EXHIBIT 10.3
OFFICE LEASE AGREEMENT
BASIC LEASE INFORMATION
1. Date: March 19, 2004
2. Landlord: Old Gettysburg Associates II
3. Tenant: Select Medical Corporation
4. Guarantor: None
5. Building: Executive Park West II, 0000 Xxx Xxxxxxxxxx Xxxx, Xxxxxxxxxxxxx,
XX 00000
6. Premises: Suite 307 (3rd fl., right side)
7. Commencement Date: April 1, 2004
8. Expiration Date: March 31, 2009 (a five year term)
9. Rentable Area of the Building: 42,758 Rentable square feet
10. Rentable Area of the Premises: 2,579 Rentable square feet
11. Useable Area of the Building: 37,181 Useable square feet
12. Useable Area of the Premises: 2,192 Useable square feet
13. Tenant's Proportionate Share: 6% (Item 12 divided by Item 11)
14. Initial Annual Base Rental: $48,614.15
15. Initial Annual Base Rental Rate: $18.85 per Rentable square foot
16. Annual Base Rental Increase (cumulative) 3.25 %
17. Initial Annual Operating Expense Allowance: $248,206.31
18. Initial Annual Operating Expense Allowance Rate: $5.80 for Rentable square
foot for Fiscal Year 2004.
19. Annual Operating Expense Allowance Increase (cumulative): 3.25 %
20. Fiscal Year: Twelve months ending December 31
21. Security Deposit: None payable at the time the Lease is signed.
22. First Rent Check of $4,051.18 payable at the time the Lease is signed.
23. Broker: None
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1. Landlord's Address for Notices: Old Gettysburg Associates II,
c/o Select Capital Corp 0000 Xxx
Xxxxxxxxxx Xxxx, Xxxxxxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxx
1. Tenant's Address for Notices: Select Medical Corporation 0000 Xxx
Xxxxxxxxxx Xx., Xxxxxxxxxxxxx, XX 00000
Attention: Legal Counsel
Exhibits A-F are part of this Lease, identified as follows:
Exhibit A, Description of Premises
Exhibit B, Description of Real Property
Exhibit C, Description of Leasehold Improvements
Exhibit D, Description of Parking Rights
Exhibit E, Security Card/Key Access
Exhibit F, Rules and Regulations
The foregoing Basic Lease Information is hereby incorporated into and made a
part of the Office Lease Agreement which is described herein and attached. Each
reference in the Lease to any information and definitions contained in the Basic
Lease Information shall mean and refer to the information and definitions
hereinabove set forth. In the event of any conflict between any Basic Lease
Information and the Lease, the Lease shall control.
Landlord:
OLD GETTYSBURG ASSOCIATES II
a Pennsylvania general partnership
WITNESS: By: /s/ Xxxx X. Xxxxxxxx
---------------------- ---------------------------------------
Xxxx X. Xxxxxxxx, General Partner
Tenant: Select Medical Corporation
A Delaware corporation
ATTEST: By: /s/ Xxxxx X. Xxxxxxxxx
---------------------- ---------------------------------------
Xxxxx X. Xxxxxxxxx, VicePresident
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TABLE OF CONTENTS
ARTICLE 1 - PREMISE........................................................ 4
ARTICLE 2 - TERM........................................................... 4
ARTICLE 3 - DELIVERY OF THE PREMISES TO TENANT............................. 5
ARTICLE 4 - ACCEPTANCE OF THE PREMISESES AND BUILDING BY TENANT............ 5
ARTICLE 5 - RENTAL......................................................... 5
ARTICLE 6 - OPERATING EXPENSES............................................. 6
ARTICLE 7 - SERVICESBY LANDLORD............................................ 8
ARTICLE 8 - UTILITIES...................................................... 8
ARTICLE 9 - USE............................................................ 9
ARTICLE 10 - LAWS, ORDINANCES AND REQUIREMENTS OF PUBLIC AUTHORITIES........ 10
ARTICLE 11 - OBSERVANCE OF RULES AND REGULATIONS............................ 10
ARTICLE 12 - ALTERATIONS.................................................... 11
ARTICLE 13 - LIENS.......................................................... 11
ARTICLE 14 - ORDINARY REPAIRS............................................... 11
ARTICLE 15 - INSURANCE...................................................... 12
ARTICLE 16 - DAMAGE BY FIRE OR OTHER CAUSES................................. 13
ARTICLE 17 - CONDEMNATION................................................... 14
ARTICLE 18 - ASSIGNMENT AND SUBLETTING ..................................... 15
ARTICLE 19 - INDEMNIFICATION................................................ 15
ARTICLE 20 - SURRENDER OF THE PREMISES...................................... 16
ARTICLE 21 - ESTOPPEL CERTIFICATES.......................................... 16
ARTICLE 22 - SUBORDINATION.................................................. 17
ARTICLE 23 - PARKING........................................................ 17
ARTICLE 24 - DEFAULT AND REMEDIES........................................... 18
ARTICLE 25 - WAIVER BY TENANT............................................... 20
ARTICLE 26 - SECURITY DEPOSIT............................................... 20
ARTICLE 27 - ATTORNEY'S FEES AND LEGAL EXPENSES............................. 20
ARTICLE 28 - NOTICES........................................................ 21
ARTICLE 29 - MISCELLANEOUS.................................................. 21
EXHIBIT "A" - DESCRIPTION OF PREMISES....................................... 25
EXHIBIT "B" - DESCRIPTION OF BUILDING....................................... 26
EXHIBIT "C" - DESCRIPTION OF PARKING RIGHTS................................. 27
EXHIBIT "D" - PARKING....................................................... 28
EXHIBIT "E" - SECURITY CARD ACCESS.......................................... 29
EXHIBIT "F" - RULES AND REGULATIONS......................................... 30
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OFFICE LEASE AGREEMENT
THIS Lease, dated as of the date specified in the Basic Lease Information which
is attached hereto and incorporated herein for all purposes, is made between
Landlord and Tenant.
ARTICLE 1
PREMISES
Landlord leases to Tenant, and Tenant leases from Landlord for the Term (as
defined below) and subject to the provisions hereof, to each of which Landlord
and Tenant mutually agree, the Premises, which Premises is more particularly
described in the floor plans in Exhibit A hereto, together with its
appurtenances, including the right to use, in common with others, the lobbies,
entrances, stairs, elevators, off-street parking and loading areas (for loading
and unloading of materials and supplies), and other public portions of the
Building, which Building is situated on the real property described in Exhibit B
hereto. The Premises shall constitute part of the "Rentable Area," which shall
be determined and defined by Landlord using standards adopted by Building Owners
and Managers Association (BOMA). For purposes of this Lease, the Rentable Area
of the Building and the Rentable Area of the Premises are as provided in the
foregoing Basic Lease Information. The term "Common Areas" shall mean all of the
common facilities now or hereafter under, over, in or adjacent to the Building
designed and intended for use by all Tenants in the Building in common
facilities now or hereafter under, over, in or adjacent to the Building designed
and intended for use by all Tenants in the Building in common with Landlord and
each other.
ARTICLE 2
TERM
Section 2.01. The term of this Lease (the "Term") shall begin on the
Commencement Date. The Commencement Date shall be the earlier of the date:
(a) specified in the Basic Lease Information provided Landlord has
delivered the Premises with the Building Standard Leasehold Improvements
as set forth on Exhibit C substantially completed: or
(b) of Tenant's occupancy of the Premises for the conduct of Tenant's
business (i.e. not occupancy for construction purposes)(the "Commencement
Date").
Unless sooner terminated, the Term shall end at midnight on the Expiration Date
specified in the Basic Lease Information.
Section 2.02. Provided Tenant performs all of Tenant's obligations under this
Lease, including Tenant's covenant for the payment of Rental as defined below,
Tenant shall, during the Term, peaceably and quietly enjoy the Premises without
disturbance from Landlord; subject, however, to the terms of this Lease and any
deeds of trust, restrictive covenants, ground leases, easements, and other
encumbrances to which this Lease now or may become subject and subordinate.
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ARTICLE 3
DELIVERY OF THE PREMISES TO TENANT
Before the Commencement Date, Landlord shall substantially complete the floor(s)
or portions thereof on which the Premises are located and shall construct the
Leasehold Improvements, if any, to be constructed or installed by Landlord
pursuant to the provisions of Exhibit C hereto. If for any reason Landlord
cannot deliver the Premises to Tenant by the Commencement Date, this Lease shall
not be void or voidable, nor shall Landlord be liable for any loss or damage
resulting therefrom, except that the Rental shall be waived for the period
between the Commencement Date and the date when Landlord can deliver possession
and Landlord shall extend the Term. Tenant may not enter or occupy the Premises
until it is tendered by Landlord, unless Tenant's entry relates to construction
work in the Premises. The Premises shall be deemed completed and possession
delivered when the Premises is completed to accommodate Tenants use. The terms
of Exhibit C hereto shall govern the construction and installation of all
Leasehold Improvements. The term "Building Standard Leasehold Improvements" as
used herein shall mean those Leasehold Improvements which conform to Building
Standard. The term "Non-Building Standard Leasehold Improvements" as used herein
shall mean all Leasehold Improvements which exceed or deviate from Building
Standard. The terms "Building Standard" and "Non-Building Standard" as used
herein shall have the meanings specified in Exhibit C hereto.
