Exhibit Number (10)(v)
to 3/31/98 Form 10-Q
SECOND AMENDMENT TO OFFICE LEASE
--------------------------------
THIS SECOND AMENDMENT TO OFFICE LEASE (the "Amendment") is made as of
this 16th day of January, 1998, by and between Metropolitan Life Insurance
Company, a New York corporation, as successor to American National Bank and
Trust Company of Chicago, as Trustee under Trust Agreement No. 61523
("Landlord") and The Northern Trust Company, a national banking corporation,
("Tenant").
W I T N E S S E T H:
WHEREAS, Landlord and Tenant entered into that certain Office Lease
dated July 8, 1987, as amended by that certain First Amendment to Office Lease
dated October 20, 1987 (collectively, the "Lease") for the lease of certain
office space, currently consisting of the 4th through 8th floors in the building
located at 00 X. XxXxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx, as more particularly
described in the Lease;
WHEREAS, Tenant desires to lease additional office space from Landlord
upon the terms and conditions contained herein;
NOW, THEREFORE, in consideration of the covenants and conditions
herein contained and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Landlord and Tenant agree as
follows:
1. Definitions. All terms used herein without definition shall have the
meanings ascribed to such terms in the Lease.
2. Expansion of Premises. Tenant hereby leases from Landlord and Landlord
hereby leases to Tenant for the purposes set forth in the Lease the premises
consisting of that certain office space diagrammed on Exhibits X-0, X-0 and A-3
attached hereto, which space is located, respectively, on the 9th, 10th and 13th
floors of the Building consisting of, respectively, 10,291 rentable square feet,
7,660 rentable square feet and 8,345 rentable square feet for a total of 26,296
rentable square feet (the "Expansion Premises"). Effective as of the date
hereof, the "Premises" as defined in the Lease shall include the Expansion
Premises. Except as modified herein, Tenant's lease of the Expansion Premises
shall be upon all terms and conditions contained in the Lease.
3. Lease Term for the Expansion Premises. The term of the lease of the
Expansion Premises (the "Expansion Premises Term") shall commence on April 1,
1998 (the "Expansion Premises Commencement Date") and shall expire on March 31,
2001 (the "Expansion Premises Expiration Date").
4. Base Rent for the Expansion Premises. Commencing on the Expansion
Premises Commencement Date, Tenant shall pay Base Rent for the Expansion
Premises at the rates listed in the Base Rent Schedule below, in the same manner
and at the same time as required under the terms of the Lease:
Base Rent Schedule for the Expansion Premises
---------------------------------------------
Monthly Annual
Lease Period Base Rent Base Rent
------------ --------- ---------
4/1/98-3/31/99 $23,009.00 $276,108.00
4/1/99-3/31/00 26,296.00 315,552.00
4/1/00-3/31/01 29,583.00 354,996.00
5. Rent Adjustment and Tenant's Proportionate Share. Tenant shall pay
Rent Adjustment and any other components of Rent for the Expansion Premises in
accordance with the terms of the Lease, except that Tenant's Proportionate Share
shall be calculated pursuant to the terms of the Lease and, as of the Expansion
Premises Commencement Date, will be 126,653/715,785 or 17.6943%.
6. Possession and Condition of the Premises. Upon execution of this
Amendment by Tenant and Landlord, Landlord shall deliver possession of the
Expansion Premises to Tenant. Upon delivery of possession of the Expansion
Premises to Tenant, Tenant shall be subject to all of the terms, covenants and
conditions of the Lease (except with respect to the payment of Base Rent and
Rent Adjustment for the Expansion Premises) as of the date of such possession.
Landlord shall deliver possession of the Expansion Premises to Tenant in its
"as-is" condition. Tenant shall be conclusively deemed to have accepted the
Expansion Premises "as is" in the condition existing on the date Tenant first
takes possession, and to have waived all claims relating to the condition of the
Expansion Premises. No promise of Landlord to remodel, improve, decorate or make
additions to the Expansion Premises or any part thereof, and no representation
respecting the condition of the Expansion Premises or the Property has been made
to Tenant by Landlord. Tenant shall make improvements to the Expansion Premises
in accordance with the terms of the Workletter attached hereto as Exhibit B.
