Initial Fixed Expansion Option Clause Samples
The Initial Fixed Expansion Option clause grants one party the right to increase the scope or size of a contractually defined service, product, or leased space at a predetermined time and under specified terms. Typically, this clause outlines the conditions under which the expansion can occur, such as the amount of additional space or service, the price or rate for the expansion, and the timeframe in which the option must be exercised. Its core practical function is to provide flexibility for future growth while ensuring both parties have clarity and certainty regarding the terms of any initial expansion, thereby reducing the risk of disputes or renegotiations.
Initial Fixed Expansion Option. Subject to the terms of this Section 39, Tenant shall have the right (the “Initial Expansion Right”), but not the obligation to expand the Premises for Tenant’s own use to include one, two or three of the Expansion Floors. For the avoidance of any doubt, in no event may Tenant elect to exercise its Initial Expansion Right for any partial floor(s). If Tenant elects to exercise its Initial Expansion Right with respect to 1 or more full Expansion Floors of the Fixed Expansion Premises, Tenant shall deliver written notice (an “Initial Expansion Election Notice”) to Landlord on or before the date that is 6 months after the Commencement Date (“Initial Option Expiration Date”) identifying the number of floors of the Fixed Expansion Premises with respect to which Tenant elects to exercise its Initial Expansion Right (“Identified Initial Expansion Premises”). For the avoidance of any doubt, (i) if Tenant elects to lease only 1 Expansion Floor pursuant to the Initial Expansion Right, then such Expansion Floor shall be the 8th floor, and (ii) if Tenant elects to lease only 2 Expansion Floors pursuant to the Initial Expansion Right, then such Expansion Floors shall be the 8th floor and the 7th floor. If Tenant elects not to exercise the Initial Expansion Right, the 6th floor shall be released from the Fixed Expansion Premises and Tenant shall have no further right to lease the 6th floor pursuant to the provisions of Section 39(a), (b) and/or (c). If Tenant timely delivers an Initial Expansion Election Notice to Landlord, Tenant shall lease the Identified Initial Expansion Premises on the same terms and conditions pursuant to which Tenant is leasing the initial Premises, except as otherwise provided in this Section 39(a). If Tenant timely exercises its Initial Expansion Right with respect to one or more Expansion Floors of the Fixed Expansion Premises, (i) Landlord shall Deliver the Identified Initial Expansion Premises to Tenant within 10 days after Landlord’s receipt of Tenant’s Initial Expansion Election Notice with the Building Shell for the Identified Initial Expansion Premises in Tenant Improvement Work Readiness Condition so that Tenant may commence construction of tenant improvements in the Identified Initial Expansion Premises, (ii) commencing on the earlier of (x) the date that is 6 months after Landlord Delivers the Identified Initial Expansion Premises to Tenant pursuant to subsection (i), and (y) the Substantial Completion of the tenant improvements in the...