Exhibit 10.4
FIRST AMENDMENT TO LEASE
THIS FIRST AMENDMENT TO LEASE (this "Amendment") is made and entered into
as of October ____, 1998, by and between MERIDIAN ROCKVILLE PLAZA, LLC, a
Delaware limited liability company ("Landlord"), and THE XXXXXX-XXXXX
CORPORATION, a New York corporation ("Tenant").
RECITALS:
A. Landlord is the owner of: (i) a building having a street address of 00
Xxxx Xxxx Xxxxx, Xxxxxxxxx, Xxxxxxxx 00000 (the "Building"); and (ii) a building
which is located adjacent to the Building, which building has a street address
of 00 Xxxx Xxxx Xxxxx, Xxxxxxxxx, Xxxxxxxx 00000 (the "Adjacent Building").
B. Landlord and Tenant have previously entered into an Office Building
Lease dated July 10, 1998 (the "Lease"), with respect to premises containing
approximately 113,960 rentable square feet (the "Original Premises") located in
the Building.
C. Tenant has requested and Landlord has agreed, to lease to Tenant,
approximately 54,246 rentable square feet of space (the "Expansion Premises")
located on the lower level and on the first and second floors of the Adjacent
Building (i.e., approximately 4,730 square feet located on the lower level,
approximately 23,947 square feet located on the first floor and approximately
25,569 square feet located on the second floor), which Expansion Premises is
more particularly depicted on Exhibit A, which is attached to and made a part
hereof.
NOW, THEREFORE, in consideration of the sum of Ten and 00/100 Dollars
($10.00), and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged by Landlord and Tenant, Landlord and Tenant
covenant and agree as follows:
1. LEASE OF EXPANSION PREMISES. Subject to the terms of this Amendment,
Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord, the
Expansion Premises.
2. TERM. The term of the Lease with respect to the Expansion Premises
shall be coterminous with the Lease Term with respect to the Original Premises.
3. CONSTRUCTION OF EXPANSION PREMISES.
(a) Notwithstanding anything herein to the contrary, Tenant is
leasing the Expansion Premises in its "as-is" condition as of the date of this
Amendment.
(b) Upon delivery of the Expansion Premises to Tenant, the base
building systems for the Adjacent Building (i.e., elevators, life safety
equipment, electrical system, plumbing systems, hot water heaters, chillers,
pumps and related central heating, ventilation and air conditioning system to
include balancing of central airshafts) shall be in good working order
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with preventive maintenance up to date and shall be Year 2000 Compliant. "Year
2000 Compliant" with respect to any base building system shall mean that, on and
after January 1, 2000, such system will continue to operate in good working
order without the requirement that any additional expenditure be made to
retrofit, update or otherwise repair or replace such system due to a malfunction
or design flaw that would impair such system solely by reason of the change from
the year 1999 to the year 2000.
(c) Landlord and Tenant shall, within sixty (60) days after the date
of this Amendment, jointly inspect the Adjacent Building and prepare a punchlist
of those items of work to be performed by Landlord under Section 6(b) of this
Amendment which remain unfinished as of the date of such inspection. Landlord
shall, in good faith, use commercially reasonable efforts to complete the items
that are set forth on the punchlist within thirty (30) days after the date of
the punchlist.
(d) In connection with Tenant's leasing of the Expansion Premises,
the amount of the "Improvements Allowance" [as defined in Section 3(b) of
Exhibit C to the Lease] is hereby increased by Eight Hundred Sixty-Five Thousand
Four Hundred Twenty-Two and 00/100 Dollars ($865,422.00) (the "Supplemental
Allowance") to Two Million Six Hundred Fifty-One Thousand Eight Hundred
Eighty-One and 00/100 Dollars ($2,651,881.00). It is expressly understood and
agreed that the time period for Tenant to utilize the Supplemental Allowance
shall be extended until December 31, 2000.
4. BASE ANNUAL RENT. In addition to the Base Annual Rent payable
with respect to the Original Premises, Tenant shall pay to Landlord, as
Additional Rent, Base Annual Rent with respect to the Expansion Premises (the
"Expansion Premises Base Annual Rent") as follows:
Expansion Premises Expansion Premises
Period Base Annual Rent Base Monthly Rent
------ ---------------- -----------------
Subject to Section 4(b) of
the Lease, Phase 2
Commencement Date
until 12/31/99 --------- $99,931.29
1/01/00-12/31/00 $1,235,150.70 $102,929.22
1/01/01-12/31/01 $1,272,205.20 $106,017.09
1/01/02-12/31/02 $1,310,371.30 $109,197.60
1/01/03-12/31/03 $1,349,682.40 $112,473.52
1/01/04-12/31/04 $1,390,172.80 $115,847.72
1/01/05-12/31/05 $1,431,877.90 $119,323.15
1/01/06-12/31/06 $1,474,834.20 $122,902.84
1/01/07-12/31/07 $1,519,079.20 $126,589.92
1/01/08-12/31/08 $1,564,651.50 $130,387.62
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All installments of Expansion Premises Base Annual Rent shall be payable in
accordance with the provisions of the Lease governing the payment of Base Annual
Rent.