Tenant shall be entitled to an allowance for such improvements as provided in
the Workletter.
7. Renewal Option for Expansion Premises.
(a) Exercise of Option. Tenant shall have the option (the "Renewal Option")
to extend the Expansion Premises Term for the Expansion Premises for one (1)
additional three (3) year period (the "Renewal Period"). If Tenant desires to
exercise the Renewal Option, Tenant shall deliver written notice ("Renewal
Notice") to Landlord on or before July 1, 2000. The Renewal Option shall be on
the same terms and conditions as contained in the Lease, except during the
Renewal Period, Base Rent shall be the amounts listed in the Expansion Premises
Renewal Base Rent Schedule listed below, there shall be no further renewal
rights and there shall be no tenant or construction allowance or any other
concessions of any kind. If Tenant
2
successfully exercises the Renewal Option, then the term "Expansion Premises
Term" as used in this Amendment shall be deemed to include the Renewal Period.
(b) Rent. Base Rent for the Expansion Premises during the Renewal Period
shall be the following amounts:
Expansion Premises Renewal Base Rent Schedule
---------------------------------------------
Monthly Annual
Lease Period Base Rent Base Rent
------------- ----------- ------------
4/1/01-3/31/02 $32,870.00 $394,440.00
4/1/02-3/31/03 36,157.00 433,884.00
4/1/03-3/31/04 39,444.00 473,328.00
Tenant shall pay Rent Adjustment and other components of Rent for the Expansion
Premises during the Renewal Period in accordance with the terms of this
Amendment and the Lease.
(c) Conditions to Renewal Option. It shall be a condition to Tenant's
exercise of the Renewal Option that both at the time of delivery of Tenant's
Renewal Notice and at the commencement of the Renewal Term, Tenant is not in
Default under the Lease. Any termination of this Lease or termination of
Tenant's right of possession shall terminate all of Tenant's rights to the
Renewal Option. Tenant shall have no right to assign, transfer or otherwise
dispose of any of its rights or interests under this Paragraph 7, such rights
being granted solely to The Northern Trust Company; provided, however, any
successor by merger, consolidation or acquisition of all or substantially all of
the assets or capital stock of The Northern Trust Company shall be entitled to
the rights granted to The Northern Trust Company hereunder.
(d) Condition of the Premises Upon Renewal. The Expansion Premises shall
be leased to Tenant during the Renewal Period in its then "as-is" condition and
Landlord shall have no obligation to remodel, improve, decorate, or make
additions to the Expansion Premises.
Notwithstanding any of the foregoing provisions of this Paragraph, any attempt
by Tenant to exercise a Renewal Option by any method, or at any time, or in any
circumstance, except as specifically set forth above shall, at the sole option
and discretion of Landlord, be null and void and of no force or effect.
8. Limitation of Liability. Tenant agrees, on its behalf and on behalf of
its successors and assigns, that any liability of Landlord with respect to this
Amendment and the Lease shall never exceed the amount of offset which Tenant
utilizes pursuant to Paragraph 12.C of the Lease, plus an amount not to exceed
$10,000,000.00 ("hereinafter collectively referred to as the "Liability Cap")
and Tenant shall not be entitled to recover from Landlord any amounts in excess
of the Liability Cap.
3
9. Entire Agreement. This Amendment and the Lease contain all the terms,
covenants, conditions and agreements between Landlord and Tenant regarding the
Expansion Premises. No prior or other agreement or understanding pertaining to
such matters shall be valid or of any force and effect.
10. Conflict. In the event of a conflict between the terms of the Lease
and the terms of this Amendment, the terms of this Amendment shall control.
11. Brokers. Tenant represents to Landlord that, except for CB
Commercial/Xxxx Management Services and Xxxxxxx-Xxxxx-Xxxxxxxx, L.L.C., Tenant
has not dealt with any real estate broker, sales person, or finder in connection
with this Amendment, and no such person initiated or participated in the
negotiation of this Lease, or showed the Expansion Premises to Tenant. Tenant
hereby agrees to indemnify, protect, defend and hold Landlord, its directors,
officers, employees, affiliates and agents, harmless from and against any and
all liabilities and claims for commissions and fees arising out of a breach of
the foregoing representation.
