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Exhibit 10.26
ASSIGNMENT, ASSUMPTION AND NOVATION AGREEMENT
This Assignment, Assumption and Novation Agreement
("Agreement") is entered into on September 12, 1997, but shall be deemed
effective as of the 1st day of August, 1997 ("Effective Date"), by and between
USA GROUP INFORMATION SOLUTION, INC., an Indiana corporation, formerly known as
TRG, Inc. ("USAGIS"), VIASOFT, INC., a Delaware corporation ("Viasoft"), and
LONDEN CENTER L.L.C., an Arizona limited liability company ("Londen").
RECITALS:
Londen, as Landlord, and USAGIS, as Tenant, have entered into
that certain Office Lease with Addendum and exhibits, each dated as of December
19, 1994 (the "Original Lease"). The Original Lease was amended by that certain
First Amendment to Lease with exhibits, dated as of December 20, 1995 (the
"First Amendment"). Pursuant to an Assignment, Assumption and Novation Agreement
dated December 19, 1996, by and between the parties hereto, the Original Lease
was split into a direct lease between USAGIS and Londen, as to approximately
14,465 rentable square feet of the Premises and a direct lease between Viasoft
and Londen, as to approximately 24,007 rentable square feet of the Premises (the
"First Assignment"). The Original Lease, the First Amendment and the First
Assignment (as to the "Assigned Premises" referenced below) are collectively
referred to as the "Lease".
USAGIS wishes to assign to Viasoft all of its remaining right,
title and interest in and to the Premises demised by the Original Lease, which
the parties agree is the approximately 14,465 remaining rentable square feet
(the "Assigned Premises") granted to USAGIS pursuant to the First Assignment.
Viasoft wishes to (i) accept the assignment to Viasoft of all
of USAGIS's right, title and interest, as Tenant under the Lease, in and to the
Assigned Premises, and (ii) assume the performance of USAGIS's obligations
applicable to the Assigned Premises as Tenant under the Lease.
Londen wishes to (i) consent to USAGIS's assignment to Viasoft
of all of USAGIS's remaining right, title and interest, as Tenant under the
Lease, and (ii) release USAGIS's from the performance of USAGIS's remaining
obligations as Tenant under the Lease.
NOW, THEREFORE, in consideration of the premises and promises
contained herein and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follow:
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AGREEMENTS:
1. Accuracy of the Recitals: The parties hereby acknowledge
the accuracy of the Recitals which are incorporated herein by this reference.
2. Defined Terms. Except for those terms expressly defined in
this Agreement, all initially capitalized terms used herein shall have the
meanings set forth for such terms in the Lease.
3. No Default. The parties acknowledge and agree that the
Lease is in full force and effect. The parties acknowledge that no party is in
default under any of the provisions of the Lease.
4. Assignment. As of the Effective Date, USAGIS hereby assigns
all of its right, title and interest, as Tenant under the Lease, in and to the
Assigned Premises to Viasoft, so that USAGIS shall have no remaining right,
title or interest in any portion of the Premises, the Building or the Project.
Without limiting the foregoing assignment, such assignment includes all signage
rights, parking and storage space held by USAGIS.
5. Assumption. As of the Effective Date, Viasoft hereby
accepts the above assignment and assumes and agrees to perform all of the terms,
conditions, covenants and agreements of USAGIS, applicable to the Assigned
Premises, as Tenant under the Lease, except as provided in Section 8 below.
6. Consent. As of the Effective Date, Londen, in accordance
with Section 8.1 of the Lease, hereby consents to the above assignment.
7. Novation.
(a) From and after the Effective Date, except as
provided in Section 8 below, Viasoft shall perform each and every term,
condition, covenant and agreement of USAGIS, applicable to the Assigned
Premises, as Tenant under the Lease, and agrees to be bound by each and every
term, condition, covenant and agreement of the Tenant applicable to the Assigned
Premises (and all other portions of the Premises) contained in the Lease as if
Viasoft were an original party to the Lease.
(b) As of the Effective Date, except as provided in
Section 8 below, Londen unconditionally releases USAGIS from all claims for any
obligation or liability as Tenant applicable to the Assigned Premises (and all
other portions of the Premises) contained in or arising out of the Lease. Londen
accepts the liability of Viasoft only to perform each and every term, condition,
covenant and agreement of the "Tenant" applicable to the Assigned Premises under
the Lease in lieu of the liability of USAGIS. Londen shall be bound by the terms
of the Lease in every way as if Viasoft was named as the Tenant of the Assigned
Premises in the Lease.
8. Annual Rent. Notwithstanding anything in this Agreement or
the Lease to the contrary, USAGIS shall remain solely responsible to pay the
Monthly Installment of Rent for Annual Rent reserved under Section 3 of the
Lease with respect to the Assigned Premises through and including September 30,
1997. Commencing on October 1, 1997, Viasoft shall be solely responsible to pay
the Monthly Installment of Rent for Annual Rent. In addition, USAGIS shall
remain responsible for all Tenant expense reimbursement (e.g., taxes) contained
in the Lease with respect to the Assigned Premises through the Effective Date,
regardless of when such items are billed by Londen.
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9. Condition and Delivery of the Premises. USAGIS hereby
represents and warrants to Viasoft that its interest in the Assigned Premises
leasehold and in the furniture referenced in Section 11 below is free and clear
of all liens and encumbrances, except for the Landlord's lien for rent. The
Assigned Premises is otherwise delivered to Viasoft by USAGIS "AS-IS" and "WITH
ALL FAULTS" on the Effective Date.
10. Access Cards. USAGIS shall deliver all remaining access
cards in its possession for the parking garage serving the Project.
11. Cubular Furniture. USAGIS agrees to sell, and Viasoft
agrees to purchase some or all of the existing cubular furniture located in the
Assigned Premises in accordance with a xxxx of sale of even date with the
execution date of this Agreement. Payment shall be made immediately upon the
delivery of this Agreement. USAGIS shall have seven business days to remove any
unpurchased furniture, which time period shall commence on the day the xxxx of
sale is executed.
12. Brokerage. Each party represents that no fee or commission
is owed or shall be paid to any broker, finder or agent with respect to this
transaction. Each party indemnifies the others with respect to any claim for a
commission by any person claiming through the indemnitor.
13. Binding Effect. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns.
14. Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which shall
constitute one and the same instrument.
[SIGNATURES APPEAR ON NEXT PAGE]
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USA GROUP INFORMATION SOLUTION,
INC., an Indiana corporation
By /s/ Xxxxxxx X. Good
----------------------
Xxxxxxx X. Good
Its Vice President and Treasurer
["USAGIS"]
VIASOFT, INC., a Delaware corporation
By /s/ Xxxx X. Xxxxxxx
_____________________________ ________________________________________
Its CFO
___________________________________
["Viasoft"]
LONDEN CENTER L.L.C., an Arizona
limited liability company
By _______________________________________
Its __________________________________
["Londen"]
State of ____________
County of __________
The foregoing instrument was acknowledged before me this _____
day of ________________, 1997, by __________________, the ___________________ of
USA Group Information Solution, Inc., an Indiana corporation, on behalf of the
corporation.
(Seal and Expiration Date)
_______________________________
Notary Public
State of Arizona
County of Maricopa
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The foregoing instrument was acknowledged before me this 19th
day of September, 1997, by Xxxx Xxxxxxx, the CFO of Viasoft, Inc., a Delaware
corporation, on behalf of the corporation.
(Seal and Expiration Date)
Xxxxxx X. Till
_______________________________
Notary Public
State of Arizona
County of Maricopa
The foregoing instrument was acknowledged before me this _____
day of ________________, 1997, by __________________, the ___________________ of
Londen Center L.L.C., an Arizona limited liability company, on behalf of the
company.
(Seal and Expiration Date)
______________________________
Notary Public
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ASSIGNMENT, ASSUMPTION AND NOVATION AGREEMENT
This Assignment, Assumption and Novation Agreement
("Agreement") is entered into as of the 19th day of December, 1996 ("Execution
Date"), by and between TRG, INC., an Indiana corporation ("TRG"), VIASOFT, INC.,
a Delaware corporation ("Viasoft"), and LONDEN CENTER L.L.C., an Arizona limited
liability company ("Londen").
RECITALS:
Londen, as Landlord, and TRG, as Tenant, have entered into
that certain Office Lease with Addendum and exhibits, each dated as of December
19, 1994, attached hereto as Exhibit A and incorporated herein by this reference
(the "Original Lease").
The Original Lease was amended by that certain First Amendment
to Lease with exhibits, dated as of December 20, 1995, attached hereto as
Exhibit B and incorporated herein by this reference (the "First Amendment"). The
Original Lease and the First Amendment are collectively referred to as the
"Lease".
TRG wishes to (i) assign to Viasoft all of its right, title
and interest, as Tenant under the Lease, in and to approximately 24,007 rentable
square feet (the "Assigned Premises") of the Premises, as defined in the Lease,
as shown on Exhibit C attached hereto and incorporated herein by this reference,
(ii) be discharged from the performance of its obligations applicable to the
Assigned Premises as Tenant under the Lease, and (iii) confirm its obligations
as Tenant under the Lease applicable to approximately 14,465 rentable square
feet (the "Retained Premises") of the Premises, as shown on Exhibit D attached
hereto and incorporated herein by this reference, effective as of March 1, 1997
(the "Effective Date").
Viasoft wishes to (i) accept the assignment to Viasoft of all
of TRG's right, title and interest, as Tenant under the Lease, in and to the
Assigned Premises, and (ii) assume the performance of TRG's obligations
applicable to the Assigned Premises as Tenant under the Lease, effective as of
the Effective Date.
Londen wishes to (i) consent to TRG's assignment to Viasoft of
all of TRG's right, title and interest, as Tenant under the Lease, in and to the
Assigned Premises, (ii) release TRG's from the performance of TRG's obligations
applicable to the Assigned Premises as Tenant under the Lease, effective as of
the Effective Date.
NOW, THEREFORE, in consideration of the premises and promises
contained herein and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follow:
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AGREEMENTS:
1. Accuracy of the Recitals: The parties hereby acknowledge
the accuracy of the Recitals which are incorporated herein by this reference.
The actual square footage of the Assigned Premises and the Retained Premises may
be confirmed by either party within 30 days from the date hereof using BOMA
standards, with adjustments being made as appropriate if required.
2. Defined Terms. Except for those terms expressly defined in
this Agreement, all initially capitalized terms used herein shall have the
meanings set forth for such terms in the Lease.
3. No Default. As of the Execution Date: Londen and TRG
acknowledge and agree that the Lease remains in full force and effect. TRG
acknowledges that Londen is not in default of any provision of the Lease. Londen
acknowledges that TRG is not in default of any provision of the Lease.
4. Assignment. As of the Effective Date, TRG hereby assigns
all of its right, title and interest, as Tenant under the Lease, in and to the
Assigned Premises to Viasoft, reserving to TRG all right, title and interest, as
Tenant under the Lease, in and to the Retained Premises.
5. Assumption. As of the Effective Date, Viasoft hereby
accepts the above assignment and assumes and agrees to perform all of the terms,
conditions, covenants and agreements of TRG, applicable to the Assigned
Premises, as Tenant under the Lease.
6. Consent. As of the Effective Date, Londen, in accordance
with Section 8.1 of the Lease, hereby consents to the above assignment.
7. Novation.
(a) From and after the Effective Date, Viasoft shall
perform each and every term, condition, covenant and agreement of TRG,
applicable to the Assigned Premises, as Tenant under the Lease, and agrees to be
bound by each and every term, condition, covenant and agreement of the Tenant
applicable to the Assigned Premises, contained in the Lease as if Viasoft were
an original party to the Lease.
(b) As of the Effective Date, Londen unconditionally
releases TRG from all claims for any obligation or liability as Tenant
applicable to the Assigned Premises contained in or arising out of the Lease.
Londen accepts the liability of Viasoft only to perform each and every term,
condition, covenant and agreement of the "Tenant" applicable to the Assigned
Premises under the Lease in lieu of the liability of TRG. Londen shall be bound
by the terms of the Lease in every way as if Viasoft was named as the Tenant of
the Assigned Premises in the Lease.
8. Confirmation. TRG hereby confirms to Londen that it shall
perform each and every term, condition, covenant and agreement as Tenant
applicable to the Retained Premises under the Lease.
9. Condition and Delivery of the Premises. The Assigned
Premises shall be
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delivered to Viasoft by TRG "AS-IS" and "WITH ALL FAULTS" on the Effective Date.
Notwithstanding the foregoing, Viasoft may enter the Premises after the
Execution Date for the sole purpose of constructing its tenant improvements.
Such tenant improvements shall include a demising wall between the Assigned
Premises and the Retained Premises and a common area corridor. Said right of
entry shall not create a lease estate or any other right in favor of Viasoft.
Viasoft hereby indemnifies and holds harmless TRG and Londen from all claims,
damages, mechanics' liens, fees and costs (including attorneys' fees) respecting
or arising out of the right granted in this Section 9. The tenant improvements
shall be made in accordance with the terms, conditions and limitations contained
in a Lease (including obtaining any required approvals of Londen); provided
Londen hereby agrees to approve a demising wall and a common area corridor that
comply with governmental requirements. Prior to any entry Viasoft shall deliver
to TRG and Londen certificates of insurance having such parties as named
additional insureds under a liability policy of not less than $1,000,000.
10. Governing Document. The Lease shall in all respects govern
Viasoft's occupancy of the Assigned Premises and TRG's occupancy of the Retained
Premises, except that, notwithstanding anything in the Lease to the contrary,
the parties agree as follows as of the Effective Date the Lease shall be deemed
two separate leases, one governing strictly the Assigned Premises and one
governing strictly the Retained Premises, and further:
(a) The "Tenant's Proportionate Share of Building"
applicable to TRG shall mean 13.35%, subject to confirmation pursuant to BOMA
standards in accordance with Section 1 hereof.
(b) The "Tenant's Proportionate Share of Building"
applicable to Viasoft shall mean 22.15%, subject to confirmation pursuant to
BOMA standards in accordance with Section 1 hereof.
(c) All other ratios and percentages in the
respective Lease shall be amended to conform with the percentages set forth in
Sections 10(a) and (b) above except for the stipulated prorations set forth in
(d) through (g) and Sections 11 and 12 below.
(d) The tenant under the Lease has certain
cancellation rights with respect to the Original Premises (as defined in the
Lease) pursuant to the Addendum to the Lease entitled Cancellation Option and
for the Additional Space (as defined in the First Amendment to Lease), pursuant
to Paragraph 9 of the First Amendment to Lease. The cancellation rights required
a cancellation fee with respect to the Original Premises, which fee as of the
first day of the lease term was $550,895 to be amortized over 72 months, at the
rate of $7,651 per month for the Original Premises. The cancellation fee with
respect to the Cancellation Option for all of the Additional Space in accordance
with Section 9(i) of the First Amendment to Lease was $164,026 as of December
20, 1995, to be amortized over 62 months, at the rate of $2,646 for all of the
Additional Space. Accordingly, the cancellation fee for the Cancellation Option
for the Retained Premises shall be $119,248 as of May 31, 1998 (which is the
earliest date said Cancellation Option may be exercised), amortizing thereafter
at $3,312 per month, which if owed shall be paid by TRG. The cancellation fee
for the Cancellation Option for the Assigned Premises shall be $251,429 as of
May 31, 1998 (which is the earliest date said Cancellation Option may be
exercised), amortizing thereafter at $6,984 per month, which if owed shall be
paid by Viasoft.
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(e) TRG shall have 55 access cards providing access
to the parking garage of the Building, the other public areas of the Building
and its elevator system and the Retained Premises. TRG shall have at least 50
unreserved employee parking spaces in the parking garage.
(f) Viasoft shall have 145 access cards providing
access to the parking garage of the Building, the other public areas of the
Building and its elevator system and the Retained Premises. Viasoft shall have
at least 107 unreserved employee parking spaces in the parking garage.
(g) Viasoft shall have the sole right to exercise the
"First Right" as set forth in the Addendum to the Original Lease. TRG shall have
no right, title or interest in or to said "First Right".
(h) TRG and Londen acknowledge and agree that
Viasoft's use of the Assigned Premises, and any additional space in the Building
Viasoft may lease in the future, shall not be deemed to be a violation of
Section 1.5 of the Lease applicable to the Retained Premises. Viasoft and Londen
acknowledge and agree that TRG's use of the Retained Premises, and any
additional space in the Building TRG may lease in the future, shall not be
deemed to be a violation of Section 1.5 of the Lease applicable to the Assigned
Premises.
(i) Each and every reference contained in the Lease
to the "Premises" shall be deemed to refer to the Retained Premises as the Lease
applies to TRG. Each and every reference contained in the Lease to the
"Premises" shall be deemed to refer to the Assigned Premises as the Lease
applies to Viasoft.
11. Signage. As of the Effective Date, TRG hereby
conditionally assigns to Viasoft its right to place signage on the Building
monument granted to TRG pursuant to the Addendum to the Original Lease;
provided, however, if Londen remains unable to provide TRG alternative signage
on the Building monument reasonably satisfactory to TRG at the time TRG desires
such monument signage, TRG hereby reserves the right to make use of the lower
50% of the signage assigned to Viasoft pursuant to this Section 11 upon 10 days'
notice to Viasoft, with Viasoft entitled to use the upper 50% of such signage.
12. Storage Space. Pursuant to the First Amendment, Londen is
obligated to provide TRG with 250 square feet of secured storage space within
the Building's G-2 parking garage level at no charge to TRG. As of the Effective
Date, TRG hereby assigns all of its right, title and interest in and to 125
square feet of said storage space to Viasoft, reserving to TRG 125 square feet.
Viasoft shall install a demising wall with the cost thereof prorated between the
parties in accordance with Section 13(a) below.
13. Tenant Improvements.
(a) Viasoft shall construct demising walls between
the common boundaries of the Assigned Premises and the Retained Premises and
between the storage space assigned to Viasoft pursuant to Section 12 above and
the storage space retained by TRG prior to the Effective Date. All costs and
expenses relating to the required demising walls and common area corridor,
including architect, engineering and permit fees shall be shared equally between
TRG and Viasoft, as incurred.
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(b) The parties intend that the Assigned Premises and
the Retained Premises shall be treated as completely separate facilities, with
equal rights to all common areas and the common area corridor. However, the
parties acknowledge that systems existing as of the Execution Date of this
Agreement (e.g., cabling) may be partially located in other portions of the
Building, and the parties accordingly grant each other reasonable rights of
entry to maintain and replace such existing systems improvements. Each party
shall give the other party at least 10 days' written notice of any exercise of
such right of entry absent an emergency.
14. Cubular Furniture. TRG agrees to sell, and Viasoft agrees
to purchase the existing cubular furniture located in the Assigned Premises for
a purchase price to be agreed upon by the parties on or before December 27,
1996. The sale shall be completed as soon as possible but TRG shall have the
option to repurchase the property sold if for any reason the assignment herein
is not effective on the Effective Date.
15. No Cross-Default. No default by TRG under the terms of the
Lease applicable to the Retained Premises shall be deemed to constitute a
default by Viasoft under the terms of the Lease applicable to the Assigned
Premises. No default by Viasoft under the terms of the Lease applicable to the
Assigned Premises shall be deemed to constitute a default by TRG under the terms
of the Lease applicable to the Retained Premises. No default by Londen under the
terms of the Lease applicable to the Retained Premises shall be deemed to
constitute a default by Londen under the terms of the Lease applicable to the
Assigned Premises. No default by Londen under the terms of the Lease applicable
to the Assigned Premises shall be deemed to constitute a default by Londen under
the terms of the Lease applicable to the Retained Premises.
16. Brokerage. Except for the fees of Xxx & Associates and CB
Commercial/Xxx Xxxxxxx, which shall by paid by Viasoft when due, TRG and Londen
have no agreement or obligation, contingent or otherwise, to pay any fees or
commissions to any broker, finder or agent with respect to the transaction
contemplated by this Agreement.
17. Effective Date. This Agreement is immediately of full
force and effect. There are no conditions, express or implied, with respect to
the Effective Date except the passage of time. The purpose of the Effective Date
is to permit Viasoft to enter portions of the Premises prior to March 1, 1997
without incurring a base rent obligation, but subject always to the Lease and
this Agreement.
18. Binding Effect. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns.
19. Counterparts. This Agreement may be executed counterparts,
each of which shall be deemed an original, but all of which shall constitute one
and the same instrument.
