant or of any guarantor of this Lease and
of all or any part of Tenant's or such guarantor's property, (iv) file a
petition seeking an order for relief under the Bankruptcy Code, as now or
hereafter amended or supplemented, or by filing any petition under any other
present or future federal, state or other statute or law for the same or similar
relief, or (v) fail to win the dismissal, discontinuation or vacating of any
involuntary bankruptcy proceeding within sixty (60) days after such proceeding
is initiated.
24.2 Remedies. Upon a default, Landlord shall have the following
remedies, in addition to all other rights and remedies provided by law or
otherwise provided in this Lease, any one or more of which Landlord may resort
cumulatively, consecutively, or in the alternative:
24.2.1 Landlord may continue this Lease in full force and effect,
and this Lease shall continue in full force and effect as long as Landlord does
not terminate this Lease, and Landlord shall have the right to collect Base
Rent, additional rent and other charges when due.
24.2.2 Landlord may terminate this Lease, or may terminate
Tenant's right to possession of the Premises, at any time by giving written
notice to that effect, in which event Landlord may (but shall not be obligated
to) relet the Premises or any part thereof. Upon the giving of a notice of the
termination of this Lease, this Lease (and all of Tenant's rights hereunder)
shall immediately terminate, provided that, without limitation, Tenant's
obligation to pay Base Rent, Costs of Electricity, Expense Increases and Tax
Increases (as well as any damages otherwise payable under this Section 24),
shall survive any such termination and shall not be extinguished thereby (but
shall be reduced by any rental payments Landlord in fact receives after any
reletting of the Premises or any portion thereof, as more fully set forth
below). Upon the giving of a notice of the termination of Tenant's right of
possession, all of Tenant's rights in and to possession of the Premises shall
terminate but this Lease shall continue subject to the effect of this Section
24. Upon either such termination, Tenant shall surrender and vacate the Premises
in the condition required by Section 26, and Landlord may re-enter and take
possession of the Premises and all the remaining improvements or property and
eject Tenant or any of the Tenant's subtenants, assignees or other person or
persons claiming any right under or through Tenant or eject some and not others
or eject none. This Lease may also be terminated by a judgment specifically
providing for termination. Any termination under this section shall not release
Tenant from the payment of any sum then due Landlord or from any claim for
damages or Base Rent, additional rent or other sum previously accrued or
thereafter accruing against Tenant, all of which shall expressly survive such
termination. Upon such termination Tenant shall be liable immediately to
Landlord for all costs Landlord incurs in attempting to relet the Premises or
any part thereof, including, without limitation, broker's commissions, expenses
of cleaning and redecorating the Premises required by the reletting and like
costs. Reletting may be for a period shorter or longer than the remaining Lease
Term. No act by Landlord other than giving written notice to Tenant shall
terminate this Lease. Acts of maintenance, efforts to relet
the Premises or the appointment of a receiver on Landlord's initiative to
protect Landlord's interest under this Lease shall not constitute a constructive
or other termination of Tenant's right to possession or of this Lease, either of
which may be effected solely by an express written notice from Landlord to
Tenant. On termination, Landlord has the right to recover from Tenant as
damages:
(a) The worth at the time of award of unpaid Base Rent,
additional rent and other sums due and payable which had been earned at the time
of termination; plus
(b) The worth at the time of award of the amount by which
the unpaid Base Rent, additional rent and other sums due and payable which would
have been payable after termination until the time of award exceeds the amount
of such rent loss that Tenant proves could have been reasonably avoided; plus
(c) The worth at the time of award of the amount by which
the unpaid Base Rent, additional rent or other sums due and payable for the
balance of the Lease Term after the time of award exceeds the amount of such
rent loss that Tenant proves could be reasonably avoided; plus
(d) Any other amount necessary which is to compensate
Landlord for all the detriment proximately caused by Tenant's failure to perform
Tenant's obligations under this Lease, or which, in the ordinary course of
things, would be likely to result therefrom, including, without limitation, any
costs or expenses incurred by Landlord: (i) in retaking possession of the
Premises; (ii) in maintaining, repairing, preserving, restoring, replacing,
cleaning, altering or rehabilitating the Premises or a portion thereof,
including such acts for reletting to a new tenant or tenants; (iii) for leasing
commissions; or (iv) for any other costs necessary or appropriate to relet the
Premises; plus
(e) At Landlord's election, such other amounts in
addition to or in lieu of the foregoing as may be permitted from time to time by
the laws of the State in which the Premises are located.
The "worth at the time of award" of the amounts referred
to in Sections 24.2.2(a) and (b) is computed by allowing interest at the Default
Rate on the unpaid rent and other sums due and payable from the termination date
through the date of award. In lieu of the amounts recoverable in a lump sum by
Landlord pursuant to clauses (b) and (c) of this Section 24.2.2, above, but in
addition to the amounts specified in clauses (a), (d), and (e) (or any other
portion of this Section 24), Landlord may, at its sole election, recover
"Indemnity Payments," as defined hereinbelow, from Tenant. For purposes of this
Lease "Indemnity Payments" means an amount equal to the Base Rent, additional
rent and other payments provided for in this Lease which would have become due
and owing thereunder from time to time during the unexpired Lease Term after the
effective date of the termination, but for such termination, less the Base Rent,
additional rent and other payments, if any, actually collected by Landlord and
allocable to the Premises. If Landlord elects to pursue Indemnity Payments in
lieu of the amount recoverable in a lump sum by Landlord under clauses (b) and
(c), above, Tenant shall, on demand, make Indemnity Payments monthly, and
Landlord may xxx for all Indemnity Payments at any time
after they accrue, either monthly, or at less frequent intervals. Tenant further
agrees that Landlord may bring suit for Indemnity Payments at or after the end
of the Lease Term as originally contemplated under this Lease, and Tenant agrees
that, in such event, Landlord's cause of action to recover the Indemnity
Payments shall be deemed to have accrued on the last day of the Lease Term as
originally contemplated. In seeking any new tenant for the Premises, Landlord
shall be entitled to grant any concessions it deems reasonably necessary. In no
event shall Tenant be entitled to any excess of any rental obtained by reletting
over and above the rental herein reserved. Tenant waives redemption or relief
from forfeiture under any other present or future law, in the event Tenant is
evicted or Landlord takes possession of the Premises by reason of any default of
Tenant hereunder.
24.2.3 Landlord may, with or without terminating this Lease, but
only upon applicable legal process, re-enter the Premises and remove all persons
and property from the Premises; such property may be removed and stored in a
public warehouse or elsewhere at the cost of and for the account of Tenant, or,
as otherwise provided in this Lease, shall be deemed abandoned by Tenant, and
may be disposed of by Landlord at Tenant's expense and free from any claim by
Tenant or anyone claiming by, through or under Tenant. No re-entry or taking
possession of the Premises by Landlord pursuant to this Section shall be
construed as an election to terminate this Lease unless a written notice of such
intention is given to Tenant.