Landlord represents to Tenant that, except for CB Commercial/Xxxx Management
Services and Xxxxxxx-Xxxxx-Xxxxxxxx, L.L.C., Landlord has not dealt with any
real estate broker, sales person, or finder in connection with this Amendment,
and no such person initiated or participated in the negotiation of this Lease.
Landlord hereby agrees to indemnify, protect, defend and hold Tenant, its
directors, officers, employees, affiliates and agents, harmless from and against
any and all liabilities and claims for commissions and fees arising out of a
breach of the foregoing representation. Landlord shall be solely responsible for
the payment of all commissions to the brokers specified in this Paragraph.
12. Reaffirmation of Lease. Except as otherwise herein provided, the
terms and conditions of the Lease are hereby reaffirmed and incorporated herein
by reference and shall, except as hereby modified, in all respects remain in
full force and effect. Any and all references in the Lease and this Amendment to
the "Lease" shall mean the Lease, as amended by this Amendment.
4
IN WITNESS WHEREOF, this Amendment is executed by the undersigned as
of the day and year first above written.
LANDLORD: TENANT:
Metropolitan Life Insurance Company, The Northern Trust Company,
a New York corporation a national banking corporation
By: Xxxx Xxxxx By: /s/ N. Xxxxx XxXxxxxx
------------------------- ---------------------
Its: Assistant Vice-President Its: Vice President
------------------------ --------------
ATTEST:
By: /s/ Xxxxxxxx Xxxxxx
-------------------
Its: Assistant Secretary
-------------------
5
EXHIBIT A-1
[FLOOR PLAN APPEARS HERE]
EXHIBIT A-2
[FLOOR PLAN APPEARS HERE]
EXHIBIT A-3
[FLOOR PLAN APPEARS HERE]
EXHIBIT B
Workletter
----------
Metropolitan Life Insurance Company, a New York corporation ("Landlord")
and The Northern Trust Company, a national banking association, ("Tenant") are
executing simultaneously herewith a Second Amendment to Lease (the "Amendment"),
whereby Landlord is leasing certain space (the "Expansion Premises") to Tenant
as more particularly described in the Amendment. In connection with the
execution of the Amendment, Landlord and Tenant have further agreed as follows
(all terms herein without definition shall have the meaning ascribed to such
terms in the Amendment):
1. Space Plan. Tenant, at Tenant's sole cost and expense, subject to
reimbursement by Landlord from the Construction Allowance, has directed and
authorized its internal or in-house architect or an outside architect reasonably
acceptable to Landlord (the "Architect") to prepare a space plan of the
Expansion Premises ("Space Plan") depicting the physical layout of the Expansion
Premises. Upon completion, Tenant shall deliver the Space Plan to Landlord for
Landlord's approval, such approval not to be unreasonably withheld or delayed.
2. Working Drawings. Tenant shall also cause the Architect to prepare, at
Tenant's sole cost and expense, subject to reimbursement by Landlord from the
Construction Allowance, the final architectural, mechanical (including heating,
ventilating and air-conditioning) electrical, plumbing and structural plans and
specifications ("Working Drawings") necessary to complete the work ("Work")
required to construct the improvements to the Expansion Premises depicted in the
Space Plan previously approved by Landlord.
Tenant shall cause Architect to submit the finished Working Drawings to
Landlord and Landlord shall review the Working Drawings and grant its consent or
denial thereof within five (5) business days after receipt of all of the Working
Drawings, which approval shall not be unreasonably withheld or delayed (provided
in all events Landlord may withhold its consent to the Working Drawings to the
extent the same affects the structural integrity of the Building or adversely or
materially affects any Building system). To the extent Landlord does not provide
its consent to the Working Drawings as aforesaid, Landlord shall state, with
specificity, Landlord's reasons for such disapproval. Tenant shall then be
required to make such corrections as Landlord may designate and resubmit the
Working Drawings to Landlord for its consent.