20. Assignment at the Direction of Londen.
(a) Should any set of circumstances arise in which
TRG is permitted to surrender possession of all or a portion of the Retained
Premises on a certain date ("Surrender Date"), TRG shall, at the written
direction of Londen (the "TRG Direction"), assign all of its right, title and
interest in and to the applicable portion of the Retained Premises as of the
Surrender Date to an
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assignee of Londen's choice, AS IS, WHERE IS, provided:
(i) That Londen and said assignee execute
and deliver to TRG an Assignment, Assumption and Novation Agreement, in form
satisfactory to TRG, which among other things, provides that TRG is
unconditionally released from any and all obligations and liabilities arising
out of the Lease as it applies to such surrendered portion of the Retained
Premises;
(ii) That notwithstanding any delay in the
execution and delivery of the Assignment, Assumption and Novation Agreement
required by Section 20(a)(i) above, TRG shall have no liability for rent or
other amounts coming due under the Lease for the applicable surrendered portion
of the Retained Premises from and after the Surrender Date.
Londen hereby indemnifies TRG for any claim by a third party
relating to such surrender and the performance of the Assignment, Assumption and
Novation Agreement.
(b) Should any set of circumstances arise in which
Viasoft is permitted to surrender possession of all or a portion of the Assigned
Premises on a certain date ("Surrender Date"), Viasoft shall, at the written
direction of Londen (the "Viasoft Direction"), assign all of its right, title
and interest in and to the applicable portion of the Assigned Premises as of the
Surrender Date to an assignee of Londen's choice, AS IS, WHERE IS, provided:
(i) That Londen and said assignee execute
and deliver to Viasoft an Assignment, Assumption and Novation Agreement, in form
satisfactory to Viasoft, which among other things, provides that Viasoft is
unconditionally released from any and all obligations and liabilities arising
out of the Lease as it applies to such surrendered portion of the Assigned
Premises;
(ii) That notwithstanding any delay in the
execution and delivery of the Assignment, Assumption and Novation Agreement
required by Section 20(b)(i) above, Viasoft shall have no liability for rent or
other amounts coming due under the Lease for the applicable surrendered portion
of the Assigned Premises from and after the Surrender Date.
Londen hereby indemnifies Viasoft for any claim by a third
party relating to such surrender and the performance of the Assignment,
Assumption and Novation Agreement.
[SIGNATURES APPEAR ON NEXT PAGE]
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TRG, INC., an Indiana corporation
By /s/ Xxxxx Xxxx
____________________________________
Its COO
______________________________
["TRG"]
VIASOFT, INC., a Delaware corporation
By /s/ Xxxx Xxxxxxx
___________________________________
Its CFO
_______________________________
["Viasoft"]
LONDEN CENTER L.L.C., an Arizona
limited liability company
By /s/ Xxxx Xxxxxx
___________________________________
Its Manager
______________________________
["Londen"]
State of Arizona
County of Maricopa
The foregoing instrument was acknowledged before me this 31st
day of December, 1996, by Xxxxx Xxxx, the COO of TRG, Inc., an Indiana
corporation, on behalf of the corporation.
(Seal and Expiration Date)
/s/ Xxxxx Xxxxxx
_________________________________
Notary Public
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State of Arizona
County of Maricopa
The foregoing instrument was acknowledged before me this 23rd
day of December, 1996, by Xxxx Xxxxxxx, the CFO of Viasoft, Inc., a Delaware
corporation, on behalf of the corporation.
(Seal and Expiration Date)
Xxxxxx X. Till
_______________________________________
Notary Public
State of Arizona
County of Maricopa
The foregoing instrument was acknowledged before me this 31st
day of December, 1996, by Xxxx Xxxxxx, the Manager of Londen Center L.L.C., an
Arizona limited liability company, on behalf of the company.
(Seal and Expiration Date)
Xxxxx X. Xxxxxxx
_______________________________________
Notary Public
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EXHIBIT A
OFFICE LEASE
REFERENCE PAGE
LEASE REFERENCE DATE: December 19, 1994
BUILDING: The Londen Center
0000 Xxxx Xxxxxxxxx Xxxx
Xxxxxxx, Xxxxxxx 00000
PROJECT: For legal description of Project see Exhibit A
attached to this Lease and made a part of this
Lease by this reference
LANDLORD: Londen Center L.L.C., an Arizona limited
liability company
MANAGER: Londen Center L.L.C., an Arizona limited
liability company
LANDLORD'S AND 0000 Xxxx Xxxxxxxxx Xxxx, Xxxxx 000
MANAGER'S ADDRESS: Xxxxxxx, Xxxxxxx 00000
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(For Notices Only)
TENANT: TRG, Inc., an Indiana corporation
TENANT'S ADDRESS: 0000 Xxxx Xxxxxxxxx Xxxx, Xxxxx 000
(As of beginning of Term) Xxxxxxx, Xxxxxxx 00000
PREMISES IDENTIFICATION: The 3rd floor of the Building as approxi
mately crossed hatched on Exhibit B attached
to and made a part of this Lease by this
reference. The Premises shall not include
any portion of the atrium (whether airspace
or structural components thereof), any public
walkways and corridors located within the
atrium, the public bathrooms and related
hallways, the elevator lobbies and areas and
any other area of the 3rd floor located outside
of the interior surface of the walls and doors
comprising the Premises which delineate the
boundary between the Premises and the
adjacent atrium and related common areas
located outside of such interior surface of
such walls and doors
PREMISES RENTABLE AREA: 33,407 rentable square feet based on 29,695
usable square feet measured by BOMA
standards and a 12.50% "load" factor
USE: General office use; engineering and product
development; sale, display and customer
service; service and repair; education and
training, together with all uses incidental or
related thereto
SCHEDULED COMMENCEMENT DATE: May 1, 1995
SCHEDULED TERMINATION DATE: April 30, 2001
TERM OF LEASE: 6 years beginning on the Commencement
Date (as hereinafter defined in Section 2.1)
and ending on the Termination Date (as
hereinafter defined in Section 2.1), which
Termination Date shall be the last day of a
calendar month
ANNUAL RENT (Article 3): $504,445.70 (which is equal to $15.10 per
rentable square foot in the Premises x 33,407
rentable square feet in the Premises), plus
applicable rental taxes per Article 26 of the
Lease, except the first year's rent shall be
$493,936.43
MONTHLY INSTALLMENT OF
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ANNUAL RENT (Article 3): $42,037.14 (which
is equal to Annual
Rent (divided by) 12),
plus applicable rental
taxes per Article
26 of the Lease,
except the first
month's rent shall
be $31,527.85
BASE YEAR (DIRECT EXPENSES): Calendar year 1995
OR
EXPENSE STOP $ N/A per square foot
BASE YEAR (TAXES): Taxes levied or imposed for calendar year
1995 whether payable by Landlord in 1995 or
1996
OR
TAX STOP $ N/A per square foot
TENANT'S PROPORTIONATE
SHARE OF BUILDING: 30.82% (based on 108,380 rentable square
feet in the Building)
REAL ESTATE BROKER DUE
COMMISSION: CB Commercial by separate agreement
between Landlord and its broker
The Reference Page information is incorporated into and made a part of the
Lease. In the event of any conflict between any Reference Page information and
the Lease, the Lease shall control. This Lease includes Exhibits A through D,
and Schedules 1 through 3, all of which are made a part of this Lease.
LANDLORD: TENANT:
LONDEN CENTER L.L.C., TRG, INC.,
an Arizona limited an Indiana corporation
liability company
By______________________________ By________________________________
Its___________________________ Its_______________________________
17
LEASE
By this Lease Landlord leases to Tenant and Tenant leases from
Landlord the Premises in the Building located on the Project as set forth and
described on the Reference Page. The Reference Page, including all terms defined
thereon, is incorporated as part of this Lease.
The Building and Land are part of a project legally described on
Exhibit A (the "Project"), which includes the Building, a parking garage
comprising a portion of the Building and exterior parking and common areas. As
used in this Lease, the "Project's common areas" and terms of similar meaning
shall mean all areas and facilities in the Project which are provided and
designated from time to time by the owner of the Project for the general and
nonexclusive use and convenience of Tenant, with Landlord and other owners or
tenants of the Project and their respective employees, invitees, customers,
licensees and other visitors, including, without limitation, the driveways,
walkways, terraces, docks, courts, loading areas and trash facilities.
This Lease includes the right of Tenant to use the common building
facilities in common with other tenants of the Building. The words "common
building facilities" and terms of similar meaning shall mean all of the
Project's common areas described above and any other facilities within the
Building designed and intended for use by the tenants of the Building in common
with Landlord and each other, including corridors; elevators; fire stairs;
telephone and electric closets; telephone trunk lines and electric risers;
aisles; walkways; restrooms; service areas; lobbies; and all other common and
service areas of the Building intended for such use on the date hereof.
1. USE.
1.1 Landlord represents and warrants that the Premises and other
portions of the Project are in compliance with all applicable laws, rules,
ordinances, regulations, orders and other requirements of governmental
authorities. The Premises are to be used solely for the purposes stated on the
Reference Page and purposes incidental thereto.
1.2 Landlord represents and warrants that the Premises and other
portions of the Project do not contain any Hazardous Materials (as hereinafter
defined) in concentrations which violate any Environmental Laws (as hereinafter
defined) and that the Premises are in compliance with all Environmental Laws.
Landlord shall be entitled to permit Circle K Corporation to continue to
maintain and replace its existing gas tanks located at the Project in accordance
with applicable law. Tenant shall not at any time handle, use, manufacture,
store or dispose of in or about the Premises or the Building any (collectively
"HAZARDOUS MATERIALS") flammables, explosives, radioactive materials, hazardous
wastes or materials, toxic wastes or materials, or other similar substances,
petroleum products or derivatives or any substance subject to regulation by or
under any federal, state and local laws and ordinances relating to the
protection of the environment or the keeping, use or disposition of
environmentally hazardous materials, substances, or wastes, presently in effect
or hereafter adopted, all amendments to any of them, and all rules and
regulations issued pursuant to any of such laws or ordinances (collectively
"ENVIRONMENTAL LAWS"), nor shall Tenant suffer or permit any Hazardous Materials
to be used in any manner not fully in compliance with all Environmental Laws, in
the Premises. Notwithstanding the foregoing, Tenant may handle, store, use or
dispose of products containing small quantities of Hazardous Materials to the
extent customary and necessary for the use of the Premises for general office
purposes; provided that Tenant shall always handle, store, use, and dispose of
any such Hazardous Materials in a safe and lawful manner and never allow such
Hazardous Materials to contaminate the Premises, Building and appurtenant land
or the environment.
1.3 Landlord represents and warrants that neither asbestos nor
asbestos-containing
18
materials were used in the construction of the Building and, notwithstanding any
other provision of this Lease, Landlord agrees to comply with all laws, rules,
regulations and ordinances governing the installation or removal of asbestos and
asbestos-containing materials at Landlord's sole cost and expense.
1.4 Landlord shall not waive and shall enforce existing lease
provisions contained in its lease with the occupant of the existing convenience
market in the Project prohibiting the location of advertising, banners and other
signs within 12 inches of the storefront windows of such store. Landlord shall
not permit the occupant of the existing convenience market in the Project to
install different types or colors of signage or additional signage on its
storefront or within the Project common areas. No Retail Space other than the
Retail Space open for business on the Lease Reference Date may be located in the
Project unless Tenant's consent is first obtained.
1.5 Landlord acknowledges that Tenant develops and uses proprietary
software in the day-to-day operation of its business. Accordingly, no party may
occupy any portion of the Building if its business is directly or indirectly
related to software development for higher education unless adequate protections
and security measures and other matters are satisfactory to Tenant in its
reasonable discretion.
2. TERM.
2.1 The Term of this Lease shall begin on the date ("COMMENCEMENT
DATE") which shall be the later of (a) the Scheduled Commencement Date as shown
on the Reference Page and (b) the date of Substantial Completion (as hereinafter
defined) of the Premises and shall end on the date (the "TERMINATION DATE")
which shall be the later of (a) the Scheduled Termination Date as shown on the
Reference Page and (b) such date as shall be six (6) years from the last day of
the month in which said Commencement Date shall occur, unless the term is
otherwise extended pursuant to the attached Addendum. "SUBSTANTIAL COMPLETION"
of the Premises shall be deemed to have occurred only when (a) the work
described in the WORK LETTER attached as Exhibit C has been substantially
completed, (b) all standard and necessary building services described under
Article 12 are available to Tenant and the Premises, (c) a certificate of
occupancy has been issued by the appropriate governmental authorities with
respect to the Premises, and (d) the Landlord has delivered to Tenant prior
notice of the Commencement Date, as provided below, and the notice period called
for therein has elapsed. The work to be completed pursuant to clause (a) above
shall be substantially completed when construction is completed excepting only
(i) so-called punch-list items consisting of uncompleted minor elements of
construction, decoration or finish work and mechanical adjustment which would
not interfere materially with the use and enjoyment by Tenant and Tenant's
ability to conduct business (such punch-list items to be diligently completed by
Landlord) and (ii) matters such as balancing of heating, ventilating and air
conditioning systems which cannot be completed owing to their seasonal nature.
Landlord shall give Tenant written notice of the Commencement Date at least ten
(10) days before the occurrence of such date and shall confirm or correct to a
later date at least five (5) days before the Commencement Date. Landlord and
Tenant shall execute a memorandum setting forth the actual Commencement Date and
Termination Date.
2.2 Landlord shall deliver the Premises not later than May 1, 1995.
In the event that the Premises are not delivered timely, Landlord shall be
liable to Tenant for all rental obligations incurred by Tenant at its existing
space for each day after May 1, 1995 through the date of Substantial Completion
of the Premises, together with any moving, rescheduling or similar fees actually
paid by Tenant based on the then-existing construction schedule for the Premises
and after reasonable efforts to mitigate such fees. In addition, Tenant shall
not be liable for any rent until the time when Landlord can, after notice to
Tenant, deliver possession of the Premises to Tenant. Landlord shall not be
liable for any delay which is as a result of strikes, shortages of materials or
19
similar matters beyond the reasonable control of Landlord and Tenant is notified
by Landlord in writing as to such delay or as a result of: (a) Tenant's failure
to agree to plans and specifications; (b) Tenant's request for materials,
finishes or installations other than reflected on the plans and specifications
for the work, except as for such, if any, that Landlord shall have expressly
agreed to furnish without extension of time agreed by Landlord; or (c) Tenant's
change in any plans or specifications, which change shall delay construction and
result in a change to the Schedule attached to the Work Letter.
2.3 In the event Landlord shall permit Tenant to occupy the
Premises prior to the Commencement Date, such occupancy shall be subject to all
the provisions of this Lease as provided below. Said early possession shall not
advance the Termination Date.
2.4 If the Term of this Lease shall not commence within three years
from the Lease Reference Date, this Lease shall be of no further force or
effect.
3. RENT.
3.1 Subject to the provisions of Article 2, Tenant agrees to pay to
Landlord the Annual Rent in effect from time to time by paying the Monthly
Installment of Rent then in effect on or before the first day of each full
calendar month during the Term, except any prorated rent for a partial month at
the beginning of the Term shall be paid on the Commencement Date. The Monthly
Installment of Rent in effect at any time shall be one-twelfth of the Annual
Rent in effect at such time. Rent for any period during the Term which is less
than a full month shall be a prorated portion of the Monthly Installment of Rent
based upon a thirty (30) day month. Said rent shall be paid to Landlord, without
notice or demand, at the Landlord's address, as set forth on the Reference Page,
or to such other person or at such other place as Landlord may from time to time
designate in writing. Tenant may occupy the Premises prior to the Scheduled
Commencement Date at Tenant's option. In such event, Tenant shall be entitled to
occupy the Premises at 25% of the otherwise applicable rent for the Premises
until the Scheduled Commencement Date. Tenant's early occupancy at reduced rent
shall not constitute acceptance of the Premises or modify the Term or the
Commencement Date or Termination Date of the Term; provided, further, Tenant
shall otherwise comply with all the terms and conditions contained in this Lease
and Tenant shall also reimburse Landlord for reasonable utility charges and
similar charges relating to Tenant's early occupancy. In addition, Tenant shall
be entitled to free rent and no rent shall be due or payable for the first week
after the Commencement Date in which 100% rent is otherwise due and payable
hereunder.
3.2 Tenant recognizes that late payment of any rent or other sum
due under this Lease will result in administrative expense to Landlord, the
extent of which additional expense is extremely difficult and economically
impractical to ascertain. Tenant therefore agrees that if rent or any other sum
is not paid within ten (10) days of when such amount is due and payable pursuant
to this Lease, a late charge shall be imposed in an amount equal to the greater
of: (a) Fifty Dollars ($50.00), or (b) a sum equal to simple interest calculated
at twelve percent (12%) per annum on the unpaid rent or other payment from the
date such amount became due and payable, to the date of payment.
4. RENT ADJUSTMENTS.
4.1 For the purpose of this Article 4, the following terms are
defined as follows, subject to the provisions of Section 4.3 below:
(a) Lease Year: Each calendar year falling partly or
wholly within the Term.
20
(b) Direct Expenses: In each calendar year, the aggregate
of all reasonable and actual costs, charges and expenses paid by Landlord (less
any rebates, reimbursements, refunds and credits received on account of such
costs, charges and expenses), obtained at competitive prices, which are directly
attributable to the normal and customary operation, maintenance and repair of
the Building, as determined in accordance with generally accepted accounting
principles, consistently applied, including the following costs by way of
illustration, but not limitation: water and sewer charges; insurance premiums of
or relating to all insurance policies and endorsements deemed by Landlord to be
reasonably necessary or desirable and relating in any manner to the protection,
preservation, or operation of the Building or any part thereof (but excluding,
however, savings attributable to self-insurance by the Landlord), utility costs
including, but not limited to, the cost of heat, light, power, steam, gas, and
waste disposal; the cost of janitorial services; the cost of security and alarm
services; window cleaning costs; labor costs; costs and expenses of managing the
Building including management fees, provided, however, that such management fees
do not exceed five percent (5%) of the gross rent which would be achieved by the
Building if the Building were 100% leased at Tenant's rental rate; air
conditioning costs; elevator maintenance fees and supplies; material costs;
equipments costs, including the cost of maintenance, repair and service
agreements; purchase costs of equipment other than capital items; current rental
and leasing costs of items which would be amortizable capital items if
purchased; tool costs; licenses, permits and inspection fees; wages and
salaries; employee benefits and payroll taxes; accounting and legal fees for
Building operation; any sales, use or service taxes incurred in connection
therewith. Direct Expenses shall not include repairs or other work occasioned by
fire or other casualty, whether or not the same is covered by insurance;
Landlord's cost of services sold to Tenant or provided or sold to others, and
for which Landlord is entitled to reimbursement other than through the scheduled
payment of rent; except as below, costs incurred by Landlord for alterations
which are considered capital improvements and replacements under generally
accepted accounting principles, consistently applied; depreciation and
amortization, except as taken in connection with costs incurred as provided
below; except as provided below, costs of a capital nature, including, without
limitation, capital improvements, capital repairs, capital equipment and capital
tools; expenses in connection with services or other benefits which are not
available to Tenant, or for which Tenant must pay a charge in excess of the
scheduled rental payments, but which are provided to another tenant or occupant
of the Building; Landlord's general corporate overhead and general
administrative expenses; real estate commissions, finder's fees, loan fees or
similar charges incurred with respect to any sale, exchange or financing of the
Building; costs incurred with the original construction of the Building or any
reconstruction, refurbishment or repair of the Building or in connection with
any major change in the Building, such as adding or deleting floors, costs of
correcting defects in or inadequacy of the design or construction of the
Building, and costs of any equipment, device or capital improvement required by
any change in laws, rules, regulations or requirements where such change was in
effect on or prior to the Commencement Date, or was reasonably foreseeable as of
the Commencement Date; payments of principal, interest or other charges on
mortgages, ground rents, and other debt costs, if any; costs of leasing rentable
areas in the Building, including advertising, leasing commissions, public
relations expenses, legal and accounting expenses related to lease negotiations
or enforcement, and the costs of improving tenant space, including the Premises
(including, without limitation, the Tenant Improvement Allowance and Overage as
defined in the Work Letter); salaries, wages and other associated costs of
building personnel above the rank of building general manager (including
principals of Landlord) or of other offsite personnel of Landlord or any
employee who does not devote substantially all his/her time to the Building;
costs for which the Landlord is reimbursed by any tenant or occupant of the
Building or by Landlord's insurance carrier or any tenant's carrier or by any
other third party; costs associated with the operation of the business of the
company or entity which constitutes the Landlord, as the same are distinguished
from the costs of operation of the Building, including accounting and legal
matters; costs of defending lawsuits with any mortgagee or beneficiary, costs of
selling, syndicating, financing, mortgaging or hypothecating any of the
Landlord's interest in the Building,
21
costs (including attorneys' fees and costs of settlement judgments and payments
in lieu thereof) arising from claims, litigation or arbitrations pertaining to
any tenant, the Landlord, the Building, the Project or the site upon which the
Building is situated; any other expenses which, in accordance with generally
accepted accounting principles, consistently applied, would not normally be
treated as operating costs by landlords of comparable buildings; any charge not
paid or required to be paid by another tenant in the Project; disproportionate
usage of utilities or wear and tear to common facilities by other tenants in the
Building; any bad debt loss, rent loss or reserves for bad debts or rent loss;
expenses directly resulting from the negligence of Landlord, its agents,
servants or employees, and costs incurred because Landlord or another tenant
violated the terms of any lease; fines, penalties and interest; all federal
income taxes, federal excess profit taxes, franchise taxes and federal estate
inheritance or estate taxes; Taxes (as hereinafter defined); and the costs of
removing Hazardous Materials (including, without limitation, asbestos) from the
Building. In addition, Landlord shall be entitled to amortize and include as an
additional rental adjustment: (i) an allocable portion of the cost of capital
improvement items which are reasonably calculated to reduce operating expenses;
and (ii) fire sprinklers and suppression systems and other life safety systems.
