EXHIBIT INDEX 10.4
OFFICE LEASE
CMD REALTY INVESTMENT FUND II, L.P.,
an Illinois limited partnership,
as Landlord,
and
CPS SYSTEMS, INC.,
a Texas corporation,
as Tenant.
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OFFICE LEASE
This Office Lease ("Lease"), dated as of the __ day of May, 1998, is
made by and between "Landlord" and "Tenant" as those terms are defined in
Article 1 below.
ARTICLE 1
DEFINITIONS
As used in this Lease, the following terms shall have the meanings
hereinafter set forth:
1.1 "Landlord" shall mean CMD Realty Investment Fund II, L.P., an Illinois
limited partnership.
1.2 "Address of Landlord" shall mean 000 Xxxx Xxxxxx Xxxxxx, Xxxxx 0000,
Xxxxxxx, XX 00000, Attn: General Counsel, with a copy to CMD Realty Investors,
Inc., 0000 Xxxxxxxxxx Xxxxxxxxx, Xxxxx 000, Xxxxx, XX 00000, Attn: Property
Manager, with a copy to CMD Realty Investors, Inc., 000 Xxxx Xxxxxx Xxxxxx,
Xxxxx 0000, Xxxxxxx, XX 00000, Attn: Asset Manager.
1.3 "Tenant" shall mean CPS SYSTEMS, INC., a Texas corporation.
1.4 "Address of Tenant" shall mean 0000 Xxxxxxxxxx Xxxxxxxxx, Xxxxx 000,
Xxxxx, XX 00000.
1.5 "Premises" shall mean the premises depicted and identified as
"Premises" on Exhibit A hereto, located on the 3rd floor of the Building and
known as Suite 350. Landlord and Tenant hereby stipulate that the Premises shall
contain 10,354 rentable square feet.
1.6 "Building" shall mean the building commonly known as One President's
Plaza, located at 0000 Xxxxxxxxxx Xxxxxxxxx, Xxxxx, XX 00000
1.7 "Lease Commencement Date" shall mean May 15, 1998, subject to Articles
3 and 33.
1.8 "Lease Expiration Date" shall mean May 14, 2003, subject to Articles 3
and 33. ---------------------
1.9 "Base Rent" shall mean the amounts shown as follows:
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Period Monthly Base Rent
------ -----------------
Lease Commencement Date through 5/14/99
$14,668.17
5/15/99 through 5/14/00
$15,185.87
5/15/00 through 5/14/01
$15,703.57
5/15/01 through 5/14/02
$16,221.27
5/15/02 through Lease Expiration Date
$16,738.97
1.10 "Direct Expense Stop" shall mean $675.935.
1.11 "Tenant's Share" shall mean 10.65%.
1.12 "Security Deposit" shall mean $5,000.00.
1.13 "Brokers" shall mean Xxxxxx International.
1.14 "Permitted Use" shall mean general office use.
1.15 "Payment Address" shall mean Landlord, c/o The First National Bank of
Chicago, X.X. Xxx 00000, Xxxxxxx, Xxxxxxxx 00000-0000.
1.16 "Lease Year" shall mean the consecutive twelve (12) month period
during the Lease Term commencing on the Lease Commencement Date and each
consecutive twelve (12) month period thereafter during the Lease Term.
1.17 "Building Hours" shall mean 8:00 A.M. to 6:00 P.M. except for Sundays
and New Year's Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day,
Christmas Day and any other nationally and locally recognized holidays
(collectively, "Holidays") and except that on Saturdays, "Building Hours" shall
mean 9:00 A.M. to 1:00 P.M.
1.18 The following exhibits and schedules attached hereto are made a
part of this Lease:
Exhibit APremises
Exhibit A-1Real Property
Exhibit BRules and Regulations
Exhibit CForm of Tenant's Estoppel Certificate
Exhibit DPremises Improvements Exhibit EOption to Extend
ARTICLE 2
REAL PROPERTY, BUILDING AND PREMISES
Commencing on the Lease Commencement Date, Landlord leases to Tenant,
and Tenant leases from Landlord, the Premises. The outline of the Premises is
set forth in Exhibit A attached hereto. The term "Real Property" shall mean the
Building, and any common areas or facilities, easements, corridors, lobbies,
sidewalks, loading areas, driveways, landscaped areas, air rights, development
rights, parking rights, skywalks, parking garages and lots, and any and all
other rights, structures or facilities operated or maintained in connection with
or for the benefit of the Building, and all parcels or tracts of land on which
all or any portion of the Building or any of the other foregoing items are
located, and any fixtures, machinery, apparatus, systems and equipment located
thereon or therein and used in connection therewith. The Real Property as of the
date hereof is depicted on Exhibit A-1 attached hereto. Landlord reserves the
right to add land, buildings, easements or other interests to, or sell or
eliminate the same from, the Real Property and grant interests and rights in the
Real Property to other parties. If the Building shall now or hereafter be part
of a development, complex or group of two or more buildings or structures
collectively owned or managed by Landlord or its affiliates or collectively
managed by Landlord's managing agent, the Real Property shall, at Landlord's
option also be deemed to include such other of those buildings or structures as
Landlord shall from time to time designate, and shall initially include such
buildings and structures (and related facilities and parcels on which the same
are located) as Landlord shall have used in determining Tenant's Share in
Article 1. Concurrently with Tenant's lease of the Premises, Landlord grants to
Tenant the right to the non-exclusive use of the common corridors and hallways,
stairwells, elevators, restrooms and other public or common areas located on the
Real Property; provided, however, that the use thereof shall be subject to the
rules, regulations and restrictions attached hereto as Exhibit B ("Rules and
Regulations").
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ARTICLE 3
TERM AND COMMENCEMENT
3.1 Term and Confirmation. The term ("Lease Term") of this Lease shall
commence on the Lease Commencement Date and end on the Expiration Date set forth
in Article 1, unless sooner terminated as provided herein, subject to adjustment
as provided below and the other provisions hereof. If the Lease Commencement
Date is advanced or postponed as provided below, the Expiration Date set forth
in Article 1 shall not be changed, unless Landlord so elects by notice to
Tenant. In addition, if the Lease Commencement Date, as so advanced or postponed
herein, occurs other than on the first day of a calendar month, Landlord may
further elect by notice to Tenant to: (i) extend the Lease Term such that the
Lease Expiration Date is the last day of the calendar month in which it would
otherwise occur, and/or (ii) adjust the dates for any fixed increases in the
Base Rent such that they occur on the first day of the calendar month in which
they would otherwise occur. Tenant shall execute a confirmation of the Lease
Commencement Date, Lease Expiration Date and other dates as adjusted herein in
such form as Landlord may reasonably request within ten (10) days after
requested; any failure to respond within such time shall be deemed an acceptance
of the matters as set forth in Landlord's confirmation. If Tenant disagrees with
Landlord's adjustment of the Lease Commencement Date, Lease Expiration Date or
other dates as adjusted herein, Tenant shall pay Rent and perform all other
obligations commencing and ending on the date or dates determined by Landlord,
subject to refund or credit when the matter is resolved.
3.2 Early Commencement. The Lease Commencement Date, Rent and Tenant's
other obligations shall be advanced to such earlier date as: (i) Landlord
substantially completes any improvements to the Premises required under this
Lease to an extent that Tenant is able to occupy the Premises, and Landlord
delivers possession thereof, or (ii) Tenant, with Landlord's written permission,
otherwise commences occupying substantially all of the Premises. If either such
events occurs with respect to a portion of the Premises, the Lease Commencement
Date, Rent and Tenant's other obligations shall be so advanced with respect to
such portion (and fairly prorated based on the rentable square footage
involved). During any period that Tenant shall be permitted to enter the
Premises prior to the Lease Commencement Date other than to occupy the same
(e.g., to perform alterations or improvements), Tenant shall comply with all
terms and provisions of this Lease, except those provisions requiring the
payment of Rent. Landlord shall permit early entry, so long as the Premises are
legally available, Landlord has completed any work required under this Lease,
and Tenant is in compliance with the other provisions of this Lease, including
the insurance requirements under Article 11.
3.3 Commencement Delays. Subject to Article 33, the Lease Commencement
Date, Rent and Tenant's other obligations shall be postponed to the extent
Tenant is unable to reasonably occupy the Premises because Landlord fails: (i)
to substantially complete any improvements to the Premises required to be
performed by Landlord under this Lease, or (ii) to deliver possession of the
Premises for any other reason, including holding over by prior occupants, except
to the extent that Tenant, its space planners, architects, contractors, agents
or employees in any way contribute to either such failures. If either such event
occurs with respect to a portion of the Premises, the Lease Commencement Date,
Rent and Tenant's other obligations shall be so postponed with respect to such
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portion (and fairly prorated based on the rentable square footage involved). Any
such delay in the Lease Commencement Date shall not subject Landlord to
liability for loss or damage resulting therefrom, and Tenant's sole recourse
with respect thereto shall be the postponement of Rent and other obligations
described herein.
ARTICLE 4
BASE RENT
Tenant shall pay in legal tender of the United States of America, without
notice or demand, to Landlord at the Payment Address, or at such other place as
Landlord may from time to time designate in writing, Base Rent as set forth in
Section 1.9, payable in equal monthly installments in advance on or before the
first day of each and every calendar month during the Lease Term commencing on
the Lease Commencement Date, without any setoff or deduction whatsoever, except
that Tenant shall pay the first such monthly installment upon the execution
hereof and such amount shall be credited against the first full monthly
installment of Base Rent. Tenant shall also deliver to Landlord the Security
Deposit set forth in Section 1.12 (if any) upon Tenant's execution and delivery
of this Lease. If the Lease Commencement Date falls on a day of a calendar month
other than the first day of such calendar month or if any Rent (as hereinafter
defined) is for a period which is shorter than one calendar month, the Rent for
any such fractional calendar month shall accrue on a daily basis for the period
from the date such payment is due to the end of such calendar month or to the
end of the Lease Term at a rate per day which is equal to 1/360 of the Rent. All
other payments or adjustments required to be made under the terms of this Lease
that require proration on a time basis shall be prorated on the same basis.
Tenant shall also pay to Landlord as additional rent, in the same manner as the
payment of Base Rent, any and all rental income tax assessed by any governmental
body relating to this Lease.
ARTICLE 5
ADDITIONAL RENT
5.1 Additional Rent. In addition to paying the Base Rent, Tenant shall pay
as additional rent Tenant's Share (as set forth in Section 1.11 hereof) of the
annual Direct Expenses (as hereinafter defined) which are in excess of the
Direct Expense Stop set forth in Section 1.10. Such additional rent, together
with any and all other amounts payable by Tenant to Landlord, as additional rent
or otherwise, pursuant to the terms of this Lease, shall be hereinafter
collectively referred to as the "Additional Rent." The Base Rent and Additional
Rent are herein collectively referred to as the "Rent." All amounts due under
this Article 5 as Additional Rent shall be payable in the same manner, time and
place as the Base Rent. The obligations of Tenant to pay the Additional Rent
provided for in this Article 5 shall survive the expiration or earlier
termination of the Lease Term.
5.2 Definitions. As used in this Article 5, the following terms shall have
the meanings hereinafter set forth:
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5.2.1 "Direct Expenses" shall mean the sum of "Operating Expenses" and
"Tax Expenses."
5.2.2 "Expense Year" shall mean each calendar year in which any
portion of the Lease Term falls.
5.2.3 "Operating Expenses" shall mean the dollar amount of all
expenses, costs and amounts of every kind and nature which Landlord shall
pay or incur during any Expense Year because of or in connection with the
ownership, management, maintenance, repair, replacement, restoration or
operation of the Real Property, excluding all Excluded Costs (as defined in
Section 5.2.5 hereof), but including, without limitation, any amounts paid
or incurred for (i) the cost of supplying all utilities, the cost of
operating, maintaining, repairing, replacing, renovating and managing the
utility systems, mechanical systems, sanitary and storm drainage systems,
communication systems, and escalator and elevator systems, and the cost of
supplies, tools, and equipment and maintenance and service contracts in
connection therewith; (ii) the cost of licenses, certificates, permits and
inspections and the cost of contesting the validity or applicability of any
governmental enactments which may affect Operating Expenses; (iii) the cost
of insurance carried by or on behalf of Landlord, in such amounts as
Landlord may reasonably determine; (iv) fees, charges and other costs,
including management fees (or amounts in lieu thereof), consulting fees
(including but not limited to any consulting fees incurred in connection
with the procurement of insurance), legal fees and accounting fees, of all
persons engaged by Landlord or otherwise reasonably incurred by Landlord in
connection with the management, operation, administration, maintenance and
repair of the Real Property; (v) the cost of parking area repair,
restoration, and maintenance, including, but not limited to, resurfacing,
repainting, restriping, and cleaning; (vi) compensation and benefits of all
persons engaged in the operation, maintenance or security of the Real
Property, and employer's Social Security taxes, unemployment taxes or
insurance, and any other taxes which may be levied on such wages, salaries,
compensation and benefits; provided, that if any employees of Landlord or
Landlord's agents provide services for more than one building, then a
prorated portion of such employees' wages, benefits and taxes shall be
included in Operating Expenses based on the portion of their working time
devoted to the Real Property, and provided further, that no portion of any
employee's wages, benefits, or taxes allocable to time spent on the
development or marketing of the Real Property shall be included in
Operating Expenses; (vii) payments under any easement, license, operating
agreement, declaration, restrictive covenant, or instrument pertaining to
the sharing of costs by the Building, including the Real Property's
allocable share of any owners' association assessments; (viii) the cost of
Landlord's office and office operation for the Building and the Real
Property and all supplies and materials used in connection therewith;
provided, that if any office of Landlord or Landlord's agents provides
services for more than one building, then a prorated portion of the cost of
such office shall be included in Operating Expenses; and (ix) capital
expenditures made: (a) primarily to reduce Operating Expenses or reduce the
expected increase therein, (b) to comply with any governmental law or
regulation or insurance requirement
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then in effect, or (c) for repairs or replacements (as opposed to additions
or new improvements) of roofs, parking areas, and other nonstructural items
located in the common areas of the Real Property required to keep such
areas in good condition; provided, any such permitted capital expenditure
shall be amortized for purposes of this Lease over the shorter of: (x) the
period during which the reasonably estimated savings in Operating Expenses
equals the expenditure, (y) the shortest period over which Landlord may
depreciate such item under the Federal Tax Code then in effect, or (z) the
useful life of the item, but in no event more than ten (10) years;
provided, Landlord may elect any longer period in Landlord's discretion. In
each such case, Landlord may include interest on the unamortized amount at
the prevailing loan rate available to Landlord when the cost was incurred,
as determined in Landlord's reasonable discretion. Operating Expenses shall
include any such remaining amortization of such permitted capital
expenditures made prior to the date of this Lease. The foregoing provision
is for definitional purposes only and shall not be construed to impose any
obligation upon Landlord to incur such expenses. Landlord may retain
independent contractors (or affiliated contractors at market rates) to
provide any services or perform any work, in which case the costs thereof
shall be deemed Operating Expenses.