ARTICLE 4
ACCEPTANCE OF THE PREMISES AND BUILDING BY TENANT
Taking possession of the Premises by Tenant shall be conclusive evidence that
Tenant:
(a) accepts the Premises as suitable for the purposes for which they are
Leased;
(b) accepts the Building and every part and appurtenance thereof as
being in a good and satisfactory condition; and
(c) waives any defects in the Premises and its appurtenances, except for
the completion of those items, if any, on any punchlist and on Exhibit C
attached hereto.
Landlord shall not be liable, except for negligence or willful misconduct, to
Tenant or any of its agents, employees, licensees, or invitees for any injury or
damage to person or property due to the condition or design of or any defect in
the Building or its mechanical systems and equipment which may exist or occur,
and Tenant, for itself and its agents, employees, licensees, and invitees,
expressly assumes all risks of injury or damage to person or property, either
proximate or remote, resulting from the condition of the Premises or the
Building.
ARTICLE 5
RENTAL
Section 5.01. Tenant covenants and agrees to pay to Landlord as Rental for the
Premises, in lawful money of the United States, 1/12 of the Annual Base Rental
specified in the Basic Lease Information, payable monthly in advance, without
notice or demand, on the first day of each calendar month. In the event of any
late payment, Tenant agrees to pay a late charge for special handling equal to
5% of the Rental due. Rental shall be paid to Landlord, without deduction or
offset, at the address of Landlord specified in the Basic Lease Information or
such other place as Landlord may designate in writing. The
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first monthly installment of Rental shall be paid on the Commencement Date,
except that if the Commencement Date is a date other than the first day of a
calendar month, then the monthly Rental for the first and last fractional months
of the Term shall be appropriately prorated. The term "Rental" as used herein
means the sum of Annual Base Rental, Proportionate Share of Operating Expense
Excess (as defined in Section 6.01), Parking Rental (as defined in Exhibit D
hereof), and all other sums, whether or not expressly denominated as rent, shall
constitute Rental for the purposes of Section 502(b)(7) of the Bankruptcy Code
U.S.C. 502(b)(7). A service charge of 10% of the amount of any checks returned
stamped "NSF" will be due and payable, in addition to the overdue installments
to cover Landlord's extra cost and expense in handling and processing. No
payment by Tenant or receipt by Landlord of a lesser amount than the monthly
installment due under this Lease shall be deemed to be other than on account of
the earliest Rental due hereunder, nor shall any endorsement or statement on any
check or payment as Rental be deemed an accord and satisfaction, and Landlord
may accept such check or payment without prejudice to Landlord's right to
recover the balance of such Rental or pursue any other remedy provided in this
Lease or by law.
Section 5.02. Upon the first anniversary of the Commencement Date of this Lease,
and upon each and every anniversary date thereafter, the then current Annual
Base Rental shall be increased by the Annual Base Rental Rate Increase
(cumulative) as specified in the Basic Lease Information.
ARTICLE 6
OPERATING EXPENSES
Section 6.01. From the Commencement Date until the Fiscal Year End following the
Commencement Date, Tenant shall pay on a monthly basis in advance, without
demand, on the first day of each calendar month, as part of the Annual Base
Rental, Tenant's Proportionate Share of Operating Expenses (as defined in
article 6 and 7) in excess of the Initial Operating Expense Allowance
("Operating Expense Excess"). Such payments shall be calculated and made as
follows:
(a) Before the beginning of each Fiscal Year during the Term, Landlord
shall furnish Tenant with Landlord's reasonable estimate of the Operating
Expenses and any anticipated Operating Expense Excess for such Fiscal
Year. On the first day of each month during such Fiscal Year, Tenant shall
pay Tenant's Proportionate Share of such Fiscal Year's estimated Operating
Expense Excess in monthly installments of 1/12th of Tenant's Proportionate
Share of the estimated annual Operating Expense Excess for such Fiscal
Year.
(b) By the first day of March of each Fiscal Year during Tenant's
occupancy (beginning with the Fiscal Year following the Commencement
Date), or as soon thereafter as possible, Landlord shall furnish to Tenant
a statement of Landlord's actual Operating Expense Excess for the previous
Fiscal Year or fraction thereof if the Commencement Date occurred after
the first day of the previous Fiscal Year. If the actual Operating Expense
Excess is greater than Landlord's estimate, a lump sum payment, considered
Rental for all purposes, shall be made by Tenant, within 30 days of the
delivery of that statement, equal to Tenant's Proportionate Share of the
actual Operating Expense Excess over the Landlord's estimate for the
previous Fiscal Year. If the actual Operating Expense Excess is less than
Landlord's estimate, a lump sum payment shall be made by Landlord, within
30 days of delivery of that statement, equal to Tenant's Proportionate
Share of the actual Operating Expense Excess under Landlord's estimate.
The effect of this reconciliation payment or adjustment is that the Tenant
shall pay during each Fiscal Year during the Term, in addition to the
Annual Base Rental,
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Tenant's Proportionate Share of Operating Expenses in excess of an amount
equal to that Fixed years allowance. Said amount is based upon 12 months
of building operation with all tenants utilizing all services provided by
Landlord pursuant to Article 7 and Article 8.
(c) The Annual Operating Expense Allowance shall be increased each
fiscal year by the Annual Operating Expense Allowance Increase
(cumulative) as specified in the Basic Lease Information.
(d) With respect to the last Fiscal Year or partial Fiscal Year, as the
case may be, during the Term, an adjustment will be made between Landlord
and Tenant pursuant to Section 6.02, at the appropriate time after the
Expiration Date. The provisions of the paragraph (d) shall survive
termination of this Lease with respect to such adjustment and any payments
owing by either party to the other after termination hereof.
Section 6.02. As used herein, "Operating Expense" means all expenses, costs, and
disbursements of every kind which Landlord pays or incurs in connection with the
ownership, operation (including, without limitation, the costs of utilities),
and maintenance of the Building, Parking Areas, and exterior areas contained
within the boundaries described in Exhibit B upon which the Building is
situated. All Operating Expenses shall be determined according to generally
accepted accrual accounting principles which shall be consistently applied.
Operating Expenses shall include, but are not limited to, the following:
(a) Wages, salaries, and fees of all personnel or entities (exclusive of
Landlord's executive personnel) directly engaged in the operation,
maintenance, repair, or security of the Building, including taxes,
insurance, and benefits relating thereto. As to personnel not involved
exclusively with the administration and operation of the Building, only
those portions of such expenses reasonably allocable to the Building shall
be included.
(b) All supplies and materials used in the operation and maintenance of the
Building, except for special lighting, relamping and ballasts within any
Tenant space.
(c) Expenses of all maintenance, janitorial, security, and service agreements
for the Building and the equipment therein, including, without limitation,
alarm service, janitorial services, exterior window cleaning, elevator
maintenance, landscaping, parking facility maintenance, roadway and
utility maintenance and cleaning, etc.
(d) Expenses of all insurance relating to the Building for which Landlord is
responsible hereunder, or which Landlord considers reasonably necessary
for the operation of the Building, including, without limitation, the cost
of property, casualty and liability insurance applicable to the Building
and Landlord's personal property used in connection therewith, and the
cost of business interruption or rental insurance.
(e) All taxes, assessments, and other governmental charges, now or hereafter
applicable to the Building, or any portion thereof, or to Landlord's
personal property used in connection therewith, and dues (including those
levied by any Association managing all common areas and easements)
attributable to the Building or its operation, exclusive of any
inheritance, gift, franchise, income, corporate, or profit taxes which may
be assessed against Landlord.
(f) Expenses of repairs and general maintenance (excluding repairs and general
maintenance paid by proceeds of insurance or by Tenant or other third
parties, and alterations attributable solely to Tenants of the Building).
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(g) Landlord's Costs related to fees paid to individuals or companies engaged
in rendering legal, accounting or technical services including efforts to
reduce Building Ad Valorem Tax expenses.
(h) All utility costs to Landlord of the Building (exclusive, however, of such
special utility services as are provided in Section 8.02 hereof),
including, without limitation, water, power, fuel, heating, lighting, air
conditioning, and ventilation.
Operating Expenses shall not include specific costs especially billed to and
paid by specific Tenants such as above Building Standard janitor service, above
Building Standard utility service, or other services above Building Standard.
Tenant shall be liable for all taxes levied or assessed against personal
property, furniture, fixtures, or Tenant finish placed by Tenant in the
Premises. If any such taxes for which Tenant is liable are levied or assessed
against Landlord or Landlord's property, and Landlord elects to pay the taxes
based on such increase, Tenant shall pay to Landlord upon demand that part of
such taxes for which Tenant is liable hereunder; provided that Tenant shall have
the right to contest such taxes if Tenant shall have furnished Landlord with
security sufficient in Landlord's reasonable determination.
ARTICLE 7
SERVICES BY LANDLORD
While Tenant is occupying the Premises and is not in default under this Lease,
Landlord shall, at its expense, but subject to the provisions of Articles 6 and
8 hereof, furnish the Premises with:
(a) passenger elevator service (where applicable) in common with other
Tenants for access to and from the Premises, reasonably limited after
normal business hours and on Saturdays, Sundays, and holidays;
(b) janitorial cleaning services as are customarily provided to Tenants
in comparable office buildings in the greater Harrisburg area; and
(c) the utility services provided for in Article 8 below.