24.2.4 To the extent such waivers are permitted by applicable
law, and solely after an Event of Default by Tenant (after expiration of all
applicable cure periods, if any), Tenant, on its own behalf and on behalf of all
persons claiming through or under Tenant, including all creditors, does hereby
specifically waive and surrender any and all rights and privileges which Tenant
and all such persons might otherwise have under any present or future law (1) to
the service of any notice to quit or of Landlord's intention to re-enter or to
institute legal proceedings, which notice may otherwise be required to be given,
except the foregoing shall not waive any notices required under Section 24.1,
above; (2) to redeem re-enter or repossess the Premises after Tenant's right of
possession has been terminated by Landlord after such Event of Default by
Tenant; (3) to restore the operation of this Lease, with respect to any
dispossession of Tenant by judgment or warrant of any court or judge, or any
expiration or termination of this Lease, whether such dispossession, expiration
or termination shall be by operation of law or pursuant to the provisions of
this Lease, or (4) to the benefit of any law which exempts property from
liability for debt or for distress for rent.
25. SUBORDINATION.
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25.1 Subordination. Subject to Section 25.2, below, this Lease is and
shall at all times be and remain subject and subordinate to the lien of any
mortgage, deed of trust, ground lease or underlying lease now or hereafter in
force against the Premises, and to all advances made or hereafter to be made
upon the security thereof. Although the foregoing subordination shall be
self-effectuating, Tenant shall execute and return to Landlord any documentation
requested by Landlord consistent with this Section 25 in order to confirm the
foregoing subordination, within five (5) business days after Landlord's written
request. If Tenant fails to provide Landlord with such subordination documents
within five (5) business days after Landlord's written request, the same shall
constitute a default by Tenant hereunder without requirement of any further
notice or
right to cure. In the event any proceedings are brought for foreclosure, or in
the event of the exercise of the power of sale under any mortgage or deed of
trust made by the Landlord covering the Premises, Tenant shall attorn to the
purchaser at any such foreclosure, or to the grantee of a deed in lieu of
foreclosure, and recognize such purchaser or grantee as the Landlord under this
Lease, provided such purchaser assumes, either expressly or by operation of law,
the obligations of "Landlord" arising under this Lease after the date title to
the Land and Building is transferred to such purchaser or grantee. Tenant agrees
that no mortgagee or successor to such mortgagee shall be (i) bound by any
payment of Rent or additional rent for more than one (1) month in advance, (ii)
bound by any amendment or modification of this Lease made without the consent of
Landlord's mortgagee or such successor in interest, (iii) liable for damages for
any breach, act or omission of any prior landlord, except for a breach which is
of a continuing nature and which continues after such mortgagee or successor has
taken possession of the Building, has been notified of the applicable breach in
writing, and has failed to cure same within the cure period otherwise afforded
Landlord hereunder, (iv) bound to effect or pay for any construction for
Tenant's occupancy, (v) subject to any claim of offset or defenses that Tenant
may have against any prior landlord and which have accrued prior to the date
that such mortgagee or successor takes legal title to the Land and Building, or
(vi) liable for the return of any security deposit, unless such security deposit
has been physically received by such mortgagee. Any such mortgagee shall have
the right, at any time, to subordinate to this Lease any instrument to which
this Lease is otherwise subordinated by operation of this Section 25.
25.2 Notwithstanding Section 25.1, above, to the contrary, Landlord
agrees that the subordination of this Lease to any future mortgage (or ground
lease) shall be conditioned upon the delivery to Tenant of a "Subordination,
Non-Disturbance and Attornment Agreement" ("SNDA") from such future mortgagee
(or ground lessor), in substantially the form attached as Exhibit H hereto or
such other commercially reasonable form of SNDA which may be required by such
mortgagee (or ground lessor), and which shall provide, inter alia, that so long
as Tenant is not in default hereunder (beyond any applicable notice and cure
period) and attorns to such mortgagee (or ground lessor) or any
successor-in-title thereto due to a foreclosure or deed-in-lieu thereof (or a
termination of such ground lease), Tenant's rights under this Lease, including
its right of possession of the Premises, shall not be disturbed in the event of
a foreclosure of such mortgage or deed of trust (or a termination of such ground
lease). Landlord shall also use commercially reasonable efforts to obtain an
SNDA from its current mortgagee of the Property.
26. SURRENDER OF POSSESSION.
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Upon expiration of the Lease Term, Tenant shall promptly and peacefully
surrender the Premises to Landlord, broom clean and free of all of its
furniture, movable fixtures and equipment and otherwise in as good condition as
when received by Tenant from Landlord or as thereafter improved, reasonable use
and wear and tear and damage by insured casualty excepted, all to the reasonable
satisfaction of Landlord. If the Premises are not surrendered as and when
aforesaid, and in accordance with the terms of this Lease, Tenant shall
indemnify Landlord against all claims, losses, costs, expenses (including
reasonable attorneys' fees) and liabilities resulting from the delay by Tenant
in so surrendering the same, including any claims made by any succeeding
occupant founded on such delay. This indemnification shall survive termination
of this Lease.
27. NON-WAIVER.
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Waiver by Landlord of any breach of any term, covenant or condition
herein contained shall not be deemed to be a waiver of such term, covenant, or
condition(s), or any subsequent breach of the same or any other term, covenant
or condition of this Lease, other than the failure of Tenant to pay the
particular rental so accepted, regardless of Landlord's knowledge of such
preceding breach at the time of acceptance of such Rent.
28. HOLDOVER.
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28.1 Holdover - Generally. If Tenant shall, without the written consent
of Landlord, hold over after the expiration of the Lease Term (hereinafter, an
"unauthorized holdover"), Tenant shall be deemed to be a tenant at sufferance,
which tenancy may be terminated immediately by Landlord as provided by
applicable state law. During any such holdover tenancy, unless Landlord has
otherwise agreed in writing, Tenant agrees to pay to Landlord a per diem
occupancy charge equal to (A) five percent (5%) of the stated monthly Base Rent
for the last full month of the Lease Term then ending for each day of the first
month of such holdover (or 150% of such monthly Base Rent for the entire first
month), (B) six percent (6%) of the stated monthly Base Rent for the last full
month of the Lease Term then ending for each day of the second month of such
holdover (or 180% of such monthly Base Rent for the entire second month), (C)
seven percent (7%) of the stated monthly Base Rent for that last full month of
the Lease Term then ending for each day of such holdover after the first two (2)
months thereof (but not to exceed 200% of such monthly Rent for each such full
month), and (D) one hundred percent (100%) of the additional rent which would
have been payable by Tenant for the period of such holdover, calculated on a per
diem basis using the additional rent which had otherwise been payable by Tenant
for the last full month of the Lease Term then ending. Such payments shall be
made within five (5) days after Landlord's demand, and in no event less often
than once per month (in arrears). In the case of a holdover which has been
consented to by Landlord, Tenant shall be deemed to be a month to month tenant
upon all of the terms and provisions of this Lease, except the monthly Base Rent
shall be as agreed by Landlord and Tenant with respect to such consented
holdover. Upon expiration of the Lease Term as provided herein, Tenant shall not
be entitled to any notice to quit, the usual notice to quit being hereby
expressly waived under such circumstances, and Tenant shall surrender the
Premises on the last day of the Lease Term as provided in Section 26, above. The
foregoing described per diem occupancy charge is in addition to, and not in lieu
of, any other claims for damages which Landlord may have or assert against
Tenant in connection with any unauthorized holdover, including any claims
arising out of Tenant's indemnity under Section 26, above.