5.2.4 "Tax Expenses" shall mean the dollar amount of (i) all real estate
taxes, assessments (special or otherwise), sewer and water rents, rates and
charges and any other governmental levies, impositions or charges of a
similar or dissimilar nature, whether general, special, ordinary,
extraordinary, foreseen or unforeseen, which may be assessed, levied or
imposed upon all or any part of the Real Property, whether or not the same
constitute one or more tax lots, and (ii) any expenses (including
attorneys' fees and disbursements and experts' and other witness' fees)
incurred by Landlord in contesting any of the foregoing or the assessed
valuation of all or any part of the Real Property; provided, however, that
if the Real Property is not fully assessed during any Expense Year, either
by virtue of the fact that the Building was not then fully completed or
that there was then some tax abatement or credit in effect, the Direct
Expenses for any such Expense Year shall be adjusted, in Landlord's
reasonable discretion, to account for any such partial assessment. If at
any time after the date hereof the methods of taxation prevailing at the
date hereof shall be altered so that in lieu of or as an addition to or as
a substitute for the whole or any part of taxes, assessments, rents, rates,
charges, levies or impositions now assessed, levied or imposed upon all or
any part of the Real Property, there shall be assessed, levied or imposed
(a) a tax, assessment, levy, imposition or charge based on the income or
rents received therefrom whether or not wholly or partially as a capital
levy or otherwise, or (b) a tax, assessment, levy, imposition or charge
measured by or based in whole or in part upon all or any part of the Real
Property and imposed upon Landlord, or (c) a license fee measured by the
rents, or (d) any other tax, assessment, levy, imposition, charge or
license fee however described or imposed, then all such taxes, assessments,
levies, impositions, charges or license fees or the part thereof so
measured or based shall be deemed to be Tax Expenses; provided that any tax
assessment, levy or imposition or charge imposed on income from the Real
Property shall be calculated as if the Real Property is the only asset of
Landlord. Any reasonable expenses incurred by Landlord in attempting to
protest, reduce or minimize Tax Expenses shall be included in Direct
Expenses in the Expense Year such expenses are paid. Tax refunds shall be
deducted from Tax Expenses in the Expense Year they are received by
Landlord.
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5.2.5 "Excluded Costs" shall mean (i) depreciation, interest and
amortization on any mortgages and other debt costs or ground lease payments
(except interest on the cost of capital expenditures to the extent
permitted under Section 5.2.3 (ix), and ground lease payments for Taxes and
Expenses), (ii) legal fees in connection with leasing, tenant disputes or
enforcement of leases, (iii) real estate brokers' leasing commissions, (iv)
improvements or alterations to tenant spaces, (v) salaries and other
compensation and fringe benefits paid to all persons above the level of
property manager, (vi) the cost of providing any service directly to, and
paid directly by, any tenant, (vii) costs of any items to the extent
Landlord receives reimbursement from insurance proceeds or from a third
party (excluding payments by tenants for Direct Expenses), (viii) costs
incurred by Landlord to the extent that Landlord is reimbursed by insurance
proceeds or otherwise, (ix) Landlord's general corporate overhead and
corporate general and administrative expenses, (x), costs, including
permit, license and inspection costs, incurred with respect to the
installation of tenants' or other occupants' improvements made for tenants
or other occupants in the Building or incurred in renovating or otherwise
improving, decorating, painting or redecorating space for tenants or other
occupants of the Building, (xi) costs associated with the operation of the
business of the partnership or entity which constitutes Landlord as the
same are distinguished from the costs of operation of the Building,
including partnership accounting and legal matters, costs of defending any
lawsuits with any mortgagee (except as the actions of Tenant may be in
issue), costs of selling, syndicating, financing, mortgaging or
hypothecating any of Landlord's interest in the Building, (vxii) costs
(including in connection therewith all attorney's fees and costs of
settlement judgments and payments in lieu thereof) arising from claims,
disputes or potential disputes in connection with potential or actual
claims, litigation or arbitrations pertaining to Landlord and/or the
Building, (xiii) costs of services, utilities, or other benefits which are
not offered to Tenant or for which Tenant is charged for directly but which
are provided to another tenant or occupant of the Building, including, but
not limited to, above Building standard heating, ventilation and
air-conditioning and janitorial services, (xiv) costs incurred by Landlord
due to the violation by Landlord or any tenant of the terms and conditions
of any lease of space in the Building, (xv) tax penalties incurred as a
result of Landlord's negligence, inability (so long as there is no uncured
monetary default on the part of Tenant hereunder) or unwillingness to make
payments and/or file any income tax or informational returns when due, and
(xvi) reserves of any kind, including but not limited to replacement
reserves, and reserves for bad debts or lost rent or any similar charge not
involving the payment of money to third parties.
5.3 Calculation and Payment of Additional Rent.
5.3.1 Calculation of Excess. If for any Expense Year, Tenant's Share
of Direct Expenses for such Expense Year exceeds Tenant's Share of the
Direct Expense Stop, then Tenant shall pay to Landlord, in the manner set
forth in Section 5.3.2, below, and as Additional Rent, an amount equal to
the excess ("Excess").
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5.3.2 Statement of Actual Direct Expenses and Payment by Tenant.
Following the end of each Expense Year, Landlord shall give to Tenant a
statement ("Statement"), which shall state the Direct Expenses for such
preceding Expense Year, and which shall indicate the amount, if any, of the
Excess. Landlord shall endeavor to give such Statement within ninety (90)
days after the end of each Expense Year. Unless Tenant shall take written
exception to any item within seventy-five (75) days after the furnishing of
a Statement, such Statement shall be considered as final and accepted by
Tenant. Upon receipt of the Statement for each Expense Year ending during
the Lease Term, if an Excess is present, Tenant shall pay, with its next
installment of Base Rent due, but in no event longer than thirty (30) days
after receipt of such Statement, the full amount of the Excess for such
Expense Year, less the amounts, if any, paid during such Expense Year as
"Estimated Excess," as that term is defined in Section 5.3.3, below. If the
Estimated Excess paid during such Expense Year is more than the Excess for
such Expense Year, Landlord shall credit Tenant with such difference
against the next accruing obligations of Tenant under this Section 5.3. The
failure of Landlord to timely furnish the Statement for any Expense Year
shall not prejudice Landlord from enforcing its rights under this Article
5. Even though the Lease Term has expired or been terminated and Tenant has
vacated the Premises, when the final determination is made of Tenant's
Share of the Direct Expenses for the Expense Year in which this Lease
expires or terminates, taking into consideration that the Lease Expiration
Date may have occurred prior to the final day of the applicable Expense
Year (a) if an Excess is present, Tenant shall immediately pay to Landlord
an amount as calculated pursuant to the provisions of Section 5.3.1 of this
Lease and (b) if the Estimated Excess paid by Tenant for such Expense Year
is more than the Excess therefor, Landlord shall immediately pay Tenant the
difference. The provisions of this Section 5.3.2 shall survive the
expiration or earlier termination of the Lease Term.
5.3.3 Statement of Estimated Direct Expenses. In addition, Landlord
shall give Tenant a yearly expense estimate statement ("Estimate
Statement") which shall set forth Landlord's reasonable estimate
("Estimate") of the total amount of Direct Expenses for the then-current
Expense Year and the estimated excess ("Estimated Excess") as calculated by
comparing Direct Expenses, which shall be based upon the Estimate, to the
amount of the Direct Expense Stop, which Estimate Statement may be revised
and reissued by Landlord from time to time. The failure of Landlord to
timely furnish the Estimate Statement for any Expense Year shall not
preclude Landlord from enforcing itsrights to collect any Estimated Excess
under this Article 5. If pursuant to the Estimate Statement (or a revision
thereof) an Estimated Excess is calculated for the then-current Expense
Year, Tenant shall pay, with its next installment of Base Rent due, but in
no event longer than thirty (30) days after receipt of such Estimate
Statement, a fraction of the Estimated Excess (or the increase in the
Estimated Excess if pursuant to a revised Estimate Statement) for the
then-current Expense Year (reduced by any amounts paid pursuant to the last
sentence of this Section 5.3.3). Such fraction shall have as its numerator
the number of months which have elapsed in such current Expense Year to the
month of such payment, both months inclusive, and shall have twelve (12) as
its denominator. Until a new Estimate Statement is furnished, Tenant shall
pay monthly, with the monthly Base Rent installments, an amount equal to
one-twelfth (1/12) of the total Estimated Excess set forth in the previous
Estimate Statement delivered by Landlord to Tenant.
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5.3.4 Landlord's Books and Records. Tenant or an independent certified
public accountant mutually selected by Landlord and Tenant, at Tenant's
expense, shall have the right to examine Landlord's books and records with
respect to a Statement during normal business hours at any time within
thirty (30) days following the furnishing by Landlord to Tenant of such
Statement. Any amount due to Landlord as shown on any Statement, whether or
not written exception is taken thereto within the time period described in
Section 5.3.2, nonetheless shall be paid by Tenant as aforesaid, provided,
however that in the event such examination determines, based on generally
accepted accounting principles (i) that the Direct Expenses shown therein
were overstated, Landlord shall promptly reimburse Tenant for any
over-payment (and if the Direct Expenses shown in such Statement exceeds
those determined by such examination by more than 7%, Landlord shall
promptly reimburse Tenant for Tenant's reasonable out of pocket expenses
incurred in performing such examination, which in no event shall exceed
$2,000.00), or (ii) that the Direct Expenses shown therein were
understated, Tenant shall promptly pay to Landlord any under payment.
5.4 Grossing Up. If the Real Property is not fully occupied during all or a
portion of any calendar year (including the year in which the Direct Expense
Stop was determined), Landlord will, in accordance with sound accounting and
management practices consistently applied, determine the amount of variable
Direct Expenses (i.e. those items which vary according to occupancy levels) that
would have been paid had the Real Property been fully occupied, and the amount
so determined shall be deemed to have been the amount of Direct Expenses for
such year. If Landlord is not furnishing all or any particular utility or
service (the cost of which, if performed by Landlord, would be included in
Direct Expenses) to a tenant during any period, Landlord may for such period:
(i) adjust Direct Expenses to reflect the additional amount that would have been
incurred during such period had Landlord furnished such utilities orservices to
such tenant, or (ii) exclude the rentable area of such tenant from the rentable
area of the Real Property in computing Tenant's Share of the component of Direct
Expenses for such utilities or services.
5.5 Direct Expense Allocations and Tenant's Share Adjustments. If the Real
Property shall now or hereafter be part of or shall include a development,
complex or group of two or more buildings or structures collectively owned or
managed by Landlord or its affiliates or collectively managed by Landlord's
managing agent, Landlord may reasonably allocate Direct Expenses (or components
thereof) within such complex, development or group, and between such buildings
and structures and the parcels on which they are located, in accordance with
sound accounting and management practices. In the alternative, Landlord shall
have the right to determine, in accordance with sound accounting and management
practices, Tenant's Share of Direct Expenses (or components thereof) based on
such items for all or any such buildings and structures, and any common areas or
facilities, easements, corridors, lobbies, sidewalks, loading areas, driveways,
landscaped areas, air rights, development rights, parking rights, skywalks,
parking garages and lots, and any and all other rights, structures or facilities
operated or maintained in connection therewith or for the benefit thereof, and
all parcels or tracts of land on which all or any portion of any of the other
foregoing items are located, and any fixtures, machinery, apparatus, systems and
equipment located thereon or therein
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and used in connection therewith; in such event, Landlord may adjust Tenant's
Share to be based on the ratio of the rentable area of the Premises to the
rentable area of such buildings as to which such Direct Expenses (or components
thereof) are included. If the Real Property or any development of which it is a
part, shall contain non-office uses during any period, Landlord shall also have
the right to determine, in accordance with sound accounting and management
practices, Tenant's Share of Direct Expenses for only the office portion of the
Real Property or of such development; in such event, Landlord may adjust
Tenant's Share to be based on the ratio of the rentable area of the Premises to
the rentable area of such office portion for such period. Tenant's Share shall
be subject to such other adjustments for such periods as may be applicable
pursuant to Section 5.4 above.
ARTICLE 6
USE OF PREMISES
Tenant shall use the Premises solely for the "Permitted Use" as defined
in Section 1.14, and Tenant shall not use or permit the Premises to be used for
any other purpose or purposes whatsoever without the prior written consent of
Landlord, which may be withheld in Landlord's sole discretion. Tenant further
covenants and agrees that it shall not use, or suffer or permit any person or
persons to use, the Premises or any part thereof for any use or purpose contrary
to the Rules and Regulations, or in violation of the laws of the United States
of America, the state in which the Premises is located, or the ordinances,
regulation or requirements of the local municipal or county governing body or
other lawful authorities having jurisdiction over the Building. Tenant shall
faithfully observe and comply with the Rules and Regulations. Landlord shall not
be responsible to Tenant for the nonperformance of any such Rules and
Regulations by or otherwise with respect to the acts or omissions of any other
tenants or occupants of the Building. Without limiting the generality of the
foregoing provisions of this Article 6, Tenant shall not use the Premises or any
portion thereof for any walk-in retail use, or any use that is in violation of
any applicable laws, rules or regulations affecting the Building or the Real
Property, the current certificate of occupancy (or other use permit) for the
Building, or any recorded covenants, conditions or restrictions of record
affecting the Real Property or the Building.
ARTICLE 7
SERVICES AND UTILITIES
7.1 Standard Tenant Services. Landlord shall provide the following services
during Building Hours as set forth in Section 1.17, unless otherwise stated
below.
7.1.1 Subject to all governmental rules, regulations and guidelines
applicable thereto, Landlord shall provide heating and air conditioning
when necessary for normal comfort for normal office use in the Premises
during Building Hours comparable to that provided in similar office
buildings within the vicinity.
7.1.2 Landlord shall provide adequate electrical power for normal
general office use,
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as reasonably determined by Landlord. Tenant shall bear the cost of replacement
of lamps, starters and ballasts for lighting fixtures within the Premises.
7.1.3 Landlord shall provide water from the regular Building outlets
for drinking, lavatory and toilet purposes.
7.1.4 Landlord shall provide janitorial services on Monday through
Friday except the date of observation of the Holidays, in and about the
Premises. Landlord's cleaning service shall include vacuuming of the
Premises, emptying of normal office trash cans and disposing of their
contents. Tenant shall dispose of all other refuse, boxes, cans, books,
abandoned furniture and all other large, unusual or heavy items at Tenant's
sole cost and expense and shall not permit the accumulation thereof in the
Premises or elsewhere in the Building.
7.1.5 Landlord shall provide non-exclusive automatic elevator service
at all times.
7.2 Overstandard Tenant Use. Tenant shall not, without Landlord's prior
written consent, use heat-generating equipment, equipment other than normal
fractional horsepower office machines, or equipment or lighting other than
building standard lights in the Premises, which may affect the temperature
otherwise maintained by the air conditioning system or increase the water
normally furnished for the Premises by Landlord pursuant to the terms of Section
7.1 of this Lease. If Tenant uses water, electricity, heat or air conditioning
in excess of that supplied by Landlord pursuant to Section 7.1 of this Lease,
Tenant shall pay to Landlord, upon billing, the cost of such excess consumption,
the cost of the installation, operation, and maintenance of equipment which is
installed in order to supply such excess consumption, and the cost of the
increased wear and tear on existing equipment caused by such excess consumption;
and Landlord may install devices to separately meter any increased use and in
such event Tenant shall pay the increased cost directly to Landlord, on demand,
including the cost of such additional metering devices. If Tenant desires to use
heat, ventilation or air conditioning during hours other than those for which
Landlord is obligated to supply such utilities pursuant to the terms of Section
7.1 of this Lease, Tenant shall give Landlord such prior notice of Tenant's
desired use as Landlord shall from time to time reasonably establish as
appropriate (but not less than 24 hours advance notice) and Landlord shall
supply such utilities to Tenant at such hourly cost to Tenant as Landlord shall
from time to time establish, (currently at $20.00 per hour) which shall be
treated as Additional Rent.