All such costs shall be amortized over the reasonable life of such improvements
in accordance with such reasonable life and amortization schedules as shall be
determined by Landlord in accordance with generally accepted accounting
principles, consistently applied, with interest on the unamortized amount at one
percent (1%) in excess of the prime lending rate announced as such by Bank One,
Arizona or its successor as of February 1st of each year.
(c) Taxes: Ad valorem real estate taxes which are levied
with respect to the Building or the land appurtenant to the Building, or with
respect to any improvements, fixtures and equipment or other property of
Landlord, real or personal, located in the Building and used in connection with
the operation of the Building and said land; and all fees, expenses and costs
incurred by Landlord in protesting or contesting any increase in any
assessments, levies or the tax rate pertaining to any Taxes to be paid by
Landlord in any Lease Year. Taxes shall not include any corporate franchise, or
estate, inheritance or net income tax, or tax imposed upon any transfer by
Landlord of its interest in this Lease or the Building. No assessments, general
or special, shall be included in the definition of Taxes.
4.2 If during any Lease Year the Building is not ninety-five
percent (95%) occupied, or if less than all of a full year's expenses have been
incurred, the Direct Expenses actually incurred in such year which vary with
occupancy shall be increased to the sum which would have been incurred at
ninety-five percent (95%) occupancy for a full year.
4.3 Portions of the Project are presently occupied by a Circle K
Convenience Store and a Xxxx-In-The-Box Restaurant (the space when used for
retail purposes being "Retail Space" and the occupants using such space as
Retail Space being "Retail Merchants", respectively) pursuant to existing leases
between the Landlord and those respective tenants. Landlord hereby represents
and warrants to Tenant that the Retail Merchants are solely responsible for all
their own Direct Expenses and Taxes (as those terms are defined herein) with
respect to the Retail Space and their occupancy within the Project.
Notwithstanding anything in this Lease to the contrary, for so long as the
Retail Space is leased or otherwise occupied by Retail Merchants, the Direct
Expenses of the Building of which Tenant shall share a pro rata portion shall be
calculated exclusive of all Direct Expenses or similar charges (whether incurred
or paid by Landlord or the Retail Merchants) attributable to the Retail Space,
and the Taxes of the Building of which Tenant shall share a pro rata portion
shall be calculated exclusive of all Taxes or similar charges (whether incurred
or paid by Landlord or the Retail Merchants) attributable to the Retail Space.
The provisions of this Section 4.3 are intended to protect Tenant from being
responsible directly or indirectly for any Direct Expenses or Taxes respecting
the Retail Space. Landlord represents and warrants that Landlord has and will
continue to have throughout the Term the right and obligation to maintain and
clean the Project's common areas (including drives, parking areas and
landscaping adjacent to the Retail
22
Space) related to the Retail Space and the cost of such maintenance as
attributable to the Retail Space will not be paid directly or indirectly by
Tenant. "Retail Merchants" shall expressly include Circle K and Xxxx-In-The-Box
and their respective successors and assigns and other occupants or subtenants
which are in the retail business. In the event the existing Retail Space is
incorporated into the Building as general office space, the Tenant's
Proportionate Share of the Building set forth on the Reference Page shall be
adjusted based on actual proportionate shares of the Building and Project.
4.4 If in any Lease Year commencing with Lease Year 1996, (i)
Direct Expenses paid or incurred by Landlord shall exceed Direct Expenses paid
or incurred in the Base Year (Direct Expenses) or (ii) Taxes paid or incurred by
Landlord shall exceed the amount of such Taxes which became due or payable in
the Base Year (Taxes), Tenant shall pay as additional rent for such Lease Year
Tenant's Proportionate Share of such excess. If the Direct Expenses for any
calendar year after the Base Year are less than the Direct Expenses for the Base
Year (but Landlord and Tenant stipulate that Annual Rent shall never be reduced
even if such Direct Expenses become less than the direct expenses used to
establish the full service rental hereunder), Landlord shall allow a rent credit
to Tenant for such deficiency. If the Taxes for any calendar year after the Base
Year are less than the Taxes for the Base Year, Landlord shall have no
obligation to allow a rent credit to Tenant for such deficiency, but the same
shall be credited against Tenant's obligation for Taxes in any subsequent year
during the Term.
4.5 Notwithstanding anything to the contrary in Article 4 of this
Lease, "Controllable Expenses" (as defined below) shall be included in Direct
Expenses only to the extent that they do not exceed the "Cost Cap" (as defined
below). "Controllable Expenses" means all Direct Expenses except utilities and
insurance premiums. The "Cost Cap" shall mean, with respect to calendar year
1996, 105% of the actual Controllable Expenses for calendar year 1995. For each
subsequent calendar year, the Cost Cap shall be 105% of the Cost Cap for the
immediately preceding calendar year.
4.6 The annual determination of Direct Expenses and Taxes
(including exclusions therefrom for Retail Space pursuant to Section 4.3 above)
shall be made by Landlord by March 15 of each Lease Year for the previous Lease
Year. Tenant may review the books and records supporting such determination in
the office of Landlord, or Landlord's agent, during normal business hours, upon
giving Landlord five (5) days advance written notice within sixty (60) days
after receipt of such determination, but in no event more often than twice in
any one year period.
4.7 Prior to the actual determination thereof for a Lease Year
after the Base Year, Landlord may from time to time reasonably estimate Tenant's
liability for Direct Expenses and/or Taxes under Section 4.4 for the Lease Year
after the Base Year or portion thereof. Landlord will give Tenant written
notification of the amount of such estimate and Tenant agrees that it will pay,
by increase of its Monthly Installments of Rent due in such Lease Year,
additional rent in the amount of such estimate. Any such increased rate of
Monthly Installments of Rent pursuant to this Section 4.7 shall remain in effect
until further written notification to Tenant pursuant hereto.
4.8 When the above-mentioned actual determination of Tenant's
liability for Direct Expenses and/or Taxes is made in any Lease Year and when
Tenant is so notified in writing, then:
(a) If the total additional rent Tenant actually paid
pursuant to Section 4.7 on account of Direct Expenses and/or Taxes for the Lease
Year is less than Tenant's liability for Direct Expenses and/or Taxes, then
Tenant shall pay to Landlord as additional rent in one lump sum within thirty
(30) days of receipt of Landlord's xxxx therefor such deficiency; and
23
(b) If the total additional rent Tenant actually paid
pursuant to Section 4.7 on account of Direct Expenses and/or Taxes for the Lease
Year is more than Tenant's liability for Direct Expenses and/or Taxes, then
Landlord shall allow a rent credit for the difference to Tenant.
5. ALTERATIONS.
5.1 Except (a) for those alterations, additions and improvements
specifically provided for in the Work Letter attached as Exhibit C to this
Lease, and (b) to the extent that any alterations, additions and improvements to
be made at any one time cost less than $5,000, in the aggregate, provided that
Tenant complies with applicable laws and such alterations, additions and
improvements do not negatively affect the structural integrity of the Building,
Tenant shall not make or suffer to be made any alterations, additions, or
improvements, including, but not limited to, the attachment of any fixtures or
equipment in, on, or to the Premises or any part thereof or the making of any
improvements as required by Article 6, without the prior written consent of
Landlord, which consent shall not be unreasonably withheld; provided, however,
any change pursuant to subpart (b) above shall nevertheless require a written
notice and disclosure of such changes to Landlord. When applying for a required
consent, Tenant shall, if requested by Landlord, furnish complete plans and
specifications for such alterations, additions and improvements.
5.2 In the event Landlord consents to the making of any such
alteration, addition or improvement by Tenant, the same shall be made using
Landlord's contractor, if Landlord's contractor is the lowest bid, at Tenant's
sole cost and expense.
5.3 All alterations, additions or improvements proposed by Tenant
shall be constructed in accordance with all governmental laws, ordinances, rules
and regulations and Tenant shall, prior to construction, provide all such
assurances to Landlord, including but not limited to, waivers of lien and surety
company performance bonds as Landlord shall require to assure payment of the
costs thereof and to protect Landlord and the Building and appurtenant land
against any loss from any mechanic's, materialmen's or other liens.
5.4 All alterations, additions, and improvements in, on, or to the
Premises made or installed by Tenant, including any carpeting installed by
Tenant, shall be the property of Tenant during the Term but, excepting
furniture, furnishings, movable partitions and other trade fixtures, shall
immediately become a part of the realty and belong to Landlord without
compensation to Tenant.
5.5 Tenant shall pay in addition to any sums due pursuant to
Article 4, any increase in ad valorem real estate taxes attributable to any such
alteration, addition or improvement for so long, during the Term, as such
increase is ascertainable; at Landlord's election said sums shall be paid in the
same way as sums due under Article 4.
5.6 Notwithstanding anything to the contrary in this Lease, Tenant
shall not have any responsibility, or directly or indirectly bear any cost or
expense, in respect of the federal Clean Air Act (or similar federal, state or
local law) or any retrofitting or modification of the heating, ventilating and
air conditioning system of the Premises or Building as to freon or other
regulated chemicals or systems.
5.7 Notwithstanding anything to the contrary in this Lease,
Landlord shall be solely responsible for compliance with the Americans with
Disabilities Act for (x) all work performed by Landlord in connection with this
Lease in the Premises (including existing tenant improvements and those
constructed pursuant to this Lease) and (y) all other portions of the Building
and Project, without cost to or reimbursement by Tenant. Tenant shall solely be
responsible for compliance
24
with the Americans with Disabilities Act for all tenant improvements within the
Premises not constructed or installed by the owner of the Building.
6. REPAIR.
6.1 Landlord shall have no obligation to alter, remodel, improve,
repair, decorate or paint the Premises, except as specified in the Work Letter
attached as Exhibit C. Landlord hereby represents and warrants that the Premises
and the Building are in good repair and condition and that all fixtures and
equipment (including, without limitation, plumbing, air conditioning, heating
and electrical systems) are in good working order, repair and condition.
Continuously throughout the Term, Landlord shall operate, maintain and repair
the Building in a manner consistent with a first-class office building and real
estate complex in the Camelback Corridor in Phoenix, Arizona, and in accordance
with applicable laws, building codes and governmental requirements, including,
without limitation, maintaining and repairing in a timely fashion the
foundations, roofs, exterior walls, exterior windows, floor slabs, elevators,
other structural components, plumbing, air conditioning, heating and electrical
systems, and other facilities as necessary or desirable to maintain the
first-class stature of the Building.
6.2 Tenant shall, at all times during the Term, keep the Premises
in good condition and repair excepting reasonable wear and tear, damage by fire
or other casualty, or condemnation and, subject to the terms of this Lease, in
compliance with all applicable governmental laws, ordinances and regulations,
promptly complying with all governmental orders and directives for the
correction, prevention and abatement of any violations or nuisances in or upon,
or connected with, the Premises (except for capital improvements otherwise
includable in Direct Expenses pursuant to Section 4.1(b) of this Lease), all at
Tenant's sole expense.
6.3 Landlord shall be liable to make any repairs or to perform any
maintenance within a reasonable time after written notice of the need of such
repairs or maintenance is given to Landlord by Tenant. Landlord shall schedule
such repairs and maintenance so as to minimize interference with Tenant's
business. Landlord shall provide Tenant with reasonable notice (except in the
case of emergency) of any repairs or maintenance that Landlord intends to
perform that will affect Tenant's use or occupancy of the Premises.
7. LIENS. Tenant shall keep the Premises, the Building and appurtenant
land and Tenant's leasehold interest in the Premises free from any liens arising
out of any services, work or materials performed, furnished, or contracted for
by Tenant, or obligations incurred by Tenant.
8. ASSIGNMENT AND SUBLETTING.
8.1 Tenant shall not have the right to assign or pledge this Lease
or to sublet the whole or any part of the Premises, or permit the use or
occupancy of the Premises by anyone other than Tenant, and shall not make,
suffer or permit such assignment, subleasing or occupancy without the prior
written consent of Landlord, which consent shall not be unreasonably withheld,
and said restrictions shall be binding upon any and all assignees of the Lease
and subtenants of the Premises; provided, however, that notwithstanding the
foregoing, Tenant may freely assign or sublet all or any portion of the Premises
to (x) any of its subsidiaries or affiliates (including by merger or otherwise
by operation of law) or (y) any entity acquiring substantially all of the assets
and operations of Tenant as an on-going business and which has substantially the
same net worth as Tenant (including by merger or otherwise by operation of law).
Tenant shall give Landlord written notice of any assignment not requiring
Landlord's prior written consent.
8.2 Tenant will pay to Landlord on demand a sum equal to all of
Landlord's reasonable costs, including attorneys' fees, incurred in
investigating and considering any proposed
25
assignment or pledge of this Lease or sublease of any of the Premises requiring
Landlord's consent hereunder, regardless of whether Landlord shall consent to,
refuse consent, or determine that Landlord's consent is not required for, such
assignment, pledge or sublease. Any purported sale, assignment, mortgage,
transfer of this Lease or subletting which does not comply with the provisions
of this Article 8 shall be void.
9. INDEMNIFICATION.
9.1 Tenant shall protect, indemnify and hold harmless the Landlord
from and against any and all loss, claims, liability or costs (including court
costs and attorneys' fees) incurred by Landlord by reason of (a) any damage to
any property (including but not limited to property of Landlord) or any injury
(including but not limited to death) to any person occurring in, on or about the
Premises or the Project or Building to the extent that such injury or damage
shall be caused by or arise from any act, neglect, fault, or omission by or of
Tenant, its agents or employees to meet any standards imposed by any duty with
respect to the injury or damage; (b) the conduct or management of any work or
thing whatsoever done by the Tenant in or about the Premises or from
transactions of the Tenant concerning the Premises; or (c) subject to the
provisions of this Lease, Tenant's failure to comply with any and all
governmental laws, ordinances and regulations applicable to the condition or use
of the Premises or its occupancy.
9.2 Landlord shall protect, indemnify and hold harmless the Tenant
from and against any and all loss, claims, liability or costs (including court
costs and attorneys' fees) incurred by Tenant by reason of (a) any damage to any
property (including but not limited to property of Tenant) or any injury
(including but not limited to death) to any person occurring in, on or about the
Premises or the Project or Building to the extent that such injury or damage
shall be caused by or arise from any act, neglect, fault, or omission by or of
Landlord, its agents or employees to meet any standards imposed by any duty with
respect to the injury or damage; (b) the conduct or management of any work or
thing whatsoever done by the Landlord in or about the Premises or Project or
Building or from transactions of the Landlord concerning the Premises or the
Project; (c) Landlord's failure to comply with any and all governmental laws,
ordinances, rules and regulations applicable to the condition or use of the
Premises or the Building; or (d) the existence of any Hazardous Materials
(including, but not limited to, asbestos) on the Premises or in or on the
Building or Project other than Hazardous Materials placed on the Premises or in
the Building by Tenant.
9.3 The provisions of this Article 9 shall survive the termination
of this Lease with respect to any claims or liability occurring prior to such
termination.
10. INSURANCE.
10.1 Tenant shall keep in force throughout the Term a commercial
general liability insurance policy or policies to protect the Landlord against
any liability to the public or to any invitee of Tenant or Landlord incidental
to the use of or resulting from any accident occurring in or upon the Premises
with a comprehensive single limit of not less than $1,000,000.00 per occurrence
and not less than $2,000,000.00 in the aggregate. Tenant shall also keep in
force throughout the Term property insurance protecting Tenant against loss of
or damage to Tenant's business personal property situated in or about the
Premises to not less than ninety percent (90%) of the replacement value of the
property so insured.
10.2 Each of the aforesaid policies shall (a) be provided at
Tenant's expense; (b) name the Landlord as additional insureds (but shall not
afford primary coverage); (c) be issued by an insurance company with a minimum
Best's rating of B+ at the time such insurance is procured; and (d) provide that
said insurance shall not be cancelled unless thirty (30) days prior written
notice
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shall have been given to Landlord; and said policy or policies or certificates
thereof shall be delivered to Landlord by Tenant upon the Commencement Date and
at least ten (10) days after each renewal of said insurance.
10.3 Tenant may participate in any self-insurance program provided
the self-insurance participants have a confirmed net worth of at least
$5,000,000.
10.4 Landlord shall at all times during the Term maintain casualty
insurance insuring against the perils included within the classification of fire
and extended coverage, in an amount consistent with the insurance coverage that
would be maintained by a prudent landlord of a first-class office building in
Phoenix, Arizona, and comprehensive public liability insurance and primary
coverage and in the amount required from time to time by Landlord's first
mortgagee or, if there is no such mortgagee, in commercially reasonable amounts.
Such insurance shall (a) be provided at Landlord's expense, (b) name Tenant as
additional insured, (c) be issued by an insurance company with a minimum Best's
rating of B+ at the time such insurance is procured, and (d) provide that said
insurance shall not be cancelled unless fourteen (14) days prior written notice
shall have been given to Tenant.
11. WAIVER OF SUBROGATION. Tenant and Landlord hereby mutually waive
their respective rights of recovery against each other for any loss insured by
fire, extended coverage, all risks or other insurance now or hereafter existing
for the benefit of the respective party. Each party shall obtain any special
endorsements required by their insurer to evidence compliance with the
aforementioned waiver.
12. SERVICES AND UTILITIES.
12.1 Subject to the other provisions of this Lease, Landlord agrees
to furnish to the Premises during the hours of 6:00 a.m. to 7:00 p.m. Monday
through Friday and 8:00 a.m. to 1:00 p.m. Saturday (including all legal holidays
that fall on such days but exclusive in any event of Sundays), the following
full-service services and utilities subject to the rules and regulations of the
Building prescribed from time to time: (a) water suitable for normal office use
of the Premises; (b) heat and air conditioning required for the use and
occupation of the Premises; (c) janitorial service as described in Schedule 1
hereto; (d) elevator service; (e) such window washing as may from time to time
be reasonably required; provided, however, not less than three times during any
twelve month period; (f) equipment to bring to Tenant's meter, electricity for
lighting, convenience outlets and other normal office use; and (g) electricity.
After hours heat and air conditioning shall be available on a "zone basis"
within the Premises and provided to Tenant at Landlord's actual cost for such
services within such zone. To the extent that Tenant uses more than its pro rata
share of electricity for the Building, Landlord shall, at its expense,
separately meter the Premises and Tenant shall pay to Landlord the charges
associated with such increased use. The charge shall be at the rates charged for
such services by the local public utility. Landlord shall be liable for, and
Tenant shall be entitled to, an abatement or reduction of rental by reason of
Landlord's failure to furnish any of the foregoing for any period of five (5)
consecutive days or for ten (10) days in any twelve month period, after written
notice of such failure is given to Landlord by Tenant and provided that Landlord
shall not be liable when such failure is caused by accident, breakage, repairs,
labor disputes of any character, energy usage restrictions or by any other
cause, similar or dissimilar, beyond the reasonable control of Landlord.
Landlord shall use reasonable best efforts to remedy any interruption in the
furnishing of services and utilities.
12.2 Should Tenant require any additional work or service, as
described above, including services furnished outside ordinary business hours
specified above, Landlord may, on terms to be agreed, upon reasonable advance
notice by Tenant, furnish such additional service and Tenant agrees to pay
Landlord such charges as may be agreed upon, including any tax imposed
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thereon, but in no event at a charge less than Landlord's actual cost plus
overhead for such additional service and, where appropriate, a reasonable
allowance for depreciation of any systems being used to provide such service.