29. CONDEMNATION.
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29.1 Definitions. The terms "eminent domain", "condemnation", and
"taken", and the like in this Section 29 include takings for public or
quasi-public use, and sales under threat of condemnation and private purchases
in place of condemnation by any authority authorized to exercise the power of
eminent domain. Any temporary taking for a period in excess of twelve
(12) consecutive months shall be deemed to be a permanent taking within the
meaning of this Section 29.
29.2 Taking. "Taking" shall mean and refer to the acquisition or taking
of property (or any right, title or interest therein) by any governmental or
quasi-governmental authority acting under power of condemnation or eminent
domain, and shall encompass contested as well as uncontested takings as long as
initiated by the applicable governmental or quasi-governmental authority. If the
whole of the Premises is temporarily taken for a period in excess of thirty (30)
days, or is permanently taken, in either case by virtue of a Taking, this Lease
shall automatically terminate as of the date title vests in the condemning
authority, and Tenant shall pay all Base Rent, additional rent, and other
payments up to that date. If (a) twenty percent (20%) or more of the Premises is
permanently taken by virtue of a Taking, or (b) in the case of a Taking of less
than twenty percent (20%) of the Premises, Tenant is unable to make reasonable
use of the balance of the Premises remaining after the Taking, as determined by
Tenant in its reasonable, good faith discretion, or (c) access to the Building
or Premises by Tenant is, by virtue of a Taking, permanently denied, or (d) if
free parking is provided for under this Lease, the parking ratio for the
Building is, by virtue of a Taking of any parking areas serving the Building,
permanently reduced to a ratio which fails to meet applicable code requirements
after taking into account any portion of the Building taken and any reasonable
substitute parking provided by Landlord in lieu of the parking areas so taken,
then Landlord and Tenant shall each have the right (to be exercised by written
notice to the other within sixty (60) days after receipt of notice of said
taking) to terminate this Lease effective upon the date when possession of the
applicable portion of the Property is taken thereunder pursuant to such Taking.
If neither party elects to terminate this Lease, as aforesaid, then Landlord
shall diligently, and within a reasonable time, after title vests in the
condemning authority, repair and restore, at Landlord's expense, the portion not
taken so as to render same into an architectural whole to the extent reasonably
practicable, and, if any portion of the Premises is taken, thereafter the Base
Rent (and Tenant's Share) shall be reduced (on a per square foot basis) in
proportion to the portion of the Premises taken. If there is a temporary Taking
involving the Premises or Building, or if a Taking of other portions of the
Building or common areas does not deny Tenant access to the Building and
Premises, or if less than twenty percent (20%) of the Premises is permanently
taken by a Taking and Tenant is able to make reasonable use of the balance of
the Premises as determined by Tenant in its reasonable good faith discretion,
then this Lease shall not terminate, and Landlord shall, as soon as reasonably
practicable thereafter, repair and restore, at its own expense, the portion not
taken so as to render same into an architectural whole to the fullest extent
reasonably practicable. If any portion of the Premises was permanently taken,
then the Base Rent (and Tenant's Share) shall be reduced (on a per square foot
basis) in proportion to the portion of the Premises taken, commencing on the
date Tenant is deprived of the use of such portion of the Premises. If any
portion of the Premises was temporarily taken, then the Base Rent (and Tenant's
Share) shall be reduced (on a per square foot basis) in proportion to the
portion of the Premises taken for the period of such temporary taking, that is,
from the date upon which Tenant is deprived of the use of such portion of the
Premises until the date Tenant is restored to the use of such portion of the
Premises.
29.3 Award. Landlord reserves all rights to damages to the Premises or
Building, or arising out of the loss of any leasehold interest in the Building
or Premises created hereby,
arising in connection with any partial or entire taking by eminent domain or
condemnation. Tenant hereby assigns to Landlord any right Tenant may have to
such damages or award, and Tenant shall make no claim against Landlord or the
condemning authority for damages for termination of Tenant's leasehold interest
or for interference with Tenant's business as a result of such taking. The
foregoing notwithstanding, Tenant shall have the right to claim and recover from
the condemning authority separate compensation for any loss which Tenant may
incur for Tenant's moving expenses, business interruption or taking of Tenant's
personal property (but specifically excluding any leasehold interest in the
Building or Premises) under the then applicable eminent domain code, provided
that Tenant shall not make any claim that will detract from or diminish any
award for which Landlord may make a claim.
29.4 Mortgagee Rights. Tenant acknowledges that Landlord's right to any
condemnation award may be subject to the rights of Landlord's mortgagee (if any)
in and to such award under the mortgage or deed of trust (if any) which
encumbers the Building and Premises. Accordingly, Landlord's obligation to
repair and restore, as set forth in Section 29, above, shall be subject to the
requirements of Landlord's mortgagee with regard thereto, and the time within
which such obligation must be satisfied shall be adjusted as reasonably
necessary to reflect delays occasioned by the exercise by the mortgagee of such
mortgagee's rights.
30. NOTICES.
--------
All notices and demands which may be required or permitted to be given
to either party hereunder shall be in writing, and shall be delivered personally
or sent by United States certified mail, postage prepaid, return receipt
requested, or by Federal Express or other reputable overnight carrier, to the
addresses set out in Section 1.8, and to such other person or place as each
party may from time to time designate in a notice to the other. Notice shall be
deemed given upon the earlier of actual receipt or refusal of delivery.
31. MORTGAGEE PROTECTION.
---------------------
Tenant agrees to give any mortgagee(s) and/or trust deed holder(s), by
registered mail, a copy of any notice of default served upon the Landlord,
provided that prior to such notice Tenant has been notified in writing (by way
of notice of assignment of rents and leases, or otherwise) of the addresses of
such mortgagee(s) and/or trust deed holder(s). Tenant further agrees that if
Landlord shall have failed to cure such default within the time provided for in
this Lease, then the mortgagee(s) and/or trust deed holder(s) shall have an
additional thirty (30) days within which to cure such default or if such default
cannot be cured within that time, then such additional time as may be necessary
if within such thirty (30) days any mortgagee and/or trust deed holder(s) has
commenced and is diligently pursuing the remedies necessary to cure such default
(including but not limited to commencement of foreclosure proceedings, if
necessary to effect such cure), in which event Tenant shall not have the right
to pursue any claim against Landlord, such mortgagee and/or such trust deed
holder(s), including but not limited to any claim of actual or constructive
eviction, so long as such remedies are being so diligently pursued.