7.3 Interruption of Use. Tenant agrees that Landlord shall not be liable
for damages, by abatement of Rent or otherwise except as provided in Section 7.4
below, for failure to furnish or delay in furnishing any service (including
telephone and telecommunication services), or for any diminution in the quality
or quantity thereof and such failures or delays or diminution shall never be
deemed to constitute an eviction or disturbance of Tenant's use and possession
of the Premises or relieve Tenant from paying Rent or performing any of its
obligations under this Lease. Furthermore, Landlord shall not be liable under
any circumstances for a loss of, or injury to, property or for injury to, or
13
interference with, Tenant's business, including, without limitation, loss of
profits, however occurring, through or in connection with or incidental to a
failure to furnish any of the services or utilities as set forth in this Article
7. Landlord may comply with voluntary controls or guidelines promulgated by any
governmental entity relating to the use or conservation of energy, water, gas,
light or electricity or the reduction of automobile or other emissions without
creating any liability of Landlord to Tenant under this Lease, provided that the
Premises are not thereby rendered untenantable.
7.4 Abatement of Rent. Notwithstanding the foregoing, in the event that
Tenant is prevented from using, and does not use, the Premises as a result of
any failure to furnish any of the services or utilities as set forth in this
Article 7 and such failure is caused by Landlord's negligence or misconduct (and
not caused by Tenant, its agents or contractors), then Tenant shall give
Landlord notice of such event and if such failure continues for thirty (30) or
more consecutive business days after Landlord's receipt of said notice, then
Rent shall be abated for each day after such thirty (30) business day period
that Tenant remains prevented from using, and does not use, the Premises due to
such failure.
ARTICLE 8
REPAIRS
Tenant shall at Tenant's own expense and pursuant to the terms of this
Lease, including without limitation Article 9 hereof, keep the Premises,
including all improvements, fixtures and furnishings therein in good order,
repair and condition at all times during the Lease Term. In addition, Tenant
shall, at Tenant's own expense but under the supervision and subject to the
prior approval of Landlord, and within any reasonable period of time specified
by Landlord, pursuant to the terms of this Lease, including without limitation
Article 9 hereof, promptly and adequately repair all damage to the Premises and
replace or repair all damaged or broken fixtures and appurtenances; provided
however, that, at Landlord's option, or if Tenant fails to make such repairs
within 10 days (or, if such repairs cannot be made within said 10 day period
despite Tenant's diligent and continuous efforts, said 10 day period shall be
extended for so long as Tenant is diligently and continuously pursuing same but
in no event longer than an additional 20 days), Landlord may, but need not, make
such repairs and replacements, and Tenant shall pay Landlord the cost thereof,
including a percentage of the cost thereof (to be uniformly established for the
Building) sufficient to reimburse Landlord for all overhead, general conditions,
fees and other costs or expenses arising from Landlord's involvement with such
repairs and replacements forthwith upon being billed for same. Landlord may, but
shall not be required to, enter the Premises at all reasonable times to make
such repairs, alterations, improvements and additions to the Premises or to the
Building or to any equipment located in the Building as Landlord shall desire or
deem necessary or as Landlord may be required to do by the terms of this Lease
or by governmental or quasi-governmental authority or court order or decree, and
any such entry shall not be deemed to be or shall be construed as an eviction of
Tenant.
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ARTICLE 9
ADDITIONS AND ALTERATIONS
9.1 Landlord's Consent to Alterations. Tenant may not make any
improvements, alterations, additions or changes to the Premises (collectively,
"Alterations") without first procuring the prior written consent of Landlord to
such Alterations, which consent shall not be unreasonably withheld or delayed by
Landlord. If Landlord shall have conditioned its consent to any Alteration upon
Tenant's agreement to remove same upon the expiration or earlier termination of
this Lease as provided in Section 9.2, then upon the termination or expiration
of this Lease, Tenant shall restore the Premises to their condition prior to the
making of any Alterations by Tenant, reasonable wear and tear and damage by
insured casualty excepted. Before proceeding with any Alterations, Tenant shall
submit to Landlord detailed plans and specifications therefor, for Landlord's
prior written consent. Tenant shall reimburse Landlord for all reasonable
expenses incurred by Landlord in connection with (A) its decision as to whether
to approve the proposed Alterations and (B) inspecting the Alterations to
determine whether the same are being or have been performed in accordance with
the approved plans and specifications therefor and in accordance with all legal
requirements and insurance requirements, including the fees and expenses of any
architect or engineer employed for such purpose. Any Alterations for which
consent has been received shall be performed strictly in accordance with the
approved plans and specifications therefor, and no amendments or additions
thereto shall be made without the prior consent of Landlord. Tenant shall not
use the elevators during business hours on business days for haulage or removal
of materials or debris.
9.2 Manner of Construction. Landlord may impose, as a condition of its
consent to all Alterations or repairs of the Premises or about the Premises,
such requirements as Landlord in its reasonable discretion may deem desirable,
including, but not limited to, the requirement that Tenant, at Tenant's expense,
remove such Alterations upon the expiration or earlier termination of the Lease
Term, and/or the requirement that Tenant utilize for such purposes only
contractors, materials, mechanics and materialmen selected by Landlord, provided
only that contractors, mechanics and materialmen selected by Landlord shall be
reasonably competitive in price with any reputable and qualified contractor,
mechanic or materialman selected by Tenant except that Tenant shall be permitted
the selection of a reputable, licensed and insured general contractor with
reasonable approval of the Landlord. Tenant shall construct such Alterations and
perform such repairs in conformance with any and all applicable rules and
regulations of any federal, state, county or municipal code or ordinance and
pursuant to a valid building permit, issued by the appropriate municipal agency
or department, or other governmental agency thereof, in conformance with
Landlord's construction rules and regulations. In performing the work of any
such Alterations, Tenant shall have the work performed in such manner as not to
obstruct access to the Building or the common areas for any other tenant of the
Building, and as not to obstruct the business of Landlord or other tenants in
the Building, or interfere with the labor force working in the Building. Upon
completion of any Alterations, Tenant shall deliver to Landlord a reproducible
copy of the "as built" drawings of said Alterations and a certificate of
occupancy issued by the city in which the Premises is located. Tenant agrees
that it will not at any time prior to or during the Lease Term, either directly
or indirectly, employ or permit the employment
15
of any contractor, mechanic or laborer, or permit any materials in the Premises,
if the use of such contractor, mechanic or laborer or such materials would, in
Landlord's reasonable opinion, create any difficulty, strike or jurisdictional
dispute with other contractors, mechanics or laborers.
9.3 Payment for Improvements. In the event Tenant and Landlord mutually
agree that Landlord shall perform or cause to be performed any Alteration or
repair work hereunder (of which Tenant is responsible), the charges for such
work shall be deemed Additional Rent under this Lease, payable upon billing
therefor. Upon completion of such work, Tenant shall deliver to Landlord, if
payment is made directly to contractors, evidence of payment, contractors'
affidavits and full and final waivers of all liens for labor, services or
materials. Tenant shall reimburse Landlord for Landlord's reasonable
out-of-pocket costs and expenses reasonably incurred in connection with
Landlord's review of the plans and specifications with respect to such work and
the supervision thereof.
9.4 Construction Insurance. In the event that Tenant makes any Alterations,
Tenant agrees to carry "Builder's All Risk" insurance in an amount approved by
Landlord covering the construction of such Alterations, and such other insurance
as Landlord may require, it being understood and agreed that all of such
Alterations shall be insured by Tenant pursuant to Article 11 of this Lease
immediately upon completion thereof.
9.5 Landlord's Property. All Alterations, improvements, fixtures and/or
equipment which may be installed or placed in or about the Premises, and all
signs installed in, on or about the Premises, from time to time, shall be at the
sole cost of Tenant and shall be and become the property of Landlord, except as
otherwise specified herein. Furthermore, if Landlord, as a condition to
Landlord's consent to any Alteration, requires that Tenant remove any Alteration
upon the expiration or early termination of the Lease Term, Tenant shall, at
Tenant's expense, remove such Alterations and repair any damage to the Premises
and the Building caused by such removal. If Tenant fails to complete such
removal and/or to repair any damage caused by the removal of any Alterations,
Landlord may do so and may charge the cost thereof to Tenant. Tenant's
obligations under this Section 9.5 shall survive the expiration or earlier
termination of the Lease Term.
ARTICLE 10
COVENANT AGAINST LIENS
Tenant has no authority or power to cause or permit any lien or
encumbrance of any kind whatsoever, whether created by act of Tenant, operation
of law or otherwise, to attach to or be placed upon the Real Property, Building
or Premises, and any and all liens and encumbrances created by Tenant shall
attach to Tenant's interest only. Landlord shall have the right at all times to
post and keep posted on the Premises any notice which it deems necessary for
protection from such liens. Tenant covenants and agrees not to suffer or permit
any lien of mechanics or materialmen or others to be placed against the Real
Property, the Building or the Premises with respect to work or services claimed
to have been performed for or materials claimed to have been furnished to Tenant
or the Premises, and, in case of any such lien attaching or notice of any lien,
Tenant covenants and agrees
16
to cause it to be immediately released and removed of record. Notwithstanding
anything to the contrary set forth in this Lease, in the event that such lien is
not released and removed on or before the date occurring twenty (20) days after
notice of such lien is delivered by Landlord to Tenant, Landlord, as its sole
option, may immediately take all action necessary to release and remove such
lien, without any duty to investigate the validity thereof, and all sums, costs
and expenses, including reasonable attorneys' fees and costs, incurred by
Landlord in connection with such lien shall be deemed Additional Rent under this
Lease and shall immediately be due and payable by Tenant.
ARTICLE 11
INSURANCE
11.1 Indemnification and Waiver. To the extent not prohibited by law,
Tenant releases Landlord, its direct and indirect partners and principals and
their respective officers, directors, shareholders, beneficiaries, agents,
servants, employees, and independent contractors (collectively, "Landlord
Parties") from, and waives all claims for, any damage either to person or
property or resulting from the loss of use thereof, which damage is sustained by
Tenant or by other persons claiming through Tenant. Tenant shall indemnify,
defend, protect, and hold harmless Landlord Parties from any and all loss, cost,
damage, expense and liability (including without limitation court costs and
reasonable attorneys' fees) incurred in connection with, or arising from, any
cause in, on or about the Premises or any acts, omissions or negligence of
Tenant or of any person claiming by, through or under Tenant, its partners, and
their respective officers, agents, servants, employees, and independent
contractors (collectively, "Tenant Parties"). Should Landlord be named as a
defendant in any suit brought against Tenant in connection with, or arising out
of, an event covered by the foregoing indemnity, Tenant shall pay to Landlord
its costs and expenses incurred in such suit, including without limitation, its
actual professional fees such as appraisers', accountants' and attorneys' fees.
Further, Tenant's agreement to indemnify Landlord pursuant to this Section 11.1
is not intended and shall not relieve any insurance carrier of its obligations
under policies required to be carried by Tenant pursuant to the provision of
this Lease, to the extent such policies cover the matters subject to Tenant's
indemnification obligations; nor shall they supersede any inconsistent agreement
of the parties set forth in any other provision of this Lease. The provisions of
this Section 11.1 shall survive the expiration or sooner termination of this
Lease with respect to any claims or liability occurring prior to such expiration
or termination.
11.2 Tenant's Compliance with Landlord's Fire and Casualty Insurance.
Tenant shall, at Tenant's expense, comply with all insurance company
requirements pertaining to the use of the Premises. If Tenant's conduct or use
of the Premises causes any increase in the premium for any insurance policies
carried by Landlord, then Tenant shall reimburse Landlord for any such increase.
11.3 Tenant's Insurance. Tenant shall maintain the following coverages in
the following amounts.
11.3.1 Commercial General Liability Insurance covering the insured
against claims
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of bodily injury, personal injury and property damage arising out of
Tenant's operations, assumed liabilities or use of the Premises, including
a Commercial General Liability endorsement covering the insuring provisions
of this Lease and the performance by Tenant of the indemnity agreements set
forth in Section 11.1 of this Lease, for limits of liability not less than:
(i) Bodily Injury and Property Damage Liability - $2,000,000 each
occurrence and $2,000,000 annual aggregate, and (ii) Personal Injury
Liability - $2,000,000 each occurrence and $2,000,000 annual aggregate.
11.3.2 Physical Damage Insurance covering (i) all office furniture,
trade fixtures, office equipment, merchandise and all other items of
Tenant's property on the Premises installed by, for, or at the expense of
Tenant, (ii) Alterations, and (iii) all other improvements, alterations and
additions to the Premises. Such insurance shall be written on all "all
risks" of physical loss or damage basis, for the full replacement cost
value new without deduction for depreciation of the covered items and in
amounts that meet any co-insurance clauses of the policies of insurance and
shall include a vandalism and malicious mischief endorsement, sprinkler
leakage coverage and earthquake sprinkler leakage coverage.
11.3.3 Forms of Policies. The minimum limits of policies of insurance
required of Tenant under this Lease shall in no event limit the liability
of Tenant under this Lease. Such insurance shall (i) name Landlord, and any
other party it so specifies, as an additional insured; (ii) specifically
cover the liability assumed by Tenant under this Lease, including, but not
limited to, Tenant's obligations under Section 11.1 of this Lease; (iii) be
issued by an insurance company having a rating of not less than A-XII in
Best's Insurance Guide or which is otherwise reasonably acceptable to
Landlord and licensed to do business in the state in which the Premises is
located; (iv) be primary insurance as to all claims thereunder and provide
that any insurance carried by Landlord is excess and is non-contributing
with any insurance requirement of Tenant; (v) provide that said insurance
shall not be canceled or coverage changed unless thirty (30) days' prior
written notice shall have been given to landlord and any mortgagee of
Landlord; and (vi) contain a cross-liability endorsement or severability of
interest clause reasonably acceptable to Landlord. Tenant shall deliver
said policy or policies or certificates thereof to Landlord on or before
the Lease Commencement Date and at least thirty (30) days before the
expiration dates thereof. All such certificates shall expressly state that
they can be relied upon by Landlord, as the holder thereof.
11.4 Subrogation. Landlord and Tenant agree to have their respective
insurance companies issuing property damage insurance waive any rights of
subrogation that such companies may have against Landlord or Tenant, as the case
may be, so long as the insurance carried by Landlord and Tenant, respectively,
is not invalidated thereby. As long as such waivers of subrogation are contained
in their respective insurance policies, Landlord and Tenant hereby waive any
right that either may have against the other on account of any loss or damage to
their respective property to the extent such loss or damage is insurable under
policies of insurance for fire and all risk coverage, theft, or other similar
insurance. If Tenant fails to carry the amounts and types of insurance required
to be carried by it pursuant to this Article 11, in addition to any remedies
Landlord may have under this Lease, such failure shall be deemed to be a
covenant and agreement by Tenant to self-insure with respect to
18
the type and amount of insurance which Tenant has so failed to carry, with full
waiver of subrogation with respect thereto.
