Common use of Building Expansion Clause in Contracts

Building Expansion. In addition to the right of first offer set forth above, Tenant may, so long as Tenant is not in default under this Lease beyond the expiration of applicable grace periods, on the terms and conditions set forth below, exercise its right to expand the Premises in the area shown as “Expansion J” on Exhibit A-1, in which event Landlord shall promptly commence and thereafter diligently prosecute to completion the construction of an addition of approximately 13,640 rentable square feet (the “Addition”) to the Building: (i) Landlord shall construct the Addition in a good and workmanlike manner using building standard materials, pursuant to plans and specifications prepared by Landlord and approved by Tenant, which approval shall not be unreasonably withheld (the approval terms and mechanism to be the same as set forth for approval of the Tenant Improvement Plans as described in Exhibit B). (ii) From and after the date Landlord reasonably anticipates Substantial Completion of the Addition, there shall remain at least seven (7) Lease Years of the Term and if there are less than seven (7) Lease Years remaining, then the term of the Lease shall be automatically extended to provide that there shall be a seven (7) Lease Year term from and after the date of substantial completion of the Addition. Basic Rent shall be paid for such period at the rates provided in the Renewal Option section of this Lease, Section 36, for the corresponding periods. (iii) Assuming Landlord delivers a shell building addition to Tenant, the Basic Rent for the area of the Addition shall be an amount equal to, on a per rentable square foot basis, the Basic Rent per rentable square foot payable under the terms of this Lease for the corresponding periods. Landlord shall make available to Tenant an allowance of not more than $30.00 per rentable square foot to be applied to leasehold improvements and $5.00 per rentable square foot for heating, ventilating and air conditioning systems. To the extent Tenant utilizes any portion of the allowance, the Basic Rent shall be increased by an amount per rentable square foot equal to the amortized cost of the amount of such allowance utilized over a seven (7) year period with interest at ten percent (10%) per annum. In connection with the construction of the Addition, Landlord shall enter into a gross maximum price contract with a contractor selected by Landlord (and approved by Tenant, such approval not to be unreasonably withheld) after receiving not less than 2 competitive bids; (iv) The area of the Addition shall be deemed a part of the Premises from and after Substantial Completion (which shall have the meaning ascribed to it in Exhibit B) as the same may be accelerated by reason of Tenant Delay (as defined in Exhibit B) of the Addition. Upon Substantial Completion, the Basic Rent, Tenant’s Pro Rata Share and provisions regarding Additional Rent shall be appropriately adjusted. (v) Upon exercise by Tenant of the right above set forth, Landlord and Tenant shall enter into an amendment of the Lease to incorporate the foregoing provisions and others as deemed necessary. If Landlord and Tenant do not enter into a fully executed amendment to this Lease within 30 days after Tenant gives notice to Landlord of the exercise of its aforesaid right, then this right shall lapse and be of no further effect; (vi) The right to have the Addition constructed shall automatically terminate and become null, void and of no force and effect upon the earlier to occur of (1) the expiration or termination of the Lease by Landlord or pursuant to law, or (2) the termination or surrender of Tenant’s right to possession of the Premises.