12.3 Temperature standards currently in effect for the Building are
reflected on Schedule 2 to this Lease. Wherever heat-generating machines or
equipment are used by Tenant in the Premises which affect the temperature
otherwise maintained by the air conditioning system, Landlord reserves the right
to install supplementary air conditioning units in or for the benefit of the
Premises and the cost thereof, including the cost of installation and the cost
of operations and maintenance, shall be paid by Tenant to Landlord upon demand
as such additional rent, subject to Section 12.4 below.
12.4 Tenant shall be entitled to one computer room within the
Premises delineated as an "Equipment Room" on Space Plan #2 for the Premises.
The computer room shall not be subject to metering for electricity and shall
have continuous cooling requirements at no extra cost to Tenant based on
Tenant's reasonable design criteria based on the existing HVAC system, including
design for alarm reporting to the Manager and Tenant and modem features for
emergencies.
13. HOLDING OVER. Tenant shall pay Landlord for each day Tenant retains
possession of the Premises or part of them after termination of this Lease by
lapse of time or otherwise at the rate which shall be the sum of (a) as to the
first 3 months of such holdover, 125% of the amount of the Annual Rent in effect
for the last period prior to the date of such termination and, as to the 4th
month and thereafter of such holdover, 150% of the amount of the Annual Rent in
effect for the last period prior to the date of such termination plus (b) all
Rent Adjustments under Article 4.
14. SUBORDINATION. Landlord hereby covenants with Tenant to fully and
timely perform the obligations of the ground lessee under the existing ground
lease for the Project. Landlord hereby represents to Tenant that as of the Lease
Reference Date and the Commencement Date no mortgage, deed of trust or other
monetary lien encumbers the Project or any portion thereof. Without the
necessity of any additional document being executed by Tenant for the purpose of
effecting a subordination, this Lease shall be subordinate at all times to the
existing ground lease and to the lien of any future mortgages or deeds of trust
placed after the Commencement Date on, against or affecting the Building,
Landlord's interest or estate in the Building, or any other future ground lease;
provided, however, that Landlord shall obtain a non-disturbance agreement for
the benefit of Tenant, in form and substance satisfactory to Tenant, from the
holder of any such future leases, mortgages or deeds of trust prior to the
effectiveness thereof, and provided further that if the lessor, mortgagee,
trustee, or holder of any such future lease, mortgage or deed of trust elects to
have Tenant's interest in this Lease be superior to any such instrument, then,
by notice to Tenant, this Lease shall be deemed superior, whether this Lease was
executed before or after said instrument. Notwithstanding the foregoing, Tenant
covenants and agrees to execute and deliver upon demand such further instruments
evidencing such subordination or superiority of this Lease as may be required by
Landlord.
15. RULES AND REGULATIONS. Tenant shall faithfully observe and comply
with all the rules and regulations as set forth in Exhibit D to this Lease and
all reasonable modifications of and additions to them from time to time put into
effect by Landlord, provided, however, that no such modification or amendment
shall be adopted in order to impact Tenant or Tenant's intended use of the
Premises disproportionately.
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16. BUILDING MODIFICATIONS. Landlord shall have the right at any time
to change the arrangement and/or locations of entrances, or passageways, doors
and doorways, and corridors, elevators, stairs, toilets or other common building
facilities in order to comply with any laws, rules, regulations or ordinances of
any governmental authorities and to change the name, number or designation by
which the Building is commonly known, except no Project common areas on the 3rd
floor shall be rearranged without Tenant's prior written consent. In the event
that Landlord damages any portion of any wall or wall covering, ceiling, or
floor or floor covering within the Premises, Landlord shall repair or replace
the damaged portion to match the original as nearly as commercially reasonable
but shall not be required to repair or replace more than the portion actually
damaged. Tenant reserves the right to cause the Premises to be measured at
Tenant's expense within 12 months of the Commencement Date to confirm the BOMA
measurement of usable square footage set forth on the Reference Page. If such
measurement results in a different usable square footage, the rental for the
first 12 months of the Term and future rental and other terms of this Lease
shall be equitably adjusted.
17. DEFAULT.
17.1 The following events shall be deemed to be Events of Default
under this Lease:
(a) Tenant shall fail to pay when due any sum of money
becoming due to be paid to Landlord under this Lease, whether such sum be any
installment of the Rent reserved by this Lease, any other amount treated as
additional rent under this Lease, or any other payment or reimbursement to
Landlord required by this Lease, whether or not treated as additional rent under
this Lease, and such failure shall continue for a period of fifteen (15) days
after written notice that such payment was not made when due.
(b) Tenant shall fail to comply with any term, provision
or covenant of this Lease which is not provided for in another Section of this
Article 17 and shall not cure such failure within thirty (30) days (forthwith,
if the failure involves a hazardous condition) after written notice of such
failure to Tenant.
17.2 Although not an Event of Default, Tenant shall give Landlord
written notice if it permanently ceases doing business from the Premises.
18. REMEDIES.
18.1 Upon the occurrence of any of the Events of Default described
or referred to in Article 17, Landlord shall have the option to pursue any one
or more of the following remedies without any notice or demand whatsoever,
concurrently or consecutively and not alternatively:
(a) Landlord may, at its election, terminate this Lease or
terminate Tenant's right to possession only, without terminating the Lease.
(b) Upon any termination of this Lease, whether by lapse
of time or otherwise, or upon any termination of Tenant's right to possession
without termination of the Lease, Tenant shall surrender possession and vacate
the Premises immediately, and deliver possession thereof to Landlord, and Tenant
hereby grants to Landlord full and free license to enter into and upon the
Premises in such event and to repossess Landlord of the Premises as of
Landlord's former estate and to expel or remove Tenant and any others who may be
occupying or be within the Premises and to remove Tenant's signs and other
evidence of tenancy and all other property of Tenant therefrom without being
deemed in any manner guilty of trespass, eviction or forcible entry or detainer,
and without incurring any liability for any damage resulting therefrom,
29
Tenant waiving any right to claim damages for such re-entry and expulsion, and
without relinquishing Landlord's right to rent or any other right given to
Landlord under this Lease or by operation of law.
(c) Upon any termination of this Lease, whether by lapse
of time or otherwise, Landlord shall be entitled to recover as damages, all
rent, including any amounts treated as additional rent under this Lease, and
other sums due and payable by Tenant on the date of termination.
(d) Upon any termination of Tenant's right to possession
only without termination of the Lease:
(i) Neither such termination of Tenant's right to
possession nor Landlord's taking and holding possession thereof as provided in
Section 18.1(b) shall terminate the Lease or release Tenant, in whole or in
part, from any obligation, including Tenant's obligation to pay the rent,
including any amounts treated as additional rent, under this Lease for the full
Term, subject to the provisions of Section 18.1(d)(iii).
(ii) Landlord and Tenant agree that Landlord shall
be required to attempt to relet the Premises using the same efforts Landlord
then uses to lease premises in the Building generally and that in any case that
Landlord shall not be required to give any preference or priority to the showing
or leasing of the Premises over any other space that Landlord may be leasing or
have available and may place a suitable prospective tenant in any such other
space regardless of when such other space becomes available. Landlord may relet
the Premises or any part thereof for such rent and upon such terms as Landlord,
in its sole discretion, shall determine (including the right to relet the
Premises for a greater or lesser term than that remaining under this Lease, the
right to relet the Premises as a part of a larger area, and the right to change
the character or use made of the Premises). In connection with or in preparation
for any reletting, Landlord may, but shall not be required to, make repairs,
alterations and additions in or to the Premises and redecorate the same to the
extent Landlord deems necessary or desirable.
(iii) Until such time as Landlord shall elect to
terminate the Lease and to the extent that Landlord has relet all or any portion
of the Premises pursuant to Section 18.1(d)(ii) above, Tenant shall pay to
Landlord, as liquidated damages, any deficiency between the rent Tenant
covenanted to pay pursuant to this Lease and the net amount, if any, of the
rents collected on account of reletting all or any portion of the Premises, for
each month of the period which would otherwise have constituted the balance of
the Term of this Lease. In computing such liquidated damages, there shall be
added to the said deficiency such expenses as Landlord may incur in connection
with such re-letting, including, but not limited to, attorneys' fees, brokerage,
advertising, and the expenses incurred in connection with maintaining the
Premises and preparing the same for re-letting. Any such liquidated damages
shall be paid in monthly installments by Tenant on the date otherwise specified
in this Lease for the payment of rent. Tenant agrees that Landlord may file
suits from time to time to recover any sums falling due under this Article 18 as
they become due. Any proceeds of reletting by Landlord in excess of the amount
then owed by Tenant to Landlord from time to time shall be credited against
Tenant's future obligations under this Lease but shall not otherwise be refunded
to Tenant or inure to Tenant's benefit.
18.2 Pursuit of any of the foregoing remedies shall not preclude
pursuit of any of the other remedies provided in this Lease or any other
remedies provided by law (all such remedies being cumulative), nor shall pursuit
of any remedy provided in this Lease constitute a forfeiture or waiver of any
rent due to Landlord under this Lease or of any damages accruing to Landlord by
reason of the violation of any of the terms, provisions and covenants contained
in this Lease.
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18.3 Landlord's acceptance of the payment of rental or other
payments after the occurrence of an Event of Default shall not be construed as a
waiver of such default, unless Landlord so notifies Tenant in writing.
Forbearance by Landlord in enforcing one or more of the remedies provided in
this Lease upon an Event of Default shall not be deemed or construed to
constitute a waiver of such default or of Landlord's right to enforce any such
remedies with respect to such default or any subsequent default.
19. LANDLORD'S DEFAULT. If Landlord defaults in the performance or
observance of any of its covenants, warranties or obligations set forth in this
Lease, Tenant shall give Landlord notice specifying in what manner Landlord has
defaulted and if the default shall not be cured by Landlord within the time
period provided elsewhere in this Lease, and otherwise within thirty (30) days
after the delivery of such notice (except that if the default cannot be cured
within said thirty (30) day period, this period shall be extended for a
reasonable additional time, provided that Landlord commences to cure the default
within the thirty (30) day period and proceeds diligently thereafter to affect
such cure within no more than ninety (90) days), Tenant may declare an event of
default. If Tenant declares an event of default, Tenant, at its option, may pay
the Annual Rent due and to accrue hereunder, to the extent necessary to cover
the cost estimated by Tenant to cure the default. Tenant may deduct all such
costs and expenses from the Annual Rent due and to become due hereunder. In
addition, in the event of Landlord's default, Tenant may terminate this Lease.
If Tenant terminates this Lease, Tenant may recover all damages that incur as a
result of Landlord's default.
20. QUIET ENJOYMENT. Landlord represents and warrants that, as of the
Commencement Date, it owns the Building free and clear of all mortgages and
deeds of trust, and all liens, except as may otherwise be indicated on Schedule
C to this Lease. Landlord further represents and warrants that the remaining
term of the existing ground lease is greater than the Term of this Lease as the
same may be extended pursuant to the Addendum. Landlord further represents and
warrants that it has full right and authority to enter into this Lease and that
Tenant, while paying the rental and performing its other covenants and
agreements contained in this Lease, shall peaceably and quietly have, hold and
enjoy the Premises for the Term without hindrance or molestation from Landlord
or parties claiming through Landlord subject to the terms and provisions of this
Lease.
21. DAMAGE BY FIRE, ETC.
21.1 In the event the Premises or portions of the Building
necessary for Tenant's uninterrupted use and enjoyment of the Premises are
damaged by fire or other cause and in Landlord's reasonable estimation such
damage can be materially restored within ninety (90) days after the Election
Date defined below, Landlord shall forthwith repair the same and this Lease
shall remain in full force and effect, except that Tenant shall be entitled to a
proportionate abatement in rent from the date of such damage. Such abatement of
rent shall be made pro rata in accordance with the extent to which the damage
and the making of such repairs shall interfere with the use and occupancy by
Tenant of the Premises from time to time. Within thirty (30) days from the date
of such damage (the "Election Date"), Landlord shall notify Tenant, in writing,
of Landlord's reasonable estimation of the length of time within which material
restoration can be made. For purposes of this Lease, the Building or Premises
shall be deemed "materially restored" if they are in such condition as would not
prevent or materially interfere with Tenant's access to and use of the Premises
for the purposes for which it was being used immediately before such damage and
the appearance of the Premises and the Building have been substantially restored
to that existing immediately before such damage.
21.2 If such repairs cannot, in Landlord's reasonable estimation,
be made within ninety (90) days after the Election Date, Landlord and Tenant
shall each have the option of giving
31
the other, at any time within ninety (90) days after such damage, notice
terminating this Lease as of the date of such damage. In the event of the giving
of such notice, this Lease shall expire and all interest of the Tenant in the
Premises shall terminate as of the date of such damage as if such date had been
originally fixed in this Lease for the expiration of the Term. In the event that
neither Landlord nor Tenant exercises its option to terminate this Lease in the
event of partial destruction, then Landlord shall repair or restore such damage,
this Lease continuing in full force and effect, and the rent becoming due under
this Lease shall be proportionately abated as provided in Section 21.1. Landlord
shall not be required to repair or replace any damage or loss by or from fire or
other cause to any partitions, office fixtures, trade fixtures or any other
property or improvements installed on the Premises by or belonging to Tenant.
Any insurance which may be carried by Landlord or Tenant against loss or damage
to the Building or Premises shall be for the sole benefit of the party carrying
such insurance and under its sole control.
21.3 In the event that Landlord should fail to complete such
repairs and material restoration by the date estimated by Landlord therefor on
the Election Date as may be extended by this Section 21.3 for acts of force
majeure, Tenant may at its option and as its sole remedy terminate this Lease by
delivering written notice to Landlord, within thirty (30) days after the
expiration of said period of time estimated by Landlord on the Election Date,
whereupon the Lease shall end on the date of such notice or such later date
fixed in such notice as if the date of such notice was the date originally fixed
in this Lease for the expiration of the Term; provided, however, that if
construction is delayed because of changes, deletions or additions in
construction requested by Tenant, strikes, lockouts, casualties, acts of God,
material or labor shortages, government regulation or control or other causes
beyond the reasonable control of Landlord, the period for restoration, repair or
rebuilding shall be extended for the amount of time Landlord is so delayed.
21.4 Notwithstanding anything to the contrary contained in this
Article 21, Landlord shall not have any obligation whatsoever to repair,
reconstruct, or restore the Premises when the damages resulting from any
casualty covered by the provisions of this Article 21 occur during the last six
(6) months of the Term or any extension thereof, but if Landlord determines not
to repair such damages Landlord shall notify Tenant and if such damages shall
render any material portion of the Premises untenantable Tenant shall have the
right to terminate this Lease by notice to Landlord within fifteen (15) days
after receipt of Landlord's notice.
21.5 In the event of any damage or destruction to the Building or
Premises by any peril covered by the provisions of this Article 21, it shall be
Tenant's responsibility to properly secure the Premises and upon notice from
Landlord to remove forthwith, at its sole cost and expense, such portion of all
of the property belonging to Tenant or its licensees from such portion or all of
the Building or Premises as Landlord shall request and Tenant hereby
indemnifies, protects, defends and holds harmless Landlord from any loss,
liability, costs and expenses, including attorneys' fees, arising out of any
claim of damage or injury as a result of any actual or alleged failure of Tenant
to properly secure the Premises prior to such removal.
21.6 This Lease shall be considered an express agreement governing
any case of damage to or destruction of the Premises, Building or Project by
fire or other casualty, and any present or future law which purports to govern
the rights of Landlord and Tenant in such circumstances in the absence of
express agreement, shall have no application.
22. EMINENT DOMAIN.
22.1 If all or any part of the Premises shall be taken or
appropriated by any public or quasi-public authority under the power of eminent
domain, or conveyance in lieu thereof, either party to this Lease shall have the
right, at its option, of giving the other, at any time within ninety (90) days
after such taking, notice terminating this Lease.
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22.2 If any part of the Building that is outside of the Premises
and is not under exclusive control of other tenants shall be taken or
appropriated by any public or quasi-public authority under the power of eminent
domain or conveyance in lieu thereof and causes material inconvenience to
Tenant's use and enjoyment of the Premises, Tenant shall have the right, at its
sole option, to terminate this Lease at any time within ninety (90) days after
such taking.
22.3 If any portion of the Project not described in Section 22.1 or
22.2 above shall be taken or appropriated by any public or quasi-public
authority under the power of eminent domain, or conveyance in lieu thereof,
Tenant shall have the right to terminate this Lease at any time within ninety
(90) days after such taking if Tenant's access to the Project, the Building or
the Premises is materially and adversely affected. Provisions of this Section
22.3 shall also apply in the event offsite access and traffic circulation to the
Premises is materially and adversely altered.
22.4 If the entire Project shall be taken or appropriated by any
public or quasi-public authority under the power of eminent domain, or
conveyance in lieu thereof, this Lease shall terminate effective as of the date
of the taking.
22.5 If neither party to this Lease shall elect to terminate this
Lease as provided in this Article 22, the rental during any condemnation and
thereafter shall be equitably abated and adjusted under the circumstances. In
the event of a partial taking of the Premises, Building or Project which does
not result in a termination of this Lease, Landlord shall restore the remaining
portion of the Building and Premises within 120 days of the taking as nearly
practicable to its condition prior to the condemnation or taking, but only to
the extent of the Building Standard and only to the Tenant Improvement Allowance
as to the Tenant Improvements (as the foregoing terms are defined in the Work
Letter attached as Exhibit C).
22.6 Landlord shall be entitled to any and all income, rent, award,
or any interest whatsoever in or upon any such sum, which may be paid or made in
connection with any such public or quasi-public use or purpose, and Tenant
hereby assigns to Landlord any interest it may have in or claim to all or any
part of such sums, other than any separate award which may be made with respect
to Tenant's trade fixtures and moving expenses; Tenant shall make no claim and
hereby assigns its award to Landlord for the value of any unexpired Term.
23. ESTOPPEL CERTIFICATES. Within ten (10) days following any written
request made by either party hereto (the "REQUESTING PARTY") from time to time,
the other party shall execute and deliver to the Requesting Party a sworn
statement certifying: (a) the date of commencement of this Lease; (b) the fact
that this Lease is unmodified and in full force and effect (or, if there have
been modifications to this Lease, that this Lease is in full force and effect,
as modified, and stating the date and nature of such modifications); (c) the
date to which the rent and other sums payable under this Lease have been paid;
(d) the fact that there are no current defaults under this Lease by either
Landlord or Tenant except as specified; and (e) such other matters as may be
reasonably requested. Landlord and Tenant intend that any statement delivered
pursuant to this Article 23 may be relied upon by any mortgagee, transferee,
assignee, sublessee, beneficiary or purchaser and shall be liable for all loss,
cost or expense resulting from the failure of any sale or funding of any loan or
any other transaction caused by any material misstatement contained in such
estoppel certificate.
24. SURRENDER OF PREMISES. At the end of the Term or any renewal of the
Term or other sooner termination of this Lease, Tenant will peaceably deliver up
to Landlord possession of the Premises, together with all permanent improvements
or additions therein, by whomsoever made, in the same condition received or
first installed, broom clean and free of all debris, excepting only ordinary
wear and tear and damage by fire or other casualty. Tenant may, and at
Landlord's written request shall, at Tenant's sole cost, remove upon termination
of this Lease, any and all
33
furniture, furnishings, and other movable trade fixtures, title to which shall
not be in or pass to Landlord upon such termination, repairing all damage caused
by such removal. Property not so removed shall be deemed abandoned by the
Tenant.
25. NOTICES. Any notice or document required or permitted to be
delivered under this Lease shall be addressed to the intended recipient, shall
be transmitted personally, by fully prepaid registered or certified United
States Mail return receipt requested, or by reputable independent contract
delivery service furnishing a written record of attempted or actual delivery,
and shall be deemed to be delivered when tendered for delivery to the addressee
at its address set forth opposite its signature on the Reference Page, or at
such other address as it has then last specified by written notice delivered in
accordance with this Article 25, or if to Tenant at either its aforesaid address
or its last known registered office, whether or not actually accepted or
received by this addressee.
26. RENT TAX. In addition to rent and other charges to be paid by
Tenant under this Lease, Tenant shall reimburse to Landlord, upon demand, any
and all taxes payable by Landlord (other than net income taxes) upon, allocable
to, or measured by or on the net rent payable under this Lease (as said taxes or
tax rates are reduced from time to time).