ARTICLE 12
DAMAGE AND DESTRUCTION
12.1 Repair of Damage to Premises by Landlord. Tenant shall promptly notify
Landlord of any damage to the Premises resulting from fire or any other
casualty. If the Premises or any common areas of the Building serving or
providing access to the Premises shall be damaged by fire or other casualty,
Landlord shall promptly and diligently, subject to reasonable delays for
insurance adjustment or other matters beyond Landlord's reasonable control, and
subject to all other terms of this Article 12, restore the Premises, excluding
Alterations, and such common areas to substantially the same condition as
existed prior to the casualty, except for modifications required by zoning and
building codes and other laws or by the holder of a mortgage on the Building or
any other modifications to the common areas deemed desirable by Landlord,
provided access to the Premises and any common restrooms serving the Premises
shall not be materially affected. Landlord shall not be liable for any
inconvenience or annoyance to Tenant or its visitors, or injury to Tenant's
business resulting in any way from such damage or the repair thereof; provided
however, that Landlord shall allow Tenant a proportionate abatement of Rent,
during the time and to the extent the Premises are being restored as set forth
below, and not occupied by Tenant solely as a result thereof.
12.2 Landlord's Option to Repair. Within sixty (60) days following the date
of any substantial damage to the Building, Landlord shall notify Tenant of
Landlord's good faith estimate of the time required to repair such damage
("Landlord's Repair Notice"). Notwithstanding the terms of Section 12.1 of this
Lease, Landlord may elect not to rebuild and/or restore the Premises and/or
Building and instead terminate this Lease by notifying Tenant in writing of such
termination within sixty (60) days after the date of damage, such notice to
include a termination date giving Tenant ninety (90) days to vacate the
Premises, but Landlord may so elect only if the Building shall be damaged by
fire or other casualty or cause, whether or not the Premises are affected, and
one or more of the following conditions is present: (i) repairs cannot
reasonably be completed within one hundred eighty (180) days of the date of
damage (when such repairs are made without the payment of overtime or other
premiums); (ii) the holder of any mortgage on the building or ground lessor with
respect to the Real Property shall require that the insurance proceeds or any
portion thereof be used to retire the mortgage debt, or shall terminate the
ground lease, as the case may be; (iii) the damage is not fully covered, except
for deductible amounts, by Landlord's insurance policies; or (iv) the damage
occurs during the last eighteen (18) months of the Lease Term. Notwithstanding
anything contained herein to the contrary, if Landlord has not terminated this
Lease pursuant to the terms of this Article 12, and if either (A) pursuant to
Landlord's Repair Notice, such repairs are not estimated to be completed within
one hundred eighty (180) days of the date of damage, or (B) such repairs are not
actually completed within two hundred ten (210) days of the date of damage
subject to reasonable delays beyond Landlord's reasonable control, Tenant shall
have the right to terminate this Lease within ten
19
(10) days after, in the cause of clause (A), receipt of Landlord's Repair Notice
or, in the case of clause (B), the expiration of such 210 day period (subject to
such reasonable delays), by written notice to Landlord in each case, effective
as of a date set forth in such notice, which date shall not be more than 30 days
after the date of delivery of such notice to Landlord.
ARTICLE 13
NONWAIVER
No waiver of any provision of this Lease shall be implied by any failure of
Landlord to enforce any remedy on account of the violation of such provision,
even if such violation shall continue or be repeated subsequently, any waiver by
Landlord of any provision of this Lease may only be in writing, and no express
waiver shall affect any provision other than the one specified in such waiver
and that one only for the time and in the manner specifically stated.
Forbearance by Landlord in enforcement of one or more of the remedies herein
provided upon an event of default shall not be deemed or construed to constitute
a waiver of such default. The acceptance of any Rent hereunder by Landlord
following the occurrence of any default, whether or not known to Landlord, shall
not be deemed a waiver of any such default, except only a default in the payment
of the Rent so accepted.
ARTICLE 14
CONDEMNATION
If ten percent (10%) or more of the Premises or Building shall be taken by
power of eminent domain or condemned by any competent authority for any public
or quasi-public use or purpose, or if Landlord shall grant a deed or other
instrument in lieu of such taking by eminent domain or condemnation, Landlord
shall have the option to terminate this Lease upon ninety (90) days' notice,
provided such notice is given no later than one hundred eighty (180) days after
the date of such taking, condemnation, reconfiguration, vacation, deed or other
instrument. If more than ten percent (10%) of the rentable square feet of the
Premises is taken, or if access to the Premises is substantially impaired,
Tenant shall have the option to terminate this Lease upon ninety (90) days'
notice, provided such notice is given no later than one hundred eighty (180)
days after the date of such taking. Landlord shall be entitled to receive the
entire award or payment in connection therewith, except that Tenant shall have
the right to file any separate claim available to Tenant for any taking of
Tenant's personal property and fixtures belonging to Tenant and removable by
Tenant upon expiration of the Lease Term pursuant to the terms of this Lease,
and for moving expenses, so long as such claim does not diminish the award
available to Landlord, its ground lessor with respect to the Real Property or
its mortgagee, and such claim is payable separately to Tenant. All Rent shall be
apportioned as of the date of such termination, or the date of such taking,
whichever shall first occur. If any part of the Premises shall be taken, and
this Lease shall not be so terminated, the Rent shall be proportionately abated.
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ARTICLE 15
ASSIGNMENT AND SUBLETTING
15.1 Transfers. Tenant shall not, without the prior written consent of
Landlord, assign, mortgage, pledge, hypothecate, encumber, or permit any lien to
attach to, otherwise transfer, this Lease or any interest hereunder, permit any
assignment or other such foregoing transfer of this Lease or any interest
hereunder by operation of law, sublet the Premises or any part thereof, or
permit the use of the Premises by any persons other than Tenant and its
employees (all of the foregoing are hereinafter sometimes referred to
collectively as "Transfers" and any person to whom any Transfer is made or
sought to be made is hereinafter sometimes referred to as a "Transferee"). If
Tenant shall desire Landlord's consent to any Transfer, Tenant shall notify
Landlord in writing, which notice ("Transfer Notice") shall include (i) the
proposed effective date of Transfer, which shall not be less than thirty (30)
days nor more than one hundred eighty (180) days after the date of delivery of
the Transfer Notice, (ii) a description of the portion of the Premises to be
transferred ("Subject Space"), (iii) all of the terms of the proposed Transfer
and the consideration therefor, including a calculation of the "Transfer
Premium," as that term is defined in Section 15.3 below, in connection with such
Transfer, the name and address of the proposed Transferee, and a copy of all
existing and/or proposed documentation pertaining to the proposed Transfer,
including all existing operative documents to be executed to evidence such
Transfer or the agreements incidental or related to such Transfer, (iv) current
financial statements of the proposed Transferee certified by an officer, partner
or owner thereof, and any other information required by Landlord, which will
enable Landlord to determine the financial responsibility, character, and
reputation of the proposed Transferee and the nature of such Transferee's
business and proposed use of the Subject Space, (v) an executed estoppel
certificate from Tenant in the form attached hereto as Exhibit C, and (vi) such
other information as Landlord may reasonably require. Any Transfer made without
Landlord's prior written consent shall, at Landlord's option, be null, void and
of no effect, and shall, at Landlord's option, constitute a default by Tenant
under Section 20.1.2 of this Lease. Whether or not Landlord shall grant consent,
Tenant shall pay Landlord's review and processing fees (not to exceed $500.00
per Transfer Request), as well as any reasonable legal fees incurred by
Landlord, within thirty (30) days after written request by Landlord.
15.2 Landlord's Consent. Landlord shall not unreasonably withhold its
consent to any proposed Transfer of the Subject Space to the Transferee on the
terms specified in the Transfer Notice. The parties hereby agree that it shall
be deemed to be reasonable under this Lease and under any applicable law for
Landlord to withhold consent to any proposed Transfer where one or more of the
following apply, without limitation as to other reasonable ground for
withholding consent:
15.2.1 Transferee is of a character or reputation or engaged in a
business which is not consistent with the quality of the Building;
15.2.2 Transferee is either a governmental agency or instrumentality
thereof;
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15.2.3 Transferee's intended use of the Premises is not for a
Permitted Use;
15.2.4 Transferee is not a party of reasonable financial worth and/or
financial stability in light of the responsibilities involved under the
Lease on the date consent is requested;
15.2.5 The proposed Transfer would cause Landlord to be in violation
of another lease or agreement to which Landlord is a party, or would give
an occupant of the Building a right to cancel its lease; or
15.2.6 Either Transferee, or any person or entity which directly or
indirectly, controls, is controlled by, or is under common control with,
the Transferee, (i) occupies space in the Building at the time of the
request for consent, (ii) is negotiating with Landlord to lease space in
the Building at such time, or (iii) has negotiated with Landlord during the
twelve (12)-month period immediately preceding the Transfer Notice,
provided, however, the foregoing provisions of this Section 15.2.6 shall
not apply to a proposed subletting to any such Transferee referred to in
this Section 15.2.6 if, at the time that Landlord's consent to such
proposed subletting is requested, Landlord does not then have available
space within the Building sufficient for such Transferee and will not,
during the term of the proposed sublease to such proposed Transferee, have
available space within the Building sufficient for such Transferee.
Notwithstanding anything to the contrary in this Lease, if Tenant or any
proposed Transferee claims that Landlord has unreasonably withheld or delayed
its consent under Section 15.2 or otherwise has breached or acted unreasonably
under this Article 15, their sole remedies shall be declaratory judgment and an
injunction for the relief sought without any monetary damages, and Tenant hereby
waives all other remedies, including without limitation, any right at law or
equity to terminate this Lease, on its own behalf and, to the extent permitted
under all applicable laws, on behalf of the proposed Transferee. Tenant shall
indemnify, defend and hold harmless Landlord from any and all liability, losses,
claims, damages, costs, expenses (including reasonable attorneys' fees and
litigation expenses), causes of action and proceedings involving any third party
or parties (including without limitation Tenant's proposed subtenant or
assignee) who claim they were damaged by Landlord's wrongly withholding or
conditioning of Landlord's consent. If Landlord consents to any Transfer
pursuant to the terms of this Section 15.2 (and does not exercise any recapture
rights Landlord may have under Section 15.4 of this Lease), Tenant may within
six (6) months after Landlord's consent, but not later than the expiration of
said six-month period, enter into such Transfer of the Premises or portion
thereof, upon substantially the same terms and conditions as are set forth in
the Transfer Notice furnished by Tenant to Landlord pursuant to Section 15.1 of
this Lease, provided that if there are any changes in the terms and conditions
from those specified in the Transfer Notice (i) such that Landlord would
initially have been entitled to refuse its consent to such Transfer under this
Section 15.2, or (ii) which would cause the proposed Transfer to be more
favorable to Transferee than the terms set forth in Tenant's original Transfer
Notice, Tenant shall again submit the transfer to Landlord for its approval and
other action under this Article 15 (including Landlord's right of recapture, if
any, under Section 15.4 of this Lease).
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15.3 Transfer Premium. If Landlord consents to a Transfer, as a condition
thereto which the parties hereby agree is reasonable, Tenant shall pay to
Landlord any "Transfer Premium," as that term is defined in this Section 15.3,
received by Tenant from such Transferee. "Transfer Premium" shall mean all rent,
additional rent or other consideration payable by such Transferee in excess of
the Rent and Additional Rent payable by Tenant under this Lease, on a per
rentable square foot basis if less than all of the Premises is transferred.
"Transfer Premium" shall also include, but not be limited to, key money and
bonus money paid by Transferee to Tenant in connection with such Transfer, and
any payment in excess of fair market value for services rendered by Tenant to
Transferee or for assets, fixtures, inventory, equipment, or furniture
transferred by Tenant to Transferee in connection with such Transfer excluding
reasonable and customary brokerage commissions, attorney's fees and tenant
improvement costs actually incurred by Tenant as a direct result of such
Transfer. In the calculations of the Rent (as it relates to the Transfer Premium
calculated under this Section 15.3), the Rent paid during each annual period for
the Subject Space shall be computed after adjusting such rent to the actual
effective rent to be paid, taking into consideration any and all leasehold
concessions granted in connection therewith, including, but not limited to, any
rent credit and tenant improvement allowance. For purposes of calculating any
such effective rent, all such concessions shall be amortized on a straight-line
basis over the relevant term.
15.4 Landlord's Option as to Subject Space. Notwithstanding anything to the
contrary contained in this Article 15, Landlord shall have the option, by giving
written notice to Tenant within thirty (30) days after receipt of any Transfer
Notice, to (i) recapture the Subject Space, or (ii) take an assignment or
sublease of the Subject Space from Tenant. Such recapture, or sublease or
assignment notice shall cancel and terminate this Lease, or create a sublease or
assignment, as the case may be, with respect to the Subject Space as of the date
stated in the Transfer Notice as the effective date of the proposed Transfer
until the last day of the term of the Transfer as set forth in the Transfer
Notice. In the event of a recapture by Landlord, if this Lease shall be canceled
with respect to less than the entire Premises, the Rent reserved herein shall be
prorated on the basis of the number of rentable square feet retained by Tenant
in proportion to the number of rentable square feet contained in the Premises,
and this Lease as so amended shall continue thereafter in full force and effect,
and upon request of either party, the parties shall execute written confirmation
of the same. If Landlord declines, or fails to elect in a timely manner to
recapture, sublease or take an assignment of the Subject Space under this
Section 15.4, then, provided Landlord has consented to the proposed Transfer,
Tenant shall be entitled to proceed to transfer the Subject Space to the
proposed Transferee, subject to provisions of the last paragraph of Section 15.2
of this Lease.
15.5 Effect of Transfer. If Landlord consents to a Transfer, (i) the terms
and conditions of this Lease shall in no way be deemed to have been waived or
modified, (ii) such consent shall not be deemed consent to any further Transfer
by either Tenant or a Transferee, (iii) Tenant shall deliver to Landlord,
promptly after execution, an original executed copy of all documentation
pertaining to the Transfer in form reasonably acceptable to Landlord, (iv)
Tenant shall furnish upon Landlord's request a complete statement, certified by
an independent certified public accountant, or Tenant's chief
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financial officer, setting forth in detail the computation of any Transfer
Premium Tenant has derived and shall derive from such Transfer, and (v) no
Transfer relating to this Lease or agreement entered into with respect thereto,
whether with or without Landlord's consent, shall relieve Tenant or any
guarantor of the Lease from liability under this Lease. Landlord or its
authorized representatives shall have the right at all reasonable times to audit
the books, records and papers of Tenant relating to any Transfer, and shall have
the right to make copies thereof. If the Transfer Premium respecting any
Transfer shall be found understated, Tenant shall, within thirty (30) days after
demand, pay the deficiency and Landlord's costs of such audit, and if
understated by more than ten percent (10%), Landlord shall have the right to
cancel this Lease upon thirty (30) days' notice to Tenant.