Building Expansion. In addition to the right of first offer set forth above, Tenant may, so long as Tenant (i) If tenant is not in default under this Lease default, beyond the expiration of any applicable grace periods, on the terms and conditions set forth below, exercise its right to expand the Premises in the area shown as “Expansion J” on Exhibit A-1period, in which event Landlord shall promptly commence and thereafter diligently prosecute to completion the construction of an addition of approximately 13,640 rentable square feet (the “Addition”) to the Building: (i) Landlord shall construct the Addition in a good and workmanlike manner using building standard materials, pursuant to plans and specifications prepared by Landlord and approved by Tenant, which approval shall not be unreasonably withheld (the approval terms and mechanism to be the same as set forth for approval respect of the Tenant Improvement Plans as described in Exhibit B). (ii) From and after the date Landlord reasonably anticipates Substantial Completion performance of the Addition, there shall remain at least seven (7) Lease Years of the Term and if there are less than seven (7) Lease Years remaining, then the term of the Lease shall be automatically extended to provide that there shall be a seven (7) Lease Year term from and after the date of substantial completion of the Addition. Basic Rent shall be paid for such period at the rates provided in the Renewal Option section of this Lease, Section 36, for the corresponding periods. (iii) Assuming Landlord delivers a shell building addition to Tenant, the Basic Rent for the area of the Addition shall be an amount equal to, on a per rentable square foot basis, the Basic Rent per rentable square foot payable its obligations arising under the terms of this Lease for Agreement and has not exercised the corresponding periods. Office Expansion Option in 11(b) hereof and (ii) this Agreement is in full force and effect in accordance with its terms, Tenant has the option (the "Building Expansion Option") to lease an addition to the Building that Landlord shall make available will erect in order to Tenant an allowance enlarge the floor area of not more than $30.00 per rentable square foot to be applied to leasehold improvements and $5.00 per rentable square foot for heating, ventilating and air conditioning systems. To the extent Tenant utilizes any warehouse portion of the allowance, Building up to 22,500 square feet (the Basic Rent shall be increased by an amount per rentable square foot equal to the amortized cost of the amount of such allowance utilized over a seven (7) year period with interest at ten percent (10%) per annum'tBuil4ing Expansion"). In connection with If Landlord undertakes the construction of the AdditionBuilding Expansion in accordance with the terms of this Section 11, Landlord shall enter into will construct it in the area depicted on the attached Exhibit B in accordance with plans and specifications mutually acceptable to the parties. In the event Tenant desires to exercise the Building Expansion Option at a gross maximum price contract with a contractor selected by Landlord (and approved by Tenant, such approval not to be unreasonably withheld) after receiving not time when there are less than 2 competitive bids; ten years remaining on the Initial Term, then Tenant shall simultaneously with the exercise of the Building Expansion Option exercise its option to renew the Term for the First Renewal Term, and if necessary, the Second Renewal Term, in accordance with the terms of Section 5 of this Agreement. Tenant shall have the option to reduce the term of the First Renewal Term or the Second Renewal Term, as necessary, to a period that when added to the remainder of the Term, remaining at the time of Substantial Completion of the Building Expansion, will equal ten (iv10) The years or may renew for the full five year period contained in the renewal option. Tenant may exercise the Building Expansion Option, if at all, by delivering written notice to Landlord. In that notice, Tenant shall state, if it is required to exercise the first renewal option the length of time which the first option will include as described above and also specify the floor area of the Addition Building Expansion that Tenant requests Landlord to construct. In the event Tenant is required to exercise the first renewal option or the second renewal option, as the case may be, Base Rent for the renewal period shall be deemed a determined in accordance with the procedures contained in Section 5 of this Agreement; however, in the event arbitration is required, the determination of Base Rent shall be based on the decision as to Fair Market Rent as of the end of the Term. Once Landlord has substantially completed construction of the Building Expansion, the parties will consider the Building Expansion part of the Premises from and after Substantial Completion (which for purposes of this Agreement. Tenant shall have the meaning ascribed right to it pay for and construct the Building Expansion and in Exhibit B) as the same may be accelerated by reason of Tenant Delay (as defined in Exhibit B) of the Addition. Upon Substantial Completion, the Basic Rent, Tenant’s Pro Rata Share and provisions regarding Additional Rent such event there shall be appropriately adjusted. (v) Upon exercise by Tenant of the right above set forth, Landlord and Tenant shall enter into an amendment of the Lease to incorporate the foregoing provisions and others as deemed necessary. If Landlord and Tenant do not enter into a fully executed amendment to this Lease within 30 days after Tenant gives notice to Landlord of no requirement for the exercise of its aforesaid right, then this right shall lapse and be of no further effect; (vi) The right to have the Addition constructed shall automatically terminate and become null, void and of no force and effect upon first renewal option or the earlier to occur of (1) second renewal option. Tenant however must comply with Section 7 regarding the expiration or termination of Alterations in the Lease by Landlord or pursuant to law, or (2) event it constructs the termination or surrender of Tenant’s right to possession of the Premisesimprovements.