5. PHASE 2 PREMISES. The term "Phase 2 Premises" [as defined in Section
4(b) of the Lease] shall be deemed to include the Expansion Premises. Until the
"Phase 2 Commencement Date" [as defined in Section 4(b) of the Lease] has
occurred, Base Monthly Rent with respect to the Expansion Premises shall be
determined based upon (a) a rate of Twelve and 75/100 Dollars ($12.75) per
rentable square feet of area contained within the lower level of the Adjacent
Building, and (b) a rate of Twenty-Three and 00/100 Dollars ($23.00) per
rentable square foot of area contained within the first and second floors of the
Adjacent Building.
6. USE. Tenant shall use the Expansion Premises in accordance with the
provisions of Section 7(a) of the Lease.
7. OPERATING EXPENSES.
(a) The provisions of Sections 4(c)(ii), 4(c)(iv), and 4(d) of the Lease
shall not be applicable to the Expansion Premises.
(b) Throughout the Lease Term, Tenant agrees to pay to Landlord, as
Additional Rent, "Tenant's Expansion Premises Proportionate Share" (as defined
below) of any increase in operating expenses over the "Base Operating Expense
Amount" (as defined below). As used herein, (i) "Expansion Premises
Proportionate Share" shall mean 51.47% and (ii) "Base Operating Expense Amount"
shall mean the operating expenses for the Adjacent Building during calendar year
1999. The term "operating expenses" shall mean any and all expenses incurred by
Landlord in connection with owning, managing, operating, maintaining, servicing,
insuring and repairing the Adjacent Building and the land thereunder and the
parking lot and other related exterior appurtenances, including but not limited
to: (1) wages and salaries of all employees engaged in the management, operation
or maintenance of the Adjacent Building, including taxes, insurance and benefits
relating hereto; (2) all supplies, materials, equipment and tools used in the
operation or maintenance of the Adjacent Building; (3) cost of all maintenance
and service agreements for the Adjacent Building and the equipment therein,
including but not limited to controlled access and energy management services,
window cleaning and elevator maintenance; (4) cost of all insurance relating to
the Adjacent Building, including the cost of casualty, liability and rent loss
insurance applicable to the Adjacent Building and Landlord's personal property
used in connection therewith; (5) general and special repairs and maintenance;
(6) management fees; (7) legal, accounting, auditing and other professional
fees; (8) the cost of any additional services not provided to the Adjacent
Building at the Commencement Date of the Lease Term, but thereafter provided by
Landlord in the prudent management of the Adjacent Building; (9) intentionally
deleted; (10) costs for char service and cleaning supplies for the common areas
of the Adjacent Building (but expressly excluding char service and cleaning
supplies for the Expansion Premises); (11) costs for utility services such as
electricity, gas, water and sewage,
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including the cost of heating and cooling the Adjacent Building; (12) the cost
of any capital improvements or alterations made to the Adjacent Building after
the Commencement Date of the Lease Term, that reduce other operating expenses,
or which are required under any governmental law or regulation that was not
applicable to the Adjacent Building at the time the Lease was executed, such
cost to be amortized over such reasonable period as Landlord shall determine,
together with interest on the unamortized balance at the rate paid by Landlord
on funds borrowed for the purposes of constructing said capital improvements
(or, in the event that Landlord elects not to borrow funds to construct such
capital improvements, at the rate that Landlord would have paid had it borrowed
funds for the purpose of constructing said improvements); (13) transportation
district fees, parking district fees, and the cost of other amenities required
by law; (14) "real estate taxes" (as hereinafter defined); (15) cost of Adjacent
Building office expenses, including telephone, rent, stationery and supplies;
(16) costs of all elevator and escalator (if installed in the Adjacent Building)
maintenance and operation; (17) cost of providing security; (18) cost of
providing garbage and snow removal and pest control; (19) cost of decoration of
common areas; (20) cost of landscaping; (21) cost of maintenance and operation
of the parking area; (22) costs and fees charged and/or assessed in connection
with any business improvement district that is applicable to the Adjacent
Building; and (23) costs of removing trash from the Adjacent Building that is
generated in connection with the use of the Expansion Premises. Notwithstanding
anything in this Lease to the contrary, the preceding list is for definitional
purposes only and shall not impose any obligation upon Landlord to incur such
expenses or provide such services. In the event that all or any of the services
(or other obligations of Landlord, including real estate taxes, which are to be
passed through to Tenant as an operating expense) that are being provided by
Landlord are provided by contractors or vendors who are providing such services
(or such other obligations) to other real property that is owned, operated or
managed by Landlord or any party that is related to or affiliated with Landlord,
and the same are being provided under a contract which includes the Adjacent
Building and such other real property, then the cost of the same shall be
allocated on a proportionate square footage basis by Landlord between the
Adjacent Building and such other real property [i.e., the amount of the cost of
such service (or such other obligation) that is allocated to the Adjacent
Building shall be a fraction, the numerator of which shall be equal to the