ARTICLE 16
SURRENDER OF PREMISES; REMOVAL OF TRADE FIXTURES
16.1 Surrender of Premises. No act or thing done by Landlord or any agent
or employee of Landlord during the Lease Term shall be deemed to constitute an
acceptance by Landlord of a surrender of the Premises unless such intent is
specifically acknowledged in a writing signed by Landlord. The delivery of keys
to Premises to Landlord or any agent or employee of Landlord shall not
constitute a surrender of the Premises or effect a termination of this Lease,
whether or not the keys are thereafter retained by Landlord, and notwithstanding
such delivery Tenant shall be entitled to the return of the keys at any
reasonable time upon request until this Lease shall have been terminated.
16.2 Removal of Tenant Property by Tenant. Upon expiration of the Lease
Term, or upon any earlier termination of this Lease, Tenant shall, subject to
the provisions of this Article 16, quit and surrender possession of the Premises
to Landlord in as good order and condition as when Tenant took possession and as
thereafter improved by Landlord and/or Tenant, reasonable wear and tear
excepted. Upon such expiration or termination, Tenant shall, without expense to
Landlord, remove or cause to be removed from the Premises all debris and
rubbish, and such items of furniture, equipment, free-standing cabinet work, and
other articles or personal property owned by Tenant or installed or placed by
Tenant at its expense in the Premises (including all signage installed pursuant
to the terms of Section 24.1), and such similar articles of any other persons
claiming under Tenant, and Tenant shall repair at its own expense all damage to
the Premises and Building resulting from such removal.
ARTICLE 17
HOLDING OVER
If Tenant holds over after the expiration or earlier termination of the
Lease Term without the express written consent of Landlord, Tenant shall be
deemed to be a tenant at sufferance, and in such case Rent shall be payable at a
monthly rate equal to one hundred fifty percent (150%) for the first thirty (30)
days, and then thereafter two hundred percent (200%), of the Rent applicable
during the last rental period of the Lease Term under this Lease for each month
or part thereof that such hold over continues. Such tenancy shall be subject to
every other term, covenant and agreement contained
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herein. Nothing contained in this Article 17 shall be construed as consent by
Landlord to any holding over by Tenant, and Landlord expressly reserves the
right to require Tenant to surrender possession of the Premises to Landlord as
provided in this Lease upon the expiration or other termination of this Lease.
The provisions of this Article 17 shall not be deemed to limit or constitute a
waiver of any other rights or remedies of Landlord provided herein or at law.
Tenant acknowledges that if Tenant holds over without Landlord's consent, such
holding over may compromise or otherwise affect Landlord's ability to enter into
new leases with prospective tenants regarding the Premises. Therefore, if Tenant
fails to surrender the Premises upon the termination or expiration of this
Lease, in addition to any other liabilities to Landlord accruing therefrom,
Tenant shall protect, defend, indemnify and hold Landlord harmless from all
loss, costs (including reasonable attorneys' fees) and liability resulting from
such failure, including, without limiting the generality of the foregoing, any
claims made by any succeeding tenant founded upon such failure to surrender, and
any losses suffered by Landlord, including lost profits, resulting from such
failure to surrender.
ARTICLE 18
ESTOPPEL CERTIFICATES
Within ten (10) days following a request in writing by Landlord, Tenant
shall execute and deliver to Landlord an estoppel certificate, which shall be
substantially in the form of Exhibit C, attached hereto (or such other form as
may be required by any prospective mortgagee or purchaser of the Building, or
any portion thereof), indicating therein any exceptions thereto that may exist
at that time, and shall also contain any other information reasonably requested
by Landlord or Landlord's mortgagee or prospective mortgagee or purchasers.
Tenant shall execute and deliver whatever other instruments may be reasonably
required for such purposes. Tenant's failure to deliver any such certificate or
instrument, in addition to being a default under this Lease, shall be deemed to
establish conclusively that this Lease is in full force and effect except as
declared by Landlord, that Landlord is not in default of any of its obligations
under this Lease, and that Landlord has not received more than one (1) month's
rent in advance.
ARTICLE 19
SUBORDINATION
This Lease is subject and subordinate to all present and future ground
or underlying leases of the Real Property and to the lien of any mortgages or
deeds of trust, now or hereafter in force against the Real Property and the
Building, if any, and to all renewals, extensions, modifications, consolidations
and replacements thereof, and to all advances made or hereafter to be made upon
the security of such mortgages or trust deeds, unless the holders of such
mortgages or deeds of trust, or the lessors under such ground lease or
underlying leases, require in writing that this Lease be superior thereto.
Tenant covenants and agrees in the event any proceedings are brought for the
foreclosure of any such mortgage, to attorn, without any deductions or set-offs
whatsoever, to the purchaser upon any such foreclosure sale if so requested to
do so by such purchaser, and to recognize such purchaser as the lessor under
this Lease. Tenant shall, within twenty (20) days of request by Landlord,
execute
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such further instruments or assurances as Landlord may reasonably deem necessary
to evidence or confirm the subordination or superiority of this Lease to any
such mortgages, trust deeds, ground leases or underlying leases. Tenant hereby
irrevocably appoints Landlord as its attorney in fact to execute any such
further instruments or assurances as required above in the event Tenant fails to
so execute and return any such instruments or assurances .
ARTICLE 20
DEFAULTS; REMEDIES
20.1 Defaults. The occurrence of any of the following shall constitute a
default of this Lease by Tenant:
20.1.1 Any failure by Tenant to pay Rent or any other charge required
to be paid under this Lease, or any part thereof, within five (5) business
days of the date the same is due; or
20.1.2 Any failure by Tenant to observe or perform any other
provision, covenant or condition of this Lease to be observed or performed
by Tenant where such failure continues for thirty (30) days after written
notice thereof from Landlord to Tenant; provided however, that any such
notice shall be in lieu of, and not in addition to, any notice required
under any applicable law; and further provided that if such failure cannot
be cured within said 30 day period despite Tenant's diligent and continuous
efforts to do so, said 30 day period shall be extended for so long as
Tenant is diligently and continuously pursuing the cure of such failure but
in no event longer than an additional 15 days.
20.2 Remedies Under Default. Upon occurrence of a default by Tenant,
Landlord shall have, in addition to any other remedies available to Landlord at
law or in equity, the option to pursue any one or more of the following
remedies, each and all of which shall be cumulative and non-exclusive, without
any notice or demand whatsoever.
20.2.1 Landlord may, without prejudice to any other remedy which it
may have for possession or arrearages in rent, enter upon and take
possession of the Premises, by picking or changing locks if necessary, and
lock out, expel or remove Tenant and any other person who may be occupying
all or any part of the Premises without being liable for any claim for
damages, and either terminate this Lease and Tenant's rights to possession
of the Premises or, without terminating this Lease, terminate Tenant's
right to possession of the Premises, and in either event Tenant shall
immediately surrender the Premises to Landlord, and Landlord may recover
from Tenant the following:
(i) The worth at the time of award of any unpaid rent which has
been earned at the time of such termination; plus
(ii) The worth at the time of award of the amount by which the
unpaid rent which
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would have been earned after termination until the time of award
exceeds the amount of such rental loss that Tenant proves could have
been reasonably avoided; plus
(iii) The worth at the time of award of the amount by which the
unpaid rent for the balance of the Lease Term after the time of award
exceeds the amount of such rental loss that Tenant proves could have
been reasonably avoided; plus
(iv) Any other amount necessary to compensate Landlord for all
the detriment proximately caused by Tenant's failure to perform its
obligations under this Lease, specifically including but not limited
to, brokerage commissions and advertising expenses incurred, expenses
of remodeling the Premises or any portion thereof for a new tenant,
whether for the same or a different use, and any special concessions
made to obtain a new tenant; and
(v) At Landlord's election, such other amounts in addition to or
in lieu of the foregoing as may be permitted from time to time by
applicable law.
The term "rent" as used in this Section 20.2 shall be deemed to be and to
mean all sums of every nature required to be paid by Tenant pursuant to the
terms of this Lease, whether to Landlord or to others. As used in Sections
20.2.1(i) and (ii), above, the "worth at the time of award" shall be computed by
allowing interest at the rate equal to 5 percentage points added to the prime
interest rate as published by The Wall Street Journal, as it varies from time to
time, from the date due until paid (in the event that The Wall Street Journal
ceases either to exist or announce a prime interest rate, the aforementioned
interest shall be calculated by adding 5 percentage points to the prime interest
rate of the lending institution in metropolitan area in which the Premises is
located that, at the time such calculation is made, has the greatest asset
value), but in no case greater than the maximum amount of such interest
permitted by law ("Interest Rate"). As used in Section 20.2.1 (iii) above, the
"worth at the time of award" shall be computed by discounting such amount at the
discount rate of five percent (5%).
20.2.2 Landlord shall have the right to continue this Lease in effect
after Tenant's breach and abandonment and recover Rent as it becomes due.
Accordingly, if Landlord does not elect to terminate this Lease on account
of any default by Tenant, Landlord may, from time to time, without
terminating this Lease, enforce all of its rights and remedies under this
Lease, including the right to recover all rent as it becomes due.
20.3 Subleases of Tenant. In the event that Landlord elects to terminate
this Lease on account of any default by Tenant, as set forth in this Article 20,
Landlord shall have the right to terminate any and all subleases, licenses,
concessions or other consensual arrangements for possession entered into by
Tenant and affecting the Premises or may, in Landlord's sole discretion, succeed
to Tenant's interest in such subleases, licenses, concessions or arrangements.
In the event of Landlord's election to succeed to Tenant's interest in such
subleases, licenses, concessions or arrangements, Tenant shall, as of the date
of notice by Landlord of such election, have no further right to or interest in
the rent or other consideration receivable thereunder.
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20.4 Specific Performance and Collection of Rent. Landlord shall at all
times have the right without prior demand or notice except as required by
applicable law to: (i) seek any declaratory, injunctive or other equitable
relief, and specifically enforce this Lease or restrain or enjoin a violation of
any provision hereof, and Tenant hereby waives any right to require that
Landlord post a bond or other security in connection therewith, and (ii) xxx for
and collect any unpaid Rent which has accrued.
ARTICLE 21
ATTORNEYS' FEES
If either party commences litigation against the other for the specific
performance of this Lease, for damages for the breach hereof or otherwise for
enforcement of any remedy hereunder, the parties hereto agree to and hereby do
waive any right to a jury trial and, in the event of any such commencement of
litigation, the prevailing party shall be entitled to recover from the other
party such costs and reasonable attorneys' fees as may have been incurred.
ARTICLE 22
QUIET ENJOYMENT
If and for so long as no default occurs by Tenant under this Lease beyond
the expiration of any applicable notice and grace period, Tenant may peaceably
and quietly enjoy the Premises without any disturbance from Landlord or from any
other person claiming by, through or under Landlord, subject, nevertheless, to
the terms and conditions of this Lease, including, without limitation, the terms
and conditions of Article 19.
ARTICLE 23
BROKERS
Tenant hereby warrants to Landlord that Tenant has had no dealings with
any real estate broker or agent in connection with the negotiation of this
Lease, excepting only the Brokers (if any), and that Tenant knows of no other
real estate broker or agent who is entitled to a commission in connection with
this Lease. Tenant agrees to indemnify and defend Landlord against and hold
Landlord harmless from any and all claims, demands, losses, liabilities,
lawsuits, judgments, and costs and expenses (including without limitation
reasonable attorneys' fees) with respect to any leasing commission or equivalent
compensation alleged to be owing on account of Tenant's dealings with any real
estate broker or agent other than the Brokers. The terms of this Article 23
shall survive the expiration or earlier termination of the Lease Term.
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ARTICLE 24
SIGNS
24.1 Full Floor Tenants. Subject to Landlord's prior written approval, in
its sole discretion, and provided all signs are in keeping with the quality,
design and style of the Building, Tenant, if the Premises comprise an entire
floor of the Building, at its sole cost and expense, may install identification
signage anywhere in the Premises including in the elevator lobby of the
Premises, provided that such signs must not be visible from the exterior of the
Building. Landlord shall provide to Tenant listings in the Building Directory in
the lobby of the Building consistent with Landlord's existing practice in
respect of other tenants of the Building.
24.2 Multi-Tenant Floor Tenants. If Tenant occupies less than the entire
floor on which the Premises is located, Tenant's identifying signage shall be
provided by Landlord, at Tenant's cost, and such signage shall be comparable to
that used by Landlord for other similar floors in the Building and shall comply
with Landlord's Building standards signage program.
24.3 Prohibited Signage and Other Items. Any signs, notices, logos,
pictures, names or advertisements which are installed and that have not been
individually approved by Landlord may be removed without notice by Landlord at
the sole expense of Tenant. Tenant may not install any signs on the exterior or
roof of the Building or the common areas of the Building or the Real Property.
Any signs, window coverings, or blinds (even if the same are located behind the
Landlord approved window coverings for the Building), or other items visible
from the exterior of the Premises, the Building or any common areas of the
Building are subject to the prior written approval of Landlord, in its sole
discretion.
ARTICLE 25
COMPLIANCE WITH LAW
Tenant shall not do anything or suffer anything to be done in or about the
Premises which will in any way conflict with any law, statute, ordinance or
other governmental rule, regulation or requirement now in force or which may
hereafter be enacted or promulgated. Should any standard or regulation now or
hereafter be imposed on Landlord or Tenant by a state, federal or local
governmental body charged with the establishment, regulation and enforcement of
occupational, health or safety standards for employers, employees, landlords or
tenants, then Tenant agrees, at its sole cost and expense, to comply promptly
with such standards or regulations applicable to Tenant's business, the Premises
or Tenant's use thereof (and not applicable to building owners or landlords
generally). Tenant shall be responsible, at its sole cost and expense, to make
all alterations to the Premises as are required to comply with the governmental
rules, regulations, requirements or standards described in this Article 25,
provided, however, Tenant shall not be under any obligation to comply with any
such law, statute, ordinance or other governmental rule, regulation or
requirement requiring any structural alteration of the Premises solely by reason
of the use thereof for general office use unless said alteration (a) is
necessitated by a condition which has otherwise been created by, or at the
instance of, Tenant, including, without limitation, any Alteration made by or at
the request of Tenant, (b) is attributable to the use or manner of use to which
Tenant puts the Premises (other than general office use), (c) is required by
reason of a breach of Tenant's obligations hereunder, or (d) is
29
occasioned in whole or in part by any act, omission or negligence of Tenant or
any person claiming through or under Tenant or any of their employees, agents,
contractors, invitees, or licensees. Tenant shall promptly reimburse Landlord
for all reasonable costs and expenses incurred by Landlord in connection with
any alterations required to be made to the common areas of the Building if said
alteration meets either of the criteria described in (a) or (b) above. The
judgment of any court of competent jurisdiction or the admission of Tenant in
any judicial action, regardless of whether Landlord is a party thereto, that
Tenant has violated any of said governmental measures, shall be conclusive of
that fact as between Landlord and Tenant.
ARTICLE 26
LATE CHARGES
If any installment of Rent or any other sum due from Tenant shall not be
received by Landlord or Landlord's designee within five (5) business days after
the date due, then Tenant shall pay to Landlord a late charge equal to three
percent (3%) of the overdue amount (except that Landlord agrees to waive the
first such late charge in any calendar year), plus any attorneys' fees incurred
by Landlord by reason of Tenant's failure to pay Rent and/or other charges when
due hereunder. Additionally, unpaid Rent shall bear interest at the Interest
Rate from the date due until paid. The late charge and interest on unpaid Rent
shall be deemed Additional Rent and the right to require it shall be in addition
to all of Landlord's other rights and remedies hereunder or at law and shall not
be construed as liquidated damages or as limiting Landlord's remedies in any
manner.