32. COSTS AND ATTORNEYS' FEES.
--------------------------
In any litigation between the parties arising out of this Lease, and in
connection with any consultations with counsel and other actions taken or
notices delivered, in relation to a default by any party to this Lease, the
non-prevailing party shall pay to the prevailing party all reasonable expenses
and court costs including attorneys' fees incurred by the prevailing party, in
preparation for and (if applicable) at trial, and on appeal. Such attorneys'
fees and costs shall be payable upon demand.
33. BROKERS.
--------
Tenant represents and warrants to Landlord that neither it nor its
officers or agents nor anyone acting on its behalf has dealt with any real
estate broker in the negotiating or making of this Lease, and Tenant agrees to
indemnify and hold Landlord, its agents, employees, partners, directors,
shareholders and independent contractors harmless from all liabilities, costs,
demands, judgments, settlements, claims and losses, including reasonable
attorneys fees and costs, incurred by Landlord in conjunction with any such
claim or claims of any broker or brokers claiming to have interested Tenant in
the Building or Premises or claiming to have caused Tenant to enter into this
Lease.
34. LANDLORD'S LIABILITY AND DEFAULT.
---------------------------------
34.1 No Personal Liability. Anything in this Lease to the contrary
notwithstanding, covenants, undertakings and agreements herein made on the part
of the Landlord are made and intended not for the purpose of binding Landlord
personally or the assets of Landlord generally, but are made and intended to
bind only the Landlord's interest in the Premises and Building, as the same may,
from time to time, be encumbered, and no personal liability shall at any time be
asserted or enforceable against Landlord or its stockholders, officers or
partners or their respective heirs, legal representatives, successors and
assigns on account of the Lease or on account of any covenant, undertaking or
agreement of Landlord in this Lease. Accordingly, and notwithstanding any other
provisions of this Lease to the contrary, Tenant shall look solely to Landlord's
interest in the Premises and Building, and not to any other or separate business
or non-business assets of Landlord, or any partner, shareholder, member, officer
or representative of Landlord, for the satisfaction of any claim brought by
Tenant against Landlord, and if Landlord shall fail to perform any covenant,
term or condition of this Lease upon Landlord's part to be performed, and as a
consequence of such default Tenant shall recover a money judgment against
Landlord, such judgment shall be satisfied only (i) out of the proceeds of sale
received upon levy against the right, title and interest of Landlord in the
Building and/or (ii) to the extent not encumbered by a secured creditor, out of
the rents or other incomes receivable by Landlord from the property of which the
Premises are a part. In addition, in no event shall Landlord be in default of
this Lease unless Tenant notifies Landlord of the precise nature of the alleged
breach by Landlord, and Landlord fails to cure such breach within fifteen (15)
days after the date of Landlord's receipt of such notice (provided that if the
alleged breach is of such a nature that it cannot reasonably be cured within
such fifteen (15) day period, then Landlord shall not be in default if Landlord
commences a cure within such fifteen (15) day period and diligently thereafter
prosecutes such cure to completion).
34.2 Notice and Cure. In no event shall Landlord be in default of this
Lease unless Tenant notifies Landlord of the precise nature of the alleged
breach by Landlord, and Landlord fails to cure such breach within fifteen (15)
days after the date of Landlord's receipt of such notice (provided (i) that if
the alleged breach is of such a nature that it cannot reasonably be cured within
such fifteen (15) day period, then Landlord shall not be in default if Landlord
commences a cure within such fifteen (15) day period and diligently thereafter
prosecutes such cure to completion, not to exceed ninety (90) days in the
aggregate within which to complete such cure, and (ii) in the event of an
Emergency, such grace or cure period may be shortened as reasonably necessary
given the scope and nature of the Emergency, provided such shortened grace or
cure period shall only apply to permit the exercise of Tenant's self help rights
under Section 34.4, below.
34.3 Rights and Remedies - Generally. In the event of a default by
Landlord after expiration of applicable cure periods, Tenant shall be entitled
to pursue all rights and remedies available at law or in equity except as
limited by this Lease, and in all events excluding consequential damages. In
addition, in no event shall Tenant have any right to terminate this Lease by
virtue of any uncured default by Landlord, except under circumstances which
amount to a constructive eviction under applicable principles of the law of the
state within which the Premises is located (and with respect to which Tenant
satisfies the requirements for a constructive eviction claim under applicable
law). Tenant shall use commercially reasonable efforts to mitigate its damages
in the event of any default by Landlord hereunder.
34.4 Tenant's Right to Perform Landlord's Obligations After a Default by
Landlord.
(a) Among other remedies permitted to be exercised by Tenant upon
a default by Landlord of its obligations hereunder after expiration of
applicable cure periods, and without waiving or releasing Landlord from any such
obligation of Landlord, Tenant may, but shall not be obligated to, perform any
such obligation of Landlord, and to recover from Landlord the reasonable and
actual costs incurred by Tenant in performing such obligation, which shall be
payable within thirty (30) days after Tenant's written demand accompanied by
reasonable substantiation of the applicable costs. The foregoing right to
perform Landlord's obligations shall only apply after the requisite notice and
opportunity to cure has been afforded to Landlord (including any shortened cure
period permitted in cases of Emergency, as long as Tenant notifies Landlord of
the needed repair or other default as soon as possible after tenant learns of
its existence).
(b) If Landlord fails to reimburse Tenant for its reasonable
costs and expenses in exercising its rights and remedies pursuant to Section
34.4(a), above, within thirty (30) days after receipt from Tenant of its written
demand for payment thereof, accompanied by reasonable substantiation of the
amount demanded and establishing Tenant's right thereto, and Landlord does not
dispute Tenant's right to such reimbursement in good faith by a written
communication specifying the nature of the dispute which is delivered to Tenant
prior to the end of such thirty (30) day period, then Tenant may thereafter
deduct the amount which is not in dispute, but which has not been paid by
Landlord within such thirty (30) day period, from the next payments of Base Rent
and Additional Rent payable by Tenant hereunder, until such amount has been
satisfied in full. To the extent Landlord disputes any portion of the amount
demanded by Tenant (as specified in Landlord's written communication as
aforesaid), then Tenant may seek entry of a judgment against Landlord for the
amount thereof, plus interest at the Default Rate and Tenant's reasonable costs
of collection (including reasonable attorney's fees). If Tenant receives a
final, non-appealable judgment against Landlord, and Landlord fails to pay the
amount thereof within thirty (30) days after the same becomes final and
non-appealable, Tenant shall thereafter have the right (in addition to execution
upon Landlord as and to the extent permitted under Section 34.1, below) to
deduct the amount of such judgment against the next payments of Base Rent and
Additional Rent payable by Tenant hereunder, until such amount has been
satisfied in full. Except as set forth in this Section 34.4(b), Tenant shall not
have any right of offset or deduction due to a default by Landlord.