number of rentable square feet of area contained in the Adjacent Building, and
the denominator of which shall be equal to the number of rentable square feet of
area contained in the other real property and in the Adjacent Building]. It is
expressly understood and agreed that the cost of providing services (or other
obligations of Landlord which are to be passed through to Tenant as an operating
expense) to the Building and the Adjacent Building under any contract which
covers both the Building and the Adjacent Building shall be allocated as
follows: (x) 51.8% of the cost shall be allocated to the Building; and (y) 48.2%
of the cost shall be allocated to the Adjacent Building. Operating expenses
shall be reduced by all cash discounts, trade discounts or quantity discounts
received by Landlord or Landlord's managing agent in the purchase of any goods,
utilities or services in connection with the prudent operation of the Adjacent
Building. If Landlord charges a user fee for use of a building amenity or
facility, then operating expenses shall be deemed reduced by the amount of such
fees. Despite the foregoing, in no event shall operating expenses be reduced by
any amount that is being charged by Landlord or any parking operator in
connection with any parking
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facilities. Landlord shall diligently and in good faith pursue all insurance,
breach of warranty or other claims which would reasonably result in a reduction
of operating expenses. Subject to the provisions of Section 7(c) below, Tenant
shall not be required to pay more than 100% of Tenant's Expansion Premises
Proportionate Share of the total operating expenses actually incurred for any
calendar year. "Operating expenses" shall not include any of the following,
except to the extent that such costs and expenses are included in operating
expenses as described above: costs of painting or decorating tenant space;
leasing brokerage commissions; interest and amortization of mortgages; ground
rent; or the costs of special services or utilities separately charged to
individual tenants of the Adjacent Building. Despite the foregoing, operating
expenses shall also not include any of the following:
(i) All costs and expenses incurred by Tenant or any other tenants
of the Adjacent Building and paid for or payable directly by Tenant or such
other tenants either to third parties or to Landlord under agreements for direct
payment or reimbursement for benefits or services;
(ii) Leasing commissions, attorneys' fees, costs, disbursements and
other expenses incurred in connection with negotiations or disputes with, or
leasing to, tenants or prospective tenants of the Adjacent Building;
(iii) Salaries and benefits paid to officers and executives of
Landlord who are above the level of property manager;
(iv) Interest, points, fees and principal payments on loans to
Landlord or secured by mortgages or deeds of trust covering the Adjacent
Building or the Project or a portion thereof and other debt costs, if any, or
amortization on any mortgage or mortgages or any other debt instrument
encumbering the Adjacent Building or the Project;
(v) Rental under any ground lease or other underlying lease or
easement (it being expressly understood and agreed that vault rentals, if any,
shall be included in operating expenses);
(vi) Any marketing costs and expenses incurred in connection with
the marketing of the Adjacent Building or any rentable space therein;
(vii) Any expenses for repairs or maintenance which are actually
recovered under warranties and service contracts;
(viii) Legal expenses arising out of (i) the negotiation, review,
preparation or termination of leases, occupancy agreements, assignments of
leases or sublease agreements, (ii) the interpretation of leases or other
occupancy agreements, or assignment or sublease agreements (iii) the enforcement
of the provisions of any lease or other occupancy agreement affecting the
Adjacent Building, (iv) any action against a present or former tenant or
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occupant under a lease or other occupancy agreement, including, without
limitation, eviction, distraint, levy and collection actions;
(ix) Costs in connection with a change in ownership or financing or
refinancing of the Adjacent Building provided, however, such provision shall not
limit any "real estate taxes" (as defined below) from being included as
operating expenses;
(x) The cost of any item paid to any entity or person related to
or affiliated with Landlord to the extent such cost exceeds the amount payable
for such services at then existing market rates to unrelated persons or
entities;
(xi) Deductions for income tax purposes attributable to
depreciation of the Adjacent Building or any improvements on the land or the
Adjacent Building equipment;
(xii) Any cost incurred directly in connection with the
investigation, remediation, clean-up, containment, abatement or removal of
Hazardous Materials (as such term is hereinafter defined) present on, about,
under or at the Project on the date hereof, or which are stored, used or
released by Landlord, its employees or agents after the date hereof or which
migrate onto the Project. As used herein, the term "Hazardous Materials"
includes any "hazardous substance" as that term is defined in the Comprehensive
Environmental Response, Compensation, and Liability Act (42 U.S.C. SS9604 et
seq.), as amended ("CERCLA") and any "hazardous waste" as that term is defined
in the Resource Conservation and Recovery Act (42 U.S.C. SS6901 et seq., as
amended) ("RCRA") (collectively, "Hazardous Materials");
(xiii) Costs incurred by Landlord which pursuant to the express terms
of any retail tenant's lease are payable by such retail tenant directly to a
utility company or other entity with respect to retail space in the Adjacent
Building;
(xiv) Costs and expenses incurred by Landlord associated with the