ARTICLE 8
UTILITIES
Section 8.01. While Tenant is occupying the Premises and is not in default under
this Lease, Landlord shall furnish Tenant with the following services:
(a) potable water
(b) heating, ventilating, and/or air conditioning in season on business
days from 7:00 a.m. to 6:00 p.m.
(c) electric lighting for public areas and special Services Areas of the
Building
all of which services shall be provided to Tenant by Landlord and paid for by
Landlord as part of the Operating Expense Allowance. If Tenant requires air
conditioning or heating outside the hours and days specified above, Landlord
shall furnish it only at Tenant's request, and Tenant will bear the entire
charge therefor which will be an amount equal to the rate charged to Landlord,
at that time, plus a reasonable fee to cover Landlord's overhead costs, with a
two-hour minimum. With respect to such after hours costs,
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Landlord acknowledges that the current after hours charge is $35.00 per hour.
Whenever machines or equipment that generate abnormal heat are used in the
Premises by Tenant which affect the temperature or humidity otherwise maintained
by the central air conditioning system, Landlord will have the right to install
supplemental air conditioning units in the Premises, and the full total cost
thereof, will be paid by Tenant to Landlord on demand. Notwithstanding anything
in this Lease to the contrary, Tenant shall be responsible for the cost of
special lighting relamping and ballasts within the Premises after initial
installation of such items.
Section 8.02. While Tenant is occupying the Premises and is not in default under
this Lease, Landlord will furnish sufficient power for lighting and for
typewriters, dictaphones, personal computers, calculating machines, and other
normal office machines of similar low electrical consumption, all of which power
shall be paid for by Landlord as a part of the Operating Expense Allowance.
Tenant agrees that Landlord's aforesaid obligation does not include the
provision of power for:
(a) special mainframe type computers and/or electronic data processing
equipment,
(b) special lighting which has electrical consumption in excess of the
Building Standard lighting, or
(c) any item that consumes more than 0.5 kilowatts at rated capacity or
requires a voltage other than 120 volt single phase
and such consumption by Tenant shall be deemed excessive usage for which Tenant
shall pay Landlord upon receipt of an invoice for the cost to Landlord of such
usage. Notwithstanding the aforementioned, Tenant acknowledges that the Building
electrical feeders have normal design limitations, such that
(i) in no event shall lighting have a design load greater than an
average of 2.00 xxxxx per Usable square foot, and
(ii) collectively, Tenant's equipment and lighting shall not have an
electrical design load greater than an average of 3.75 xxxxx per Usable
square foot.
Upon the existence of Tenant's excess electrical requirements, Landlord may, at
its option, upon not less than 30 days prior written notice to Tenant,
discontinue electric services to the Premises until Tenant reduces its power
consumption to the permissible limits. Landlord will not be liable in any way to
Tenant for failure or defect in the supply or character of electric energy or
any other utility service furnished to the Premises because of any requirement,
act, or omission of the public utility servicing the Building. All installations
of electrical fixtures, appliances, and equipment within the Premises shall be
subject to Landlord's prior approval. Landlord's obligation to furnish utility
services shall be subject to the rules and regulations of any municipal or other
governmental authority regulating the business of providing utility services.
When Tenant's use of the Premises consumes power in excess of the Building
Standard lighting and for typewriters, dictaphones, calculating machines and
other normal office machines of similar low consumption, then the usage of such
additional consumption shall be determined, at Landlord's election, either
(i) by a survey performed by a reputable consultant selected by Landlord
(and paid for by Tenant when such additional consumption is proven), or
(ii) by separate meter in the Premises to be installed, maintained and
read by Landlord at Tenant's sole expense.
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Section 8.03. Failure to furnish, or any stoppage of, the services provided for
in Article 7 above and in this Article 8 resulting from any cause will not make
Landlord liable in any respect for damages to either person, property, or
business, nor be construed as an eviction of Tenant, nor entitle Tenant to any
abatement of Rental, nor relieve Tenant from its obligations under this Lease.
Landlord will, with reasonable diligence, repair any malfunction of the Building
Improvements or facilities, but Tenant will have no claim for rebate, abatement
of Rental, or damages because of any malfunctions or interruptions in service.
ARTICLE 9
USE
The Premises shall be used for general office purposes, and for no other purpose
and Tenant agrees to use and maintain the Premises in a clean, careful, safe,
lawful, and proper manner.
ARTICLE 10
LAWS, ORDINANCES AND REQUIREMENTS OF PUBLIC AUTHORITIES
Tenant shall, at its sole expense,
(i) comply with all laws, orders, ordinances, and regulations of
federal, state, county, and municipal authorities having jurisdiction over
the Premises,
(ii) comply with any direction made pursuant to law of any public officer
or officers requiring abatement of any nuisance, or imposing any
obligation, order, or duty upon Landlord or Tenant arising from Tenant's
use of the Premises or from conditions which have been created by or at
the insistence of Tenant or required by reason of a breach of any of
Tenant's obligations hereunder, and
(iii) indemnify Landlord and hold Landlord harmless from any loss, cost,
claim, or expense which Landlord may incur or suffer by reason of Tenant's
failure to comply with its obligations under clauses (i) or (ii) above. If
Tenant receives written notice of violation of any such law, order,
ordinance, or regulation, it shall promptly notify Landlord thereof.
ARTICLE 11
OBSERVANCE OF RULES AND REGULATIONS
Tenant and its employees, agents, visitors, and licensees shall observe
faithfully and comply strictly with all Rules and Regulations attached to this
Lease (Exhibit F). Landlord shall at all times have the right to make reasonable
exchanges in and additions to such Rules and Regulation. Any failure by Landlord
to enforce any of the Rules and Regulations now or hereafter in effect, either
against Tenant or any other Tenant in the Building, shall not constitute a
waiver of any such Rules and Regulations. Landlord shall not be liable to Tenant
for the failure or refusal by any other Tenant, guest, invitee, visitor, or
occupant of the Building to comply with any of the Rules and Regulations, but
Landlord shall, after receipt of notice, take reasonable action to assure
compliance.
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ARTICLE 12
ALTERATIONS
Section 12.01. Tenant may not, at any time during the Term, without Landlord's
prior written consent (which consent shall not be unreasonably withheld), make
any alterations to the Premises. All alterations shall be made at Tenant's
expense, either by Tenant's contractors which have been approved in writing by
Landlord, or at Landlord's option, by Landlord's contractors on terms reasonably
satisfactory to Tenant, including a fee of 15% of the actual costs to Landlord
for performing such work to cover Landlord's overhead.
Section 12.02. All Leasehold Improvements (whether Building Standard or
Non-Building Standard), alterations, and other physical additions made or
installed by or for Tenant in or to the Premises shall be and remain Landlord's
property, except Tenant's furniture, furnishings, personal property, and
moveable trade fixtures and shall not be removed without Landlord's written
consent.
ARTICLE 13
LIENS
Tenant shall keep the Premises, the Building, and the property on which the
Building is located, free from any liens arising from any work performed,
materials furnished, or obligations incurred by or at the request of Tenant.
Nothing contained in this Lease shall be construed as Landlord's consent to any
performance of labor or furnishing of any materials for any specific
improvements, alteration, or repair of, or to, the Premises, that would result
in any liens against the Premises or liability of the Landlord. If, based upon
acts of Tenant, any lien is filed against the Premises, the Building, the
Property on which the Building is located, or Tenant's Leasehold interests
therein, Tenant shall discharge same within 10 days after its filing. If Tenant
fails to discharge such lien within such period, then, in addition to any other
right or remedy of Landlord, Landlord may, at its election, discharge the lien
by either paying the amount claimed to be due, obtaining the discharge by
deposit with a court or a title company, or by bonding. Tenant shall pay on
demand any amount paid by Landlord for reasonable attorneys' fees and other
legal expenses of Landlord incurred in defending any such action or in obtaining
the discharge of such lien, together with all necessary disbursements in
connection therewith, to double the amount of the lien claim plus a sufficient
amount to cover any penalties, interest, attorneys' fees, court costs, and other
legal expenses resulting from such contest. This bond shall name Landlord and
such other parties as Landlord may direct as beneficiaries thereunder.
ARTICLE 14
ORDINARY REPAIRS
Tenant shall, at all times during the Term hereof and at Tenant's sole cost and
expense, keep the Premises and every part thereof in good condition and repair,
ordinary wear and tear, fire and other casualty excepted. Subject to Article 20,
section 20.02 herein, Tenant shall, at the end of the term hereof, surrender the
Premises, as repaired, to Landlord in the same condition as when received,
ordinary wear and tear excepted. If Tenant fails to make such repairs promptly,
Landlord may, at its option, make such repairs, and Tenant shall pay Landlord on
demand Landlord's actual costs in making such repairs plus a fee of (15%) to
cover Landlord's overhead.
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ARTICLE 15
INSURANCE
Section 15.01. Tenant shall, during the Term, at its sole expense, keep in
force, with Tenant, Landlord, and the mortgagees and ground lessors of Landlord
named as additional insured thereunder (except with respect to Worker's
Compensation coverage) all as their respective interests may appear, the
following insurance:
(a) All Risk Insurance (including fire, extended coverage,
vandalism, malicious mischief, extended perils, sprinkler leakage and
debris removal) upon property of every description and kind owned by
Tenant and located in the Building or for which Tenant is legally liable
or installed by or on behalf of Tenant including, without limitation,
fittings, installations, fixtures, removable trade fixtures, Non-Building
Standard Leasehold Improvements (as defined in Exhibit C), and
alterations, in an amount not less than the full replacement cost thereof.