Building Expansion. In addition (a) At any time after the Lease Term Commencement Date and prior to January 1, 2014, Tenant may provide written notice (“Notice of Expansion”) to Landlord requesting the Landlord construct an expansion of the Building of approximately 17,000 square feet for light manufacturing use (“Expansion”), reasonably incorporating the features of the Expanded Building Site Plan which is Exhibit D to this Lease. Such written notice shall specify (“Expansion Completion Date”) which date shall be as early as reasonably possible but not later than twelve (12) months after the date of the Notice of Expansion. Thereafter, Landlord shall, subject to the right of first offer set forth above, Tenant may, so long as Tenant is not in default under this Lease beyond the expiration of applicable grace periods, on the additional terms and conditions set forth in Sections 2.04(b) – (f) below, exercise design and construct the Expansion. (b) Upon receipt of Tenant’s notice of its right election to expand have Landlord complete the Premises in the area shown as “Expansion J” on Exhibit A-1Expansion, in which event Landlord shall promptly commence provide Tenant with an estimate of engineering and thereafter diligently prosecute to completion the construction of an addition of approximately 13,640 rentable square feet design costs (the “AdditionDesign costs”) sufficient to the Building: (i) Landlord shall construct the Addition in a good and workmanlike manner using building standard materials, pursuant to develop Expansion plans and specifications prepared to a sufficient level of detail to allow Landlord to obtain an amendment to the existing Site Plan for the Premises from Manatee County, reasonably consistent with the Exhibit D, (“Amended Site Plan”) and a fixed price bid to complete the Expansion by the Expansion Completion Date(“Expansion Plans”). Upon receipt of the Design Costs, Tenant shall within ten (10) days thereafter pay Landlord and approved 100% of said costs (“Design Cost Funding”). The Design Cost Funding shall be credited to Tenant’s Expansion Cost Contribution as defined in Section 2.04(d), but in the event that Tenant fails to approve the Expansion Specifications or the Cost Budget or the Expansion is terminated by Tenant for any reason prior to Tenant’s payment of the Expansion Cost Contribution, the Landlord shall retain the Design Cost Funding as reimbursement for Design Costs incurred by Landlord. (c) Following receipt of Tenant’s Design Cost Funding the Landlord shall proceed with development of the Expansion Plans, including without limitation, meeting with Tenant’s representatives to confirm the Expansion characteristics intended by Tenant, hiring of architect and/or engineer to prepare the Expansion Plans, consulting or meeting with governmental agencies and obtaining the Amended Site Plan. The Expansion Plans shall comply in all respects to Manatee County development standards and in the event that after diligent and good faith efforts Landlord is unable to obtain an Amended Site Plan reasonably consistent with the Expansion Specifications or otherwise approved by Tenant which approval shall not be unreasonably withheld (denied, conditioned or delayed, the approval terms Expansion may be terminated by either party by notice to the other party and mechanism to be the same as set forth for approval of the thereafter Tenant Improvement Plans as described in Exhibit B). (ii) From and after the date Landlord reasonably anticipates Substantial Completion of the Addition, there shall remain at least seven (7) Lease Years of the Term and if there are less than seven (7) Lease Years remaining, then the term of have no right under the Lease shall be automatically extended to provide that there shall be a seven (7) Lease Year term from and after the date of substantial completion of the Addition. Basic Rent shall be paid for such period at the rates provided in the Renewal Option section of this Lease, Section 36, for the corresponding periods. (iii) Assuming Landlord delivers a shell building addition to Tenant, the Basic Rent for the area of the Addition shall be an amount equal to, on a per rentable square foot basis, the Basic Rent per rentable square foot payable under the terms of this Lease for the corresponding periods. Landlord shall make available to Tenant an allowance of not more than $30.00 per rentable square foot to be applied to leasehold improvements and $5.00 per rentable square foot for heating, ventilating and air conditioning systems. To the extent Tenant utilizes any portion of the allowance, the Basic Rent shall be increased by an amount per rentable square foot equal to the amortized cost of the amount of such allowance utilized over a seven (7) year period with interest at ten percent (10%) per annum. In connection with require the construction of the AdditionExpansion. Upon completion of the Expansion Plans they shall be delivered to Tenant for approval at its discretion. Tenant shall have fifteen (15) days after receipt of the Expansion Plans