operation of the business of the legal entity or entities which constitute
Landlord (as opposed to operation of the Adjacent Building), including, without
limitation, sale and financing matters, legal entity accounting, income taxation
matters, costs of selling, syndicating, financing, mortgaging or hypothecating
any of Landlord's interest in the Adjacent Building or the Project, and disputes
with employees or persons who own an interest in Landlord;
(xv) Wages, salaries or other compensation and benefits of any
off-site employees of Landlord or its managing agent, provided, however,
operating expenses shall include Landlord's reasonable allocation (based on time
spent in connection with the Adjacent Building) of compensation paid for the
wages, salary, and other compensation and benefits paid to such employees, if
off-site, who are assigned part-time to the operation, management, maintenance,
or repair of the Adjacent Building;
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(xvi) Any other costs or expenses for which Landlord actually
receives reimbursement from any source (other than the payment of operating
expenses), including without limitation, insurance, condemnation awards or
warranties, or any cost or expense for which Landlord would have received
reimbursement from an insurance company had Landlord been insured as required
under the terms of this Lease;
(xvii) Any expenditures which under generally accepted accounting
principles are treated as capital expenditures, except as otherwise expressly
set forth herein;
(xviii) Fines, penalties, late payment charges and interest arising
from the acts or inaction of Landlord or failure timely to make tax and/or other
payments;
(xix) Capital costs incurred by Landlord for the repair of damage to
the Adjacent Building, or for the restoration of all or any portion of the
Adjacent Building after the occurrence of a casualty and any other costs
reimbursable by insurance proceeds or to the extent reimbursed by any other
third party, together with associated deductible amounts;
(xx) Expenses resulting from the breach of this Lease by Landlord,
or the negligence of Landlord, its agents, contractors, employees, or other
tenants of the Adjacent Building or the Project;
(xxi) Fees for services rendered to the Adjacent Building, the
Project or the common areas by entities controlled by or under common control
with Landlord to the extent such fees exceed the market rate payable for
comparable services if rendered by unrelated third parties;
(xxii) Charitable or political contributions, advertising and
promotional expenditures, including the costs of staging special events;
(xxiii) Assessments to the extent paid in less than the maximum
permitted number of installments;
(xxiv) Depreciation of the Adjacent Building or the Project, or the
fixtures or equipment therein;
(xxv) Except as provided for herein, the costs and expenses of
utilities provided to any property other than the Adjacent Building;
(xxvi) The costs and expenses of bringing the Adjacent Building,
including the common areas, into compliance with the ADA, to the extent the
Adjacent Building is not in compliance with the ADA as of the date of this
Lease;
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(xxvii) The costs and expenses of causing the base building systems
of the Adjacent Building to be Year 2000 Compliant (hereinafter defined);
(xxviii) In the event that Landlord provides any services to other
buildings that are located in the immediate vicinity of the Adjacent Building,
but Landlord does not provide such services to the Adjacent Building, the cost
of such services shall not be passed through to Tenant as an operating expense;
(xxix) Any cost to remediate or remove Hazardous Materials that are
caused by occupants of the Adjacent Building;
(xxx) Costs incurred by Landlord in (x) suing any insurance
company in connection with damage to the Adjacent Building, and/or (y) suing any
governmental authority in connection with a condemnation of the Adjacent
Building; and
(xxxi) Cost of providing char and janitorial service to the
Expansion Premises.
The term "real estate taxes" shall mean all taxes and assessments,
general and special, ordinary and extraordinary, foreseen and unforeseen, now or
hereafter assessed, levied or imposed upon the Adjacent Building, and the land
on which it is built, including, without limitation, vault fees and charges,
arena taxes, front foot benefit charges and adequate public facility costs and
assessments, together with (i) any tax, assessment, or other imposition in the
nature of a real estate tax, (ii) any ad valorem tax on rent or any tax on
income if imposed in lieu of or in addition to real estate taxes and
assessments, and (iii) any taxes and assessments which may hereafter be
substituted for real estate taxes, including by way of illustration only, any
tax, assessment or other imposition (whether a business rental or other tax) now
or hereafter levied for Tenant's use or occupancy of or conduct of business at
the Expansion Premises, on Tenant's improvements to or furniture, fixtures or
equipment in the Expansion Premises, or imposed upon the rent payments. "Real
estate taxes" shall also include all costs incurred by Landlord in contesting
the validity or amount of any such taxes.
(c) If the average occupancy rate for the Adjacent Building during any
calendar year is less than ninety percent (90%), or if any tenant is separately
paying for (or does not require) electricity or janitorial services furnished to
its premises, then operating expenses for such year shall be deemed to include
all additional expenses, as reasonably estimated by Landlord, which would have
been incurred during such year if such average occupancy rate had been ninety
percent (90%) and if Landlord paid for electricity and janitorial services
furnished to such premises.