If there is a dispute as to the amount which comprises full replacement
cost, the decision of Landlord or the mortgagees of Landlord shall be
conclusive and binding.
(b) Commercial liability insurance coverage to include death,
personal injury, bodily injury (not less that $1,000,000 limits), broad
form property damage (not less than $1,000,000 limits), fire sprinkler
hazard, operations hazard, owner's protective coverage, contractual
liability, and products and completed operations liability, with combined
single liability limits not less than $1,000,000. Such coverage shall
insure against all liability of Tenant and its authorized representatives
and visitors arising out of, and in connection with, Tenant's use or
occupancy of the Premises.
(c) Worker's Compensation and Employer's Liability Insurance, with
a waiver of subrogation endorsement, in form and amount satisfactory to
Landlord.
(d) Any other form or forms of insurance as Tenant or Landlord or
the mortgagees of Landlord may reasonably require from time to time in
form, in amounts, and for insurance risks against which a prudent Tenant
of a comparable size and in a comparable business would protect itself.
All policies shall be issued by insurers with a Best's Insurance Reports rating
of A or better and shall be in form satisfactory to Landlord. Tenant agrees that
certificates of insurance on the Landlord's standard form, or certified copies
of each such insurance policy, naming Landlord and its mortgagees as additional
insured, will be delivered to Landlord not later than 5 days prior to the date
that Tenant takes possession of any part of the Premises. All policies shall
contain an undertaking by the insurers to notify Landlord and the mortgagees of
Landlord in writing, by Registered U.S. Mail, not less than 30 days before any
material change, reduction in coverage, cancellation, or other termination
thereof. All insurance shall be primarily as to Landlord and not participating
with any other available insurance. So long as Tenant is not in default,
proceeds of Tenant's insurance shall be available to repair or replace the
insured fixtures and equipment.
Section 15.02. During the Term, Landlord shall insure the Building (but
excluding Non-Building Standard Leasehold Improvements and any other property
which Tenant is obligated to insure under Section 15.01 hereof) against damage
by fire and standard extended coverage perils in an amount equal to the full
replacement cost thereof, and shall provide public liability insurance in such
amounts and with such deductions as Landlord considers appropriate. Landlord
may, but shall not be obligated to, take out and carry any other form or forms
of insurance as it or Landlord's mortgagees may reasonably determine
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appropriate. Notwithstanding any contribution by Tenant to the cost of insurance
premiums, as provided herein, Tenant acknowledges that it has no right to
receive any proceeds from any insurance policies carried by Landlord. Landlord
will not be required to carry insurance of any kind on any Non-Building Standard
Leasehold Improvements, on Tenant's furniture or furnishings, or on any of
Tenant's fixtures, equipment, improvements, or appurtenances under this Lease;
and Landlord shall not be obligated to repair or replace same.
Section 15.03. Tenant shall not keep in the Premises any article which may be
prohibited by any reasonable insurance policy periodically in force covering the
Building. If Tenant's occupancy results in any increase in premiums for the
insurance carried by Landlord, Tenant shall pay any such increase in premiums as
additional Rental within 10 days after being billed therefor. Tenant shall
promptly comply with all reasonable requirements of the insurance authority or
any present or future insurer relating to the Premises and the Building.
Section 15.04. If any of Landlord's insurance policies shall be cancelled or
cancellation shall be threatened or the coverage thereunder reduced or
threatened to be reduced, or if the premiums on any of Landlord's insurance
policies are increased or threatened to be increased, in any way because of
Tenant's use of the Premises and, if Tenant fails to remedy the cause thereof
within 48 hours after notice, Landlord may, at its option, either terminate this
Lease or enter upon the Premises and attempt to remedy such condition, and
Tenant shall promptly pay the cost thereof to Landlord as additional Rental.
Landlord shall not be liable for any damage or injury caused to any property of
Tenant or of others located on the Premises resulting from such entry. If
Landlord is unable to remedy such condition, then Landlord shall have all of the
remedies provided for in this Lease in the event of a default by Tenant.
Section 15.05. All policies covering real or personal property which either
party obtains affecting the Premises shall include a clause or endorsement
denying the insurer any rights of subrogation against the other party to the
extent rights have been waived by the insured before the occurrence of injury or
loss. Landlord and Tenant hereby mutually waive any rights of recovery against
the other for injury or loss due to hazards covered by insurance containing such
a waiver of subrogation clause or endorsement to the extent of the injury or
loss covered thereby.
ARTICLE 16
DAMAGE BY FIRE OR OTHER CAUSE
Section 16.01. Subject to Sections 16.02 and 16.03 hereof, if the Building is
damaged by fire or other casualty so as to affect the Premises, Tenant shall
immediately notify Landlord, who shall (but only if the proceeds from Landlord's
insurance available to Landlord
(i) are free from collection by Landlord's mortgagee, ground or
primary lessor, and
(ii) are sufficient)
have the damage repaired with reasonable speed at the expense of Landlord,
subject to delays which may arise by reason of adjustment of loss under
insurance policies and to other delays beyond Landlord's reasonable control.
Provided such damage was not the result of the negligence or willful misconduct
of Tenant, or Tenant's employees or invitees, an abatement in the Rental
hereunder shall be allowed as to that portion of the Premises rendered
untenantable by such damage until such time as Landlord determines that such
damaged portion of the Premises has been made tenantable for Tenant's use.
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Section 16.02. If the Premises are damaged or destroyed by any cause whatsoever,
and if, in Landlord's reasonable opinion, the Premises cannot be rebuilt or made
fit for Tenant's purposes within 120 days of the damage or destruction, or if
the proceeds from insurance remaining after payment of any such proceeds to
Landlord's mortgagee, ground, or primary lessor, are insufficient to repair or
restore the damage by destruction, Landlord may, at its option, terminate this
Lease by giving Tenant, within 60 days after such damage or destruction, notice
of termination, and thereupon Rental and any other payments for which Tenant is
liable under this Lease shall be apportioned and paid to the date of such
damage, and Tenant shall immediately vacate the Premises, provided, however,
that those provisions of this Lease which are designated to cover matters of
termination and the period thereafter shall survive the termination hereof.
Section 16.03. If either
(a) the Building is damaged or destroyed to the extent that,
in Landlord's reasonable opinion it would not be economically feasible to
repair or restore such damage or destruction, or
(b) in Landlord's reasonable judgment, the damage or
destruction to the Building cannot be repaired or restored within 60 days
after such damage or destruction,
Landlord may, at its option, terminate this Lease by giving Tenant, within 60
days after such damage, notice of such termination requiring Tenant to vacate
the Premises 60 days after delivery of the notice of termination, and thereupon
Rental and any other payments shall be apportioned and paid to the date on which
possession is relinquished and Tenant shall immediately vacate the Premises
according to such notice of termination, provided, however, that those
provisions of this Lease which are designed to cover matters of termination and
the period thereafter shall survive the termination hereof.
Section 16.04. No damages shall be payable by Landlord for inconvenience, loss
of business, or annoyance arising from any repair or restoration of any portion
of the Premises, or the Building. Landlord shall use its best efforts to have
such repairs made promptly so as not to unnecessarily interfere with Tenant's
occupancy.
Section 16.05. The provisions of this Article shall be considered an express
agreement governing any case of damage or destruction of the Building, the
Building Standard Leasehold Improvements, the Non-Building Standard Leasehold
Improvements, the alterations, or the Premises by fire or other casualty.
ARTICLE 17
CONDEMNATION
If the Premises shall be taken or condemned, in whole or in part, for any public
purpose to such an extent as to render said Premises untenantable, this Lease
shall, at the option of Landlord or Tenant, forthwith terminate. All proceeds
from any taking or condemnation shall belong to and be paid to Landlord, except
to the extent of any proceeds awarded to Tenant on account of moving and
relocation expenses and depreciation to and removal of Tenant's physical
property.
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ARTICLE 18
ASSIGNMENT AND SUBLETTING
Section 18.01. If Tenant should desire to assign this Lease or sublet the
Premises (or any part thereof), Tenant shall give Landlord written notice at
least 60 days in advance thereof. Landlord shall then have a period of 30 days
following receipt of such notice within which to notify Tenant in writing that
Landlord elects either
(a) to terminate this Lease as to the space so affected by Tenant in its
notice, in which event Tenant, subject to the provisions of this Lease
which expressly survive the termination hereof, shall be relieved of all
further obligations hereunder as to such space;
(b) to permit Tenant to assign or sublet such space, subject, however,
to the subsequent written approval of the proposed assignee or subTenant
by Landlord, and provided that if the Rental rate agreed upon between
Tenant and its proposed subtenant is greater than the Rental rate that
Tenant must pay Landlord hereunder, then 100% of such excess Rental shall
be considered additional Rental owed by Tenant to Landlord, and shall be
paid by Tenant to Landlord in the same manner that Tenant pays Annual Base
Rental; or
(c) to refuse to consent to Tenant's assignment or subleasing of such
space and to continue this Lease in full force and effect as to the entire
Premises, in which case, any judgment against Landlord for unreasonable
denial shall be limited to specific performance of approval of said
assignment or sublease and reasonable attorneys' fees along with costs
related to obtaining such judgement.