within which to approve, reject or request alterations by notice to Landlord. If the Tenant requests modifications to the Expansion Plans the parties shall meet as soon as reasonably possible (with Landlord’s architect and/or engineer in Landlord’s discretion) to diligently and in good faith resolve the requested modifications and mutually agree upon the final Expansion Plans. Upon acceptance of the Expansion Plans both parties shall initial two (2) duplicates of the Expansion Plans and each party shall retain one duplicate for their records. Each day of delay (1) in Tenant’s approval of the Expansion Plans or (2) in reaching mutually agreed upon Tenant-requested modifications to the Expansion Plans shall result in a corresponding delay in the Expansion Completion Date (d) Within ten (10) days following Tenant’s approval/acceptance of the Expansion Plans, Landlord shall enter into deliver to Tenant an Expansion cost budget covering all costs necessary to complete the Expansion (“Cost Budget”) and Tenant shall approve or reject the Cost Budget by notice in writing within ten (10) days of receipt thereof. If the Tenant approves the Cost Budget it shall be obligated pay to Landlord a gross maximum price contract sum of money equal to 50% of the total Cost Budget (“Expansion Cost Contribution”). The Expansion Cost Contribution shall be paid as follows: (1) 75% of the Expansion Cost Contribution, less the Design Cost Funding, shall be paid to Landlord simultaneously with Tenant’s notice of approval of the Cost Budget; and (2) 25% of the Expansion Cost Contribution shall thereafter be paid in equal monthly installments over the period of time commencing from first day of the first new month following commencement of the Expansion construction and ending on the first day of the first new month after the Expansion Completion Date. All Expansion Cost Contribution payments to Landlord shall be made by wire transfer or certified/bank check. If the Tenant fails to approve the Cost Budget, the parties agree to promptly schedule a contractor selected by joint meeting to attempt to revise the Cost Budget to a mutually acceptable amount, failing which the Expansion shall be terminated and Tenant shall have no further rights under this Lease to demand construction of the Expansion. After Completion of the Expansion, the Tenant shall receive a credit against future rents in the amount of the Expansion Cost Contribution or a reduced portion thereof, as provided in Section 3.02(c). The Landlord (shall be responsible for all Expansion Costs in excess of the Expansion Cost Contribution, except for construction change orders requested and approved by Tenant, such the cost of which will be paid in full to Landlord by Tenant at the time of approval not to be unreasonably withheld) after receiving not less than 2 competitive bids; (iv) The area of the Addition shall be deemed a part of the Premises from and after Substantial Completion (which shall have the meaning ascribed to it in Exhibit B) as the same may be accelerated by reason of Tenant Delay (as defined in Exhibit B) of the Additionthereof. Upon Substantial Completion, the Basic Rent, Tenant’s Pro Rata Share and provisions regarding Additional Rent shall be appropriately adjusted. (v) Upon exercise acceptance by Tenant of the right above set forth, Cost Budget the parties shall initial two (2) duplicates thereof and each shall retain one duplicate for their records. (e) Upon receipt of Tenant’s approval of the Expansion Plans and Cost Budget Landlord shall proceed with construction and Tenant completion of the Expansion by the Expansion Completion Date (as defined below) based upon the approved Expansion Plans. Landlord shall enter into an amendment such contracts and agreements as it deems necessary to reasonably prosecute construction of the Lease Expansion to incorporate completion in conformance with the foregoing provisions and others as deemed necessaryExpansion Plans. If Landlord and Tenant do not enter into a fully executed amendment to this Lease within 30 days after Tenant gives notice to Landlord of The “Expansion Completion Date” (or “Completion”) shall mean the exercise of its aforesaid right, then this right shall lapse and be of no further effect; (vi) The right to have the Addition constructed shall automatically terminate and become null, void and of no force and effect earliest date upon the earlier to occur of which: (1) the expiration or termination of the Lease by Landlord or pursuant to law, or Expansion contruction is complete in compliance with Expansion Plans; and (2) Manatee County shall have issued the termination Certificate of Occupancy or surrender Certificate of Tenant’s right Completion (or a temporary Certificate of Occupancy permitting Tenant to possession occupy the Expansion) for the Expansion.. (f) On the day following the Expansion Completion Date, Tenant shall take occupancy of the PremisesExpansion and commence the payment of Rent attributable to the Expansion as provided in Sections 1.01(g) and 3.02(c) and Schedule 1.01(g).