27. HEADINGS. The Article headings shown in this Lease are for
convenience of reference and shall in no way define, increase, limit or describe
the scope or intent of any provision of this Lease.
28. TENANT'S AUTHORITY. Each of the persons executing this Lease on
behalf of Tenant represents and warrants that Tenant has been and is qualified
to do business in the State of Arizona, that the corporation has full right and
authority to enter into this Lease, and that all persons signing on behalf of
the corporation were authorized to do so by appropriate corporate actions.
Tenant agrees to furnish promptly upon request a corporate resolution or other
appropriate documentation evidencing the due authorization of Tenant to enter
into this Lease.
34
29. COMMISSIONS. Each of the parties: (a) represents and warrants to
the other that it has not dealt with any broker or finder in connection with
this Lease, except as described on the Reference Page; and (b) indemnifies and
holds harmless the other from any and all losses, liability, costs or expenses
(including liens and attorneys' fees) incurred as a result of any alleged breach
of the foregoing warranty by it. Landlord hereby agrees to pay any and all
commissions owing any broker or finder in connection with this Lease as
described on the Reference Page.
30. TIME AND APPLICABLE LAW. Time is of the essence of this Lease. This
Lease shall in all respects be governed by the laws of the State of Arizona.
31. SUCCESSORS AND ASSIGNS. Subject to the provisions of Article 8, the
terms, covenants and conditions contained in this Lease shall be binding upon
and inure to the benefit of the heirs, successors, executors, administrators and
assigns of the parties to this Lease.
32. ENTIRE AGREEMENT. This Lease, together with its exhibits, schedules
and the addenda, contains all agreements of the parties to this Lease and
supersedes any previous negotiations. There have been no representations made by
the Landlord or understandings made between the parties other than those set
forth in this Lease and its exhibits. This Lease may not be modified except by a
written instrument duly executed by the parties to this Lease.
33. RECORDATION. Tenant may, at its expense, record a short form
memorandum of this Lease and Landlord shall execute and deliver such instrument.
The legal description of the property on which the Building is located is set
forth on Exhibit A.
LANDLORD: TENANT:
LONDEN CENTER L.L.C., TRG, INC.,
an Arizona limited an Indiana corporation
liability company
By_______________________________ By_________________________________
Its____________________________ Its________________________________
State of Arizona
County of Maricopa
The foregoing instrument was acknowledged before me this ___
day of ________, 1994, by ______________________, the ________________________
of Londen Center L.L.C., an Arizona limited liability company, on behalf of the
company.
(Seal and Expiration Date)
__________________________________________
Notary Public
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State of __________
County of ____________
The foregoing instrument was acknowledged before me this
___ day of ________, 1994, by TRG, Inc., an Indiana corporation, on behalf of
the corporation.
(Seal and Expiration Date)
__________________________________________
Notary Public
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EXHIBIT A
Legal Description of Project
37
Exhibit A
Legal Description of Project
LEGAL DESCRIPTION
A PARCEL OF LAND IN MARICOPA COUNTY, ARIZONA, IN THE XXXXXXXXX XXXXXXX XX
XXXXXXX 00, XXXXXXXX 0 XXXXX, XXXXX 4 EAST OF THE GILA AND SALT RIVER BASE AND
MERIDIAN FURTHER DESCRIBED AS FOLLOWS:
BEGINNING AT THE NORTHWEST CORNER OF SECTION 19;
THENCE SOUTH 87(DEGREE)16'00" EAST ALONG THE NORTH SECTION LINE OF SAID SECTION
19 A DISTANCE OF 2,174.95 FEET TO A POINT;
THENCE SOUTH 02(DEGREE)44'00" WEST A DISTANCE OF 55.00 FEET TO THE TRUE POINT OF
BEGINNING;
THENCE SOUTH 02(DEGREE)44'00" WEST A DISTANCE OF 61.28 FEET TO A POINT;
THENCE SOUTH 53(DEGREE)22'30" WEST A DISTANCE OF 67.68 FEET TO A POINT;
THENCE SOUTH 37(DEGREE)40'00" EAST A DISTANCE OF 274.49 FEET TO A POINT;
THENCE SOUTH 82(DEGREE)38'55" EAST A DISTANCE OF 14.15 FEET TO A POINT;
THENCE NORTH 52(DEGREE)22'10" EAST A DISTANCE OF 161.22 FEET TO A POINT;
THENCE SOUTH 89(DEGREE)28'45" EAST A DISTANCE OF 138.90 FEET TO A POINT;
THENCE NORTH 00(DEGREE)31'13" EAST (PARALLEL TO AND 50 FEET WEST OF THE
MIDSECTION LINE OF SECTION 19) A DISTANCE OF 158.84 FEET TO A POINT;
THENCE NORTH 37(DEGREE)19'30" WEST A DISTANCE OF 49.10 FEET TO A POINT OF CURVE;
THENCE ALONG A CURVE TO THE LEFT HAVING A RADIUS OF 65.34 FEET, A CENTRAL ANGLE
OF 10(DEGREE)20'04", AN ARC LENGTH OF 11.78 FEET, AND A CHORD WHICH BEARS NORTH
42(DEGREE)29'32" WEST TO A POINT ON A LINE;
THENCE NORTH 87(DEGREE)16'00" WEST (PARALLEL TO AND 50 FEET SOUTH OF THE NORTH
SECTION LINE OF SECTION 19) A DISTANCE OF 355.30 FEET TO THE TRUE POINT OF
BEGINNING.
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Addendum to Lease Dated December 19, 0000
Xxxxxxx Xxxxxx Xxxxxx L.L.C., as Landlord,
and TRG, Inc., an Indiana corporation, as Tenant
Signage. Tenant shall have signage in accordance with the Work Letter
and Schedule C-1, thereto. Tenant shall always have the first (highest) sign
portion on the one(1) existing Project monument sign subject to one (1) higher
sign for "Londen Insurance." Tenant's signage shall be of size at least equal to
any other signage thereon. Circle K and Xxxx-In-The-Box shall always have the
last (lowest) two positions on the existing monument sign. Complete tenant names
shall be used and no logos shall be permitted on the existing monument sign. A
sign panel on any monument sign for any other tenant shall be of the same size
or less than Tenant's sign panel and all signage shall be of uniform
presentation, color and lettering, except as may be required on the future
monument sign referred to below in order to erect and maintain such future
monument sign. The Building shall not be a signature building or otherwise known
by reference to any business in the software development industry. During the
Term no other Project signage shall be established or permitted and in no event
shall any tenant have signage on the exterior of the Building except only (x)
existing first floor tenant signage (and replacements thereof in accordance with
the foregoing criteria) is permissible for Circle K and Xxxx-In-The-Box, (y)
future other first floor tenants may have exterior signage on the first floor on
the Building identifying their premises, but such signage shall be of
substantially the same color and lettering as any signage of such tenant on the
Project's monument sign and (z) Landlord may erect and maintain in the future
one (1) additional monument sign in the Project and Tenant shall, subject to any
requirements to erect or maintain such future monument sign, always have the
first (highest) sign position on such Project Monument sign subject only to one
(1) higher sign for "Londen Insurance." Xxxx-In-The-Box shall always have the
last (lowest) positions on such additional monument sign, subject to any
requirements to erect or maintain such future monument sign, Circle K shall have
no signage on such additional monument sign. The signage shall conform to
Landlord's sign standards on Schedule C-1 to the Work Letter and shall be in
conformance with the City of Phoenix sign ordinances.
Renewal Options. In the event Tenant is not then in default under this
Lease, Tenant shall have the right to extend the term of this Lease for two
periods of three years each (the "Renewal Terms"). Each option shall be
exercised, if at all, by written notice given to Landlord at least 180 days
before the last day of the then current Term. All of the terms and conditions of
this Lease shall continue in full force and effect during each Renewal Term,
except that the amount of the Base Rent shall be increased (and in no event
decreased) at the beginning of each Renewal Term to 95% of the "Prevailing
Rate". "Prevailing Rate" shall mean the fair market rental rate then being
charged for like space similarly situated in similar office buildings located in
the Camelback Corridor in Phoenix, Arizona, taking into consideration the
applicable Base Year for purposes of determining additional rent, as well as the
value of rent concessions, buildout allowances and the like.
Cancellation Option. In the event Tenant is then not in default of this
Lease, Tenant shall have the right to cancel this Lease effective at any time
after the third anniversary of the Commencement Date by (I) a written notice
delivered to Landlord at least 180 days prior to the Lease termination date
specified in such notice and (ii) payment to Landlord, prior to the effective
39
cancellation date, of the unamortized portions of (x) the Construction Costs (as
defined in Section I of the Work Letter) of the Tenant Improvements (as defined
in Section I of the Work Letter) and (y) the actual leasing commissions paid to
CB Commercial for this Lease not to exceed $5.00 per rentable square foot of the
Premises (i.e., $167,035), based on a level amortization of the Construction
Costs and leasing commissions over the original 6 year Term of the Lease
commencing from the Commencement Date. Effective as of the cancellation date and
surrender of the Premises in accordance with this Lease, this Lease shall be of
no force or effect without further liability under this Lease by either Landlord
or Tenant.
Circle K Gas Tanks. In no event shall Tenant be or become directly or
indirectly liable or obligated as to the underground storage tanks now or
hereafter located on the Project.
Landlord's Lien For Rent. Landlord shall not unreasonably withhold its
consent to any instrument subordinating the Landlord's statutory lien for rent
to financing of Tenant secured by its personal property located in the Premises.
Tenant Improvements. All Tenant Improvements (as defined in the Work
Letter attached as Exhibit C) incorporated, affixed or permanently attached to
the Premises are to be placed on secured property tax rolls of Project and taxed
as real property.
Satellite & Antenna. Subject to applicable ordinances and Tenant
obtaining all required permits, Tenant shall have a right to locate satellite
and antenna equipment used in conjunction with its business within the Premises
upon the roof of the Building. All expenses, including the equipment and any
necessary supports, location and screening expenses as required in Landlord's
reasonable discretion and load and other engineering studies, shall be at
Tenant's sole cost and expense. All such equipment shall be removed by Tenant at
the termination of the Lease at its cost.
Card Access and Parking. Landlord shall issue to Tenant, at Landlord's
cost, 200 access cards providing access to the parking garage of the Building,
the other public areas of the Building and its elevator system and the Premises.
Tenant shall only issue such cards to its own employees and its business
contractors. Tenant shall surrender all access cards immediately upon a
termination of the Lease. Each card shall permit the holder of such card free
access and parking in the parking garage located under the Building. Landlord
shall at all times provide to Tenant for the benefit of the users of such cards
at least 157 unreserved employee parking spaces in the parking garage. Landlord
shall have a right to monitor the use of the parking garage to confirm that
average daily parking by Tenant does not consistently exceed 157 spaces. If such
parking use does consistently exceed such 157 parking spaces, Landlord may
require payment of $10.00 per car per month for the consistent excess over 157
parking spaces. Landlord shall issue additional cards over the initial 200
access cards from time to time at Tenant's request, for Landlord's cost but at
Tenant's expense, and such cards shall entitle the cardholder at its option to
park in the parking garage at a parking rate of $10.00 per month for such
employee parking space (all cardholders over 200 being required to pay $10.00
per month if such cardholder uses the parking garage). In addition, Landlord
shall provide free, reserved visitor parking during the entire term of the Lease
in such amounts and locations as are reasonable satisfactory to Tenant. Subject
to the foregoing requirements, the parking shall be subject to such terms,
conditions and regulations
40
as landlord may reasonably establish from time to time.
First Right. Subject to all of the terms and conditions set forth in
this paragraph, Landlord hereby grants to Tenant the first right (the "First
Right"), to be offered by Landlord the opportunity to lease any and all premises
located on the 2nd and 4th floors of the Building, as the same may exist from
time to time (the "Additional Space"). If, at any time while the First Right is
in effect, Landlord should intend in good faith to lease any portion of the
Additional Space to a third party tenant (excluding in all events any affiliate
of Landlord), Landlord shall, prior to binding itself to any such lease except
as subject to Tenant's rights hereunder, notify Tenant of the portion of the
Additional Space which is the subject of the proposed lease (an "Offer Notice").
Tenant shall have until the tenth business day after Landlord's delivery of an
Offer Notice (the "Deadline") to notify Landlord that Tenant would like to lease
all of the portion of the Additional Space described in the Offer Notice (an
"Acceptance Notice"). If Tenant delivers its Acceptance Notice prior to the
Deadline, then Landlord and Tenant shall negotiate for a period of 20-days
after delivery of Tenant's Acceptance Notice the terms and provisions of an
amendment to the lease pursuant to which the subject portion of the Additional
Space will be incorporated into the Premises for the remainder of the Term. If
Tenant fails to deliver its Acceptance Notice prior to the Deadline, or if
Landlord and Tenant fail to agree upon the terms of such an amendment within
such 20-day period, of if Landlord and Tenant have agreed to such terms but fail
to finalize and execute such amendment within 60 days after Tenant's delivery of
its Acceptance Notice, then, in any such case, for a period of 180 days from and
after the subject Deadline, 20-day period or 60-day period, as the case may be
(a "Leasing Period"), Landlord shall be free, without further restriction, to
enter into a lease with a third-party tenant for the portion of the Additional
Space described in the subject Offer Notice, but only on the terms and
conditions contained in the Offer Notice. If Landlord has not entered into a
lease for the portion of the Additional Space described in an Offer Notice on or
before the expiration of the Leasing Period applicable to such Offer Notice,
then Landlord shall be required to repeat the procedures set forth in this
paragraph prior to binding itself to any lease of the subject portion of the
Additional Space. The First Right shall commence on the 90th day after the
Commencement Date and expire nine months before the end of the Term. For the
purposes of this paragraph, "lease" shall include any partial assignment of
Landlord's interest in the Additional Space in lieu of a lease of such space.
This First Right shall not apply to any transaction for Additional Space between
Landlord and any affiliated insurance company or other affiliate of Landlord,
nor to any portion of the 1st floor of the Building.
41
Exhibit B
Site Plan of Project and Floor Plan of Premises
A Project is a four story office building located on the southwest corner of
Camelback Road and 44th Street in Phoenix, Arizona. On the ground floor, a
Circle K store faces 44th Street, and a Xxxx in the Box Restaurant faces
Camelback Road. There is a parking garage comprising a portion of the
building and there are also exterior parking and common areas.
B The Floor Plan showing the 3rd Floor consisting of 33,407 rentable square
feet based on 29,695 usable square feet measured by BOMA standards and a
12.50% "load" factor.
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EXHIBIT C
WORK LETTER
Without limiting or changing the obligations and rights set forth in
the Lease, Landlord and Tenant agree as follows:
I. Definitions.
A. Architect means Pinnacle Design, Inc.
B. Base Building means the improvements presently contained
within the Project, the Building and the Premises, subject to the work required
below in this definition and subject also to the removal of such existing
improvements as required pursuant to the Space Plan. Landlord agrees that the
Base Building shall be completed (including Punch List Items) at no cost to
Tenant and shall not constitute a Construction Cost or be reimbursable from the
Tenant Improvement Allowance. Landlord agrees that the following shall be
furnished, installed and, if appropriate, repaired and made operational as part
of the Base Building prior to Substantial Completion and the Scheduled
commencement Date:
1. All existing walls within the public corridors, restrooms
and other third floor common areas shall be refurbished, including cleaning,
repairing and painting of surfaces as required. Damaged existing exterior and
atrium window frames, windowsills and molding shall be reattached, resecured and
refurbished as required. All existing exterior and atrium window glass and
window frames shall be cleaned and broken glass replaced as required.
2. The existing Building Standard ceiling grid and existing
ceiling tiles in common areas shall be cleaned and repaired as required, with
all damaged or stained ceiling tiles being replaced as required throughout the
entire third floor of the Building.
3. Existing flooring within all public corridors and other
common areas located on the third floor shall be fully cleaned to remove all
existing stains or replaced as required. All base will be replaced.
4. Building Standard light fixtures shall remain at the
presently-installed common area locations with all fixtures, lamps, lenses and
ballasts cleaned and repaired as required.
5. Men's and women's restrooms shall be cleaned and repaired as
required.
6. All existing appliances, sinks and Building Standard
drinking fountains shall be cleaned and repaired as required.
7. The present main heating ventilation and air conditioning
(HVAC) plant (including energy management system and integration) shall be in
good working order. The HVAC and air distribution system serving and within the
Premises shall be integrated into the Tenant Improvements and fully operational
and balanced after the Tenant Improvements are completed. All controls,
including thermostats, shall be in working order in a number of the present
ratio of thermostats to space in the Premises, after the Tenant Improvements are
completed.
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8. All sprinkler rises and sprinkler heads required by law
shall be in working order and repair.
9. All fire hose cabinets and fire extinguisher cabinets shall
be stocked and in working order as required by applicable law.
10. Hardware on all doors throughout the third floor and
entrance doors to the Building shall be replaced to comply with Americans with
Disabilities Act ("ADA") requirements. The quality of replacement hardware
outside of the Premises shall be consistent with the hardware used in the
Premises.
11. All present main Building electrical systems and
electrical distribution rooms, including panel boards, shall be in good working
order.
12. All present telephone distribution rooms shall be in good
working order. Telephone trunk lines to the Premises shall be in good working
order and shall be in capacity to adequately service Tenant's business needs.
Fiber optic cable is presently delivered to the Building.
13. Building Standard exterior window blinds and Building
Standard interior blinds for all interior window lights and side lights shall be
supplied or repaired as required.
14. All elevators and related equipment (including card access
security system) shall be in good working order.
15. All signs and graphics not located on the 3rd floor of the
Building shall be supplied by Landlord in accordance with Schedule C-1: Elevator
buttons, monument signage and directory information. Tenant signage on the 3rd
floor of the Building shall be funded from the Tenant Improvement Allowance.
All Base Building improvements shall be in compliance with ADA
requirements. "As required" shall mean all Base Building finishes shall be of at
least the same quality and state of repair as the interior finishes within the
Premises as improved by the Tenant Improvements. All Base Building work and
improvements located on the third floor shall be of quality consistent with the
Tenant Improvements and shall be of consistent color and finish with the
existing improvements as modified by the Tenant Improvements.
C. Construction Costs means the total cost and price for
designing, constructing and completing (including Punch List Items) the Tenant
Improvements before deducting any Tenant Improvement Allowance.
D. Contractor means Jokake Construction Company.
E. Overage means the amount by which Construction Costs exceed
the Tenant Improvement Allowance. The Overage shall be solely the responsibility
of Landlord except solely in the event of a Tenant Change Order, which Tenant
Change Order expense shall be solely at Tenant's cost.
44
F. Project Completion Document means the following:
1. Certification by the Architect that the Tenant
Improvements have been completed in compliance with the provisions of the Space
Plan, the Working Drawings and Specifications and the Lease.
2. A final Certificate of Occupancy for the Premises.
3. Copies of all manufacturer's guarantees and
warranties covering equipment and systems installed by Landlord or the
Contractor on the Premises.
4. A binder comprised of manufacturer's installation,
operation, service and maintenance manuals for equipment and systems installed
by Landlord or the Contractor on the Premises.
5. Air balance report for the completed Premises
reasonably approved by Tenant.
G. Savings means the amount by which Construction Costs are
less than the Tenant Improvement Allowance. This Savings shall be split 50/50
between Landlord and Tenant, with Tenant's portion of the Savings to be applied
to cabling within the Premises or reimbursement to Tenant for such cabling
costs.
H. Space Plan means "Space Plan #2" prepared by the Architect
(and containing notations thereon by Tenant) for the Premises which shall be
comprised of layout plans and specifications which identify all Tenant
Improvements to be completed in the Premises, including design specifications
and criteria as may be required to reasonably establish the quality of all
Tenant Improvements and which may reasonably facilitate preparation of the
Working Drawings and Specifications and bidding. The final Space Plan #2 with
notations shall be identified by written Tenant Representative authorization and
initialing thereon.
I. Substantial Completion shall mean when all the requirements
of Section 2.1 of the Lease respecting the "Substantial Completion" (as defined
therein) of Premises have been satisfied, including the completion of the Base
Building construction and all Tenant Improvements in accordance with the Space
Plan and the Working Drawings and Specifications, so that the Premises is
completed and functioning as general office space, subject only to the Punch
List, and in all events Substantial Completion shall not be deemed to occur
unless and until a final Certificate of Occupancy has been issued for the
Premises as improved.