No assignment or subletting by Tenant shall relieve Tenant of Tenant's
obligations under this Lease. Any attempted assignment or sublease by Tenant in
violation of the terms and provisions of this Section 18.01 shall be void. In no
event shall Tenant solicit assignees or sublessees in other Buildings owned by
Landlord, or at less than a fair market rate.
Section 18.02. Landlord may sell, transfer, assign, and convey all or any part
of the Building and any and all of its rights under this Lease, provided
Landlord's successor in interest assumes Landlord's obligations hereunder, and
in the event Landlord assigns its rights under this Lease, Landlord shall be
released from any further obligations hereunder, and Tenant agrees to look
solely to Landlord's successor in interest for performance of such obligations.
ARTICLE 19
INDEMNIFICATION
Tenant waives all claims against Landlord for damage to any property or injury
to, or death of, any person in, upon, or about the Building, the Premises or
Parking Facilities arising at any time and from any and all causes whatsoever
other than solely by reason of the negligence or willful misconduct of Landlord,
its agents, employees, representatives, or contractors, and Tenant agrees that
it will defend, indemnify, save, and hold harmless, Landlord from and against
all claims, demands, actions, damages, loss, cost, liabilities, expenses, and
judgments suffered by, recovered from, or asserted against Landlord on account
of any damage to any property or injury to, or death of, any person arising from
the use of the Building, the Premises, or the Parking Facilities by Tenant or
its employees or invitees, except such as is caused solely by the negligence or
willful misconduct of Landlord, its agents, employees, representatives, or
contractors. Tenant's foregoing indemnity obligation shall include reasonable
attorneys' fees and all
15
other reasonable costs and expenses incurred by Landlord. The provisions of this
Article 19 shall survive the termination of this Lease with respect to any
damage, injury, or death occurring before such termination. If Landlord is made
a party to any litigation commenced by or against Tenant or relating to this
Lease or to the Premises, and provided that in any such litigation, Landlord is
not finally adjudicated to be at fault, then Tenant shall pay all costs and
expenses, including attorneys' fees and court costs, incurred by or imposed upon
Landlord because of any such litigation, and the amount of all such costs and
expenses, including attorneys' fees and court costs, shall be a demand
obligation owing by Tenant to Landlord, and shall be considered as additional
Rental.
ARTICLE 20
SURRENDER OF THE PREMISES
Section 20.01. Upon the expiration or other termination of this Lease for any
cause whatsoever, Tenant shall peacefully vacate the Premises in as good order
and condition as the same were at the beginning of the Term or may thereafter
have been improved by Landlord or Tenant, subject only to reasonable use and
wear thereof, and repairs which are Landlord's obligation hereunder.
Section 20.02. Landlord may require Tenant to remove any Non-Building Standard
Leasehold Improvements, alterations, and physical additions installed in the
Premises upon termination of this Lease. In the event Landlord so elects, and
Tenant fails to remove the aforementioned items, Landlord may remove and store
same at Tenant's cost, and Tenant shall pay Landlord on demand, the cost of
restoring the Premises to Building Standard, ordinary wear and tear excepted.
Tenant agrees to remove, at Tenant's expense, all of its furniture, furnishings,
personal property, and moveable trade fixtures by the Expiration Date, and shall
promptly reimburse Landlord for the cost of repairing all damage done to the
Premises or the Building by such removal.
Section 20.03. Should Tenant continue to hold the Premises after the termination
of this Lease, whether the termination occurs by lapse of time or otherwise,
such holding over shall, unless otherwise agreed to by Landlord in writing,
constitute and be construed as a tenancy at will at a daily Rental equal to
1/30th of an amount equal to 2 times the monthly Rental Rate for the Premises as
of the date of termination, and subject to all of the other terms set forth
herein except any right to renew or expand this Lease. Tenant shall be liable to
Landlord for all damage which Landlord suffers because of any holding over by
Tenant, and Tenant shall indemnify Landlord against all claims made by any other
Tenant or prospective Tenant against Landlord resulting from delay by Landlord
in delivering possession of the Premises to such other Tenant or prospective
Tenant.
ARTICLE 21
ESTOPPEL CERTIFICATES
Tenant agrees to furnish, when requested by Landlord or the holder of any deed
of trust covering the Building, the Land, or any interest of Landlord therein, a
certificate signed by Tenant certifying to such parties as Landlord may
designate to the extent true matters with respect to the terms and status of
this Lease and the Premises, stating that Tenant, as of the date of such
certificate, has no charge, lien, or claim of offset under this Lease or
otherwise against Rentals or other charges due or to become due hereunder; and
such other matters as may be requested by Landlord or the holder of any such
deed of trust. To the extent any such statements requested are not true, Tenant
shall explain such facts in writing. Landlord agrees periodically to furnish,
when reasonably requested in writing by Tenant, certificates signed by Landlord
containing substantially the same information as described above.
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ARTICLE 22
SUBORDINATION
Section 22.01. This Lease is subject and subordinate to any deeds of trust,
mortgages, or other security instruments, and any other supplements or
amendments thereto, which presently or may in the future cover the Building and
the Land or any interest of Landlord therein, and to any increases, renewals,
modifications, consolidations, replacements, and extensions of any of such deeds
of trust, mortgages, or security instruments. Landlord agrees to use his best
efforts to obtain for Tenant a "non-disturbance" agreement from the holder or
beneficiary of any deeds of trust, mortgages or other security instruments that
in the future may cover the Building and the Land or any interest of Landlord
therein. This provision is declared by Landlord and Tenant to be self-operative
and no further instrument shall be required to effect such subordination of this
Lease. Tenant shall, however, upon demand, execute, acknowledge, and deliver to
Landlord any further instruments and certificates evidencing such subordination
as Landlord may require. This Lease is further subject and subordinate to
(a) all ground or primary Leases in existence at the date hereof and to
any supplements, modifications, and extensions thereof heretofore or
hereafter made, and
(b) utility easements and agreements, covenants, restrictions, and other
encumbrances which do not materially adversely effect Tenant's intended
use of the Premises, both existing and future.
Section 22.02. Notwithstanding the generality of the foregoing provisions of
Section 22.01 hereof, any such mortgagee or ground or primary lessor shall have
the right at any time to subordinate any such ground or primary Leases, deeds of
trust, mortgages, or other security instruments to this Lease on such terms and
subject to such conditions as such mortgagee or ground or primary lessor may
consider appropriate in its discretion. At any time, before or after the
institution of any proceedings for the foreclosure of any such deeds of trust,
mortgages, or other security instruments or termination of any ground or primary
Lease, or sale of the Building under any such deeds of trust, mortgages, or
other security instruments or termination of any ground or primary Lease, Tenant
shall attorn to such ground or primary lessor or such purchaser upon any such
sale or the grantee under any deed in lieu of such foreclosure and shall
recognize such ground or primary lessor or such purchaser or grantee as Landlord
under this Lease. The agreement of Tenant to attorn contained in the immediately
preceding sentence shall survive any such termination of any ground or primary
Lease, foreclosure sale, trustee's sale, or conveyance in lieu thereof. Tenant
shall upon demanded at any time, before or after any such termination, execute,
acknowledge, and deliver to Landlord's mortgagee or ground or primary lessor any
written instruments and certificates evidencing such attornment as Landlord's
mortgagee or ground or primary lessor may reasonably require.
ARTICLE 23
PARKING
Landlord will permit Tenant to use the areas designated by Landlord ("Parking
Facilities") for parking of vehicles in common with other Tenants in the
Building during the Term as more fully provided for in Exhibit D hereto.
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ARTICLE 24
DEFAULT AND REMEDIES
Section 24.01. The occurrence of any one or more of the following events shall,
at Landlord's option, constitute an event of default of this Lease:
(a) if Tenant shall fail to pay any Rental or other sums payable by
Tenant hereunder within 10 days of written notice thereof from Landlord
(provided, however, if such event of default shall occur more than once in
every 6 months period, Landlord shall not be required to provide any
written notice of default and an event of default shall occur as and when
such Rental or other sums becomes due and payable);
(b) if Tenant shall fail to perform or observe any other term hereof or
any of the Rules and Regulations and such failure shall continue for more
than 30 days after notice thereof from Landlord;
(c) if Tenant fails to take occupancy within 30 days following
substantial completion;
(d) if Tenant deserts or vacates any substantial portion of the
Premises;
(e) if any petition is filed by or against Tenant or any guarantor of
Tenant's obligations under this Lease under any section or chapter of the
present or any future Federal Bankruptcy Code or under any similar law or
statute of the United States or any state thereof;
(f) if Tenant or any guarantor of Tenant's obligations under this Lease
becomes insolvent or makes a transfer in fraud of creditors;
(g) if Tenant or any guarantor of this Lease makes an assignment for the
benefit of creditors; or
(h) if a receiver, custodian, or trustee is appointed for Tenant or for
any of the assets of Tenant which appointment is not vacated within 30
days of the date of such appointment.