35. ESTOPPEL CERTIFICATES.
----------------------
Tenant shall, from time to time, within ten (10) days of Landlord's
written request, execute, acknowledge and deliver to Landlord or its designee a
written statement stating: the date the Lease was executed and the date it
expires; the date the Tenant entered occupancy of the Premises; the amount of
Rent, additional rent and other charges due hereunder and the date to which such
amounts have been paid; that this Lease is in full force and effect and has not
been assigned, modified, supplemented or amended in any way (or specifying the
date and terms of any agreement so affecting this Lease); that this Lease
represents the entire agreement between the parties as to this leasing (or
identifying any such other agreements); that all conditions under this Lease to
be performed by the Landlord have been satisfied (or specifying any such
conditions that have not been satisfied); that all required contributions by
Landlord to Tenant on account of Tenant's improvements have been received (or
specifying any such contributions that have not been received); that on the date
of such certificate there are no existing defenses or offset which the Tenant
has against the enforcement of this Lease by the Landlord (or specifying any
such defenses or offsets); that no Rent has been paid more than one (1) month in
advance (or, if so, the amount thereof); that no security has been deposited
with Landlord (or, if so, the amount thereof); and/or any other matters
evidencing the status of the Lease as may be required either by a lender or
prospective lender with respect to any loan to Landlord secured or to be secured
by a deed of trust or mortgage against the Building, or by a purchaser or
prospective purchaser of the Building, Landlord's interest therein or Landlord's
ownership interests, which written statement shall be in substantially the same
form as Exhibit F attached hereto and made a part hereof by this reference. It
is intended that any such statement delivered pursuant to this paragraph may be
relied upon by a prospective purchaser of Landlord's interest or a mortgagee of
Landlord's interest or assignee of any mortgage upon Landlord's interest in the
Building. If Tenant fails to respond within ten (10) days after receipt by
Tenant of a written request by Landlord as herein provided, Tenant shall be
deemed to have given such certificate as above provided without modification and
shall be deemed to have admitted the accuracy of any information supplied by
Landlord to a prospective purchaser or mortgagee.
36. FINANCIAL STATEMENTS.
---------------------
In addition to any financial reporting required under Section 3.1,
above, Tenant agrees that, within ten (10) days after Landlord's request, which
may be made not more than once per fiscal quarter with regard to quarterly
reports, and once per annum with regard to annual reports, Tenant shall deliver
to Landlord Tenant's unaudited quarterly financial statement for the most recent
fiscal quarter and (to the extent not previously delivered by Tenant to
Landlord) Tenant's audited annual financial statement for the two (2) most
recent fiscal years. Such quarterly and annual financial statements shall
include, at a minimum, a balance sheet, a profit and loss statement and
accompanying notes, as of the date prepared. Tenant hereby agrees and Landlord
hereby acknowledges that Tenant's annual financial statements shall be completed
within ninety (90) days after Tenant's fiscal year-end and that Tenant's
quarterly financial statements shall be completed within thirty (30) days after
Tenant's fiscal quarter-end. The certified public accountant preparing such
annual financial statements shall provide an opinion that any such annual
financial statements are complete and materially accurate and that the same have
been prepared in accordance with generally accepted accounting principles
consistently applied.
37. TRANSFER OF LANDLORD'S INTEREST.
--------------------------------
In the event of any transfer(s) of Landlord's interest in the Premises
or the Building, other than a transfer for security purposes only, the
transferor shall be automatically relieved of any and all obligations and
liabilities on the part of Landlord accruing from and after the date of such
transfer, to the extent such obligations are assumed by the transferee either
expressly or by operation of law, and Tenant agrees to attorn to the transferee.
38. RIGHT TO PERFORM.
-----------------
If Tenant shall fail to make any payment or perform any other act on its
part to be performed hereunder, and such failure is not cured within fifteen
(15) days after written notice from Landlord (provided that (a) where such
failure cannot reasonably be cured within a fifteen (15) day period, Tenant
shall not be in default if it commences such performance promptly after
receiving Landlord's notice of Tenant's failure to perform and diligently
thereafter prosecutes the same to completion, such grace period not to exceed a
maximum of sixty (60) days in the aggregate, and (b) no such grace or cure
period (or such xxxxxxx xxxxx or cure period as is set forth below) shall be
required in the event of Emergency), Landlord may, but shall not be obligated
to, perform any such obligation of Tenant, and to recover from Tenant the
reasonable and actual costs incurred by Landlord in performing such obligation,
which shall be payable within thirty (30) days after Landlord's written demand
accompanied by reasonable substantiation of the applicable costs, as additional
rent hereunder. Landlord shall have (in addition to any other right or remedy of
Landlord) the same rights and remedies in the event of the nonpayment of sums
due under this section as in the case of default by Tenant in the payment of
Rent. All sums paid by Landlord and all penalties, interest and costs in
connection therewith, shall be due and payable by Tenant together with interest
thereon at the Default Rate, which shall be calculated from the date incurred by
Landlord until the date of payment.
39. [INTENTIONALLY DELETED]
40. SALES AND AUCTIONS.
-------------------
Tenant may not display or sell merchandise outside the exterior walls
and doorways of the Premises and may not use such areas for storage. Tenant
agrees not to install any exterior lighting, amplifiers or similar devices in or
about the Premises. Tenant shall not conduct or permit to be conducted any sale
by auction in, upon or from the Premises whether said auction be voluntary,
involuntary, pursuant to any assignment for the payment of creditors or pursuant
to any bankruptcy or other insolvency proceedings.
41. NO ACCESS TO ROOF.
------------------
Except as and solely to the extent expressly set forth in this Lease,
Tenant shall have no right of access to the roof of the Premises or the Building
and shall not install, repair or replace any aerial, fan, air conditioner or
other device on the roof of the Premises or the Building without the prior
written consent of Landlord.
42. SECURITY.
---------
Tenant hereby agrees to the exercise by Landlord and its agents and
employees, within their sole discretion, of such security measures as Landlord
deems necessary for the Building. Tenant may install a security system within
the Premises, provided such system and its installation (i) shall be subject to
Landlord's prior written approval, which shall not be unreasonably withheld
(provided it shall not be unreasonable for Landlord to deny consent to any
system which is not compatible with the building's overall security and fire
safety and life safety systems, or which is not reasonably usable by any
successor tenants in the Premises), (ii) shall be in accordance with all
applicable legal requirements (iii) shall be performed at Tenant's sole expense,
and shall be otherwise be installed in accordance with the provisions governing
Alterations under this Lease.
43. AUTHORITY OF TENANT.
--------------------
If Tenant is a corporation or partnership, each individual executing
this Lease on behalf of said corporation or partnership represents and warrants
that he is duly authorized to execute and deliver this Lease on behalf of said
corporation or partnership, and that this Lease is binding upon said corporation
or partnership.
44. NO ACCORD OR SATISFACTION.
--------------------------
No payment by Tenant or receipt by Landlord of a lesser amount than the
Rent and other sums due hereunder shall be deemed to be other than on account of
the earliest rent or other sums due, nor shall any endorsement or statement on
any check or accompanying any check or payment be deemed an accord and
satisfaction; and Landlord may accept such check or payment without prejudice to
Landlord's right to recover the balance of such Rent or other sum and to pursue
any other remedy provided in this Lease.