Building Expansion. In addition (a) Tenant may elect to have Landlord (i) expand the right Building by up to a maximum of first offer set forth above, Tenant may, so long as Tenant is not in default under this Lease beyond the expiration one hundred and twenty thousand (120,000) square feet of applicable grace periods, contiguous space on the terms and conditions set forth below, exercise its right to expand same grade as the Premises in the area shown as “Expansion J” on Exhibit A-1, in which event Landlord shall promptly commence and thereafter diligently prosecute to completion the construction of an addition of approximately 13,640 rentable square feet primary building (the “AdditionBuilding Expansion”) to the Building: (i) Landlord shall construct the Addition in a good and workmanlike manner using building standard materials, pursuant to plans and specifications prepared by Landlord and approved by Tenant, which approval shall not be unreasonably withheld (the approval terms and mechanism to be the same as set forth for approval of the Tenant Improvement Plans as described in Exhibit B). or (ii) From and after the date Landlord reasonably anticipates Substantial Completion of the Addition, there shall remain at least seven (7) Lease Years of the Term and if there are less than seven (7) Lease Years remaining, then the term of the Lease shall be automatically extended to provide construct a new building on that there shall be a seven (7) Lease Year term from and after the date of substantial completion of the Addition. Basic Rent shall be paid for such period at the rates provided in the Renewal Option section of this Lease, Section 36, for the corresponding periods. (iii) Assuming Landlord delivers a shell building addition to Tenant, the Basic Rent for the area of the Addition shall be an amount equal to, on a per rentable square foot basis, the Basic Rent per rentable square foot payable under the terms of this Lease for the corresponding periods. Landlord shall make available to Tenant an allowance of not more than $30.00 per rentable square foot to be applied to leasehold improvements and $5.00 per rentable square foot for heating, ventilating and air conditioning systems. To the extent Tenant utilizes any portion of the allowanceLand depicted on Exhibit C hereof (the “New Building”), by providing Landlord with written notice of its election (the “Expansion Notice”) and specifying whether Tenant is electing the Building Expansion or the New Building (such election, the Basic Rent shall be increased by an amount per rentable square foot equal to the amortized cost “New Construction”). Within thirty (30) days following receipt of the amount of such allowance utilized over a seven (7) year period with interest at ten percent (10%) per annum. In connection with the construction of the Addition, Landlord shall enter into a gross maximum price contract with a contractor selected by Landlord (and approved by Tenant, such approval not to be unreasonably withheld) after receiving not less than 2 competitive bids; (iv) The area of the Addition shall be deemed a part of the Premises from and after Substantial Completion (which shall have the meaning ascribed to it in Exhibit B) as the same may be accelerated by reason of Tenant Delay (as defined in Exhibit B) of the Addition. Upon Substantial Completion, the Basic Rent, Tenant’s Pro Rata Share and provisions regarding Additional Rent shall be appropriately adjusted. (v) Upon exercise by Tenant of the right above set forthExpansion Notice, Landlord and Tenant shall enter use good faith efforts to determine the rent constant for the New Construction which shall be based on the prevailing cap rates for single tenant industrial distribution warehouses in the Richmond, Virginia market taking into an amendment account Tenant’s credit worthiness, the Premises location, and total cost of development for the Lease to incorporate the foregoing provisions and others as deemed necessaryexpansion, among other reasonable factors. If Landlord and Tenant do cannot agree upon a rent constant for the New Construction, Tenant may rescind the Expansion Notice. (b) If Landlord and Tenant agree upon the rent constant for the New Construction (such agreed upon number, the “Expansion Rent Constant”), within sixty (60) days