Section 24.02. If an event of default occurs, at any time thereafter Landlord
may do one or more of the following without any additional notice or demand:
(a) Terminate this Lease, in which event Tenant shall immediately
surrender the Premises to Landlord. If Tenant fails to do so, Landlord
may, without notice and without prejudice to any other remedy Landlord may
have, enter upon and take possession of the Premises and expel or remove
Tenant and its effects without being liable to prosecution or any claim
for damages therefor; and Tenant shall be liable to Landlord for all loss
and damage which Landlord may suffer by reason of such termination,
whether through inability to relet the Premises or otherwise, including
any loss of Rental for the remainder of the Term. Any such loss of Rental
shall be offset by any Rental received by Landlord as a result of
reletting the Premises during the remainder of the Term.
(b) Terminate this Lease, in which event Tenant's event of default shall
be considered a total breach of Tenant's obligations under this Lease and
Tenant
18
immediately shall become liable for such damages for such breach amount,
equal to the total of:
(1) the costs of recovering the Premises;
(2) the unpaid Rental earned as of the date of termination,
plus interest thereon at a rate per annum from the due date equal to
5% percent over the Prime Rate; provided, however, that such
interest shall never exceed the Highest Lawful Rate;
(3) the amount of the excess of
(i) the total Rental and other benefits which
Landlord would have received under the Lease for the remainder
of the Term, at the rates then in effect, together with all
other expenses occurred by Landlord in connection with
Tenant's default, over
(ii) the Fair Market Rate of the balance of the
Term as of the time of such breach,
which excess shall be discounted at the rate of 8% per annum to the
then present value; and
(4) all other sums of money and damages owing by Tenant and
Landlord.
(c) Enter upon and take possession of the Premises as Tenant's agent
without terminating this Lease and without being liable to prosecution or
any claim for damages therefor, and Landlord may relet the Premises as
Tenant's agent and receive the Rental therefor, in which event Tenant
shall pay to Landlord on demand the cost of renovating, repairing, and
altering the Premises for a new Tenant or Tenants and any deficiency that
may arise by reason of such reletting; provided, however, that Landlord
shall have no duty to relet the Premises and Landlord's failure to relet
the Premises shall not release or affect Tenant's liability for Rental or
for damages.
(d) Do whatever Tenant is obligated to do under this Lease and may enter
the Premises without being liable to prosecution or any claim for damages
therefor, to accomplish this purpose. Tenant shall reimburse Landlord
immediately upon demand for any expenses which Landlord incurs in thus
effecting compliance with this Lease on Tenant's behalf, and Landlord
shall not be liable for any damages suffered by Tenant from such action,
whether caused by the negligence of Landlord or otherwise.
Section 24.03. No act or thing done by Landlord or its agents during the Term
shall constitute an acceptance of an attempted surrender of the Premises, and no
agreement to accept a surrender of the Premises or to terminate this Lease shall
be valid unless made in writing and signed by Landlord. No re-entry or taking
possession of the Premises by Landlord shall constitute an election by Landlord
to terminate this Lease, unless a written notice of such intention is given to
Tenant. Notwithstanding any such reletting or re-entry or taking possession,
Landlord may at any time thereafter terminate this Lease for a previous default.
Landlord's acceptance of Rental following an event of default hereunder shall
not be construed as a waiver of such event of default. No waiver by Landlord of
any breach of this Lease shall constitute a waiver of any other violation or
breach of any time of the terms hereof. Forbearance by
19
Landlord to enforce one or more of the remedies herein provided upon a breach
hereof shall not constitute a waiver of any other breach of the Lease.
Section 24.04. No provision of this Lease shall be deemed to have been waived by
Landlord unless such waiver is in writing and signed by Landlord. Nor shall any
custom or practice which may evolve between the parties in the administration of
the terms of this Lease be construed to waive or lessen Landlord's right to
insist upon strict performance of the terms of this Lease. The rights granted to
Landlord in this Lease shall be cumulative of every other right or remedy which
Landlord may otherwise have at law or in equity or by statue, and the exercise
of one or more rights or remedies shall not prejudice or impair the current or
subsequent exercise of other rights or remedies.
ARTICLE 25
WAIVER BY TENANT
To the extent permitted by applicable law, Tenant waives for itself and all
claiming by, through, and under it, including creditors of all kinds
(a) any right and privilege which it or any of them may have under any
present or future constitution, statute, or rule of law to redeem the
Premises or to have a continuance of this Lease for the Term after
termination of Tenant's right of occupancy by order or judgment of any
court or by any legal process or writ, under the terms of this Lease, or
after the termination of the Term as herein provided,
(b) the benefits of any present or future constitution, statute, or rule
of law which exempts property form liability for debt or for distress for
rent, and
(c) the provisions of law relating to notice and/or delay in levy of
execution in case of eviction of a Tenant for non-payment of rent.
ARTICLE 26
SECURITY DEPOSIT
The Security Deposit shall be held by Landlord, without interest, as security
for the performance of Tenant's obligations under this Lease. Landlord may,
without prejudice to any other remedy, use the Security Deposit to remedy any
default in any obligation of Tenant hereunder, and such use shall survive the
termination of this Lease, and Tenant shall promptly, on demand, restore the
Security Deposit to its original amount. If Tenant is not in default at the
termination of this Lease, any remaining portion of the Security Deposit shall
be returned to Tenant. If Landlord transfers its interest in the Premises during
the Term, Landlord shall assign the Security Deposit to the transferee who shall
then become obligated to Tenant for its return, and thereafter Landlord shall
have no further liability for its return.
ARTICLE 27
ATTORNEY'S FEES AND LEGAL EXPENSES
In any action or proceeding brought by either party against the other with
respect to this Lease, the prevailing party shall be entitled to recover from
the other party's reasonable attorneys' fees, investigation costs, and other
legal expenses and court costs incurred by such party in such action or
proceeding as the
20
court may find to be reasonable. The prevailing party shall be the one who
receives the net judgment in its behalf at the end of any action.
ARTICLE 28
NOTICES
Any notice or document required to be delivered hereunder shall be considered
delivered, whether actually received or not, when hand delivered to the address
of the other party, or 48 hours after deposited in the United States Mail,
postage prepaid, registered or certified mail, return receipt requested,
addressed to the parties hereto at the respective addresses specified in the
Basic Lease Information, or at such other address as they have subsequently
specified by written notice.
ARTICLE 29
MISCELLANEOUS
Section 29.01. Where this Lease requires Tenant to reimburse Landlord the cost
of any item, if no such cost has been stipulated, such cost will be the
reasonable and customary charge therefor periodically established by Landlord.
Failure to pay any such cost shall be considered as a failure to pay Rental.
Section 29.02. Tenant represents and warrants that it has had no dealings with
any broker or agent in connection with the negotiation or execution of this
Lease except such brokers or agents as may be identified in Item 23 of the Basic
Lease Information. Tenant shall indemnify and hold Landlord harmless from any
costs, expenses, or liability for commission or other compensation or charges
claimed by any person, broker or agent (other than those identified in the Basic
Lease Information), claiming through association with Tenant with respect to
this Lease.
Section 29.03. As used herein, the terms "business days" means Monday through
Friday (except for holidays); "normal business hours" means 7:00 a.m. to 6:00
p.m. on business days; and "holidays" means those holidays designated by
Landlord, which holidays shall be consistent with those holidays designated by
Landlords of comparable office Buildings in the immediate area and town.
Section 29.04. Every agreement contained in this Lease is, and shall be
construed as, a separate and independent agreement. If any term of this Lease or
the application thereof to any person or circumstances shall be invalid and
unenforceable, the remainder of this Lease, or the application of such term to
persons or circumstances other than those as to which it is invalid or
unenforceable, shall not be affected.
Section 29.05. There shall be no merger of this Lease or of the Leasehold estate
hereby created with the fee estate in the Premises or any part thereof by reason
of the fact that the same person may acquire or hold, directly or indirectly,
this Lease or the Leasehold state hereby created or any interest in this Lease
or in any interest in such fee estate. In the event of a voluntary or other
surrender of this Lease, or a mutual cancellation hereof, Landlord may, at its
option, terminate all subLeases, or treat such surrender or cancellation as an
assignment of such subLeases.
Section 29.06. Any liability of Landlord to Tenant under the terms of this Lease
shall be limited to Landlord's interest in the Building and the Land, and
Landlord shall not be personally liable for any deficiency.
21
Section 29.07. Whenever a period of time is herein prescribed for action, other
than the payment of money, to be taken by either party hereto, such party shall
not be liable or responsible for, and there shall be excluded from the
computation for any such period of time, any delays due to strikes, riots, acts
of God, shortages of labor or materials, war, governmental laws, regulations, or
restrictions, or any other cause of any kind whatsoever which is beyond the
control of such party.
Section 29.08. The article headings contained in this Lease are for convenience
only and shall not enlarge or limit the scope or meaning of the various and
several articles hereof. Words of any gender used in this Lease shall include
any other gender, and words in the singular number shall be held to include the
plural, unless the context otherwise requires.
Section 29.09. If there be more than one Tenant, the obligations hereunder
imposed Tenant shall be joint and several, and all agreements and covenants
herein contained shall be binding upon the respective heirs, personal
representatives, successors, and to the extent permitted under this Lease,
assigns of the parties hereto. If there is a guarantor of Tenant's obligations
hereunder, Tenant's obligations shall be joint and several obligations of Tenant
and such guarantor, and Landlord need not first proceed against Tenant hereunder
before proceeding against such guarantor, nor shall any such guarantor be
released from its guarantee for any reason, including, without limitation, any
amendment, renewal, expansion or diminution of this Lease, any forbearance by
Landlord or waiver of any of Landlord's rights, the failure to give Tenant or
such guarantor any notices, or the release of any party liable for the payment
of Tenant's obligations hereunder.