45. MODIFICATION FOR LENDER.
------------------------
If in connection with obtaining financing for the Building or any
portion thereof, Landlord's lender shall request reasonable modifications to
this Lease as a condition to such financing, or as a condition to such Lender's
approval of this Lease, Tenant shall not unreasonably withhold, delay, or defer
its consent to such modification provided such modifications do not materially
adversely affect Tenant's rights hereunder.
46. PARKING.
--------
Tenant shall have the right to park in the Building parking facilities
in common with other tenants of the Building upon such terms and conditions,
including the imposition of a reasonable parking charge, if the same is
established by Landlord at any time during the term of this Lease. Tenant agrees
not to overburden the parking facilities and agrees to cooperate with Landlord
and other tenants in use of the parking facilities. Landlord reserves the right
in its sole, but reasonable, discretion to determine whether the parking
facilities are becoming overburdened by any tenant of the Building (including
Tenant) based on such tenant's percentage share of the rentable area of the
Building. Landlord shall have the absolute right (i) to allocate and assign
parking spaces among some or all of the tenants of the Building (and Tenant
shall comply with any such parking assignments), (ii) to reconfigure the parking
area and (iii) modify the existing ingress to and egress from the parking area
as Landlord shall deem appropriate, as long as access to such area is maintained
after such modification is completed. The foregoing notwithstanding, Landlord
agrees that, as part of Tenant's total parking allocation, Landlord shall assign
and reserve for the exclusive use of Tenant's employees, agents and invitees
thirty (30) reserved parking spaces in the location marked on Exhibit A-3 as the
"Reserved Parking Spaces".
47. GENERAL PROVISIONS.
-------------------
47.1 Acceptance. The delivery of any draft of this Lease, including a
so-called "execution draft", shall not constitute an offer of any kind, and this
Lease shall only become effective and binding upon full execution hereof by
Landlord and Tenant, and delivery of a signed copy by Landlord to Tenant.
47.2 Joint Obligation. If there be more than one Tenant, the obligations
hereunder imposed shall be joint and several.
47.3 Marginal Headings, Etc. The marginal headings, Table of Contents,
lease summary sheet and titles to the sections of this Lease are not a part of
the Lease and shall have no effect upon the construction or interpretation of
any part hereof.
47.4 Choice of Law. This Lease shall be governed by and construed in
accordance with the laws of the State in which the Premises is located (without
regard to the choice of law and/or conflict of law principles applicable in such
State).
47.5 Successors and Assigns. The covenants and conditions herein
contained, subject to the provisions as to assignment, inure to and bind the
heirs, successors, executors, administrators and assigns of the parties hereto.
47.6 Recordation. Except to the extent otherwise required by law,
neither Landlord nor Tenant shall record this Lease, but a short-form memorandum
hereof may be recorded at the request of Landlord.
47.7 Quiet Possession. Upon Tenant's paying the Rent reserved hereunder
and observing and performing all of the covenants, conditions and provisions on
Tenant's part to be observed and performed hereunder, Tenant shall have quiet
possession of the Premises for the Lease Term hereof, free from any disturbance
or molestation by Landlord, or anyone claiming by, through or under Landlord,
but in all events subject to all the provisions of this Lease.
47.8 Inability to Perform; Force Majeure. This Lease and the obligations
of the parties hereunder shall not be affected or impaired because the other
party is unable to fulfill any of its obligations hereunder (or is delayed in
doing so) to the extent such inability or delay is caused by reason of war,
civil unrest, strike, labor troubles, unusually inclement weather, unusual
governmental delays, inability to procure services or materials despite
reasonable efforts, third party delays, acts of God, or any other cause(s)
beyond the reasonable control of such party (which causes are referred to
collectively herein as "Force Majeure"), provided (i) in no event shall any
monetary obligations, including without limitation the Tenant's obligation to
pay Base Rent or additional rent, be extended due to Force Majeure, (ii) in no
event shall financial inability constitute a cause beyond the reasonable control
of a party, and (iii) in order for any party hereto to claim the benefit of a
delay due to Force Majeure, such party shall be required to use reasonable
efforts to minimize the extent and duration of such delay, and to notify the
other party of the existence and nature of the cause of such delay within a
reasonable time after the such delay first commences. Except as limited by the
foregoing clauses (i), (ii) and (iii), any time specified non-monetary
obligation of a party in this Lease shall be extended one day for each day of
delay suffered by such party as a result of the occurrence of any Force Majeure.
47.9 Partial Invalidity. Any provision of this Lease which shall prove
to be invalid, void, or illegal shall in no way affect, impair or invalidate any
other provision hereof and such other provision(s) shall remain in full force
and effect.
47.10 Cumulative Remedies. No remedy or election hereunder shall be
deemed exclusive but shall, whenever possible, be cumulative with all other
remedies at law or in equity.
47.11 Entire Agreement. This Lease contains the entire agreement of the
parties hereto and no representations, inducements, promises or agreements, oral
or otherwise, between the parties, not embodied herein, shall be of any force or
effect.
47.12 Survival. All indemnities set forth in this Lease shall survive
the expiration or earlier termination of this Lease.
47.13 Consents. If any provision of this Lease subjects any action,
inaction, activity or other right or obligation of Tenant to the prior consent
or approval of Landlord, Landlord shall be deemed to have the right to exercise
its sole and unfettered discretion in determining whether to grant or deny such
consent or approval, unless the provision in question states that Landlord's
consent or approval "shall not be unreasonably withheld", in which event
Landlord's consent shall be subject to Landlord's sole, but reasonable,
discretion.
47.14 Saving Clause. In the event (but solely to the extent) the
limitations on Landlord's liability set forth in Section 8.3 of this Lease would
be held to be unenforceable or void in the absence of a modification holding the
Landlord liable to Tenant or to another person for injury, loss, damage or
liability arising from Landlord's omission, fault, negligence or other
misconduct on or about the Premises, or other areas of the Building appurtenant
thereto or used in connection therewith and not under Tenant's exclusive
control, then such provision shall be deemed modified as and to the extent (but
solely to the extent) necessary to render such provision enforceable under
applicable law. The foregoing shall not affect the application of Section 34 of
this Lease to limit the assets available for execution of any claim against
Landlord.
47.15 Reservation. Nothing herein set forth shall be deemed or construed
to restrict Landlord from making any modifications to any of the parking and/or
common areas serving the Building and/or Premises as of the date of execution
hereof, and Landlord expressly reserves the right to make any modifications to
such areas as Landlord may deem appropriate, including but not limited to, the
addition or deletion of temporary and/or permanent improvements therein, and/or
the conversion of areas now dedicated for the non-exclusive common use of
tenants (including Tenant) to the exclusive use of one (1) or more tenants or
licensees within the Building.