thereafter, Landlord shall provide Tenant with an estimate of the preliminary costs (the “Preliminary Costs”) to be incurred by Landlord in connection with the New Construction, including without limitation, architectural drawings, preliminary plans and specifications, permitting, legal fees and title and survey (“Preliminary Estimate”). Tenant shall have thirty (30) days following receipt of the Preliminary Estimate to notify Landlord if it desires to proceed with the New Construction. If Tenant does not elect to proceed, Tenant may rescind the Expansion Notice. If Tenant elects to proceed, (a) Tenant agrees to indemnify and reimburse Landlord for the Preliminary Costs, and (b) Landlord shall cause preliminary plans and specifications for the New Construction to be prepared and shall deliver such plans and specifications, as well as a proposed budget to Tenant (the “Initial New Construction Delivery”). Tenant shall have thirty (30) days following receipt of the Initial New Construction Delivery to notify Landlord if it desires to proceed with the New Construction. If Tenant does not elect to proceed, Tenant may rescind the Expansion Notice and Tenant shall reimburse Landlord for all costs and expenses, including reasonable attorney’s fees, incurred by Landlord in connection with the New Construction. If Tenant elects to proceed, Landlord and Tenant shall negotiate in good faith a new work letter for the New Construction substantially on the same terms as the Work Letter attached hereto as Exhibit B. If Landlord and Tenant cannot agree upon a work letter for the New Construction, Tenant may rescind the Expansion Notice, in which case Tenant shall reimburse Landlord for all costs and expenses, including reasonable attorney’s fees, incurred by Landlord in connection with the New Construction. If Landlord and Tenant agree upon a new work letter, Landlord shall undertake the New Construction in accordance with such work letter. Upon completion of the New Construction, (i) the Initial Term (as hereinafter defined) shall be extended to 11:59 p.m., local time for the Premises, on the last day of the calendar month in which occurs the fifteenth (15th) anniversary of the delivery date of the New Construction (the “New Construction Delivery Date”) and the parties will enter into a fully executed an amendment to this Lease within 30 days reflecting the new expiration date of the Initial Term; (ii) the base rental for the New Construction shall equal the product of the total development costs for the New Construction and the Expansion Rent Constant (the “New Construction Base Rental”); and (iii) the total Base Rental from and after the New Construction Delivery Date shall be the sum of the Base Rental payable immediately prior to the New Construction Delivery Date and the New Construction Base Rental, which shall be subject to escalation as provided in Sections 3.4 and 4.2(b) hereof. Landlord represents, to its actual knowledge, that as of the Delivery Date, the Premises shall be zoned to permit the New Construction. (c) If Tenant gives notice elects to rescind the Expansion Notice in accordance with paragraphs (a) or (b) hereof, Tenant shall have the right to construct the New Construction on such requirements that may be reasonably required by Landlord and any lender providing financing secured by the Premises which may include prior written approval of plans and specifications, the architect and general contractor, and customary disbursement procedures including the delivery of lien waivers, the posting of collateral and customary retainage. Tenant shall complete the New Construction at Tenant’s sole cost and expense and shall be obligated to deliver a permanent certificate of occupancy to Landlord for such New Construction. Tenant’s obligations under this Section 1.4(c) (but not its rights under this Section 1.4) shall survive the expiration of the exercise term of its aforesaid right, then this right shall lapse and be of no further effect; (vi) The right to have the Addition constructed shall automatically terminate and become null, void and of no force and effect upon the earlier to occur of (1) the expiration or termination of the Lease by Landlord or pursuant to law, or (2) the termination or surrender of Tenant’s right to possession of the PremisesLease.