ARTICLE 27
LANDLORD'S RIGHT TO CURE DEFAULT; PAYMENTS BY TENANT
27.1 Landlord's Cure. All covenants and agreements to be kept or performed
by Tenant under this Lease shall be performed by Tenant at Tenant's sole cost
and expense and without any reduction of Rent. If Tenant shall fail to perform
any of its obligations under this Lease, within a reasonable time after such
performance is required by the terms of this Lease, Landlord may, but shall not
be obligated to, after reasonable prior notice to Tenant, make any such payment
or perform any such act on Tenant's part without waiving its right based upon
any default of Tenant and without releasing Tenant from any obligations
hereunder.
27.2 Tenant's Reimbursement. Except as may be specifically provided to the
contrary in this Lease, Tenant shall pay to Landlord, within fifteen (15) days
after delivery by Landlord to Tenant of statements therefor: (i) sums equal to
expenditures reasonably made and obligations incurred by Landlord in connection
with the remedying by Landlord of Tenant's defaults pursuant to the provisions
of Section 27.1; (ii) sums equal to all losses, costs, liabilities, damages and
expenses referred to in Article 11 of this Lease; and (iii) sums equal to all
expenditures made and obligations incurred by Landlord in collecting or
attempting to collect the Rent or in enforcing or attempting to enforce any
rights of Landlord under this Lease or pursuant to law, including, without
limitation, all legal fees and other amounts so expended. Tenant's obligations
30
under this Section 27.2 shall survive the expiration or sooner termination of
the Lease Term.
ARTICLE 28
ENTRY BY LANDLORD
Landlord reserves the right at all reasonable times and upon reasonable
notice to the Tenant to enter the Premises to (i) inspect them; (ii) show the
Premises to prospective purchasers, mortgagees or ground or underlying lessors,
or during the last twelve (12) months of the Lease Term, prospective tenants;
(iii) post notices of nonresponsibility; or (iv) alter, improve or repair the
Premises or the Building if necessary to comply with current building codes or
other applicable laws, or for alterations, repairs or improvements to the
Building. Notwithstanding anything to the contrary contained in this Article 28,
Landlord may enter the Premises at any time to (A) perform services required of
Landlord; (B) take possession due to any breach of this Lease in the manner
provided herein; and (C) perform any covenants of Tenant which Tenant fails to
perform. Landlord may make any such entries without the abatement of Rent and
may take such steps as required to accomplish the stated purposes; provided,
however, that any such entry shall be accomplished as expeditiously as
reasonably possible and in a manner so as to cause as little interference to
Tenant as reasonably possible. Tenant waives any claim for damages or for any
injuries or inconvenience to or interference with Tenant's business, lost
profits, any loss of occupancy or quiet enjoyment of the Premises, and any other
loss occasioned thereby. For each of the above purposes, Landlord shall at all
times have a key with which to unlock all the doors in the Premises, excluding
Tenant's vaults, safes and special security areas designated in advance by
Tenant. In an emergency, Landlord shall have the right to use any means that
Landlord may deem proper to open the doors in and to the Premises. Any entry
into the Premises by Landlord in the manner hereinbefore described shall not be
deemed to be a forcible or unlawful entry into, or a detainer of, the Premises,
or an actual or constructive eviction of Tenant from any portion of the
Premises.
ARTICLE 29
DISABILITIES ACTS
The parties acknowledge that the Americans With Disabilities Act of 1990
(42 U.S.C. ss.12101 et seq.) and regulations and guidelines promulgated
thereunder ("ADA"), and any similarly motivated state and local laws ("Local
Barriers Acts"), as the same may be amended and supplemented from time to time
(collectively referred to herein as the "Disabilities Acts") establish
requirements for business operations, accessibility and barrier removal, and
that such requirements may or may not apply to the Premises and Real Property
depending on, among other things: (i) whether Tenant's business is deemed a
"public accommodation" or "commercial facility", (ii) whether such requirements
are "readily achievable", and (iii) whether a given alteration affects a
"primary function area" or triggers "path of travel" requirements. The parties
hereby agree that: (a) Landlord shall perform any required ADA Title III and
related Local Barriers Acts compliance in the common areas, the cost of which
shall be included in Operating Expenses under Article 5 of this Lease (except
that any items constituting capital expenditures shall be amortized as required
therein),
31
except as provided below, (b) Tenant shall perform any required ADA Title III
and related Local Barriers Acts compliance in the Premises, at Tenant's expense,
and (c) Landlord may perform, or require that Tenant perform, and Tenant shall
be responsible for the cost of, ADA Title III and related Local Barriers Acts
"path of travel" and other requirements triggered by any public accommodation or
other use of, or alterations in, the Premises. Tenant shall be responsible for
ADA Title I and related Local Barriers Acts requirements relating to Tenant's
employees, and Landlord shall be responsible for ADA Title I and related Local
Barriers Acts requirements relating to Landlord's employees.
ARTICLE 30
MISCELLANEOUS PROVISIONS
30.1 Binding Effect. Each of the provisions of this Lease shall extend to
and shall, as the case may require, bind or inure the benefit not only of
Landlord and of Tenant, but also of their respective successors or assigns,
provided this clause shall not permit any assignment by Tenant contrary to the
provisions of Article 15 of this Lease.
30.2 No Air or Roof Rights. Tenant shall have no rights: (i) to install any
radio or television antennas or any other device or item on the roof, exterior
walls, windows or window xxxxx of the Building, (ii) to any view or to light or
air over any property, whether belonging to Landlord or any other person.
30.3 Modification of Lease. Should any current or prospective mortgagee or
ground lessor for the Building require a modification or modifications of this
Lease, which modification will not cause an increased cost or expense to Tenant
or in any other way adversely change the rights and obligations of Tenant
hereunder, then and in such event, Tenant agrees that this Lease may be so
modified and agrees to execute whatever documents are required therefor and
deliver the same to Landlord within twenty (20) days following the request
therefor.
30.4 Transfer of Landlord's Interest. Tenant acknowledges that Landlord has
the right to transfer all or any portion of its interest in the Real Property
and Building and in this Lease, and Tenant agrees that in the event of any such
transfer, Landlord shall automatically be released from all liability under this
Lease and Tenant agrees to look solely to such transferee for the performance of
Landlord's obligations hereunder. Tenant further acknowledges that Landlord may
assign its interest in this Lease to a mortgage lender as additional security
and agrees that such an assignment shall not release Landlord from its
obligations hereunder and that Tenant shall continue to look to Landlord for the
performance of its obligations hereunder.
30.5 Captions. The captions of Articles and Sections are for convenience
only and shall not be deemed to limit, construe, affect or alter the meaning of
such Articles and Sections.
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30.6 Relationship of Parties. Nothing contained in this Lease shall be
deemed or construed by the parties hereto or by any third party to create the
relationship of principal and agent, partnership, joint venturer or any
association between Landlord and Tenant.
30.7 Time of Essence. Time is of the essence of this Lease and each of its
provisions.
30.8 Partial Invalidity. If any term, provision or condition contained in
this Lease shall, to any extent, be invalid or unenforceable, the remainder of
this Lease, or the application of such term, provision or condition to persons
or circumstances other than those with respect to which it is invalid or
unenforceable, shall not be affected thereby, and each and every other term,
provision and condition of this Lease shall be valid and enforceable to the
fullest extent possible permitted by law.
30.9 Landlord Exculpation. It is expressly understood and agreed that
notwithstanding anything in this Lease, as may be amended from time to time, to
the contrary, and notwithstanding any applicable law to the contrary, the
liability of Landlord and the Landlord Parties hereunder or thereunder
(including any successor landlord) and any recourse by Tenant against Landlord
or the Landlord Parties shall be limited solely and exclusively to the interest
of Landlord in the Real Property, and neither Landlord, nor any of the Landlord
Parties shall have any personal liability therefor, and Tenant hereby expressly
waives and releases such personal liability on behalf of itself and all persons
claiming by, through or under Tenant. Landlord and Tenant agree that in no event
shall Landlord be liable to Tenant for any consequential or incidental damages.
30.10 Entire Agreement. This Lease, including the Exhibits listed in
Article 1 (WHICH COLLECTIVELY ARE HEREBY INCORPORATED WHERE REFERRED TO HEREIN
AND MADE A PART HEREOF AS THOUGH FULLY SET FORTH), contains all the terms and
provisions between Landlord and Tenant relating to the matters set forth herein.
It is understood and acknowledged that there are no oral agreements between the
parties hereto affecting this Lease and this Lease constitutes the parties'
entire agreement with respect to the leasing of the Premises and supersedes and
cancels any and all previous negotiations, arrangements, brochures, agreements
and understandings, if any, between the parties hereto or displayed by Landlord
to Tenant with respect to the subject matter thereof, and none thereof shall be
used to interpret or construe this Lease. TENANT HAS RELIED ON TENANT'S
INSPECTIONS AND DUE DILIGENCE IN ENTERING THIS LEASE, AND NOT ON ANY
REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, CONCERNING THE HABITABILITY,
CONDITION OR SUITABILITY OF THE PREMISES OR PROPERTY FOR ANY PARTICULAR PURPOSE
OR ANY OTHER MATTER NOT EXPRESSLY CONTAINED HEREIN. None of the terms,
covenants, conditions or provisions of this Lease can be modified, deleted or
added to except in writing signed by the parties hereto.
30.11 Right to Lease. Landlord reserves the absolute right to effect such
other tenancies in the Building as Landlord in the exercise of its sole business
judgment shall determine to best promote the interests of the Building. Tenant
does not rely on the fact, nor does Landlord represent, that any
33
specific tenant or type or number of tenants shall, during the Lease Term,
occupy any space in the Building.
30.12 Force Majeure. Any prevention, delay or stoppage due to strikes,
lockouts, labor disputes, acts of God, inability to obtain services, labor, or
materials or reasonable substitutes therefor, governmental actions, civil
commotions, fire or other casualty, and other causes beyond the reasonable
control of Landlord (collectively, "Force Majeure"), shall excuse the
performance of Landlord for a period equal to any such prevention, delay or
stoppage and, therefore, if this Lease specifies a time period for performance
of an obligation by Landlord, that time period shall be extended by the period
of any delay in Landlord's performance caused by a Force Majeure.
30.13 Notices. All notices, demands, approvals or communications
(collectively, "Notices") given or required to be given by either party to the
other hereunder shall be in writing, shall be sent by United States certified or
registered mail, postage prepaid, return receipt requested, or delivered by a
nationally-recognized overnight delivery service (i) to Tenant at the
appropriate address set forth in Section 1.4, or to such other place as Tenant
may from time to time designate in a Notice to Landlord; or (ii) to Landlord at
the addresses set forth in Section 1.2, or to such other firm or to such other
place as Landlord may from time to time designate in a Notice to Tenant. Any
Notice will be deemed given on the date it is mailed as provided in this Section
30.13 or upon the date personal delivery is made or attempted to be made. If
Tenant is notified of the identity and address of Landlord's mortgagee or ground
or underlying lessor, Tenant shall give to such mortgagee or ground or
underlying lessor written notice of any default by Landlord under the terms of
this Lease by registered or certified mail,and such mortgagee or ground or
underlying lessor shall be given a reasonably opportunity to cure such default
prior to Tenant's exercising any remedy available to Tenant.
30.14 Joint and Several Tenants; Partnership Tenant. If there is more than
one Tenant, the obligations imposed upon Tenant under this Lease shall be joint
and several. If Tenant is a partnership, all current and new general partners
shall be jointly and severally liable for all obligations of Tenant hereunder
and as this Lease may hereafter be modified, whether such obligations accrue
before or after admission of future partners or after any partners die or leave
the partnership. Tenant shall cause each new partner to sign and deliver to
Landlord written confirmation of such liability, in form and content
satisfactory to Landlord, but failure to do so shall not avoid such liability.
30.15 Authority. If Tenant is any form of corporation, partnership, limited
liability company or partnership, association or other organization, Tenant and
all Persons signing for Tenant below hereby represent that this Lease has been
fully authorized and no further approvals are required, and Tenant is duly
organized, in good standing and legally qualified to do business in the Premises
(and has any required certificates, licenses, permits and other such items).
30.16 Governing Law. This Lease shall be construed and enforced in
accordance with the laws of the state in which the Premises is located.
34
30.17 Independent Covenants. This Lease shall be construed as though the
covenants herein between Landlord and Tenant are independent and not dependent
and Tenant hereby expressly waives the benefit of any statute to the contrary
and agrees that if Landlord fails to perform its obligations set forth herein,
Tenant shall not be entitled to make any repairs or perform any acts hereunder
at Landlord's expense or to any setoff of the Rent or other amounts owing
hereunder against Landlord.
30.18 Building Name and Signage. Landlord shall have the right at any time
to change the name of the Building and to install, affix and maintain any and
all signs on the exterior and on the interior of the Building as Landlord may,
in Landlord's sole discretion, desire. Tenant shall not use the name of the
Building or use pictures or illustrations of the Building in advertising or
other publicity, without prior written consent of Landlord.
30.19 Rentable Area. Tenant acknowledges that the term "rentable area"
includes the so-called usable area, without deduction for columns or
projections, multiplied by one or more load or conversion factors, to reflect a
share of certain areas, which may include ground floor and elevator lobbies,
corridors, mechanical, utility, janitorial, boiler and service rooms and
closets, restrooms, and other common, public and service areas.
30.20 Successors. Except as otherwise expressly provided herein, the
obligations of this Lease shall bind and benefit the successors and assigns of
the parties hereto; provided, however, that no assignment, sublease or other
transfer in violation of the provisions of Article 15 shall operate to vest any
rights in any putative assignee, subtenant or transferee of Tenant.
30.21 Landlord Renovations. Tenant's taking possession of the Premises
shall be conclusive evidence as against Tenant that the Premises, the Building
and the Real Property were in good order and satisfactory condition when Tenant
took possession and that Landlord has fully complied with all of its obligations
with respect to any work to be performed in the Premises, the Building or the
Real Property. However, Tenant acknowledges that Landlord may during the Lease
Term renovate, improve, alter, or modify (collectively, "Renovations") the
Building, Premises, and/or Real Property, including without limitation the
parking structure, common areas, systems and equipment, roof, and structural
portions of the same. Tenant hereby agrees that such Renovations and Landlord's
actions in connection with such Renovations shall in no way constitute a
constructive eviction of Tenant nor entitle Tenant to any abatement of Rent.
Landlord shall have no responsibility or for any reason be liable to Tenant for
any direct or indirect injury to or interference with Tenant's business arising
from the Renovations, nor shall Tenant be entitled to any compensation or
damages from Landlord for loss of the use of the whole or any part of the
Premises or of Tenant's personal property or improvements resulting from the
Renovations or Landlord's actions in connection with such Renovations, or for
any inconvenience or annoyance occasioned by such Renovations or Landlord's
actions in connection with such Renovations, provided, however, in connection
with any such Renovations, Landlord shall make reasonable efforts to minimize
any adverse effect upon Tenant's business.