47.16 Keys. The cost of any suite keys or security keys to the Building
beyond those already within Tenant's possession shall be reimbursed by Tenant to
Landlord upon demand.
47.17 Rule Against Perpetuities. In order to ensure the compliance of
this Lease with any rule against perpetuities that may be in force in the state
in which the Premises are located, and without limiting or otherwise affecting
Landlord's and Tenant's rights and obligations under this Lease, as stated in
the other sections hereof, Landlord and Tenant agree that, irrespective of the
reasons therefor (other than a default by Tenant), in the event Tenant fails to
take possession of the Premises and commence paying Base Rent hereunder within
twenty (20) years after the date of execution of this Lease, then this Lease,
and the obligations of the parties hereunder, shall be deemed to be null and
void and of no further force and effect. Without affecting the specific timing
requirements otherwise applicable thereto under this Lease, any and all options
granted to Tenant under this Lease (including, without limitation, expansion,
renewal, right of first refusal, right of first offer, and like options) must be
exercised by Tenant, if at all, during the term of this Lease.
47.18 Certain Terminology.
--------------------
A. The terms "including", "includes" and terms of like import
shall be interpreted to mean "including, but not limited to" and/or "includes,
without limitation."
B. The terms "herein", "hereunder", "hereinbelow", "above" and/or
"below", and any terms of like import, shall be interpreted to mean this Lease
as a whole, and not merely the Section, paragraph or subparagraph within which
such term is set forth.
C. As used in those provisions of this Lease where Tenant is
agreeing to assume responsibility for certain conduct, actions and/or omissions
of "Tenant", the term "Tenant" shall be construed to mean Tenant, and Tenant's
agents, employees, contractors,
subcontractors, assignees, sublessees, licensees and, while within the Premises,
invitees and business visitors.
D. The term "Emergency" shall mean and refer to any situation or
circumstance where there is an immediate or imminent risk of injury or death to
persons or damage to property unless immediate action is taken to address such
situation or circumstances, as determined by the party invoking such term in
good faith.
48. [INTENTIONALLY DELETED]
-----------------------
49. WAIVER OF JURY TRIAL.
---------------------
Landlord and Tenant hereby waive trial by jury in any action, proceeding
or counterclaim brought by either of them against the other on all matters
arising out of this Lease, or the use and occupancy of the Premises. If Landlord
commences any summary proceeding for non-payment of Rent, Tenant will not
interpose (and waives the right to interpose) any non-mandatory counterclaim in
any such proceeding.
50. RENEWAL OPTION
A. General. Provided that (i) both at the time of the exercise of the
option hereinafter set forth and at the time of commencement of the Renewal Term
(as hereinafter defined) this Lease is in full force and effect, and provided
further that Tenant is not then in default hereunder beyond the expiration of
any applicable notice and cure period provided for in this Lease and (ii) Tenant
is in occupancy of at least fifty percent (50%) of the Premises for the purpose
of conducting its own business, Tenant is hereby granted the option to renew the
Lease Term for one (1) additional period(s) of sixty (60) months (the "Renewal
Term"), such Renewal Term to commence at the expiration of the initial Lease
Term. Tenant shall exercise its option to renew by delivering notice of such
election (the "Renewal Notice") to Landlord not less than nine (9) months nor
more than twelve (12) months prior to the expiration of the initial Lease Term.
In the event that Landlord does not receive the Renewal Notice prior to the
expiration of such time period (time being of the essence with respect thereto),
then such option to renew the Lease Term shall, upon the expiration of such time
period, become null and void and be of no further force or effect and Tenant
shall, at the request of Landlord, execute an instrument in form and substance
acceptable to Landlord confirming such facts.
B. Terms. The Renewal Term shall be upon the same terms and conditions
of this Lease except that (a) unless Landlord and Tenant reach agreement on a
different Base Rent amount at the time, the annual Base Rent during each year of
the Renewal Term shall be equal to the greater of (i) $32.00 per rentable square
foot of the Premises (being the Base Rent in effect as of the last day of the
initial Lease Term), escalating annually in an amount equal to three percent
(3%) of the prior year's Base Rent per annum, or (ii) at an annual rate equal to
the annual fair market rental and escalation rate ("FMR") for space comparable
to the Premises for the Renewal Term as determined by the Three Appraiser Method
set forth in Section 50.C of this Lease; (b) Tenant shall have no option to
renew the Lease Term beyond the expiration of the Renewal Term; and (c) the
Premises shall be delivered in their existing condition (on an "as is" basis) at
the time the Renewal Term commences.
C. Three Appraiser Method. If the parties are unable to agree upon the
FMR for comparable space, said rental rate shall be determined by arbitration in
the following manner:
(i) Landlord and Tenant shall each appoint one arbitrator who
shall, by profession, be an M.A.I. real estate appraiser, and who shall have
been active over the five (5) year period ending on the date of the Renewal
Notice in the appraisal of office properties in the Boston metropolitan area,
including specifically the Xxxxxx submarket. Each such arbitrator shall be
appointed within ten (10) business days after the date of the Renewal Notice.
(ii) The two arbitrators so appointed shall, within ten (10)
business days of the date of the appointment of the last appointed arbitrator,
agree upon and appoint a third arbitrator who shall be qualified based upon the
same criteria set forth hereinabove for the qualification of the initial two
arbitrators.
(iii) The three arbitrators shall within thirty (30) days of the
appointment of the third arbitrator reach a decision the regarding the
prevailing fair market rental and escalation rate for comparable space in the
Boston metropolitan area, including specifically the Xxxxxx submarket and notify
Landlord and Tenant thereof.
(iv) The decision of the majority of the three arbitrators shall
be binding upon Landlord and Tenant. Failure of a majority of said arbitrators
to reach agreement shall result in the prevailing fair market rental for
comparable space in the Boston metropolitan area, including specifically the
Xxxxxx submarket being designated by averaging the appraisals of the three
arbitrators, ignoring for the purposes of such averaging any appraisal which is
more than ten percent (10%) in excess of or ten percent (10%) less than the
middle appraisal.
(v) If either Landlord or Tenant fails to appoint an arbitrator
within the time period specified in subparagraph (i) hereinabove, the arbitrator
appointed by one of them shall reach a decision and notify Landlord and Tenant
thereof, and such arbitrator's decision shall be binding upon Landlord and
Tenant.
(vi) The cost of arbitration shall be paid by Landlord and Tenant
equally.
(vii) In no event shall the Base Rent payable during the first
year of the Renewal Term be less than the Base Rent payable immediately
preceding the Renewal Term.
The term "comparable space" as used herein for the purpose of
determining "market rates" shall mean buildings of the same quality as the
Building and located in the Boston metropolitan area, including specifically the
Xxxxxx submarket.
D. New Lease After Renewal Term. Except for the renewal option set forth
above in this Section 50, this Lease may only be extended beyond the Lease
Expiration Date by the parties executing a mutually agreeable new lease based on
Landlord's then current lease form or by an extension agreement signed by both
parties making specific reference to this Lease. No proposals, offers,
correspondence, or the like shall be legally binding upon Landlord unless and
until the terms thereof are incorporated in either a new lease or a formal
amendment to this Lease as provided in this subsection.