Subsequent to Landlord's approval of the Working Drawings, any changes to
the Working Drawings requested by Tenant shall be subject to the prior written
consent of Landlord, which consent shall not be unreasonably withheld or
delayed, provided Landlord may withhold its consent to any of said changes for
the same reasons previously stated for not approving the Working Drawings and
under the same conditions as stated in the preceding Paragraph.
1
Tenant shall pay to Landlord any reasonable out-of-pocket costs or expenses
Landlord incurs in the process of reviewing the Working Drawings or any changes
thereto.
3. Work. Tenant shall cause the Work to be completed. Tenant hereby
agrees that the Work shall be completed by a general contractor selected by
Tenant and approved by Landlord, which approval shall not be unreasonably
withheld or delayed (the "General Contractor"). Tenant shall cause General
Contractor to hire only union subcontractors (collectively, "Subcontractors").
Further, Tenant agrees Tenant's failure to cause General Contractor to hire only
union Subcontractors shall constitute a default under the Lease. Tenant agrees
General Contractor shall have no right to commence any Work to the Expansion
Premises unless and until Tenant has tendered to Landlord a building permit for
the Work issued by the City of Chicago. Tenant agrees to display the building
permit at the Expansion Premises at all times during the prosecution of the
Work. Tenant hereby guarantees to Landlord that the Work shall be completed in a
lien free manner and in strict accordance with the Working Drawings and all
applicable laws (it being acknowledged by Landlord and Tenant the provisions of
the Lease shall control with respect to mechanics' liens filed against the Real
Estate or the Building as a result of the Work). Tenant shall only conduct the
Work between the hours of 7:00 a.m. to 6:00 p.m. unless otherwise consented to
by Landlord (which consent shall not be unreasonably withheld or delayed) and
shall cause as minimal disruption as reasonably possible to other tenants of the
Building.
4. Freight Elevator. For purposes of the Work, Tenant shall have the non-
exclusive right to use the Building's freight elevator subject to availability
and scheduling as may be reasonably established by Landlord. Such freight
elevator use by Tenant during normal business hours shall be free of charge
during such construction period; provided, however, to the extent Tenant
utilizes such freight elevators after normal business hours, Tenant shall pay to
Landlord any reasonable costs and expenses incurred by Landlord as a result of
such after hours activities; provided, further, if any other tenant of the
Building is also using said freight elevator with Tenant after normal business
hours, then any charge to Tenant shall be apportioned between all parties
utilizing said freight elevators.
5. Cost of Work. Tenant shall be responsible for and shall pay all costs
associated with the Space Plan, the Working Drawings and the Work. Tenant shall
pay all amounts timely so as to prevent the filing of any liens against the
Expansion Premises, the Building or the Real Estate. Landlord shall provide to
Tenant an allowance to be used by Tenant as payment for costs incurred in
connection with the Space Plan, the Working Drawings and the Work in the total
amount of Two Hundred Ninety-Nine Thousand Seven Hundred Seventy-Four and
40/100ths Dollars ($299,774.40) (the "Construction Allowance"). The Construction
Allowance shall be paid to Tenant on or before April 1, 1998.
6. Lien Waivers. Tenant shall diligently obtain and promptly deliver to
Landlord all waivers of lien and affidavits of the General Contractor, all
subcontractors, laborers, suppliers and materialmen and others conducting
"lienable" work on or to the Expansion Premises. In any event, Tenant shall
submit all such waivers of lien and affidavits to Landlord no later than
September 1, 1998.
2
7. Utility Costs. Tenant shall be responsible and shall pay for the cost
of utility services provided to the Expansion Premises during construction of
the Work. It is acknowledged by Tenant that Tenant shall be responsible for
causing all utilities to be operating within the Expansion Premises as of the
Expansion Premises Commencement Date and, to the extent such utilities are not
operating within the Expansion Premises as of the Expansion Premises
Commencement Date, through no fault of Landlord, Landlord's obligations to
supply certain utilities described in the Lease shall be of no force and effect
until such time as Tenant causes said utilities to be operational within the
Expansion Premises.