35
30.22 Radon Gas. Radon Gas is a naturally occurring radioactive gas that,
when it has accumulated in a building in sufficient quantities, may present
health risks to persons who are exposed to it over time. Levels of radon that
exceed federal and state guidelines have been found in buildings in Florida.
Additional information regarding radon and radon testing may be obtained from
your county public health unit.
ARTICLE 31
RELOCATION OF TENANT
INTENTIONALLY OMITTED.
ARTICLE 32
SECURITY DEPOSIT
The Security Deposit set forth in Section 1.12 (if any) shall be held by
Landlord for the performance of Tenant's covenants and obligations under this
Lease, it being expressly understood that the Security Deposit shall not be
considered an advance payment of rental or a measure of Landlord's damage in
case of default hereunder by Tenant, and shall be held by Landlord without
payment of any interest thereon. Upon the occurrence of any event of default by
Tenant under this Lease, Landlord may, from time to time, without prejudice to
any other remedy, use the Security Deposit to the extent necessary to make good
any arrears of rent, or to repair any damage or injury, or pay any expense or
liability incurred by Landlord as a result of the event of default or breach of
covenant, and any remaining balance of the Security Deposit shall be returned by
Landlord to Tenant upon the termination of this Lease and the performance of all
of Tenant's obligations contained in this Lease. If any portion of the Security
Deposit is so used or applied, Tenant shall upon ten (10) days written notice
from Landlord, deposit with Landlord by cash or certified check an amount
sufficient to restore the Security Deposit to its original amount. The Security
Deposit may be assigned and transferred by Landlord to the successor in interest
of Landlord and Landlord shall thereby be discharged of any further obligation
relating thereto.
ARTICLE 33
CONDITION OF PREMISES
Tenant has inspected the Premises (and portions of the Building, Real
Property, systems and equipment providing access to or serving the Premises) or
has had an opportunity to do so, and agrees to accept the same "AS IS" without
any agreements, representations, understandings or obligations on the part of
Landlord to perform any alterations, repairs or improvements, or regarding any
other matter, unless expressly provided under this Lease. If Landlord has
expressly agreed to perform any improvements to the Premises under this Lease:
(a) such improvements shall consist of Landlord's building standard materials
and finishes unless otherwise expressly provided, and (b) notwithstanding
anything contained herein to the contrary, all furniture and equipment, if any,
whether or not shown
36
on any Exhibit hereto, shall be provided by Tenant at Tenant's sole cost and
expense. If Landlord has expressly agreed to perform any improvements to the
Premises under this Lease, Landlord agrees to use diligent, good faith efforts
to substantially complete any such improvements to an extent that Tenant can
reasonably occupy the Premises by the Lease Commencement Date set forth in
Article 1, subject to Article 3 and the other provisions of this Lease. In such
event, Tenant also agrees to use diligent, good faith efforts to cooperate, and
to cause its space planners, architects, contractors, agents and employees to
cooperate diligently and in good faith, with Landlord and any space planners,
architects, contractors or other parties designated by Landlord, such that any
such improvements to the Premises can be planned, permits can be obtained, and
the work can be substantially completed by the Lease Commencement Date set forth
in Article 1. In the event of any dispute as to whether any such improvements
have been substantially completed, Landlord may refer the matter to Landlord's
independent architect, whose decision shall be final and binding on the parties.
Notwithstanding the foregoing or Article 3 or any other provision of this Lease
to the contrary, if Tenant is currently occupying the Premises, whether pursuant
to a prior lease or otherwise, and Landlord is required to perform any
improvements to the Premises under this Lease, the parties hereby agree that:
(i) Landlord shall use commercially reasonable efforts to minimize any
disruption to Tenant's occupancy of the Premises in connection therewith, (ii)
Landlord shall seek to substantially complete the same by the Commencement Date
set forth in Article 1, or within a reasonable time thereafter, but shall not be
required to incur overtime or pay premiums to perform such work before or after
the Building Hours, and may require that Tenant cooperate in scheduling and
staging the work within the Premises (including cooperation in moving personnel,
furniture and equipment or permitting Landlord to do so), and (iii) there shall
be no postponement of the Lease Commencement Date or abatement of Rent as a
result of any such improvements, or delays in substantially completing the same,
under any circumstances (Tenant hereby acknowledging that it could have arranged
for such improvements through an independent contractor, subject to Landlord's
approval, the other provisions of this Lease and such other documentation as
Landlord may have required).
ARTICLE 34
LIEN
34.1 Landlord's Lien. As security for payment of Rent, damages and all
other payments required to be made by this Lease, Tenant hereby grants to
Landlord a lien upon and security interest in all property of Tenant now or
subsequently located upon the Premises. If Tenant is in default of any provision
of this Lease, Landlord may enter upon the Premises, by picking or changing
locks if necessary, and take possession of all or any part of such property, and
may sell all or any part of such property at a public or private sale, in one or
successive sales, with or without notice, to the highest bidder for cash, and,
on behalf of Tenant, sell and convey all or part of such property to the highest
bidder, delivering to the highest bidder all of Tenant's title and interest in
the property sold. The proceeds of the sale of such property shall be applied by
Landlord toward the reasonable costs and expenses of the sale, including
attorneys' fees, and then toward the payment of all sums then due by
37
Tenant to Landlord under the terms of this Lease. Any excess remaining shall be
paid to Tenant or any other person entitled thereto by law.
34.2 Uniform Commercial Code. This Lease is intended as and constitutes a
security agreement within the meaning of the Uniform Commercial Code of the
state in which the Premises are situated. Landlord, in addition to the rights
prescribed in this Lease, shall have all of the rights, titles, liens and
interests in and to Tenant's property, now or hereafter located upon the
Premises, which may be granted a secured party (as that term is defined under
such Uniform Commercial Code) under this Lease. Tenant will on request execute
and deliver to Landlord a financing statement (or continuation statement) for
the purpose of perfecting Landlord's security interest under this Lease or
Landlord may file this Lease, a carbon, photographic or other reproduction of
this Lease, or a memorandum of this Lease as a financing statement.
ARTICLE 35
CONFIDENTIALITY
Tenant shall keep the content and all copies of this Lease, related
documents or amendments now or hereafter entered, and all proposals, materials,
information and matters relating thereto strictly confidential, and shall not
disclose, disseminate or distribute any of the same, or permit the same to
occur, except to the extent reasonably required for proper business purposes by
Tenant's employees, attorneys, insurers, auditors, lenders, purchasers and
Transferees (and Tenant shall obligate any such parties to whom disclosure is
permitted to honor the confidentiality provisions hereof), and except as may be
required by law or court proceedings.
ARTICLE 36
OFFER
The submission and negotiation of this Lease shall not be deemed an offer
to enter the same by Landlord (nor an option or reservation for the Premises),
but the solicitation of such an offer by Tenant. Tenant agrees that its
execution of this Lease constitutes a firm offer to enter the same which may not
be withdrawn for a period of thirty (30) days after delivery to Landlord. During
such period and in reliance on the foregoing, Landlord may, at Landlord's
option, deposit any Security Deposit and Rent, proceed with any plans,
specifications, alterations or improvements, and permit Tenant to enter the
Premises, but such acts shall not be deemed an acceptance of Tenant's offer to
enter this Lease, and such acceptance shall be evidenced only by Landlord
signing and delivering this Lease to Tenant.
38
IN WITNESS WHEREOF, Landlord and Tenant have caused their duly authorized
representatives to execute this Lease as of the day and date first above
written.
LANDLORD:
CMD REALTY INVESTMENT FUND II, L.P.,
an Illinois limited partnership
By: CMD/Fund II GP Investments, L.P.,
an Illinois limited partnership,
its general partner
By: CMD XXXX II, Inc.,
an Illinois corporation,
its general partner
___________________________
Witness By: ___________________________________
___________________________ Name: Xxxxx Xxxxxxxx
Witness Its: Vice President
TENANT:
CPS SYSTEMS, INC.,
a Texas Corporation
___________________________
Witness By: _____________________________
___________________________ Name: _____________________________
Witness Its: _____________________________
39
EXHIBIT A
---------
OUTLINE OF PREMISES
-------------------
0xx Xxxxx
Xxxxx 000
One President's Plaza
0000 Xxxxxxxxxx Xxxxxxxxx
40
EXHIBIT A-1
-----------
REAL PROPERTY
-------------
41
EXHIBIT B
---------
RULES AND REGULATIONS
---------------------
Tenant shall faithfully observe and comply with the following Rules and
Regulations. Landlord shall not be responsible to Tenant for the nonperformance
of any of said Rules and Regulations by or otherwise with respect to the acts or
omissions of any other tenants or occupants of the Real Property.
1. Tenant shall not alter any lock or install any new or additional
locks or bolts on any doors or windows of the Premises without obtaining
Landlord's prior written consent. Tenant shall bear the cost of any lock
changes or repairs required by Tenant except Landlord will, pursuant to
Exhibit D, re-key existing suite door entry lockset. Landlord will provide
Tenant a total of forty (40) keys without charge. Any additional keys will
be paid for by Tenant.. Two keys will be furnished by Landlord for the
Premises, and any additional keys required by Tenant must be obtained from
Landlord at a reasonable cost to be established by Landlord or, at Tenant's
option, obtained by Tenant at Tenant's expense. Landlord will provide to
Tenant, 40 after-hours access cards at no charge. Any additional cards will
be paid for by Tenant.
2. All doors opening to public corridors shall be kept closed at all
times except for normal ingress and egress to the Premises. The foregoing
sentence shall not be applicable to floors of the Building that are
entirely contained within the Premises.
3. Landlord reserves the right to close and keep locked all entrance
and exit doors of the Building during such hours as are customary for
comparable buildings. Tenant, its employees and agents must be sure that
the doors to the Building are securely closed and locked when leaving the
Premises if it is after the normal hours of business for the Building. Any
tenant, its employees, agents or any other persons entering or leaving the
Building at any time when it is so locked, or any time when it is
considered to be after normal business hours for the Building, may be
required to sign the Building register. Access to the Building may be
refused unless the person seeking access has proper identification or has a
previously arranged pass for access to the Building. Landlord and his
agents shall in no case be liable for damages for any error with regard to
the admission to or exclusion from the Building of any person. In case of
invasion, mob, riot, public excitement, or other commotion, Landlord
reserves the right to prevent access to the Building or the Real Property
during the continuance thereof by any means it deems appropriate for the
safety and protection of life and property.
42
4. All moving activity into or out of the Building and all
construction activity shall be scheduled with Landlord and done only at
such time and in such manner as Landlord designates. Landlord shall have
the right to prescribe the weight, size and position of all safes and other
heavy property brought into the Building and also the times and manner of
moving the same in and out of the Building. Safes and other heavy objects
shall, if considered necessary by Landlord, stand on supports of such
thickness as is necessary to properly distribute the weight. Landlord will
not be responsible for loss of or damage to any such safe or property in
any case. Any damage to any part of the Building, its contents, occupants
or visitors by moving or maintaining any such safe or other property shall
be the sole responsibility and expense of Tenant.
5. No furniture, packages, supplies, equipment or merchandise will be
received in the Building or carried up or down in the elevators, except
between such hours and in such specific elevator as shall be designated by
Landlord.
6. The requirements of Tenant will be attended to only upon
application at the management office for the Real Property or at such
office location designated by Landlord. Employees of Landlord shall not
perform any work or do anything outside their regular duties unless under
special instructions from Landlord.
7. Tenant shall not disturb, solicit, or canvass any occupant of the
Real Property and shall cooperate with Landlord and its agents of Landlord
to prevent the same.
8. 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.
The expense of any breakage, stoppage or damage resulting from the
violation of this rule shall be borne by the tenant who, or whose employees
or agents, shall have caused it.
9. Tenant shall not overload the floor of the Premises, nor xxxx,
drive nails or screws, or drill into the partitions, woodwork or plaster or
in any way deface the Premises or any part thereof with out Landlord's
prior written consent. Hanging of artwork, shelving, bulletin boards and
plaques are permitted.
10. Except for one vending machine intended for the sole use of
Tenant's employees and invitees, no vending machine or machines other than
fractional horsepower office machines shall be installed, maintained or
operated upon the Premises without the written consent of Landlord.
11. Tenant shall not use or keep in or on the Premises, the Building,
or the Real Property any kerosene, gasoline or other inflammable or
combustible fluid or material. Tenant shall not bring, or permit any of its
employees or agents to bring, any hazardous or toxic materials, firearms,
ammunition or other weapons, or any other materials or substances that
might pose a health or safety risk, upon the Premises, the Building or the
Real Property. Tenant shall be allowed to store normal
43
quantities of office supplies including copier toner and cleaning supplies
on the Premises.
12. Tenant shall not without the prior written consent of Landlord use
any method of heating or air conditioning other than that supplied by
Landlord.
13. Tenant shall not use, keep or permit to be used or kept, any foul
or noxious gas or substance in or on the Premises, or permit or allow the
Premises to be occupied or used in a manner offensive or objectionable to
Landlord or other occupants of the Real Property by reason of noise, odors,
or vibrations, or interfere in any way with other tenants or those having
business therein. Landlord shall have the right to prohibit the smoking of
any tobacco products in the Building, including the Premises, and may,
without any obligation to do so, designate exclusive areas for the smoking
of tobacco products.
14. Tenant shall not bring into or keep within the Real Property, the
Building or the Premises any animals, birds, bicycles or other vehicles,
other than seeing-eye dogs assisting the visually-impaired.
15. No cooking shall be done or permitted on the Premises, nor shall
the Premises be used for the storage of merchandise, for lodging or for any
improper, objectionable or immoral purposes. Notwithstanding the foregoing,
Underwriters' Laboratory-approved equipment and microwave ovens may be used
in the Premises for heating food and brewing coffee, tea, hot chocolate and
similar beverages for employees and visitors, provided that such use in
accordance with all applicable federal, state and city laws, codes,
ordinances, rules and regulations.
16. Landlord will approve where and how telephone and
telecommunication wiring and cabling are to be introduced to the Premises.
No boring or cutting for wires shall be allowed without the consent of
Landlord. The location of telephone, call boxes and other office equipment
affixed to the Premises shall be subject to the approval of Landlord.
17. Landlord reserves the right to exclude or expel from the Real
Property any person who, in the judgment of Landlord, is intoxicated or
under the influence of liquor or drugs, or who shall in any manner do any
act in violation of any of these Rules and Regulations.
18. Tenant, its employees and agents shall not loiter in or on the
entrances, corridors, sidewalks, lobbies, halls, stairways, elevators, or
any common areas of the Building for the purpose of smoking tobacco
products (excepting the designated smoking area for the Building) or for
any other purpose, nor in any way obstruct such areas, and shall use them
only as a means of ingress and egress for the Premises.
19. Tenant shall not waste electricity, water or air conditioning and
agrees to cooperate fully with Landlord to ensure the most effective
operation of the Building's heating and air conditioning system, and shall
refrain from attempting to adjust any controls.