(d) (i) In order to provide for current monthly payments of Additional
Rent, Landlord shall submit to Tenant prior to January 1st of each year a
written statement of Landlord's estimate of the amount of the increases
described in Section 7(b) above, together with
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the amount of Tenant's Additional Rent which is estimated to result from such
increases. Tenant shall pay each month one-twelfth (1/12th) of Tenant's
Expansion Premises Proportionate Share of Landlord's estimate of the increase in
each year of operating expenses over the Base Operating Expense Amount.
Landlord may revise its estimate of operating expenses at any time during a
calendar year by written notice to Tenant, setting forth such revised estimate
and Tenant's Expansion Premises Proportionate Share of the estimated operating
expense increases. In such event, all monthly payments made by Tenant after
such notice shall be in an amount calculated on the basis of such revised
estimate.
(ii) If payment of Additional Rent begins on a date other than
January 1st under this Lease, in order to provide for current payments of
Additional Rent through December 31st of that partial calendar year, Landlord
shall submit to Tenant a statement of Landlord's estimate of Tenant's Additional
Rent for that partial year, stated in monthly increments resulting from
increases described in Section 7(b). Tenant shall make the monthly incremental
payments of estimated Additional Rent, together with its installments of
operating expenses.
(iii) After the end of each calendar year, Landlord will as soon as
practicable submit to Tenant a statement of the actual increases incurred in
operating expenses for the preceding calendar year over the Base Operating
Expense Amount. Tenant shall pay Landlord, within thirty (30) days of Tenant's
receipt of such statement, Tenant's Expansion Premises Proportionate Share of
the excess, if any, of actual operating expenses over the projected operating
expenses. If the amount paid by Tenant during the previous year exceeded
Tenant's share of actual operating expenses for the year, the excess shall be
credited toward payment of the next installment of operating expenses to be paid
by Tenant after Tenant receives said statement from Landlord. If the amount
paid by Tenant during the last calendar year of the Lease Term exceeds Tenant's
share of actual operating expenses for such year, Landlord shall pay Tenant the
excess amount within thirty (30) days after Landlord's submission to Tenant of
the aforesaid operating expense statement for such calendar year.
(iv) Within ten (10) days after receipt of Landlord's statement
showing actual figures for the year, Tenant shall have the right to request a
statement of operating expenses of the Adjacent Building and copies of real
estate tax bills, which shall be supplied to Tenant within a reasonable time
after Tenant's written request. No such request shall extend the time for
payments as set forth in Section 7(b) or Section 7(d)(iii) above. Unless Tenant
asserts specific error(s) and supports such errors, in writing, within fifteen
(15) days after Landlord has complied with Tenant's request, Tenant shall waive
the right to contest the statement of actual figures for the year submitted by
Landlord. If Tenant timely asserts specific error(s) and supports such errors,
in writing, and it shall be determined that there is an error in Landlord's
statement, Tenant shall be entitled to a credit for any overpayment.
(e) Tenant shall be liable for, and shall pay at least ten (10) days
before delinquency, all taxes levied against any personal property or trade
fixtures placed by Tenant in
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or about the Expansion Premises. If any such taxes on Tenant's personal
property or trade fixtures are levied against Landlord or Landlord's property,
or if the assessed value of the Expansion Premises is increased by the inclusion
therein of a value placed upon such personal property or trade fixtures of
Tenant, and if Landlord, after written notice to Tenant, pays the taxes based
upon such increased assessments (which Landlord shall have the right to do
regardless of the validity thereof, but under protest if requested by Tenant),
Tenant shall upon demand repay to Landlord a sum equal to the taxes levied
against Landlord or the portion of such taxes resulting from such increase in
the assessment; provided that, in any such event, Tenant shall have the right,
at Tenant's sole cost and expense, to bring suit to recover the amount of any
such taxes so paid under protest, and any amount so recovered shall belong to
Tenant.
(f) The provisions of Section 7 of this Amendment shall not be
applicable to the Original Premises.
8. SERVICES AND UTILITIES.
(a) Xxx xxxxxxxxxx xx Xxxxxxxx 00(x), (x), (x), (x), (x), (x) and
(h) of the Lease shall not be applicable to the Expansion Premises.
(b) BUILDING STANDARD SERVICES AND UTILITIES. Landlord shall
furnish to the Expansion Premises sufficient electric current for routine and
normal requirements for lighting and typical office equipment and machinery,
such as typewriters, calculators, personal computers, small copiers and similar
items, subject to the limitations of Section 8(e), water for lavatory and
drinking purposes, and automatically operated elevator service, all without
additional cost to Tenant. Landlord further agrees to furnish heating and
cooling to the Expansion Premises during the appropriate seasons of the year,
during the "Adjacent Building Operating Hours" (as defined below), exclusive of
the Adjacent Building Holidays, with holidays falling on Saturday observed both
on said day and on the preceding Friday, and holidays falling on Sunday observed
on the following Monday.