8. Insurance.
(i) During the course of construction of the Work, Tenant shall obtain, pay
for and maintain or cause General Contractor to obtain, pay for and
maintain insurance for the coverages and amounts of coverage not less
than those set forth below in the Schedule of Insurance Coverages (as
hereinafter defined) and shall provide or shall cause General
Contractor to provide to Landlord certificates issued by insurance
companies reasonably satisfactory to Landlord to evidence such
coverages before any Work commences at the Expansion Premises. Such
certificates shall provide that there shall be no termination, non-
renewal, modification or expiration of such coverage without thirty
(30) days prior written notice to Landlord. Such certificates shall
name Metropolitan Life Insurance Company, owner, and CB Commercial Real
Estate Group, Inc. and its affiliates and subsidiaries, manager, as
additional insureds. In the event of any failure by Tenant to cause
General Contractor to comply with the provisions of this Xxxxxxxxx 0,
Xxxxxxxx may, at is option, upon notice to Tenant, suspend the Work
until such time as there is full compliance with this Paragraph 8.
Tenant shall provide to Landlord a certified copy of any and all
applicable insurance policies upon request of Landlord.
(ii) Schedule of Insurance Coverages. The following shall constitute the
"Schedule of Insurance Coverages":
(a) Workers' Compensation Insurance. Coverage complying with the law
of the State of Illinois and Employer's Liability insurance with a
limit of $1,000,000.00 each accident, including occupational
disease coverage with a limit of $1,000,000.00 per person subject
to aggregate limit of $1,000,000.00 per annum.
(b) Comprehensive Automobile Liability Insurance. $1,000,000.00
combined single limit of liability for bodily injuries, death and
property damage resulting from any one occurrence, including all
owned, hired and non-owned vehicles.
(c) Commercial General Liability Insurance. $1,000,000.00 combined
single limit of liability for bodily injuries, death and property
damage resulting from any one occurrence, including the following
coverages:
3
(1) Premises and Operations;
(2) Completed Operations for one (1) year after completion of the
Work;
(3) Broad Form Comprehensive General Liability Endorsement, Bodily
Injury (with employment and contractual exclusions deleted) and
Broad Form Property Damage Coverage;
(4) Independent Contractors; and
(5) Delete Exclusions relative to Collapse, Explosion and Underground
Property Damage Hazards;
(d) Builder's Risk Insurance. Tenant shall procure, pay for, and maintain
all-risk builder's risk insurance (or comparable form) for the full
insurable value of all labor and materials incorporated into the
construction of the Work, while at the construction site and/or
staging area awaiting erection and during erection, until completion
and acceptance. Insurance is to cover real and personal property after
it is received at the construction site and/or staging area (but not
while otherwise stored off-site or in transit). The policy so
purchased shall insure Landlord, General Contractor and the
Subcontractors as their interests may appear may appear and shall be
so written as to provide for reimbursement, in the event of claim for
loss or damage, for the entire cost of repairing or replacing,
reconditioning, or re-erecting the property lost or damaged with
materials of similar kind and quality, including, but not by way of
limitation, the cost of materials, labor, supervision, engineering and
transportation.
Notwithstanding the foregoing, Tenant may elect to effect the all-risk
builder's risk insurance described above through a plan of self
insurance provided that Tenant complies with the provisions of
Paragraph 17.A of the Lease relating to self insurance as applied to
the insurance coverage requirements contained in this subparagraph
(including, without limitation, obtaining Landlord's consent).
(e) Miscellaneous.
(1) Any insured loss or claim of loss pursuant to this Paragraph 8
shall be adjusted by Landlord, and any settlement payments shall
be made payable to Landlord as trustee for the insureds, as their
interests may appear, subject to the requirements of any
applicable mortgagee clause. Upon the occurrence of an insured
loss or claim of loss, monies received will be held by Landlord
who shall make distribution in accordance with an agreement to be
reached in such event between Landlord and Tenant. If the parties
are unable to agree between themselves on the settlement of the
loss, such dispute shall be submitted to a court of competent
jurisdiction to
4
determine ownership of the disputed amounts but the Work shall
nevertheless progress during any such period of dispute without
prejudice to the rights of any party to the dispute.