51. RIGHT OF FIRST OFFER.
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51.1 Subject to all pre-existing renewal and/or expansion rights of any
other tenants in the Building as of the date hereof, if any, Tenant is hereby
granted a right of first offer on any space in the Building which is contiguous
to (and, for purposes of determining contiguity, located on the same floor as)
the Premises (such space, "Contiguous Space"), in accordance with and subject to
the terms of this Section 51. Such right of first offer shall apply to all, but
not less than all, of each Contiguous Space that becomes available for lease
during the Term of this Lease (including any extension Term) provided the terms
of this Section 51 regarding the minimum term of any Expansion Lease are
satisfied. All references in this Section 51 to any right of first offer shall
mean and refer only the right of first offer which is established and applicable
under this Section 51. The right of first offer under this Section 51 shall be
"activated" once Landlord has determined that a Contiguous Space will become
available for occupancy as of a date certain, and has notified Tenant of such
determination in writing. At such time (hereinafter, each an "Offer Date"),
Landlord shall give notice (an "Offer Notice") to Tenant of the activation of
such right of first offer on such Contiguous Space, including a description of
the rentable area of the building as to which such Offer Notice is given (herein
referred to as the "Offer Space"); and (ii) the date on which Landlord estimates
in good faith that the Offer Space will be available for occupancy (the
"Applicable Expansion Date").
51.2 Tenant may, within ten (10) business days after the receipt of each
such Offer Notice, give notice to Landlord in writing agreeing to lease the
Offer Space in accordance with the terms set forth in this Section 51. If Tenant
shall give such notice, then Landlord shall within ten (10) business days after
deliver to Tenant a new lease or amendment to this Lease (either, an "Offer
Lease") with respect to the Offer Space having the legal terms consistent with
the legal terms specified in this Lease, and incorporating such Offer Space into
this Lease as of the Applicable Expansion Date, except for any modifications to
the business terms of such Offer Lease as described in Section 51.4, below.
51.3 Should Tenant fail to give notice under Subparagraph 51.2 above
within the time provided, or if Tenant shall fail to execute and deliver the
Offer Lease to Landlord within fifteen (15) business days after delivery to
Tenant of an Offer Lease which reflects the agreed upon terms, then in either
such event, Tenant's right of first offer under this Section 29.3 as to such
Offer Space shall be deemed to have lapsed, and Landlord shall be free to lease
such Offer Space to a third party on any terms Landlord deems appropriate, and
Tenant's right of first offer under this Section 51 as to such Offer Space shall
thereafter be null and void. In addition, if Tenant exercises its right of first
offer hereunder as to an Offer Space, and then fails or refuses to execute an
Offer Lease which reflects the agreed upon terms applicable to such Offer Space,
then Tenant's right of first offer under this Section 51 shall fully and forever
terminate for all purposes, and Tenant shall thereafter have no further right of
first offer under this Lease. Time is of the essence of this Section 51.
51.4 If Tenant exercises its right of first offer under this Section 51,
then the Offer Space shall be incorporated within this Lease as of the
Applicable Expansion Date on the same business terms as are in effect under this
Lease as of the Applicable Expansion Date, except as hereafter provided. In all
events, the Lease Expiration Date under this Lease and the Lease Expiration Date
under any Offer Lease shall coincide. The foregoing notwithstanding (i) in no
event shall the term of any Offer Lease be less than three (3) full years, so
that Tenant shall not have the right to exercise its right of first offer
hereunder as to any Offer Space at any time when
there are less than three (3) full years remaining in the Term, unless Tenant
concurrently exercises its renewal option (and then solely to the extent Tenant
is still entitled to exercise its renewal option hereunder) so as to extend the
Term of this Lease (and thus the Term of the Offer Lease) beyond three (3)
years; (ii) Base Rent under the Offer Lease shall equal the Base Rent in effect
under this Lease as of the Applicable Expansion Date, and shall escalate
concurrently with any escalations provided for hereunder, so that the Base Rent
under the Offer Lease is at all times equal to the Base Rent payable hereunder
for the originally leased Premises; (iii) the Offer Space shall be added to the
Premises for purposes of calculating Tenant's Share hereunder, and Tenant's
Share of Expense Increases and Tenant's Share of Tax Increases, as described in
Sections 9 and 10 herein, shall be calculated for the Offer Space in exactly the
same manner (and using the same Base Year) as such items are calculated for the
originally leased Premises; and (iv) the Offer Space shall be delivered to
Tenant in its then current "as-is, where-is" condition, except Landlord shall
provide to Tenant, on the same basis as the same is provided to Tenant pursuant
to Exhibit C hereof, a Refurbishment Allowance (which must be used for
improvements or refurbishment to the Offer Space within one (1) year after the
Applicable Expansion Date), equal to the product of (a) Ten Dollars ($10.00) per
rentable square foot of the Offer Space, and (b) a fraction, the numerator of
which is the number of months of the Term of the Offer Lease, but not more than
72, and the denominator of which is 72. The construction of any Tenant
Improvements to the Offer Space shall be handled in a manner substantially
identical to Exhibit C hereto. Such Offer Lease will not provide for any further
expansion options.
51.5 The right of first offer provided for in this Section 51 shall be
personal to Tenant, and may not be assigned by Tenant. Accordingly, upon any
assignment of this Lease by Tenant, this Section 51 shall be null and void and
of no further force and effect.
52. ADDITIONAL SCHEDULES.
---------------------
The following additional schedules are attached hereto and made a part
of this Lease:
EXHIBIT A-1 Location and Dimensions of Premises
EXHIBIT A-2 Description of Land
EXHIBIT A-3 Depiction of Unreserved Parking Spaces
EXHIBIT B Declaration of Lease Commencement
EXHIBIT C Construction Exhibit
EXHIBIT D Rules and Regulations
EXHIBIT E Janitorial Specifications
EXHIBIT F Form Estoppel Certificate
EXHIBIT G [Intentionally Deleted]
EXHIBIT H Form of SNDA
IN WITNESS WHEREOF, Landlord and Tenant have executed this Deed of
Lease, in triplicate, on the day and year first above written.
LANDLORD:
XXXXX AVENUE SENIOR HOLDINGS,
L.L.C.
By: Xxxxx Avenue Holdings, L.L.C. its
Managing Member
By: Wellsford/Whitehall Holdings, L.L.C., its
Managing Member
By: Wellsford/Whitehall Properties II, L.L.C.,
its Managing Member
By: Wellsford Commercial Properties Trust, its
Managing Member
By: /s/ Xxxxxxx X. Prevardi
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Xxxxxxx X. Xxxxxxx, Chief Operating Officer
TENANT:
MARCAM SOLUTIONS, INC.
By: /s/ Xxxxx X. Xxxxxx (seal)
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Name: Xxxxx X. Xxxxxx
Title: Chief Financial Officer