44
20. Tenant shall store all its trash and garbage within the interior
of the Premises. No material shall be placed in the trash boxes or
receptacles if such material is of such nature that it may not be disposed
of in the ordinary and customary manner of removing and disposing of trash
in the vicinity of the Building without violation of any law or ordinance
governing such disposal. All trash, garbage and refuse disposal shall be
made only through entry-ways and elevators provided for such purposes at
such times as Landlord shall designate. If the Premises is or becomes
infested with vermin as a result of the use or any misuse or neglect of the
Premises by Tenant, its agents, servants, employees, contractors, visitors
or licensees, Tenant shall forthwith, at Tenant's expense, cause the
Premises to be exterminated from time to time to the satisfaction of
Landlord and shall employ such licensed exterminators as shall be approved
in writing in advance by Landlord.
21. Tenant shall comply with all safety, fire protection and
evacuation procedures and regulations established by Landlord or any
governmental agency.
22. Tenant shall assume any and all responsibility for protecting the
Premises from theft, robbery and pilferage, which includes keeping doors
locked and other means of entry to the Premises closed.
23. No awnings or other projection shall be attached to the outside
walls of the Building without the prior written consent of Landlord. No
curtains, blinds, shades or screens shall be attached to or hung in, or
used in connection with, any window or door of the Premises without the
prior written consent of Landlord. All electrical ceiling fixtures hung in
offices or spaces along the perimeter of the Building must be fluorescent
and/or of a quality, type, design and bulb color approved by Landlord.
Tenant shall abide by landlord's regulations concerning the opening and
closing of window coverings which are attached to the windows in the
Premises, if any, which have a view of any interior portion of the Building
or the common areas of the Building.
24. The sashes, sash doors, skylights, windows, and doors that reflect
or admit light and air into the halls, passageways or other public places
in the Building shall not be covered or obstructed by Tenant, nor shall any
bottles, parcels or other articles be placed on the window xxxxx.
25. Tenant must comply with requests by Landlord concerning the
informing of their employees of items of importance to Landlord.
26. Tenant shall not use in any space or in the public halls of the
Building any hand trucks except those equipped with rubber tires and side
guards or such other material-handling equipment as Landlord may approve.
Tenant shall not bring any other vehicles of any kind into the Building.
27. Without the written consent of Landlord, Tenant shall not use the
name or a likeness of the Building in connection with or in promoting or
advertising the business of Tenant except as Tenant's address.
45
28. If the Real Property now or hereafter contains, or Landlord has
obtained the right to use for the Real Property, a parking garage,
structure, facility or area, the following Rules shall apply therein:
(i) Parking shall be available in areas designated by Landlord
from time to time. Parking for Tenant and its employees and visitors
shall be on a "first come, first served," unassigned basis, in common
with Landlord and other tenants at the Real Property, and their
employees and visitors, and other Persons to whom Landlord shall grant
the right or who shall otherwise have the right to use the same.
However, in no event shall Tenant and Tenant's employees and visitors
use more spaces than the number derived by applying Tenant's Share (as
defined in the Lease) to the total number of unassigned spaces in the
area or areas designated by Landlord from time to time to serve the
Premises. In addition, Landlord reserves the right to: (x) adopt
additional requirements or procedures pertaining to parking, including
systems with charges favoring carpooling, and validation systems, (y)
assign specific spaces, and reserve spaces for small and other size
cars, disabled persons, and other tenants, customers of tenants or
other parties, and (z) restrict or prohibit full size vans and other
large vehicles.
(ii) In case of any violation of these rules, Landlord may also
refuse to permit the violator to park, and may remove the vehicle
owned or driven by the violator from the Real Property without
liability whatsoever, at such violator's risk and expense. Landlord
reserves the right to close all or a portion of the parking areas or
facilities in order to make repairs or perform maintenance services,
or to alter, modify, re-stripe or renovate the same, or if required by
casualty, strike, condemnation, act of God, law or governmental
requirement or guideline, termination or modification of any lease or
other agreement by which Landlord obtained parking rights, or any
other reason beyond Landlord's reasonable control. In the event access
is denied for any reason, any monthly parking charges shall be abated
to the extent access is denied, as Tenant's sole recourse.
(iii) Hours shall be reasonably established by Landlord or its
parking operator from time to time; cars must be parked entirely
within the stall lines, and only small or other qualifying cars may be
parked in areas reserved for such cars; all directional signs, arrows
and speed limits must be observed; spaces reserved for disabled
persons must be used only by vehicles properly designated; washing,
waxing, cleaning or servicing of any vehicle is prohibited; every
xxxxxx is required to park and lock his own car, except to the extent
that Landlord adopts a valet parking system; parking is prohibited in
areas: (a) not striped or designated for parking, (b) aisles, (c)
where "no parking" signs are posted, (d) on ramps, and (e) loading
areas and other specially designated areas. Delivery trucks and
vehicles shall use only those areas designated therefor.
(iv) Parking stickers, key cards or any other devices or forms of
identification or entry shall remain the property of Landlord. Such
devices must be displayed as requested and may not be mutilated in any
manner. The serial number of the parking identification device may not
be
46
obliterated. Devices are not transferable and any device in the
possession of an unauthorized holder will be void. Loss or theft of
parking identification, key cards or other such devices must be
reported to Landlord or any garage manager immediately. Any parking
devices reported lost or stolen which are found on any unauthorized
car will be confiscated and the illegal holder will be subject to
prosecution. Lost or stolen devices found by Tenant or its employees
must be reported to Landlord or the office of the garage immediately.
Notwithstanding anything expressly to the contrary contained in clause (i)
of Paragraph 28 of these Rules, Landlord agrees to provide to Tenant the right,
throughout the Lease Term, to free non-exclusive use of not fewer than 41
parking spaces in the parking facilities on the Real Property, in areas
designated by Landlord from time to time.
Landlord reserves the right at any time to change or rescind any one or
more of these Rules and Regulations, or to make such other and further
reasonable Rules and Regulations as in Landlord's judgment may from time to time
be necessary for the management, safety, care and cleanliness of the Premises,
Building, and the Real Property, and for the preservation of good order therein,
as well as for the convenience of other occupants and tenants therein. Landlord
may waive any one or more of these Rules and Regulations for the benefit of any
particular tenants, but no such waiver by Landlord shall be construed as a
waiver of such Rules and Regulations in favor of any other tenant, nor prevent
Landlord from thereafter enforcing any such Rules or Regulations against any or
all tenants of the Real Property. Tenant shall be deemed to have read these
Rules and Regulations and to have agreed to abide by them as a condition of its
occupancy of the Premises.
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EXHIBIT C
ESTOPPEL CERTIFICATE
To: ________________________
________________________
________________________
________________________
Attn:____________________
___________________________________ ("Tenant") hereby certifies as follows:
1. The undersigned is the Tenant under that certain Office Lease dated
_____________, 19___ (the "Lease"), executed by ________________________________
("Landlord") as Landlord and the undersigned as Tenant, covering a portion of
the property located at _____________________ (the "Property").
2. Pursuant to the Lease, Tenant has leased space commonly known as Suite
___ (the "Premises") at the Property and has paid to Landlord a security deposit
of $_______. The term of the Lease commenced on _______________, 19____ and the
expiration date of the Lease is ________________________, _____. Tenant has paid
rent through _____________, 19___. The next rental payment in the amount of
$____________ is due on _____________, 19____. Tenant is required to pay ____
percent (____%) of all annual operating expenses for the Property in excess of
_____________.
3. The Lease provides for ____ option(s) to extend the Lease Term for
_______ years (each). The rental rate for such extension term(s) is as follows:
________________________________________________________________________________
Except as expressly provided in the Lease, and other documents attached hereto,
Tenant does not have any right or option to renew or extend the term of the
Lease, to lease other space at the Property, nor any preferential right to
purchase all or any part of the Premises or the Property.
4. Tenant has no right of refusal, option to expand, option to terminate,
option to purchase, or exclusive business rights, except as follows: .
5. True, correct and complete copies of the Lease and all amendments,
modifications and supplements thereto are attached hereto and the Lease, as so
amended, modified and supplemented, is in full force and effect, and represents
the entire agreement between Tenant and Landlord with
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respect to the Premises and the Property. There are no amendments, modifications
or supplements to the Lease, whether oral or written, except as follows (include
the date of such amendment, modification or supplement): _______________________
________________________________________________________________________________
________________________________________________________________________________
6. All space and improvements leased by Tenant have been completed and
furnished in accordance with the provisions of the Lease, and Tenant has
accepted and taken possession of the Premises.
7. Landlord is not in any respect in default in the performance of the
terms and provisions of the Lease. Tenant is not in any respect in default under
the Lease and has not assigned, transferred or hypothecated the Lease or any
interest therein or subleased all or any portion of the Premises.
8. There are not offsets or credits against rentals payable under the Lease
and no free periods or rental concessions have been granted to Tenant, except as
follows:
________________________________________________________________________________
9. Tenant has no actual or constructive knowledge of any processing, use,
storage, disposal, release or treatment of any explosive, corrosive, hazardous
or toxic materials or substances, or materials capable of emitting toxic fumes,
on the Premises or the Real Property except as follows (if none, state "none"):
________________________________________________________________________________
This Certificate is given to _____________________________________ with
the understanding that ______________ will rely hereon in connection with the
financing [conveyance] of the Real Property of which the Premises constitutes a
part. Following any such financing [conveyance], Tenant agrees that the Lease
shall remain in full force and effect [and shall bind and inure to the benefit
of the ___________ and its successor in interest as if no purchase had
occurred].
DATED:__________________, 19___ "TENANT"
_____________________________
_____________________________
(ATTACH LEASE AND AMENDMENTS TO THIS CERTIFICATE)
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EXHIBIT D
---------
PREMISES IMPROVEMENTS
---------------------
Landlord will build the Premises pursuant to architectural plans prepared by
Xxxxxxx X. Xxxxxx, Xx., Architect dated May 3, 1998 and approved by Xxxx Xxxxxx
of CPS Systems, Inc. on May 5, 1998, Tenant hereby accepts the Premises "as-is"
other than the items specified below which will be completed in compliance with
local building code requirements.
1. Landlord will remove 991 sq. yds of existing floor covering/carpeting.
2. Landlord will remove approximately 540 s.f. of existing wallcovering
within the interior office area.
3. Landlord will remove 13 l.f. of existing drywall within the Premises.
4. Landlord will remove framing and drywall for a new door opening adjacent
the existing breakroom.
5. Landlord will remove 1,612 l.f. of existing vinyl cove base.
6. Landlord will construct 78 l.f. of building standard interior drywall
walls in order to create four (4) offices.
7. Landlord will patch and prepare existing drywall for paint.
8. Landlord will supply and install five (5) building standard doors and
frames.
9. Landlord will install five (5) sets of building standard matching
hardware for new doors within the Premises.
10. Landlord will install and provide four (4) building standard glass
sidelights adjacent to the four (4) newly constructed offices. Sidelights will
have building standard mini blinds.
11. Landlord will provide four (4) building standard switches within the
newly constructed offices (4 new offices).
12. Landlord will provide twelve (12) building standard receptacles within
the newly constructed offices pursuant to the plan.
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13. Landlord will re-locate five (5) existing 2' x 4' lay-in fixtures.
14. Landlord will provide five (5) new lay-in building standard fixtures.
15. Landlord will provide four (4) data poles within the 4 newly
constructed offices.
16. Tenant will be responsible for running the necessary
cabling/telecommunications within newly constructed offices.
17. Landlord will provide five (5) building standard power poles and
powered to customer supplied work stations.
18. Landlord will re-locate two (2) existing emergency and exit lights
within the Premises.
19. Landlord will test and balance HVAC system.
20. Landlord will re-locate four (4) existing HVAC supply grills within the
Premises.
21. Re-locate five (5) existing return air grills within the Premises.
22. Landlord will re-locate three (3) fire sprinkler heads within the
Premises.
23. Landlord will supply and install four (4) new building standard fire
extinguishers within the Premises.
24. Landlord will paint 15,082 s.f. of wall area, building standard paint,
one color flat latex throughout, two (2) coats of paint.
25. Landlord will paint thirty (30) existing door frames, building
standard, one color.
26. Landlord will stain and seal five (5) new building standard doors
within the Premises.
27. Landlord will supply and install 991 sq. yds. of 30 oz. cut pile,
building standard carpeting throughout the Premises, one color throughout.
28. Landlord will install 206 l.f. of carpet border within the Premises,
building standard carpet.
29. Landlord will supply and install 1,900 l.f. of building standard vinyl
base on new and existing walls within the Premises.
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30. Landlord will sand and stain all new and existing interior doors within
the Premises.
31. Landlord will install building standard floor receptacle in conference
room within the Premises.
32. Landlord will re-key front entry suite door to building master system
on or before Lease Commencement Date. Landlord will provide Tenant initially
with 40 suite door keys and after hours access cards at no charge. Any
additional keys/access cards will be an additional cost/charge.
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EXHIBIT E
---------
OPTION TO EXTEND
----------------
1. Provided that this Lease is in full force and effect and Tenant is not
in default under any terms and conditions of this Lease as of the date of the
Extension Option Notice (as hereinafter defined) and as of the Extension Term
Commencement Date (as hereinafter defined) and subject to the terms of this
Exhibit, Tenant shall have the right ("Extension Option") to extend the Lease
Term for the period ("Extension Term") commencing on and including the Extension
Term Commencement Date and ending at 11:59 P.M. (local time at the Premises) on
the Extension Term Expiration Date (as hereinafter defined). Tenant shall
exercise the Extension Option, if at all, by delivering written notice of such
exercise ("Extension Option Notice") on or before the 365th day immediately
preceding the Lease Expiration Date. If Tenant fails to deliver the Extension
Option Notice to Landlord on or before such date, Tenant shall be deemed to have
forever waived any and all rights to extend the Lease Term pursuant to this
Exhibit.
(a) The phrase "Extension Term Commencement Date" means the May 15,
2003.
(b) The phrase "Extension Term Expiration Date" means May 14, 2008.
2. Commencing on the Extension Term Commencement Date, Tenant shall pay to
Landlord Base Rent equal to the Extension Market Rent (as hereinafter defined),
but in no event less than the Base Rent then in effect on the day immediately
preceding the Extension Term Commencement Date. Within 30 days after Landlord's
receipt of the Extension Option Notice, Landlord shall deliver to Tenant a
written notice which sets forth the rent for which Landlord is willing to lease
the Premises during the Extension Term ("Extension Market Rent"). If Tenant
approves the Extension Market Rent, Tenant shall deliver to Landlord a written
notice which approves the Extension Market Rent within 15 days after its receipt
of the Extension Market Rent. If Tenant objects to the Extension Market Rent,
then Tenant shall, within the aforesaid 15 day period, deliver to Landlord a
written notice which objects to the Extension Market Rent ("Objection Notice").
If Tenant delivers the Objection Notice pursuant to the terms hereof or fails to
deliver a written notice to Landlord which approves or objects to the Extension
Market Rent within said 15 day period, then Tenant shall be deemed to have
waived any and all rights to extend the Lease Term pursuant to this Exhibit.
3. The rights of Tenant under this Exhibit are for the sole benefit of CPS
Systems, Inc. and shall automatically terminate upon any assignment of this
Lease, sublease of the Premises, or other transfer of this Lease and/or the
rights of Tenant.
4. Except to the extent set forth otherwise herein, all of the terms of
this Lease shall apply during the Extension Term.
53