J. Tenant Improvements means all improvements, alterations and
installations, as approved by Tenant, which are required for Tenant's turn-key
occupancy and use and which are in conformance with the Space Plan and the
Working Drawings and Specifications. Such Tenant Improvements will be fully
described in and shown on the Working Drawings and Specifications, which shall
be based on the Space Plan, subject only to Tenant Change Orders.
K. Tenant Improvement Allowance means $10.00 for each square
foot of Premises Rentable Area ($334,070.00 total). To the extent the Tenant
Improvement Allowance is not exhausted by the construction of the Tenant
Improvements, the remaining Tenant Improvement Allowance (i.e., Savings) shall
be applied in accordance with Section
45
III.C below.
L. Working Drawings and Specifications means a complete set of
drawings and specifications based on the Space Plan and sufficient to permit
proper bidding by Contractor and subcontractors and also sufficient to obtain a
building permit for the Project. The Working Drawings and Specifications shall
be made with precision and detail, specifying material to be used and the
construction methods to be employed for the complete installation and
construction of all Tenant Improvements. Such Working Drawings and
Specifications shall include at a minimum:
1. Architectural, mechanical and electrical plans and
structural plans (if structural plans are required). Architectural to include
reflected ceiling plan, elevations, sections, details and schedules, color
schemes and finishes.
2. To the extent required to update existing plans to
conform with the Space Plan, electrical design for lighting, power and
telephone/data; provided, however, all cabling design beyond wall stubs shall be
solely Tenant's responsibility and at Tenant's sole cost.
3. To the extent required to update existing plans to
conform with the new Space Plan, mechanical design for air distribution systems,
HVAC, control systems and fire protection.
4. To the extent required to update existing plans to
conform with the new Space Plan, updated plumbing design.
II. Working Drawings and Specifications:
A. Preparation. Based strictly on the Space Plan, Landlord shall cause
the Working Drawings and Specifications for the Tenant Improvements to be
prepared by the Architect and its engineers.
B. Approval. Tenant shall approve or disapprove the Working Drawings
and Specifications in accordance with the criteria established on the Space
Plan. Landlord shall revise the Working Drawings and Specifications and resubmit
them to Tenant for approval.
C. Final Approval. No bids shall be approved unless and until Tenant's
Representative has approved in writing the Working Drawings and Specifications,
which approval process shall occur in parallel with bidding of the work.
III. Bidding/Scope of Work/Tenant Improvements.
A. Bids. Contractor will bid the Tenant Improvements to a list of
subcontractors, suppliers and materialmen approved in advance by Landlord and
Tenant, which approval shall not be unreasonably withheld. A minimum of three
(3) bids shall be obtained in each work category unless waived by Tenant. All
bids shall be sealed bids and a final budget by trade shall be delivered to
Tenant for review. The bidding process shall include an aggressive value
engineering effort by Landlord Representative, Architect and Contractor. All
phases of the project costs shall be based on open book review by Tenant at a
reasonable frequency and at reasonable times during business hours.
46
B. Scope of Work. Landlord shall be fully responsible for all matters
that must be accomplished to perform, finish and completely install the Tenant
Improvements (in operating condition to manufacture specifications, if
applicable) in accordance with the provisions of this Work Letter and the Lease.
Landlord's obligations hereunder shall include furnishing through Contractor all
labor, materials and equipment; filing all plans with the proper governmental
authorities; obtaining all building permits; demolishing all existing
improvements in the Premises as necessary under the Space Plan; supervising all
details of construction; obtaining any temporary certificate of occupancy and
obtaining all final certificates of occupancy; engaging in supervising the
Contractor and its subcontractors and the Architect and its consultants;
promptly paying for all Tenant Improvements except as specifically provided in
Section IV hereof in respect of Tenant Change Orders; repairing and restoring
damaged, lost or destroyed tenant improvements, whether or not installed;
removing all debris from the Premises caused by any trade (including Tenant's
trades and any utility companies); obtaining applicable insurance coverage and
providing utility and building service at its sole cost at all times until the
Scheduled Commencement Date. Tenant has the right to modify current lighting to
provide ambient lighting in workstation areas through the use of ambient
fixtures. Such lighting may or may not use some portion of the existing
parabolics.
C. Overage/Savings. In all events, Landlord shall be responsible for
any Overage in Construction Costs over the Tenant Improvement Allowance except
only those costs incurred in an approved Tenant Change Order. Savings in
Construction Costs shall be split 50/50 between Landlord and Tenant, with
Tenant's portion of the Savings to be applied to cabling within the Premises or
reimbursement to Tenant for such cabling costs.
D. ADA. Landlord shall be responsible for all compliance with ADA
requirements for the Base Building and shall be similarly responsible for all
ADA requirements for the Tenant Improvements through the Commencement Date. ADA
requirements for the Tenant Improvements subsequent to the Commencement Date
shall be solely at Tenant's cost and expense.
E. Contractor. All Tenant Improvements will be of quality set forth on
the Space Plan and the Working Drawings and Specifications, completed only in
accordance with the Working Drawings and Specifications approved by Tenant, and
completed only by the Contractor or such other contractor approved by Tenant
executing such work through subcontractors, materialmen and suppliers set forth
on a list approved by Tenant.
F. Inspection. Tenant shall have the right to inspect the Tenant
Improvements as they are being installed and require corrections as are
necessary for work which is not in compliance with the Space Plan or the Working
Drawings and Specifications.
G. Injury. Tenant shall not be liable for any injury to persons or
damage to property within the Premises during the performance of the Tenant
Improvements, except for Tenant's own negligence. Landlord hereby indemnifies
and holds harmless Tenant from any claims, costs (including reasonable
attorneys' fees), charges, damages, lawsuits and judgments on account of such
injury or damage.
IV. Change Orders.
A. Change Orders Generally. No change orders over $1,000 for the Tenant
Improvement shall be made or executed without Tenant's prior written consent. No
change
47
orders for the Tenant Improvements affecting in any manner quality of materials,
colors, texture or finish shall be made or executed without Tenant's prior
written consent.
B. Tenant Change Orders. From time to time solely at its cost, Tenant
may make changes to the Space Plan or the Working Drawings and Specifications
and, in addition, to Tenant Improvement already installed ("Tenant Change
Orders"). Tenant may not request changes to the Base Building without Landlord's
prior written consent.
C. Charges. Within three business days after Tenant notifies Landlord
of a Tenant Change Order, Landlord shall submit to Tenant in writing a statement
of additional charges as agreed upon by the Architect, the Contractor and the
Landlord (or any savings involved) and the time period, if any, that the Tenant
Change Order will materially and adversely affect the Schedule or the Scheduled
Commencement Date. Tenant may either approve or disapprove such additional
charges or savings submitted by Landlord.
D. Architect Expenses. In addition to paying for the additional
construction charges resulting from Tenant Change Order approved by Tenant
pursuant to E. below, Tenant shall always pay reasonable fees and charges, if
any, by the Architect in preparing and pricing the Tenant Change Orders, whether
or not the Tenant Change Order is executed.
E. Execution. Landlord shall not be authorized to make or execute any
change and the Schedule shall remain unaffected unless and until Tenant's
Representative shall have approved in writing the cost and Schedule changes of a
Tenant Change Order proposal. If Tenant's Representative approves in writing the
additional charges or savings and the change in the Schedule, Landlord shall
cause the approved Tenant Change Orders to be made and executed and the Schedule
shall be adjusted appropriately.
V. Pricing of Tenant Improvement Costs and Change Orders.
A. Approved Subcontractors. All Tenant Improvement costs shall be
competitively bid by Contractor from a list of approved subcontractors,
materialmen and suppliers in accordance with Section III.A. above. All Tenant
Change Orders shall be first bid with the subcontractor, materialmen or supplier
that has bid or been awarded the subcontract for such matter; provided, however,
Tenant, at its sole cost and expense, shall have the right to cause another
subcontractor to bid or perform any Tenant Change Order.
B. Cost Breakdown. Landlord shall submit, prior to the commencement of
the Tenant Improvements, final breakdown by trade of all Construction Costs.
Tenant shall have the right, prior to the commencement of construction of the
Tenant Improvements, to review and approve the Construction Costs.
VI. Plan Costs.
A. Without modifying any other agreement contained in this Work Letter
or the Lease, the following plan costs and expenses shall be paid as indicated:
1. Preparation or modification of any Base Building plans:
Landlord-solely at its cost and without reimbursement.
2. Preparation of Space Plan through Lease Reference Date:
Landlord-solely at its cost and without reimbursement.
48
3. Revision of Space Plan after Lease Reference Date:
(a) Due to Tenant changes: Tenant-solely at its cost and
without reimbursement.
(b) Due to Landlord's errors or omissions:
Landlord-solely at its cost and without
reimbursement.
4. Preparation of Working Drawings and Specifications:
Landlord-with a reimbursement from the Tenant Improvement
Allowance, not to exceed 85 cents/usable square foot.
5. Coordination, if required, of Working Drawings and
Specifications with the Base Building plans: Landlord-solely
at its cost and without reimbursement.
6. Modification of Working Drawings and Specifications after
Tenant's final approval thereof:
(a) Due to Tenant changes: Tenant-solely at its cost and
without reimbursement.
(b) Due to Landlord's errors and omissions:
Landlord-solely at its cost and without
reimbursement.
7. Project Completion Documents: Landlord-with reimbursement from
the Tenant Improvement Allowance except the certificate of
completion shall be at Landlord's sole cost if costs related
to the issuance thereof is from an Overage.
VII. Payment of Tenant Improvement Costs.
Landlord shall be responsible for all Construction Costs of the Tenant
Improvements, including Overages, except specifically only the following:
1. All costs and expenses approved in writing by Tenant for a
Tenant Change Order shall be paid solely by Tenant.
2. Tenant shall pay all Tenant Change Orders within 30 days
after receipt of an invoice from Landlord, such payment shall be 90% of the
Tenant Change Order, as estimated by the Architect, as completed and
incorporated into the Premises since the last billing. All retention shall be
paid upon completion of the Punch List. Landlord shall be responsible to cause
the Contractor to pay all subcontractors, materialmen and suppliers that have
worked on a Tenant Change Order.
VIII. Scheduling.
Landlord and Tenant shall comply with the SCHEDULE attached hereto as
Schedule 2 and with the BENCHMARK DATES set forth below, unless modified in
writing by the Landlord Representative and the Tenant Representative.
49
A. Working Drawings and Specifications delivered by Landlord
to Tenant within 30 calendar days after Lease execution and date Landlord and
Tenant approve the final Space Plan.
B. Tenant's comments on the Working Drawings and
Specifications delivered to Landlord within 5 working days after Tenant receives
such plans and specifications. Review to occur during bidding process.
C. Landlord shall use best efforts to complete bidding of the
job and review of bids with Tenant within 10 working days after completion of
Working Drawings and Specifications.
D. Landlord shall use best efforts to obtain a building permit
within 10 working days after completion of Working Drawings and Specifications.
E. Construction of Tenant Improvements to commence immediately
after the building permit is issued and Tenant has approved the bids except for
demolition which will be bid and completed prior to start of new construction.
F. March 20, 1995: Date when Tenant may commence cabling
installation within the Premises.
G. March 31, 1995: Date when Tenant may begin to install
computer and phone systems, move in work-
stations and other furniture and perform
other pre-occupancy activities for a
general office space, which in all events
and notwithstanding anything to the
contrary in this Work Letter or the
Lease, must be at least 15 calendar days
before the Premises is substantially
Completed.
H. May 1, 1995: The Premises and the Tenant Improvements
are Substantially Completed.
I. May 1, 1995: Scheduled Commencement Date.
I.-1 May 15, 1995: Penalty Date
J. By May 1, 1995: Initial Punch List submitted by Tenant
to Landlord.
K. May 1, 1995: Punch List Items completed by Landlord,
but not less than 5 days after receipt
of Initial Punch List.
L. May 1, 1995: Project Completion Documents delivered
to Tenant.
M. Landlord covenants and agrees that the Base Building will
be completed, including Punch List Items therefor, on or before the Scheduled
Commencement Date. Tenant reserves the right to submit additional punch list
items after occupancy and throughout the warranty period.
IX. Representatives
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Landlord appoints Xxx Xxxxxxx ("Landlord Representative") to act for
Landlord in all matters covered by this Work Letter. Tenant appoint Xxxxx
XxXxxxxx or Xxxx Xxxxxx (Tenant's Representative") to act for Tenant in all
matters covered by this Work Letter. All inquiries, requests, instructions,
authorizations and approvals with respect to the matters covered by this Work
Letter shall be made to Landlord's Representative or Tenant's Representative as
applicable.
X. Landlord's Additional Obligations.
Landlord, at its sole cost and expense and without reimbursement from
the Tenant Improvement Allowance, shall continuously coordinate the
architectural, engineering, construction and design disciplines for the Base
Building and for all aspects of the Tenant Improvements. Landlord shall have
continuous on-site personnel supervise construction and report any delays to
Tenant's Representative. Landlord shall cause Landlord's Representative to
communicate with Tenant's Representative as to the Tenant Improvements. Landlord
shall notify Tenant of any clarification required by the Contractor or the
Architect in interpreting or implementing material provisions of the Space Plan
or the Working Drawings and Specifications. To insure appropriate communication
and coordination of the Work Landlord's Representative will hold weekly status
meetings from commencement to completion of the work to include Architect,
Contractor and Tenant's Representative. Architect's costs for review of the work
and attendance at status meetings shall be a Landlord expense without
reimbursement from the Tenant Improvement Allowance.
XI. Architect.
The Landlord shall cause the Architect to devote such time and effort
as is required to properly and timely complete the Project in accordance with
the Schedule.
XII. Contractor.
Tenant shall have the right to review the construction contract with
Contractor to assure itself that provisions of the construction contract are
consistent with the terms and conditions of this Work Letter. The construction
contract shall always provide that Contractor agrees to make Tenant Change
Orders without the imposition of general conditions or other overhead or
surcharge for the first 10% (measured by the cost of the initial Construction
Costs) in dollar value of the Tenant Change Orders but with a reasonable
overhead for all Tenant Change Orders exceeding such 10% amount.
51
SCHEDULE C-1
A drawing showing the Replacement Faces of a Double Faced Display, at the corner
of 00xx Xxxxxx and Camelback Road, Phoenix, Arizona, describing the following:
"Remove and discard the existing faces reading "CIRCLE K" and "DELI
STORE." Fabricate and install new white face panels with cut out black copy
reading "THE LONDON CENTER" and "4343."
52
SCHEDULE 2
PROJECT SCHEDULE Dec. 12, 1994
TRG, INC. Page 1 of 1
A chart prepared by the Xxxxxxxxx Corporation setting forth the work schedule
for the completion of the Building, commencing with Lease Negotiations in
November and December through Project Completion Documents in April, as follows:
Timing -
Weeks of
Lease Negotiations Nov. 28 and Dec. 5
Lease Prep/Execution Nov. 28, Dec. 5-12
Program Data Collection Complete
Preliminary Space Plan Complete
Final Space Plan Nov. 28
General Contractor Selection Complete
Conceptual Estimate Nov. 28 and Dec. 5
Design Dev./Construction Docs. Dec. 19 & 26, Jan.2-9 (1)
Bid Jan. 16-23
Value Engineering Last half of week of Jan.23
city Submittal/Redlines/Permit Jan. 16 (2)
Furniture Order Through Delivery Jan. 16 through March 27
Construction Jan. 23 through April 10 (3)
Cabling March 20-27
FF&E Install April 3-10
Punchlist Completion April 10 (3)
Move-in Mid-April
Project Completion Documents Approx. April 20
1. Pinnacle Design, Inc. estimate 12/6/94
2. Based on use of Landlord consultant
3. Jokake Construction Estimate 12/6/94; demolition 1 week; construction 10
weeks; punchlist 1 week
53
EXHIBIT D
BUILDING RULES AND REGULATIONS
1. SIGNS. Subject to Lease and Work Letter: No sign, placard, picture,
advertisement, name or notice shall be inscribed, displayed or printed
or affixed on or to any part of the outside of the Building without the
written consent of Landlord first had and obtained. Landlord shall have
the right to remove any such sign, placard, picture, advertisement name
or notice with notice to and at the expense of Tenant. All approved
signs or lettering on doors shall be printed, painted, affixed or
inscribed at the expense of Tenant by a person approved by Landlord.
Tenant shall not place anything or allow anything to be placed near the
glass of any window, door, partition, or wall which may appear
unsightly from outside the Premises.
2. SERVICES. No Tenant shall obtain for use upon the Premises ice,
drinking water, towel or other similar service or accept barbering or
bootblacking services on the Premises, except from persons authorized
by the Landlord and at the hours and under regulations fixed by the
Landlord.
3. DIRECTORY. The bulletin board or directory of the Building will be
provided exclusively for the display of the name and location of Tenant
only and Landlord reserves the right to exclude any other names
therefrom.
4. OBSTRUCTIONS. The sidewalks, halls, passages, exits, entrances,
elevators and stairways shall not be obstructed by any of the Tenants
or used by them for any purpose other than for ingress to and egress
from their respective premises. The halls, passages, exits, entrances,
elevators, stairways, balconies and roof are not for the use of the
general public and the Landlord shall in all cases retain the right
outside of the leased premises to control and prevent access thereto by
all persons whose presence in the judgment of the Landlord shall be
prejudicial to the safety, character, reputation and interests of the
Building and its Tenants. No Tenant and no employees or invitees of any
Tenant shall go upon the roof of the Building.
5. LOCKS. Tenant shall not alter any lock or install any new or additional
locks or any bolts on any door of the premises.
6. RESTROOMS. The toilet rooms, urinals, wash bowls and other apparatus
shall not be used for any purpose other than that for which they were
constructed and no foreign substance of any kind whatsoever shall be
thrown therein and the expense of any breakage, stoppage or damage
resulting from the violation of this rule shall be borne by the Tenant
who, or which employees or invitees, shall have caused it.
7. DAMAGE. Tenant shall not overload the floor of the Premises or xxxx,
drive nails screw or drill into the partition, woodwork or plaster or
in any way deface the Premises or any part thereof except for purposes
incidental to Tenant's permitted uses.
8. HEAVY EQUIPMENT. No furniture, freight or equipment of any kind shall
be brought
54
into the Building without the consent of Landlord and all moving of the
same into or out of the Building shall be done at such time and in such
manner as Landlord shall designate. Landlord shall have the right to
prescribe the weight, size and position of all safes brought into the
Building and also the times and manner of moving the same in and out of
the Building. Safes shall, if considered necessary by Landlord, stand
on wood strips of such thickness as is necessity to properly distribute
the weight. Landlord will not be responsible for loss of or damage to
any such safe or property from any cause and all damage done to the
Building by moving or maintaining any such safe or other property shall
be repaired at the expense of Tenant.
9. CLEANING. Tenant shall not employ any person or persons other than the
janitor of Landlord for the purpose of cleaning the Premises unless
otherwise agreed to by Landlord. Except with the written consent of
Landlord, no person or persons other than those approved by Landlord
shall be permitted to enter the Building for the purpose of cleaning
the same. Tenant shall not cause any unnecessary labor by reason of
Tenant's carelessness or indifference in the preservation of good order
and cleanliness. Landlord shall in no way be responsible to any Tenant
for any loss of property on the Premises, however occurring, or for any
damage done to the effects of any Tenant by the janitor or any other
employee or any other person. Janitor service shall include ordinary
dusting and cleaning by the janitor assigned to such work and shall not
include moving of furniture or other special services.
10 NUISANCE. Tenant shall not use, keep or permit to be used or kept any
foul or noxious gas or substance in the Premises, or permit or suffer
the Premises to be occupied or used in a manner offensive or
objectionable to the Landlord or other occupants of the Building by
reason of noise, odors and/or vibrations, or interfere in any way with
other Tenants or those having business therein, nor shall any animals
or birds be brought in or kept in or about the Premises or the
Building.
11. PROHIBITED ACTIVITIES. No cooking shall be done or permitted except for
microwave oven and beverage preparation in the employee breakrooms by
any Tenant on the Premises, nor shall the Premises be used for the
storage or merchandise, for washing clothes, for loading, or for any
improper, objectionable or immoral purposes.
12. PROHIBITED MATERIALS. Tenant shall not use or keep in the Premises or
the Building any kerosene, gasoline or inflammable or combustible fluid
or material, or use any method of heating or air conditioning other
than that supplied by Landlord.
13. WIRES. The location of the initial telephones, call boxes and other
office equipment affixed to the Premises shall be installed in a manner
consistent with space plan #2.
14. KEYS. Each Tenant, upon the termination of the tenancy, shall deliver
to the Landlord the keys of offices, rooms, and toilet rooms which
shall have been furnished the Tenant or which the Tenant shall have had
made, and in the event of loss of any keys so furnished, shall pay the
Landlord therefor.