Section 29.10. Neither Landlord nor Landlord's agents or brokers have made any
representations or promises with respect to the Premises or the Building except
as herein expressly set forth and all reliance with respect to any
representations or promises is based solely on those contained herein.
Section 29.11. This Lease sets forth the entire agreement between the parties
and cancels all prior negotiations, arrangements, brochures, agreements, and
understandings, if any, between Landlord and Tenant regarding the subject matter
of this Lease. No amendment or modification of this Lease shall be binding or
valid unless expressed in a writing executed by both parties hereto.
Section 29.12. The submission of this Lease to Tenant shall not be construed as
an offer, nor shall Tenant have any rights with respect thereto unless Landlord
executes a copy of this Lease and delivers the same to Tenant.
Section 29.13. If Tenant signs as a corporation, each of the persons executing
this Lease on behalf of Tenant represents and warrants that Tenant is a duly
organized and existing corporation, that Tenant has and is qualified to do
business in the Commonwealth of Pennsylvania, that the corporation has full
right and authority to enter into this Lease, and that all persons signing on
behalf of the corporation were authorized to do so by appropriate corporation
actions. If Tenant signs as a partnership, trust, or other legal entity, each of
the persons executing this Lease on behalf of Tenant represents and warrants
that Tenant has complied with all applicable laws, rules, and governmental
regulations relative to its right to do business in the Commonwealth of
Pennsylvania, that such entity has the full right and authority to enter into
this Lease, and that all persons signing on behalf of the Tenant were authorized
to do so by any and all necessary or appropriate partnership, trust, or other
actions.
Section 29.14. If, in connection with obtaining financing for the Building or of
any ground or underlying Lease, any lender shall request reasonable
modifications in the Lease as a condition for such financing, Tenant will not
unreasonably withhold, delay, or defer its consent thereto, provided that such
modifications do not increase the obligations of Tenant hereunder or materially
adversely affect either the Leasehold interest hereby created or Tenant's use
and enjoyment of the Premises.
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Section 29.15. This Lease shall be governed by and construed under the laws of
the Commonwealth of Pennsylvania. Any action brought to enforce or interpret
this Lease shall be brought in the court of appropriate jurisdiction in
Cumberland County, Pennsylvania. Should any provision of this Lease require
judicial interpretation, it is agreed that the Court interpreting or considering
same shall not apply the presumption that the terms hereof shall be more
strictly construed against a party by reason of the rule or conclusion that a
document should be construed more strictly against the party who itself or
through its agent prepared the same, it being agreed that all parties hereto
have participated in the preparation of this Lease and that legal counsel was
consulted by each party before the execution of this Lease.
Section 29.16. Any elimination or shutting off of light, air, or view by any
structure which may be erected on lands adjacent to the Building, modification
of the amenities to the Building shall in no way affect this Lease or impose any
liability on Landlord.
Section 29.17. Landlord may, upon reasonable notice (except in the case of
emergencies) enter upon the Premises at reasonable hours to inspect same or
clean or make repairs or alterations (but without any obligation to do so,
except as expressly provided for herein) and to show the Premises to prospective
lenders or purchasers, and, during the last 6 months of the Term of the Lease,
to show them to prospective Tenants at reasonable hours and, if they are
vacated, to prepare them for re-occupancy. Landlord shall cause its officers,
agents and representatives to exercise care with any such entry not to
unreasonably interfere with the operation and normal office routine of Tenant
(except in the case of emergency).
Section 29.18. Landlord may elect to relocate Tenant to other space in the
Building containing at least the same amount of Rentable Area as contained in
the Premises ("Substitution Space"). If such relocation occurs, the description
of the Premises set forth in this Lease shall, without further act on the part
of Landlord or Tenant, be deemed amended so that the Substitution Space shall be
deemed the Premises hereunder, and all of the terms, covenants, conditions and
provisions of this Lease shall continue in full force and effect and shall apply
to the Substitution Space. The cost of relocating Tenant and altering the
Substitution Space to make it comparable to the Premises shall be borne by
Landlord. The Annual Base Rental for the Substitution Space shall be the amount
specified under item 14 of the Basic Lease Information.
Section 29.19. The exhibits and numbered riders attached to this Lease are by
this reference incorporated fully herein. The term "this Lease" shall be
considered to include all such exhibits and riders.
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IN WITNESS WHEREOF, Landlord and Tenant have set their hands and seals to
this Lease Agreement the day and year first above written.
Landlord:
OLD GETTYSBURG ASSOCIATES II
a Pennsylvania general partnership
WITNESS: By: /s/ Xxxx X. Xxxxxxxx
--------------------- --------------------------------
Xxxx X. Xxxxxxxx, General Partner
Tenant:
SELECT MEDICAL CORPORATION,
a Delaware Corporation
ATTEST: By: /s/ Xxxxx Xxxxxxxxx
---------------------- --------------------------------
Xxxxx Xxxxxxxxx
(Vice) President
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EXHIBIT "A"
(floor plan to be attached)
25
EXHIBIT "B"
ALL THAT CERTAIN tract of land situate in Lower Xxxxx Township, Cumberland
County, Pennsylvania, bounded and described as follows, to wit:
BEGINNING at an iron pin on the northern dedicated right-of-way line of
Old Gettysburg Road (L.R. 21099) (forty (40.00) feet from center line) at the
dividing line between the herein described lot and lands not or formerly of X.
X. Xxxxx; thence along the northern dedicated right-of-way line of Old
Gettysburg Road, south fifty-one degrees eleven minutes five seconds west (S 51
degrees 11' 05" W), a distance of two hundred sixty-fine and forty-three
hundredths (269.43) feet to a point at the dividing line between Lot Nos. 1 and
2 as shown on the hereinafter mentioned Plan; thence along the dividing line
between Lot Nos. 1 and 2, North thirty-eight degreed forty-eight minutes
fifty-five seconds West (N 38 degrees 48' 55" W), a distance of one hundred
seventy-seven (177.00) feet to a point; thence continuing along the same, North
twenty-three degrees fifty-eight minutes eight seconds West (N 23 degrees 58'
08" W), a distance of fifty-six and eighty-four hundredths (56.84) feet to a
point; thence continuing along the same, North thirty-nine degrees forty-nine
minutes ten seconds West (N 39 degrees 49' 10" W), a distance of forty (40.00)
feet to a point; thence still continuing along the dividing line between Lot
Nos. 1 and 2, North fifty degrees ten minutes fifty seconds East (N 50 degrees
10' 50" E), a distance of three hundred thirty-two (332.00) feet to a point on
the western line of Lot No. 3; thence along the dividing line of Lot Nos. 2 and
3, South thirty-nine degrees forty-nine minutes ten seconds East (S 39 degrees
49' 10" E), a distance of seventy-six and ninety-three hundredths (76.93) feet
to a point on the northern line of lands nor ow formerly of X. X. Xxxxx, South
fifty degrees forty-five minutes zero seconds West (S 50 degrees 45' 0" W, a
distance of fifty-seven and fifty hundredths (57.50) feet to an iron pipe;
thence continuing along the western line of lands now or formerly X. X. Xxxxx,
South thirty-three degrees three minutes zero seconds East (S 33 degrees 03' 0"
E), a distance of two hundred one and forty-two hundredths (201.42) feet to an
iron pin on the northern dedicated right-of-way line of Old Gettysburg Road,
said point being the place of BEGINNING.
BEING all of Lot No. 2 as shown on the Preliminary/Final Subdivision Plan
of Executive Park West Office Complex recorded in Cumberland County Plan Book
59, Page 89.
CONTAINING 1.852 acres, more or less.
00
XXXXXXX "X"
Xxxxxxxx agrees to finish the Premises "turn key" according to Building Standard
finishes as listed below.
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EXHIBIT "D"
PARKING
1. Throughout the Term, Tenant shall Lease from Landlord parking spaces
("Allocated Number") in the Parking Facilities. All such parking spaces shall be
Leased by Tenant on an unassigned basis and shall be used in common with the
other Tenants.
2. Throughout the Term, Tenant shall pay to Landlord as monthly rent
("Parking Rent") for such parking spaces an amount equal to the product of
(a) the Allocated Number
times
(b) the then current monthly rate for parking in the Parking Facilities
as established by Landlord from time to time.
All Parking Rent shall be paid by Tenant to Landlord in advance without demand
on the first day of each month, with partial months prorated accordingly,
commencing with the Commencement Date.
3. Landlord shall have the right to reserve parking spaces as it elects and
condition use thereof on such terms as it elects.
4. Landlord shall have the right to: make a reasonable charge for public
parking, control access to the garage, control access to any elevators in the
garage, add parking decks, change curb cuts, change traffic patterns, re-stripe
the parking garage and parking surfaces as to size and location of spaces,
temporarily displace vehicles (for the purpose of improving and expanding
Parking Facilities and with appropriate rebate of Parking Rent), abandon
basement parking and add or delete acceleration/deceleration lanes on private
easements, if any.
5. If a card system is utilized, lost cards will be replaced on request, but
a charge of $5.00 per card will be required to reimburse Landlord for
administrative costs of card replacement and reprogramming of card entry
processing unit.