(c) OVERTIME SERVICES. Should Tenant require heating and cooling
services beyond the Adjacent Building Operating Hours, Landlord will furnish
such additional service at the then-prevailing hourly rate (which shall include,
without limitation, Landlord's actual cost of supplying heating and cooling
services, wear and tear on the heating and cooling equipment and machinery, and
Landlord's administrative and engineering costs), as established by Landlord
from time to time, provided that Tenant gives Landlord no less than twenty-four
(24) business hours advance written notice of the need therefor. The hourly
rate established by Landlord from time to time for such additional service shall
be consistent with the then hourly rate being charged by landlords of similar
buildings, which contain similar heating and cooling systems and equipment
(i.e., similar type of system, of a similar age and utility) that are located in
the vicinity of the Adjacent Building. Despite the foregoing, it is expressly
understood and agreed that (i) the hourly rate for a building whose heating and
cooling system must be run on a "building-wide" basis will be higher than a
building whose heating and cooling system can be run on a "zone by zone" or
"floor by floor" basis, and (ii) the hourly rate for a building whose heating
and cooling
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system is consistently run on an overtime basis may, as a result of the
increased wear and tear caused by such use, be higher than the hourly rate for a
building whose heating and cooling system is only occasionally run on an
overtime basis.
(d) INTERRUPTION OF SERVICE. In no event shall Landlord be liable
to Tenant for any interruption or failure in the supply of any utilities to the
Expansion Premises. Landlord reserves the right to interrupt service of the
heat, elevator, plumbing, air conditioning, cooling, electric, and sewer and
water systems, when necessary, by reason of accident, or of repairs, alterations
or improvements which in the judgment of Landlord are desirable or necessary to
be made, until such repairs, alterations or improvements shall have been
completed; and Landlord shall have no responsibility or liability for failure to
supply heat, plumbing, air conditioning, cooling, electric, and sewer and water
service, or other service or act for the benefit of Tenant, when prevented from
so doing by strikes, accidents or by any other causes beyond Landlord's
reasonable control, or by orders or regulations of any federal, state, county,
or municipal authority, or by any failure to receive suitable fuel supply, or
inability despite exercise of reasonable diligence to obtain the regularly-used
fuel or other suitable substitute; and Tenant agrees that Tenant shall have no
claim for damages nor shall there be any abatement of Base Annual Rent in the
event that any of said systems or service shall be discontinued or shall fail to
function for any reason. Despite the foregoing, in the event that (i) as a
result of Landlord's negligence or intentional misconduct the services to be
provided by Landlord under Section 8(b) of this Amendment shall not be furnished
for more than five (5) consecutive days, and (ii) Tenant, in its reasonable
business judgment, determines that it is unable to use and occupy the Expansion
Premises (or any part thereof) as a result thereof, then commencing on the sixth
(6th) day that such services are not being provided the Base Annual Rent Tenant
is obligated to pay hereunder with respect to the Expansion Premises shall xxxxx
with respect to that part of the Expansion Premises which Tenant does not use
and occupy. Such abatement shall immediately cease on the date that such
services are restored. In the event that any such failure to furnish such
services is caused by Tenant's acts or omissions, Tenant shall not be entitled
to an abatement of Base Annual Rent.
(e) EXCESSIVE ELECTRICAL USAGE.
(i) Tenant will not install or operate in the Expansion
Premises any heavy duty electrical equipment or machinery, without obtaining the
prior written consent of Landlord. Landlord may require, as a condition of its
consent to the installation of such equipment or machinery, payment by Tenant,
as Additional Rent, for such excess consumption of electricity as may be
occasioned by the operation of said equipment or machinery. Landlord may make
periodic inspections of the Expansion Premises at reasonable times to determine
that Tenant's electrically operated equipment and machinery complies with the
provisions of this Section and Section 8(f) below.
(ii) Landlord shall have the right to require that one or
more separate meters or submeters be installed to record the consumption or use
of electricity, or to cause a
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reputable independent electrical engineer to survey and determine the quantity
of electricity consumed by such excessive use. The cost of any such survey or
meters and of installation, maintenance and repair thereof shall be paid by
Tenant. Tenant agrees to pay Landlord (or the utility company, if direct
service is provided by the utility company), promptly upon demand therefor, for
all such electricity consumption as shown by said meters, or a flat monthly
charge determined by the survey, as applicable, at the rates charged for such
service by the local public utility company. If Tenant's cost of electricity
based on meter readings is to be paid to Landlord, Tenant shall pay a service
charge related thereto.
(f) EXCESSIVE HEAT GENERATION. Landlord shall not be liable for
its failure to maintain comfortable atmospheric conditions in all or any portion
of the Expansion Premises, due to heat generated by any equipment or machinery
installed by Tenant (with or without Landlord's consent) that exceeds
generally-accepted engineering design practices for normal office purposes. If
Tenant desires additional cooling to offset excessive heat generated by such
equipment or machinery, Tenant shall pay for auxiliary cooling equipment and its
operating costs, including without limitation electricity, gas, oil and water,
or for excess electrical consumption by the existing cooling system, as
appropriate.