55
PARKING RULES AND REGULATIONS
The following rules and regulations shall govern use of the parking facilities
which are appurtenant to the Building.
1. All claimed damage or loss must be reported and itemized in writing delivered
to the Parking Facility Office within ten (10) business days after any claimed
damages or loss occurs. Any claim not so made is waived. Landlord has the option
to make repairs at its expense of any claimed damage within two (2) business
days after filing of any claim. In all court actions the burden of proof to
establish a claim remains with Tenant. Court actions by Tenant for any claim
must be filed within (90) days from date of parking in court of jurisdiction
where a claimed loss occurred. Landlord is not responsible for damage by water,
fire, or defective brakes or parts, or for the acts or omissions of others, or
for articles left in the car. The total liability of Landlord is limited to
$250.00 for all damages or loss to any car. Landlord is not responsible for loss
of use.
2. Tenant shall not park or permit the parking of any vehicle under its control
in any parking areas designated by Landlord as areas for parking by visitors to
the Building. Tenant shall not leave vehicles in the parking areas overnight nor
park any vehicles in the parking areas other than automobiles, motorcycles,
motor drive or non-motor driven bicycles or four-wheeled trucks.
3. Parking stickers or any other device or form of identification supplied by
Landlord as a condition of use of the Parking Facilities shall remain the
property of Landlord. Such parking identification device must be displayed as
requested and may not be mutilated in any manner. The serial number of the
parking identification device may not be obliterated. Devices are not
transferable and any device in the possession of an unauthorized holder will be
void.
4. No overnight or extended term storage of vehicles shall be permitted except
parking incidental to business travel.
5. Vehicles must be parked entirely within the painted stall lines of a single
parking stall.
6. All directional signs and arrows must be observed.
7. The speed limit within all parking area shall be five (5) miles per hour.
8. Parking is prohibited:
(a) in areas not striped for parking;
(b) in aisles:
(c) where "no parking" signs are posted;
(d) on ramps;
56
(e) in cross-hatched areas; and
(f) in such other areas as may be designated by Landlord or
Garage Manager.
9. Every parking is required to park and lock his own vehicle. All
responsibility for damage to vehicles is assumed by the xxxxxx.
10. Loss or theft of parking identification devices from vehicles must be
reported to the Garage Manager immediately, and a lost or stolen report must be
filed by the xxxxxx at that time. Landlord has the right to exclude any car from
the parking facilities that does not have an identification device.
11. Any parking identification devices reported lost or stolen found on any
unauthorized car will be confiscated and the illegal holder will be subject to
prosecution.
12. Lost or stolen devices found must be reported to the Parking Facility Office
immediately to avoid confusion.
13. Washing, waxing, cleaning or servicing of any vehicle in any area not
specifically reserved for such purpose is prohibited.
14. Tenant shall acquaint all persons to whom Tenant assigns parking spaces with
these Rules and Regulations. Garage Manager or attendants are not authorized to
make or allow any exceptions to these Rules and Regulations.
15. Landlord reserved the right to refuse to issue monthly stickers or other
parking identification devices to any Tenant or person and/or his agents or
representatives who willfully refuse to comply with these Rules and Regulations
and all unposed city, state or federal ordinances, laws or agreements.
16. Landlord reserves the right to modify and/or adopt such other reasonable and
non-discriminatory rules and regulations for the parking facilities as it deems
necessary for the operation of the parking facilities by giving notice of same
to Tenant as set forth in Section 25 of the Lease. Landlord may refuse to permit
any person who violates these rules to park in the parking facilities, and any
violation of the rules shall subject the car to removal.
57
SCHEDULE 1
SPECIFICATIONS FOR JANITORIAL SERVICE
1. Daily: Five (5) Day Service
OFFICES
a. Empty all waste baskets and replace liners as needed.
b. Empty and clean all ash trays.
c. Dust all office furniture, window ledges, horizontal surfaces,
blinds, pictures, files cabinets, telephones, moldings and
baseboards.
d. Clean glass doors and thresholds.
e. Vacuum and spot clean carpet.
f. Spot clean marks on walls, next to light switches, doors and
door frames.
g. Turn off all lights and lock all doors upon completion in each
space.
ENTRANCES AND HALLWAYS
a. Clean glass doors and thresholds.
b. Spot clean marks on the painted entrance doors and janitor's
closet door.
c. Vacuum and spot clean carpeting.
d. Maintain entrance mats and clean balconies.
e. Dust window ledges, moldings and baseboards.
f. Clean cigarette urns.
g. Sanitize and polish drinking fountain.
h. Lock doors upon completion of work.
REST ROOMS
a. Dust mop floors and spot clean.
b. Empty and clean waste containers.
c. Empty and clean sanitary containers.
d. Clean and polish mirrors, frames and shelves.
e. Clean and sanitize wash basins and soap dispensers.
f. Check and refill soap, towel and toilet tissue dispensers.
g. Clean and sanitize toilets, toilet seats and urinals.
h. Clean and polish chrome fixtures.
i. Spot clean walls around sinks, towel dispensers, urinals,
partitions, doors and frames.
j. Report fixtures not working properly.
2. Semi-Annually
a. wash HVAC grills and vents.
b. wash light fixtures.
3. Annually
a. Shampoo carpet
b. wash cafeteria/breakroom walls
c. buff floors
4. As Needed
a. light and lamp replacement.
58
Schedule 2
Temperature Standards
- Londen Center Temperatures area controlled by a Novell Energy Management
System ("EMS")
- Water circulating - California Heat Pump System
- Each zone is approximately 600 square feet/3 tons
- Each zone has a controller with 30 minutes overrides for after hour
operation
- Operating Hours: 6:00 a.m. to 7:00 p.m. Monday through Friday, 8:00 a.m. to
1:00p.m. on Saturday
- Computer controlled with modem for service monitoring
- Heat/68/70 degrees
- Cool/73/75 degrees
- Variance range - 3 degrees
- Air flow and volume is adjustable
59
Schedule 3
Permitted Title Exceptions
1. Existing Ground Lease
2. Customary utility easements not having an adverse effect on Tenant's
rights or tenancy.
60
EXHIBIT C-1
ADDITIONAL SPACE WORK LETTER
(TurnKey)
Without limiting or changing the obligations and rights set
forth in the Lease, as modified by the First Amendment to Lease Agreement (the
"Amendment"), Landlord and Tenant agree as follows:
This Work Letter covers the "Additional Space" (as defined in
the Amendment) and identified spaces located within the existing Premises set
forth on the Space Plan referenced below and generally set forth on Exhibit B-4
("Remodeled Original Premises").
For the purposes of this Work Letter only, the Additional
Space and the Remodeled Original Premises are hereinafter collectively the
"Premises".
I. Definitions
A. Architect means Pinnacle Design, Inc.
B. Base Building means the improvements presently contained
within the Project, the Building and the Premises, subject to the work required
below in this definition and subject also to the removal of such existing
improvements as required pursuant to the Space Plan. Landlord agrees that the
Base Building shall be completed (including Punch List Items) at no cost to
Tenant and shall not constitute a Construction Cost or be reimbursable from the
Tenant Improvement Allowance. Landlord agrees that, to the extent not presently
furnished and operational, the following shall be furnished, installed, repaired
and made operational, as appropriate, as part of the Base Building prior to
Substantial Completion of the Premises and the Scheduled Commencement Date with
respect to the Additional Space.
1. All existing walls and ceilings within the public
corridors, restrooms and other second floor common areas shall be refurbished,
including cleaning, repairing and painting of surfaces as required.
2. Building Standard light fixtures shall remain at
the presently-installed common area locations on the second floor with all
fixtures, lamps, lenses and ballasts cleaned and repaired as required.
3. Any portion of the present main heating
ventilation and air conditioning (HVAC) plant (including energy management
system and integration) and air distribution system serving the Additional Space
shall be integrated into the new HVAC installed as Tenant Improvements and fully
operational and balanced after the Tenant Improvements are completed. All
controls, including thermostats, shall be in working order, after the Tenant
Improvements are completed.
4. All sprinkler risers and sprinkler heads required
by law shall be in working order and repair.
5. All fire hose cabinets and fire extinguisher
cabinets shall be stocked and in working order as required by applicable law.
61
6. Telephone trunk lines to the Additional Space
shall be in good working order and shall be in capacity to adequately service
Tenant's business needs.
7. Building Standard exterior window blinds and
Building Standard interior blinds for all interior window lights and side lights
shall be supplied.
8. All signs and graphics not located on the second
floor of the Building shall be supplied by Landlord.
In addition, all existing provisions of the Lease
regarding the third floor common areas shall be deemed applicable to the second
floor common areas; the parties agreeing that the common areas of the second and
third floors shall be treated and maintained in a similar manner in accordance
with the provisions of the Lease.
All Base Building improvements shall be in compliance
with ADA requirements, "As required" shall mean all Base Building finishes shall
be of at least the same quality and state of repair as the interior finishes
within the Premises as improved by the Tenant Improvements. All Base Building
work and improvement located on the second floor shall be of quality consistent
with the Tenant Improvements and shall be of consistent color and finish with
the existing improvements as
modified by the Tenant Improvements.
C. Construction Costs means the total cost and price for
designing, constructing and completing (including Punch List Items) the Tenant
Improvements.
D. Contractor means Jokake Construction Company
E. Premises Completion Document means the following:
1. Certification by the Architect that the Tenant
Improvements have been completed in compliance with the provisions of the Space
Plan, the Working Drawings and Specifications and the Lease.
2. A final Certificate of Occupancy for the Premises,
including the Remodeled Original Premises, if required.
3. Copies of all manufacturer's guarantees and
warranties covering equipment and systems installed by Landlord or the
Contractor on the Premises.
4. A binder comprised of manufacturer's installation,
operation, services and maintenance manuals for equipment and systems installed
by Landlord or the Contractor on the Premises.
5. Air balance reports for the completed Additional
Space reasonably approved by Tenant.
F. Space Plan means "Space Plan 5A" consisting of two (2)
sheets, dated December 4, 1995, prepared by the Architect for the Premises which
shall be comprised of layout plans and specifications which identify all Tenant
Improvements to be completed in the Additional Space and the Remodeled Original
Premises, including design specifications and criteria as may be required to
reasonably establish the quality of all Tenant Improvements and which may
reasonably facilitate preparation of the Working Drawings and Specifications and
62
bidding. The final Space Plan 5A shall be identified by written Tenant
Representative authorization and initialing thereon.
G. Substantial Completion shall mean when all the requirements
of Section 2.1 of the Lease, as modified by the Amendment, respecting the
"Substantial Completion" (as defined therein) of the Premises have been
satisfied, including the completion of the Base Building construction and all
Tenant Improvements in accordance with the Space Plan and the Working Drawings
and Specifications, so that the Premises is completed and functioning as general
office space, subject only to the Punch List, and in all events Substantial
Completion shall not be deemed to occur unless and until a final Certificate of
Occupancy has been issued for the Premises (including the Remodeled Original
Premises, if required) as improved.
H. Tenant Improvements means all improvements, alterations and
installations, as approved by Tenant, which are required for Tenant's turn-key
occupancy and use of the Additional Space and the Remodeled Original Premises
and which are in conformance with the Space Plan and the Working Drawings and
Specifications. Such Tenant Improvements will be fully described in and shown on
the Working Drawings and Specifications, which shall be based on the Space Plan,
subject only to Tenant Change Orders.
I. Working Drawings and Specifications means a complete set of
drawings and specifications based on the Space Plan and sufficient to permit
proper bidding by Contractor and subcontractors and also sufficient to obtain a
building permit for the Tenant Improvements. The Working Drawings and
Specifications shall be made with precision and detail, specifying material to
be used and the construction methods to be employed for the complete
installation and construction of all Tenant Improvements. Such Working Drawings
and Specifications shall include at a minimum:
1. Architectural, mechanical and electrical plans and
structural plans (if structural plans are required). Architectural to include
reflected ceiling plan, elevations, sections, details and schedules, color
schemes and finishes.
2. Electrical design for lighting, power and
telephone/data for the Additional Space; provided, however, all cabling design
beyond wall stubs shall be solely Tenant's responsibility and at Tenant's sole
cost.
3. Mechanical design for air distribution systems,
HVAC, control systems and fire protection for the Additional Space.
4. Plumbing design for the Additional Space.
II. Working Drawings and Specifications.
A. Preparation. Based strictly on the Space Plan, Landlord
shall cause the Working Drawings and Specifications for the Tenant Improvements
to be prepared by the Architect and its engineers.
B. Approval. Tenant shall approve or disapprove the Working
Drawings and Specification in accordance with the criteria established on the
Space Plan. Landlord shall revise the Working Drawings and Specifications and
resubmit them to Tenant for approval.
C. Final Approval. No bids shall be approved unless and until
Tenant's
63
Representative has approved in writing the Working Drawings and Specifications,
which approval process shall occur in parallel with bidding and permitting of
the work.
III. Bidding/Scope of Work/Tenant Improvements.
A. Bids. Contractor will bid the Tenant Improvements to a list
of subcontractors, suppliers and materialmen approved in advance by landlord and
Tenant, which approval shall not be unreasonably withheld. A minimum of three
(3) bids shall be obtained in each work category unless waived by Tenant. All
bids shall be sealed bids and a final budget by trade shall be delivered to
Tenant for review. The bidding process shall include an aggressive value
engineering effort by Landlord Representative, Architect and Contractor. All
phases of the project costs shall be based on open book review by Tenant at a
reasonable frequency and at reasonable times during business hours.
B. Scope of Work. Landlord shall be fully responsible for all
matters that must be accomplished to perform, finish and completely install the
Tenant Improvements (in operating condition to manufacture specifications, if
applicable) in accordance with the provisions of this Additional Space Work
Letter and the Lease, as modified by the Amendment. Landlord's obligations
hereunder shall include furnishing through Contractor all labor, materials and
equipment; filing all plans with the proper governmental authorities; obtaining
all building permits; supervising all details of construction; obtaining any
temporary certificate of occupancy and obtaining all final certificates of
occupancy; engaging in supervising the Contractor and its subcontractors and the
Architect and its consultants; promptly paying for all Tenant Improvements
except as specifically provided in Section IV hereof in respect of Tenant Change
Orders; repairing and restoring damaged, lost or destroyed tenant improvements,
whether or not installed; removing all debris from the Premises caused by any
trade (including Tenant's trades and any utility companies); obtaining
applicable insurance coverage and providing utility and building service at its
sole cost at all times until the Scheduled Commencement Date.
C. ADA. Landlord shall be responsible for all compliance with
ADA requirements for the Base Building and shall be similarly responsible for
all ADA requirements for the Tenant Improvements through the Additional Space
Commencement Date. ADA requirements for the Tenant Improvements subsequent to
the Additional Space Commencement Date shall be solely at Tenant's cost and
expense.
D. Contractor. All Tenant Improvements will be of quality set
forth on the Space Plan and the Working Drawings and Specifications, completed
only in accordance with the Working Drawings and Specifications approved by
Tenant, and completed only by the Contractor or such other contractor approved
by Tenant executing such work through subcontractors, materialmen and suppliers
set forth on a list approved by Tenant.
E. Inspection. Tenant shall have the right to inspect the
Tenant Improvements as they are being installed and require corrections as are
necessary for work which is not in compliance with the Space Plan or the Working
Drawings and Specifications.
F. Injury. Tenant shall not be liable for any injury to
persons or damage to property within the Premises during the performance of the
Tenant Improvements, except for Tenant's own negligence. Landlord hereby
indemnifies and holds harmless Tenant from any claims, costs (including
reasonable attorneys' fees), charges, damages, lawsuits and judgments on account
of such injury or damage.
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G. Planning. Landlord shall cause the Tenant Improvements
within the Remodeled Original Premises to be completed with the least amount of
possible disturbance to the ongoing business operations of Tenant, including
after-hours work when necessary and as required by Tenant. Except for
nondisruptive work as determined by Tenant, no work shall occur in the Remodeled
Original Premises between 9:00 a.m. and 6:00 p.m., Monday through Friday.
H. Swing Space. Landlord agrees to make available to Tenant,
rent free, Swing Space on the 4th floor of the Building as hereinafter provided.
The location of the Swing Space is set forth on Exhibit B-5. The following shall
apply to the Swing Space:
1. Tenant shall provide all furniture.
2. Landlord shall provide, at its cost, electricity
delivered to the Swing Space. Tenant shall provide, at its cost, computer wiring
to the Swing Space and each workstation/desk.
3. The Swing Space shall be keyed for access only by
Tenant with ten copies of a unique key and also so that the 3rd floor master key
is usable for such locks.
4. It is the purpose of the Swing Space to permit
Tenant to enjoy space which is otherwise lost with the work to be performed on
the Remodeled Original Premises. Tenant shall be permitted to use the Swing
Space until the remodeled Premises are complete and operational, including the
installation of systems, furniture and workstations.
IV. Change Orders.
A. Change Orders Generally. No change orders over $1,000 for
the Tenant Improvements shall be made or executed without Tenant's prior written
consent. No change orders for the Tenant Improvements affecting in any manner
quality of materials, colors, texture or finish shall be made or executed
without Tenant's prior written consent.
B. Tenant Change Orders. From time to time solely at its cost,
Tenant may make changes to the Space Plan or the Working Drawings and
Specifications and, in addition, to Tenant Improvements already installed
("Tenant Change Orders"). Tenant may not request changes to the Base Building
without Landlord's prior written consent.
C. Charges. Within three business days after Tenant notifies
Landlord of a Tenant Change Order, Landlord shall submit to Tenant in writing a
statement of additional charges as agreed upon by the Architect, the Contractor
and the Landlord (or any savings involved) and the time period, if any, that the
Tenant Change Order will materially and adversely affect the Schedule or the
Scheduled Commencement Date for the Additional Space. Tenant may either approve
or disapprove such additional charges or savings submitted by Landlord.
D. Architect Expenses. In addition to paying for the
additional construction charges resulting from Tenant Change Order approved by
Tenant pursuant to E. below, Tenant shall always pay reasonable fees and
charges, if any, by the Architect in preparing and pricing the Tenant Change
Orders, whether or not the Tenant Change Order is executed.
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E. Execution. Landlord shall not be authorized to make or
execute any change and the Schedule shall remain unaffected unless and until
Tenant's Representative shall have approved in writing the cost and Schedule
changes of a Tenant Change Order proposal. If Tenant's Representative approves
in writing the additional charges or savings and the change in the Schedule,
Landlord shall cause the approved Tenant Change Orders to be made and executed
and the Schedule shall be adjusted appropriately.
V. Pricing of Tenant Improvement Costs and Change Orders.
A. Approved Subcontractors. All Tenant Improvement cost shall
be competitively bid by Contractor from a list of approved subcontractors,
materialmen and suppliers in accordance with Section III.A above. All Tenant
Change Orders shall be first bid with the subcontractor, materialmen or supplier
that has bid or been awarded the subcontract for such matter; provided, however,
Tenant, at its sole cost and expense, shall have the right to cause another
subcontractor to bid or perform any Tenant Change Order.
B. Cost Breakdown. Landlord shall submit, prior to the
commencement of the Tenant Improvements, a final breakdown by trade of all
Construction Costs. Tenant shall have the right, prior to the commencement of
construction of the Tenant Improvements to review and approve the Construction
Costs.
VI. Plan Costs.
A. Without modifying any other agreement contained in this
Additional Space Work Letter or the Lease, as modified by the Amendment, the
following plan costs and expenses shall be paid as indicated:
1. Preparation of Space Plan through date of the
Amendment: Landlord (Landlord to direct
architect to directly xxxx Landlord for all
prior work incurred by either Landlord or
Tenant).
2. Revision of Space Plan after the date of the
Amendment:
(a) Due to Tenant changes: Tenant-solely at
its cost and without reimbursement.
(b) Due to Landlord's errors or omissions:
Landlord-solely at its cost and without
reimbursement.
(c) Any work due to lighting to be attached
to Building: Landlord.
3. Preparation of Working Drawings and
Specifications: Landlord.
4. Coordination, if required, of Working Drawings
and Specifications with the Base Building
plans: Landlord.
5. Modification of Working Drawings and
Specifications after Tenant's final approval
thereof:
(a) Due to Tenant changes: Tenant.
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(b) Due to Landlord's errors and omissions:
Landlord.
6. Project Completion Documents: Landlord.
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VII. Payment of Tenant Improvement Costs.