6. Tenant shall cooperate fully in Landlord's efforts to maintain the
designated use of the various Parking Facilities and parking areas, and shall
follow all regulations issued by the Landlord with respect thereto.
7. Parking rent at the Commencement Date and throughout the Lease Term will
be calculated as follows:
Current Monthly Rate at
Type of Parking Spaces Allocated Number the Commencement Date
* N/A N/A ea at $
------------------------------
* 143 of non-reserved parking spaces are provided for Tenants, guests, visitors
and subcontractors at no cost.
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EXHIBIT "E"
SECURITY CARD ACCESS
Building: Executive Park West II, 0000 Xxx Xxxxxxxxxx Xxxx, Xxxxxxxxxxxxx XX
00000
Security in the form of limited access to the Building during other than Normal
Business Hours through the use of cards may be provided by Landlord. In such
event Landlord agrees to provide to Tenant free of charge, 2 cards which cards
will be surrendered at the Expiration Date. The deposit for any card Tenant may
desire in addition to this quantity shall be $15.00 per card. Landlord, however,
shall have no liability to Tenant, its employees, agents, invitees or licensees
for losses due to theft or burglary, or for damages done by unauthorized persons
on the Premises and neither shall Landlord be required to insure against any
such losses. Tenant agrees to surrender all cards then in its possession upon
the expiration or earlier termination of this Lease. Any lost card shall be
cancelled and Tenant shall pay the sum of $15.00 Dollars for each replacement
card.
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EXHIBIT "F"
RULES AND REGULATIONS
1. Sidewalks, doorways, vestibules, halls, stairways, and similar areas shall
not be obstructed by Tenants or their officers, agents, servants, and employees,
or used for any purpose other than ingress and egress to and from the Premises
and for going from one part of the Building to another part of the Building.
2. Plumbing fixtures and appliances shall be used only for the purpose for
which constructed, and no sweepings, rubbish, rags, or other unsuitable material
shall be thrown or placed therein. The cost of repairing any stoppage or damage
resulting to any such fixtures or appliances from such misuse shall be paid by
such Tenant.
3. No signs, posters, advertisements, or notices shall be painted or affixed
on any of the windows or doors, or other part of the Building, or placed in such
a manner as to be visible outside the Premises, except of such color, size, and
style, and in such places, as shall be first approved in writing by the Building
Manager. No nails, hooks, or screws shall be driven into or inserted in any part
of the Building, except by Building maintenance personnel.
4. Directories will be placed by Landlord, at Landlord's own expense, in a
conspicuous place in the Building. No other directories shall be permitted.
5. The Premises shall not be used for conducting any barter, trade, or
exchange of goods or sale through promotional give-away programs or any business
involving the sale of second-hand goods, insurance salvage stock, or file sale
stock, and shall not be used for any auction or pawnshop business, any fire
sale, bankruptcy sale, going-out-of-business sale, moving sale, bulk sale, or
any other business which, because of merchandising methods or otherwise, would
tend to lower the character of the Building. Canvassing, soliciting and peddling
in the Building are prohibited.
6. Tenants shall not do anything, or permit anything to be done, in or about
the Building, or bring or keep anything therein, that will in any way increase
the possibility of fire or other casualty or obstruct or interfere with the
rights of, or otherwise injure or annoy, other Tenants, or do anything in
conflict with the valid pertinent laws, rules, or regulations of any
governmental authority. Tenants shall not use or keep in the Building any
inflammable or explosive fluid or substance, or any illuminating material,
unless it is battery powered, UL approved.
7. Tenants shall not place a load upon any floor of the Premises which
exceeds the floor load per square foot which such floor was designed to carry or
which is allowed by applicable Building code. Landlord may prescribe the weight
and position of all safes and heavy installations which Tenant desires to place
in the Premises so as properly to distribute the weight thereof. All damage done
to the Building by the improper placing of heavy items which over-stress the
floor will be repaired at the sole expense of the Tenant.
8. A Tenant shall notify the Building Manager when safes or other heavy
equipment are to be taken into or out of the Building. Moving of such items
shall be done under the supervision of the Building Manager, after receiving
written permission from him/her. Tenant shall not move in or out of the Building
at the beginning or end of the Lease term, prior to 6:00 p.m. on any weekday.
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9. Corridor doors, when not in use, shall be kept closed. All window blinds
shall be left in closed position, in order to facilitate energy conservation.
10. All deliveries must be made via the service entrance and service elevators
during normal business hours. Prior approval must be obtained from Landlord for
any deliveries that must be received after normal business hours. Any hand
trucks utilized for deliveries must be equipped with rubber tires and
sideguards.
11. Each Tenant shall cooperate with Building employees in keeping the
Premises neat and clean. When conditions are such that Tenant must dispose of
crates, boxes, etc., it will be the responsibility of Tenant to do so outside of
the hours of 7:00 a.m. and 6:00 p.m., at Tenant's expense.
12. Nothing shall be swept or thrown into the corridors, halls, elevator
shafts or stairways. No birds, animals, reptiles, or any other creatures, shall
be brought into or kept in or about the Building except for any seeing eye dogs.
13. Should a Tenant require telegraphic, telephonic, annunciator, or any other
communication service, Landlord will direct Tenant as to where and how the
electricians and installers shall introduce and place wires, and none shall be
introduced or placed except as Landlord shall direct in writing.
14. Tenants shall not make or permit any improper noises in the Building, or
otherwise interfere in any way with other Tenants or persons having business
with them.
15. No equipment shall be operated on the Premises that could unreasonably
interfere with the rights of any other Tenant in the Building without written
consent of Landlord. Nothing shall be done or permitted in the Premises, and
nothing shall be brought into or kept on the Premises, which would impair or
interfere with any of the Building services, or the use or enjoyment by any
other Tenant of any other Premises, nor shall there be installed by any Tenant
any heating, ventilating, air conditioning, electrical or other equipment of any
kind which, in the judgment of the Landlord, might cause any such impairment or
interference. No space heaters or fans shall be operated in the Premises.
16. Business machines and mechanical equipment belonging to Tenant which cause
noise and/or vibration that may be transmitted to the structure of the Building
or to any Leased space so as to be objectionable to Landlord or any Tenants in
the Building, shall be placed and maintained by Tenant, at Tenant's expense, in
settings of cork, rubber, or spring type noise and/or vibration eliminators
sufficient to eliminate vibration and/or noise.
17. Tenants shall not permit any cooking within the Premises and shall not
permit any food or other odors emanating within the premises to seep into other
portions of the Building. Tenants shall not install vending machines in the
Premises.
18. No additional locks shall be placed upon any doors without the prior
written consent of Landlord. All necessary keys shall be furnished by Landlord,
and the same shall be surrendered upon termination of this Lease, and Tenant
shall then give Landlord or his agent an explanation of the combination of all
locks on the doors or vaults. Tenant shall initially be given two (2) keys to
the Premises by Landlord. No duplication of such keys shall be made by Tenants.
Additional keys shall be obtained only from Landlord, at a reasonable fee to be
determined by Landlord.
19. Tenants, employees, or agents, or anyone else who desires to enter the
Building after normal business hours, may be required to sign in upon entry and
sign out upon leaving, giving the location during such person's stay and such
person's time of arrival and departure.
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20. Tenants will not locate furnishings or cabinets adjacent to mechanical or
electrical access panels or over air conditioning outlets so as to prevent
operating personnel form servicing such units as routine or emergency access may
require. Cost of moving such furnishings for Landlord's access will be at
Tenant's expense. The lighting and air conditioning equipment of the Building
will remain the exclusive charge of the Building designated personnel. Landlord
will control all internal lighting that may be visible from the exterior of the
Building and shall have the right to change any unapproved lighting, without
notice to Tenant, at Tenant's expense.
21. Tenants shall comply with parking rules and regulations as may be posted
and distributed from time to time, and shall take reasonable steps to cooperate
with Landlord to enforce compliance.
22. Tenants shall provide plexiglass or other pads for all chairs mounted on
rollers or casters, unless same are designated for use on carpet by the
manufacturer.
23. No Tenant shall make any changes or alterations to any portion of the
Building without Landlord's prior written approval (which approval shall not be
unreasonably withheld), which may be given on such conditions as Landlord may
elect. All such work shall be done by Landlord or by contractors and/or workmen
approved by Landlord (which approval shall not be unreasonably withheld),
working under Landlord's supervision.
24. Landlord has the right to evacuate the Building in event of emergency or
catastrophe.
25. If any governmental license or permit shall be required for the proper and
lawful conduct of Tenant's business, Tenant, before occupying the Premises,
shall procure and maintain such license or permit and submit it for Landlord's
inspection. Tenant shall at all times comply with the terms of any such license
or permit.
26. Landlord shall have the right, exercisable without notice and without
liability to any Tenant, to change the name and street address of the Building,
and to install signs on the interior and exterior of the Building.
27. Smoking is not permitted anywhere inside the Premise or building .
28. Landlord reserves the right to rescind any of these rules and regulations
and make such other and further rules and regulations as in the reasonable
judgment of Landlord shall from time to time be needed for the safety,
protection, care, and cleanliness of the Building, the operation thereof, the
preservation of good order therein, and the protection and comfort of its
Tenants, their agents, employees, and invitees, which rules and regulations when
made and notice thereof given to a Tenant shall be binding upon him in like
manner as if originally herein prescribed.
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