(2) Landlord shall not insure or be responsible for any loss or
damage to property owned, rented or leased by General Contractor,
Subcontractors, or their employees, servants or agents, other
than property which will become a part of the permanent
construction.
(3) With respect to General Contractor's operations, Tenant shall
cause General Contractor to purchase, maintain and pay for all-
risk contractor's equipment floater on all machinery, tools,
equipment and other similar property in an amount at least equal
to their fair market value and any deductible shall be for the
account of General Contractor. This insurance coverage shall be
the sole and complete means of recovery for any loss covered by
such insurance.
(f) Subcontractor's Insurance. Tenant shall cause General Contractor to
require each of its Subcontractors to comply with a Worker's
Compensation, Employer's Liability, Comprehensive General Liability
and the Automobile Liability insurance provisions set forth in the
Schedule of Insurance Coverages. Tenant shall cause General
Contractor to cause each of the Subcontractors to deliver to Landlord
certificates of insurance evidencing the foregoing coverages prior to
commencement of respective Work and, in the event Tenant fails to
cause General Contractor to cause each Subcontractor to deliver to
Landlord the required certificates of insurance from such
Subcontractors and a claim is made or suffered, Tenant shall
indemnify, defend and hold harmless Landlord, its shareholders,
officer, directors, affiliates, employee's or agents from any and all
claims for which the required insurance would have provided coverage.
This indemnity obligation is in addition to any other indemnity
obligation provided herein.
(g) Certificates of Insurance. All certificates of insurance required to
be delivered to Landlord as set forth herein from General Contractor
or any Subcontractor shall name Landlord as an additional insured as
its interest may appear.
9. Indemnification. To the fullest extent permitted by law, Tenant shall
indemnify, defend and hold harmless Landlord, its directors, officers,
employees, affiliates and agents (the "Indemnified Parties") from and against
any and all loss, cost, expense, damage, injury, liability, claim, demand,
penalty or cause of action (including reasonable attorneys' fees and court
costs), directly or indirectly arising out of, resulting from or related to (in
whole or in part), (1) the Work, (2) this Workletter, (3) any mechanics' liens
which may be placed against the Building or Real Estate as a result of the Work,
and (4) any act or omission of Tenant, General Contractor, any Subcontractor or
any individual, partnership, joint venture or corporation (a) directly or
indirectly employed by General Contractor or a Subcontractor, or (b) for whose
acts or omissions
5
General Contractor or any Subcontractor may be liable. Subject to the waiver of
subrogation provisions in the Lease, the obligations of Tenant under this
indemnification shall apply to all matters except those arising solely from the
negligence or the wrongful acts or omissions of Landlord. Tenant shall promptly
advise Landlord in writing of any action, administrative or legal proceeding or
investigation as to which this indemnification may apply, and Tenant, at
Tenant's expense, shall assume on behalf of Landlord and conduct with due
diligence and in good faith the defense thereof with counsel reasonably
satisfactory to Landlord; provided, that Landlord shall have the right to be
represented therein by advisory counsel of its own selection and at its own
expense. The obligations of this Paragraph 9 shall survive final completion of
the Work and shall be in addition to the insurance requirements set forth in the
Lease and shall not be in discharge of or in substitution for the same.
10. Landlord's Supervision. Tenant hereby acknowledges that Landlord, at
Landlord's cost, shall have the right to cause a "Supervising Architect" to
periodically inspect the Work to determine its compliance with the Working
Drawings. Tenant agrees to provide access to the Work to the Supervising
Architect and cooperate with the Supervising Architect at such times as Landlord
may request, in its reasonable discretion.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Workletter as of
the day and year of the execution of the Lease.
LANDLORD: TENANT:
Metropolitan Life Insurance Company, The Northern Trust Company,
a New York corporation a national banking corporation
By: Xxxx Xxxxx By: /s/ N. Xxxxx XxXxxxxx
-------------------------- ---------------------
Its: Assistant Vice-President Its: Vice President
------------------------ --------------
ATTEST:
By: /s/ Xxxxxxxx Xxxxxx
--------------------
Its: Assistant Secretary
6