Landlord shall be responsible for all Construction Costs of
the Tenant Improvements, including Overages, except specifically only the
following: All costs and expenses approved in writing by Tenant for a Tenant
Change Order shall be paid solely by Tenant; up to $29,566.00 in reimbursements
as required by Section 6 of the Amendment.
Tenant shall pay all Tenant Change Orders within 30 days after
receipt of an invoice from Landlord, such payments shall be 90% of the Tenant
Change Order, as estimated by the Architect, as completed and incorporated into
the Premises since the last billing. All retention shall be paid upon completion
of the Punch List. Landlord shall be responsible to cause the Contractor to pay
all subcontractors, materialmen and suppliers that have worked on a Tenant
Change Order.
VIII. Scheduling.
Landlord and Tenant shall comply with the Schedule attached
hereto as Schedule 2 and with the Benchmark Dates set forth below, unless
modified in writing by the Landlord Representative and the Tenant
Representative: The 1,320 Square foot portion of Additional Space shall be
designed and constructed on a fast-track basis.
A. Working Drawings and Specifications shall be delivered by
Landlord to Tenant at their completion in accordance with the Schedule attached
as Schedule 2.
B. Tenant's comments on the Working Drawings and
Specifications delivered to Landlord within 5 working days after Tenant receives
such plans and specifications. Review to occur during bidding and permitting
process.
C. Landlord shall use best efforts to complete bidding of the
job and review of bids with Tenant after completion of Working Drawings and
Specifications in accordance with the Schedule attached as Schedule 2.
D. Landlord shall submit all plans for the 1,320 square foot
portion of Additional Space no later than December 18, 1995 and for the balance
of the Premises no later than January 4, 1996 to the governmental authorities
and use best efforts to obtain a building permit within three calendar days for
the 1,320 square foot portion of Additional Space and 30 calendar days for the
balance of the Premises after completion of Working Drawings and Specifications.
E. Construction of Tenant Improvements to commence immediately
after the building permits are issued and Tenant has approved the bids except
for demolition, if any, which will be bid and completed prior to start of new
construction.
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F. January 18, 1996 - Swing Space:
January 1, 1996 - 1,320 square
foot portion of Additional
space (1,320 sq.ft.):
February 19, 1996 - Balance
of Premises ("Balance"): Date when Tenant may
commence cabling installation.
G. January 24, 1996: Completed Swing Space
available to Tenant.
H. January 24, 1996 - Swing Space:
January 5, 1996 - 1,320 sq. ft.:
Xxxxx 00, 0000 - Xxxxxxx: Date when Tenant may begin to
install computer and phone
systems, move in workstations
and other furniture and perform
other preoccupancy activities in
the Premises for a general office
space, which in all events and
notwithstanding anything to the
contrary in this Additional Space
Work Letter or the Lease, as
modified by the Amendment,
must be at least 7 calendar days
before the space is required to be occupied.
I.-1 January 5, 1996: The 1,320 square foot portion of the
additional Space identified on the Space
Plan are to be Substantially Completed.
I.-2 March 15, 1996: The entire remaining portion of the Premises
and the Tenant Improvements are Substantially
Completed, subject to delay not past the
Scheduled Commencement Date if the building
permit is not issued within time specified
in Article VIII.D above after best efforts
by Landlord.
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J. January 12, 1996 - 1,320 sq. ft.:
March 22, 1996 - Balance: Respective Scheduled Commencement Date(s)
for the Premises.
K. January 5, 1996 - 1,320 sq. ft.:
March 15, 1996 - Balance: Initial Punch List submitted by Tenant to
Landlord, subject to I-2. Above.
L. January 12, 1996 - 1,320 sq. ft.:
March 22, 1996 - Balance: Punch List Items completed by Landlord,
subject to I-2. Above.
M. January 12, 1996 - 1,320 sq. ft.:
March 22, 1996 - Balance: Tenant Improvements Completion Documents
delivered to Tenant, subject to I-2. above.
N. Landlord covenants and agrees that the Base Building will
be completed, including Punch List Items therefor, on or before the Scheduled
Commencement Date for the Balance of the Premises. Tenant reserves the right to
submit additional punch list items after occupancy and throughout the warranty
period.
IX. Representatives.
Landlord appoints Xxx Xxxxxxx ("Landlord Representative") to
act for Landlord in all matters covered by this Additional Space Work Letter.
Tenant appoints Xxxxx XxXxxxxx/Xxxx Xxxxxx/Xxxx Xxxxxxxxx ("Tenant's
Representatives") to act for Tenant in all matters covered by this Additional
Space Work Letter. All inquiries, requests, instructions, authorizations and
approvals with respect to the matters covered by this Additional Space Work
Letter shall be made to Landlord's Representative or Tenant's Representative as
applicable.
X. Landlord's Additional Obligations.
Landlord, at its sole cost, shall continuously coordinate the
architectural, engineering, construction and design disciplines for the Base
Building and for all aspects of the Tenant Improvements. Landlord shall have
continuous on-site personnel supervise construction and report any delays to
Tenant's Representative. Landlord shall cause Landlord's Representative to
communicate with Tenant's Representative as to the Tenant Improvements. Landlord
shall notify Tenant of any clarification required by the Contractor or the
Architect in interpreting or implementing material provisions of the Space Plan
or the Working Drawings and Specifications. To insure appropriate communication
and coordination of the work, Landlord's Representative will review the space on
a weekly basis from commencement to completion of the work, such review to
include Contractor and Tenant's Representative. When either Landlord or Tenant
deem it necessary, the parties will hold a status meeting, to include Architect,
Contractor, Landlord's Representative and Tenant's Representative. Attendance by
Architect at such status meetings shall be at Landlord's expense.
XI. Architect.
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The Landlord shall cause the Architect to devote such time and
effort as is required to properly and timely complete the Tenant Improvements in
accordance with the Schedule.
XII. Contractor.
Tenant shall have the right to review the construction
contract with Contractor to assure itself that provision of the construction
contract are consistent with the terms and conditions of this Additional Space
Work Letter. The construction contract shall always provide that Contractor
agrees to make Tenant Change Orders without the imposition of general conditions
or other overhead or surcharge for the first 10% (measured by the cost of the
initial Construction Costs) in dollar value of the Tenant Change Orders but with
a reasonable overhead for all Tenant Change Orders exceeding such 10% amount.
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FIRST AMENDMENT TO LEASE
THIS FIRST AMENDMENT TO LEASE (this "Amendment") is made and
entered into as of December 20, 1995, by and between LONDEN CENTER L.L.C., an
Arizona limited liability company ("Landlord"), and TRG, INC., an Indiana
corporation ("Tenant").
RECITALS
This Amendment is made with respect to the following facts:
A. Landlord and Tenant have entered into that certain Office
Lease with Addendum and exhibits, each dated December 19, 1994 (collectively,
the "Lease"), pursuant to which Landlord is presently leasing to Tenant
approximately 33,407 square feet of rentable area consisting of all of the 3rd
floor of a building known as The Londen Center and located at 0000 Xxxx
Xxxxxxxxx Xxxx, Xxxxxxx, Xxxxxxx (the "Building" as more particularly defined in
the Lease).
B. The parties desire to amend the Lease to additionally
provide for the leasing of approximately 1,320 square feet of rentable area on
the 2nd floor of the Building and approximately 3,745 square feet of rentable
area on the 2nd floor of the Building (collectively, the "Additional Space") as
hereinafter provided.
AMENDMENT
NOW, THEREFORE, in consideration of the Lease and the mutual
promises and agreements set forth below, the parties hereby agree as follows:
1. Defined Terms. Except for those terms expressly defined in
this Amendment, all initially capitalized terms used herein shall have the
meanings set forth for such terms in the Lease.
2. Premises. The Lease is hereby amended as necessary to
provide that the term "Premises" as used therein shall mean approximately 38,472
square feet of rentable area in the Building, consisting, collectively, of (a)
the 3rd floor of the Building, as presently described in the Lease and as shown
on Exhibit B of the Lease, containing a total of approximately 33,407 square
feet of rentable area (the "Original Premises"); (b) that portion of the 2nd
floor of the Building shown on Exhibit B-1 to this Amendment, containing
approximately 1,320 square feet of rentable area; and (c) that portion of the
2nd floor of the Building shown on Exhibit B-2 to this amendment, containing
3,745 square feet of rentable area.
Upon the Additional Space Commencement Date (defined below)
all of the provisions of the Lease shall cover and be applicable to the
Additional Space except to the extent a provision contained in the Lease is
specifically amended or in express conflict with a provision contained in this
Amendment. Any ratio or percentage contained in the Lease and not expressly
referenced herein shall be automatically adjusted to include the Additional
Space from and after the Additional Space Commencement Date.
72
3. Scheduled Commencement Date. The Lease is hereby amended as
necessary to provide that the term "Scheduled Commencement Date" as used therein
shall mean March 22, 1996 with respect to the Additional Space, subject to
earlier delivery on January 12, 1996 of the 1,320 square foot portion of the
Additional Space shown on Exhibit B-1, as more particularly provided in a Work
Letter with respect to the Additional Space and portions of the Original
Premises (the "Additional Space Work Letter") attached as Exhibit C-1 to this
Amendment.
4. Term. The Lease is hereby amended as necessary to provide
that the Term of the Lease with respect to the Additional Space shall commence
on the date ("Additional Space Commencement Date") which shall be the later of
(a) the Scheduled Commencement Date with respect to the "Balance" (as defined in
Section VIII, F of the Additional Space Work Letter) of the Additional Space and
(b) the date of Substantial Completion of all of the Additional Space. The Term
of the Lease for the entire Premises shall end on the Termination Date, it being
the parties' intent that the Lease shall be coterminous for the entire Premises.
The parties acknowledge and agree that the Termination Date under the Lease is
May 31, 2001. The Lease is hereby further amended to provide that "Substantial
Completion" with respect to the Additional Space shall have the same meaning as
"Substantial Completion" with respect to the Original Premises, as set forth in
Section 2.1 of the Lease, except that the "Work Letter" is the Additional Space
Work Letter. If the Term of the Lease for the Additional Space has not commenced
on the third anniversary of this Amendment, this Amendment shall be of no
further force or effect but without waiving any rights either party may have
hereunder based on a failure to perform by the other party hereto. Tenant may
enter and use any substantially completed portion of the Additional Space prior
to the Scheduled Commencement Date or the Additional Space Commencement Date.
Such use shall be without a rental charge but Tenant shall not interfere with
Landlord's construction work and shall otherwise observe the provisions of the
Lease.
5. Rental. The Lease is hereby amended as necessary to provide
that, beginning on the Additional Space Commencement Date, the term "Annual
Rent" as used therein shall mean (x) $15.10 per rentable square foot in the
Original Premises multiplied by 33,407 rentable square feet in the Original
Premises, plus (y) $19.00 per rentable square foot in the Additional Space
multiplied by 5,065 rentable square feet in the Additional Space, plus (z)
applicable rental taxes per Article 26 of the Lease. The Lease is hereby further
amended as necessary to provide that the term "Monthly Installment of Annual
Rent" as used therein shall mean, beginning on the Additional Space Commencement
Date, the Annual Rent as amended by this Amendment divided by 12. Any Monthly
Installment of Annual Rent shall be prorated if the Additional Space
Commencement Date is other than the first day of a calendar month. It is the
parties' intent that Annual Rent attributable to the Original Premises shall not
be modified by reason of this Amendment. Notwithstanding the foregoing, the
Annual Rent shall be reduced on a proportionate per rentable square foot basis
for the remaining portion of the Premises (based on the applicable rental rate
set forth above) in the event that Tenant exercises its cancellation rights
contained in Paragraph 9 of this Amendment for all or a portion of the
Additional Space.
6. Reimbursement for a Portion of Construction Expenses.
Tenant shall pay to Landlord the actual cost of the tenant improvements built in
the Remodeled Original Premises
73
(as defined in the Additional Space Work Letter) as hereinafter set forth within
20 days of Substantial Completion of the Additional Space. Although the
transactions evidenced by the Lease require a turnkey premises by the Landlord,
Tenant agrees to reimburse Landlord for the actual cost of the tenant
improvements built in the Remodeled Original Premises pursuant to the Additional
Space Work Letter and Space Plan, but in no event shall such reimbursement
exceed $29,566.00 even if the actual tenant improvement costs are greater than
$29,566.00.
7. Base Year. The Lease is hereby amended as necessary to
provide that the term "Base Year (Direct Expenses)" and "Base Year (Taxes)" as
used therein shall continue to mean calendar year 1995 with respect to the
Original Premises and calendar year 1996 with respect to the Additional Space.
8. Building Share. The Lease is hereby amended as necessary to
provide that the term "Tenant's Proportionate Share of Building" as used therein
shall mean 35.50% (based on 108,380 rentable square feet in the Building) from
and after the Additional Space Commencement Date.
9. Additional Space Cancellation Rights. The Lease is hereby
amended as necessary to provide that Tenant shall also have the right to cancel
the Lease with respect to (i) all of the Additional Space, or (ii) only the
1,320 square foot portion of the Additional Space shown on Exhibit B-1, or (iii)
only the 3,745 square foot portion of the Additional Space shown on Exhibit B-2
on the same terms as contained in the Addendum to the Lease entitled
"Cancellation Option," except that (i) the cancellation option contained in this
Paragraph 9 of the Amendment may only be exercised for a termination date
occurring after the second anniversary of the Additional Space Commencement Date
if the termination is not for the entire Premises including the Original
Premises, (ii) the Construction Costs and Tenant Improvements related to the
Additional Space, or either portion thereof, shall be defined in Section I of
the Additional Space Work Letter, provided Tenant shall receive a credit against
the cancellation payment otherwise payable to Landlord in an amount equal to
$7.50 per rentable square foot of the cancelled Additional Space, to evidence a
stipulated amount of Construction Costs deemed necessary to bring the Additional
Space to base building standards, and (iii) the actual brokerage commission
shall not exceed $5.00 per rentable square foot of the cancelled Additional
Space. Effective on the termination of the Lease for less than the entire
Premises, the Annual Rent, Tenant's Proportionate Share of the Building and
other ratios and percentages shall be proportionally reduced.
10. Original Premises Cancellation Rights. Landlord and Tenant
hereby acknowledge that Tenant shall have the right to cancel the Lease for all
or a portion of the Premises as follows: (i) on the terms as presently contained
in the Addendum to the Lease entitled "Cancellation Option" with respect to the
Original Premises and (ii) on the terms provided for under Paragraph 9 of this
Amendment with respect to the Additional Space, provided, Tenant must
simultaneously cancel the Lease for all of the Additional Space if it elects to
cancel the Lease for the Original Premises.
11. Renewal Option. Landlord and Tenant agree that Tenant
shall have the option, in its discretion, to exercise the renewal options
contained in the Lease for either (x) just
74
the Original Premises or (y) the Original Premises and all or portions of the
Additional Space. In no event may Tenant exercise its renewal options for only
the Additional Space. The renewal options shall be for the same term for the
entire Premises for which the renewal option is exercised, it being the parties'
intent that the renewal option(s) shall commence on the same date and terminate
on the same date for the entire Premises.
12. Additional Parking. In addition to access cards and
unreserved employee parking spaces presently required by the Lease, the Lease is
hereby amended as necessary to provide that Landlord will proportionally
increase the access cards and unreserved employee parking spaces based on the
increased space.
13. Storage Space. The lease is hereby amended as necessary to
provide that Landlord shall provide to Tenant 250 square feet of secured storage
space within the Building's G-2 parking garage level (at the location delineated
on Exhibit B-3) at no charge to Tenant commencing on the Additional Space
Commencement Date.
14. Third Party Training. Tenant may permit portions of the
Additional Space to be used as a training center for third party entities. No
single third party may use the Additional Space as a training center for more
than 14 consecutive days. Such use shall not unduly burden the parking in the
Project.
15. First Right. The parties acknowledge that this Amendment
fulfills the Landlord's obligations under the provision of the Lease entitled
"First Right" with respect to the Additional Space. The "First Right" provisions
of the Lease shall remain in full force and effect for all other portions of the
Building subject thereto.
16. Broker Fees. Landlord shall pay any brokerage fee due to
CB Commercial/Xxxxx Xxxxxxx by separate agreement.
17. Signage. All signage within the Building (including second
floor signage and any other signage previously required by the Lease) shall be
changed to "USA Group-TRG" at Landlord's expense prior to the Additional Space
Commencement Date. Tenant may cause a similar change to occur at any time on the
Project monument sign, but at its own expense.
18. No Additional Modifications. Except as modified hereby,
the Lease has not been amended, and, as modified hereby, the Lease is in full
force and effect and applicable to the Original Premises and Additional Space as
provided above.
19. Counterpart. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Amendment
as of the date first set forth above.
LANDLORD:
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LONDEN CENTER L.L.C., an Arizona limited
liability company
By: /s/ Xxxx Xxxxxx
_________________________________________
Its Manager
_________________________________________
TENANT:
TRG, INC., an Indiana corporation
By: /s/ Xxxxx XxXxxxxx
_________________________________________
Its Vice President, Operations
_________________________________________
State of Arizona
County of Maricopa
The foregoing instrument was acknowledge before me this 20th
day of December, 1995, by Xxxx Xxxxxx, the Manager of Londen Center L.L.C., an
Arizona limited liability company, on behalf of the company.
(Seal and Expiration Date)
/s/ Xxxxx X. Xxxxxxx
_______________________________________
Notary Public
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State of Arizona
County of Maricopa
The foregoing instrument was acknowledge before me this 20th
day of December, 1995, by Xxxxx XxXxxxxx, the VP of Operations of TRG, Inc. an
Indiana corporation, on behalf of the corporation.
(Seal and Expiration Date)
/s/ Xxxxx X. Xxxxxx
__________________________________
Notary Public
77
Schedule 2
PROJECT SCHEDULE Dec. 15, 1995
TRG, Inc. Page 1 of 1
A chart prepared by the Xxxxxxxxx Corporation setting forth the work schedule
for the completion of the Building, commencing with Review/Execute Lease
Amendment in December through Project Completion Documents in March, as follows:
Timing -
Weeks of
Review/ Execute Lease Amendment Dec. 4-18
Space Plan Approved Dec. 4
1320 - Working Drawings & Specifications Dec. 11 (last half of week) (1)
Balance of Working Drawings &
Specifications Last half of week, Dec. 11 through first half of week Jan.1
Cable 4th Floor Swing Space Last half of week, Jan. 15 through first half of week, Jan. 00
Xxxxxx 0xx Xxxxx, Remodel Spaces Last half of week, Jan. 22 through first half of week, Jan. 29
1320 - City Submittal/Redlines/Permit Dec. 20/95
Balance of Space - City Submittal/
Redlines/Permit Last half of week, Jan. 1, through first half of week, Jan. 29,
Feb. 1, 1996
1320 - Review Bids First half of week, Jan. 18
Balance of Space - Review Bids Last half of week, Jan. 1 through first half of week, Jan.8
1320- Furniture Order through Delivery Dec. 18 through Jan. 1
Balance of Space - Furniture Order
through Delivery Dec. 18 through first half of week, March 11
1320 - Construction Last half of week, Dec. 18 through Jan. 5, 1996
Balance of Space Construction Last half of week, Jan. 29, through March 15, 1996
1320 - Cabling Jan. 1 - 8
Balance of Space Cabling Feb. 12; last half of week, March 4 through March 18
1320 - FF&E Install Jan. 8
Balance of Space - FF&E Install March 18
1320 - Punchlist Completion Jan. 8
Balance of Space - Punchlist Completion March 18
1320 - Move-in & Project Completion
Documents Jan. 12. 1996
Balance of Space - Move-in and Project
Completion Documents March 22, 1996
1. 1320 refers to that separate portion of additional space on Floor Two
consisting of 1320 S.F.
78
Exhibit B-1
A drawing of the second floor, showing 1320 square feet cross-hatched.
79
Exhibit B-2
A drawing of the 2nd floor showing 3,745 square feet of rentable area
cross-hatched.
80
Exhibit B-3
A drawing showing Level Two of the Garage showing placement of fire
extinguishers, fire exits and pull boxes.
81
Exhibit B-4
A drawing of the third floor, completely cross-hatched.
82
Exhibit B-5
A drawing of the fourth floor.
83
Exhibit C
Consists of a drawing of the Assigned Premises showing assigned areas cross-
hatched in addition to all applicable 2nd floor space pursuant to the first
amendment of the Lease dated 12/20/95.
84
Exhibit D
Consists of a drawing of the Retained Premises - cross-hatched areas retained on
2nd floor, pursuant to the first amendment of the Lease dated 12/2/95.