(g) SECURITY. In the event that Landlord, in the exercise of its
sole and absolute discretion, elects to provide any security measures, such
security measures: (i) shall be for protection of the Adjacent Building only;
and (ii) shall not be relied upon by Tenant to protect Tenant, its property, its
employees or their property.
(h) As used herein, (i) "Adjacent Building Holidays" means: New
Year's Day, Xxxxxx Xxxxxx Xxxx Day, Memorial Day, President's Day, the Fourth of
July, Labor Day, Veterans Day, Thanksgiving Day, Christmas Day and any other
federal holiday that may exist in the future; and (ii) "Adjacent Building
Operating Hours" means 8:00 a.m. to 6:00 p.m. Monday-Friday, and 9:00 a.m. to
1:00 p.m. on Saturday.
(i) Notwithstanding anything herein to the contrary, it is
expressly acknowledged and agreed that (x) Landlord shall have no obligation to
provide char or janitorial services to the Expansion Premises, and (y) Tenant,
at its sole cost and expense, shall provide char and janitorial services to the
Expansion Premises (including, without limitation, any bathrooms that are
located on the lower level, the first floor and/or the second floor of the
Adjacent Building).
(j) The provisions of Section 8 of this Amendment shall not be
applicable to the Original Premises.
9. CHANGES AND ADDITIONS.
(a) The provisions of Section 14(c) of the Lease shall not be
applicable to the Adjacent Building.
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(b) Landlord reserves the right at any time and from time to time,
as often as Landlord deems desirable, without the same constituting an actual or
constructive eviction and without incurring any liability to Tenant or otherwise
affecting Tenant's obligations under the Lease, to make changes, alterations,
additions, improvements, repairs, relocations or replacements in or to the
Adjacent Building and the fixtures and equipment thereof, as well as in or to
the street entrances, halls, passages, stairways and other common facilities
thereof, and to change the name by which the Adjacent Building is commonly known
and/or the Adjacent Building's address. Landlord reserves the right from time
to time to install, use, maintain, repair and replace pipes, ducts, conduits,
wires and appurtenant meters and equipment for service to other parts of the
Adjacent Building, above the ceiling surfaces, below the floor surfaces, within
the walls and in the central core areas, and to relocate any pipes, ducts,
conduits, wires and appurtenant meters and equipment included in the Expansion
Premises which are located in the Expansion Premises or located elsewhere
outside the Expansion Premises, and to expand and/or build additional stories on
the Adjacent Building. Landlord further reserves the right at any time to
alter, expand or reduce the parking facilities, to change the means of ingress
thereto and egress therefrom, and to impose charges for parking in such
facilities. Nothing contained herein shall be deemed to relieve Tenant of any
duty, obligation or liability with respect to making any repair, replacement or
improvement or complying with any law, order or requirement of any government or
other authority and nothing contained herein shall be deemed or construed to
impose upon Landlord any obligation, responsibility or liability whatsoever, for
the care, supervision or repair of the Adjacent Building, or any part thereof,
other than as expressly provided in this Lease.
(c) The provision of Section 9 of this Amendment shall not be
applicable to the Building.
10. INTENTIONALLY DELETED.
11. INTERPRETATION. From and after the "Expansion Premises Commencement
Date" (as hereinafter defined), except where the context plainly requires
otherwise, and except as otherwise provided for herein, the term "Demised
Premises" shall mean the Original Premises and the Expansion Premises, and all
references in the Lease to the term "Demised Premises" shall mean the Original
Premises and the Expansion Premises. All capitalized terms that are not defined
in this Amendment shall have the meanings ascribed to such terms in the Lease.
12. PARKING. Landlord shall make available (or cause to be made
available) to Tenant at all times during the Lease Term three and seven-tenths
(3.7) monthly parking contracts for every one thousand (1,000) square feet of
rentable area of the Expansion Premises to park an automobile (collectively, the
"Parking Rights") in the parking facilities for the Adjacent Building (the
"Adjacent Building Parking Rights"). Except as provided in the sentence which
immediately follows this sentence, the Adjacent Building Parking Rights shall
(i) be unassigned, and (ii) be on a self-park or attendant parking basis (or a
combination thereof) as determined by the garage operator. In the event that
Landlord, in its sole discretion, designates any of the parking spaces that are
located directly in front of the lobby of the Adjacent Building as
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"reserved spaces", then, as part of the Adjacent Building Parking Rights, Tenant
shall have the exclusive right to use one-half (2) of such reserved parking
spaces.
13. SIGNAGE. Tenant, at Tenant's sole cost and expense, shall have the
right to erect and maintain its company name and/or logo on a monument sign (the
"Adjacent Building Monument Sign"). The size, location, color, design, method
of installation, and method of illumination (if applicable) of the Adjacent
Building Monument Sign shall be subject to: (i) Landlord's prior written
consent, and (ii) all applicable government rules, codes, orders, laws, and
statutes (collectively, the "Governmental Laws"). Tenant, at Tenant's sole cost
and expense, shall maintain the Adjacent Building Monument Sign in a first-class
manner in accordance with the Governmental Laws.
14. SUPPLEMENTAL ACCESS SYSTEM.
(a) Subject to the provisions of Section 12 of the Lease, Landlord
hereby grants Tenant the right, at Tenant's sole cost and expense, to install
supplemental access devices and equipment in the Adjacent Building to supplement
any access system that Landlord may, from time to time, in its discretion,
provide in connection with access to the Adjacent Building.
(b) Subject to the terms of this Section 14(b), Tenant shall be
permitted, at its sole cost and expense, to locate a security guard directly in
front of the entrance to the Expansion Premises that is located on the first
floor of the Adjacent Building. Tenant's security guard shall: (i) not carry
any firearms; (ii) not interfere with access by any party to any portion of the
Adjacent Building that is not leased to Tenant; (iii) comply with all rules and
regulations that are promulgated by Landlord from time to time with respect to
the Adjacent Building; (iv) shall comply with all Governmental Laws; and (v) not
identify itself, or hold itself out to be, an employee, agent, or contractor of
Landlord or the Adjacent Building. Tenant shall indemnify and hold Landlord
harmless from and against all damage, liability, cost and expense, including,
without limitation, attorneys' fees and litigation costs, caused as a result of
Tenant's security guard's (x) presence or activities in or about the Adjacent
Building, and/or (y) negligence or misconduct.
15. NEW LEASE.
(a) In the event that Landlord and Tenant enter into a written
agreement whereby Landlord leases to Tenant, and Tenant leases from Landlord,
the balance of the rentable area of the Adjacent Building so that Tenant is
leasing the entire Adjacent Building, then the parties shall, upon either
party's request, enter into a written agreement whereby (i) Tenant leases the
Adjacent Building on a triple net basis, and (ii) the applicable provisions of
the Lease (as amended by this Amendment) shall be appropriately modified to
reflect (x) that Tenant is leasing the entire Adjacent Building and that the
maintenance, repair and replacement obligations with respect to the Adjacent
Building shall be allocated between Landlord and Tenant in the same manner that
they were allocated between Landlord and Tenant under the Lease with respect to
the Building, (y) that Tenant will be responsible for the payment of one hundred
percent
15
(100%) of the operating expenses and real estate taxes for the Building and the
Adjacent Building, and (z) that the amount of the management fee that is
included as part of operating expenses under the Lease shall be appropriately
increased to reflect the rentable square footage of the Adjacent Building.
(b) Notwithstanding anything herein to the contrary, in the event
that Landlord desires to sell the Building or the Adjacent Building such that
the two buildings will be owned by two (2) different parties, then, upon written
notice from Landlord, Tenant will enter into a separate lease with Landlord (or
its successor) for each of the Expansion Premises and the Original Premises,
which leases will contain the same economic terms as are currently contained in
the Lease (as amended by this Amendment) as appropriately allocated to the
Original Premises and the New Premises.
16. BROKERS. Landlord and Tenant each represents and warrants to the
other that, except for Xxxxxx X. Xxxxxxx, Inc. and Insignia Xxxxxx Xxxxxx, it
has not employed any broker in connection with this Amendment. Landlord and
Tenant shall each indemnify and hold harmless the other from and against any
claims for brokerage or other commission arising by reason of a breach by the
indemnifying party of the aforesaid representation and warranty.
17. GOVERNING DOCUMENT. Except as otherwise amended by this Amendment,
the Lease shall remain in full force and effect. In the event of any conflict
between the terms and conditions of the Lease, and the terms and conditions of
this Amendment, the terms and conditions of this Amendment shall govern and
control.
18. INCORPORATION OF RECITALS. The Recitals set forth herein are
incorporated in and made a part of this Amendment.
19. COUNTERPARTS. This Amendment may be executed in two (2) or more
counterpart copies, all of which counterparts shall have the same force and
effect as if all parties hereto had executed a single copy of this Amendment.
20. NO OPTION. The submission of this Amendment by Landlord to Tenant for
examination shall not constitute a reservation of or option for the Expansion
Premises. This Amendment shall become effective only upon execution thereof by
both parties and delivery thereof to Tenant.
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IN WITNESS WHEREOF, the parties have executed this Amendment as of the date
first set forth above.
ATTEST/WITNESS: LANDLORD:
MERIDIAN ROCKVILLE PLAZA, LLC, a
Maryland limited liability company
______________________________ By: _______________________________
Name: _____________________________
Title: ____________________________
Date:______________________________
ATTEST/WITNESS: TENANT:
THE XXXXXX-XXXXX CORPORATION, a
New York corporation
______________________________ By: _______________________________
Name: _____________________________
Title: ____________________________
Date:______________________________
