AWARD OF IN-LEASE (L-100)
Exhibit 10.4
Execution Version
|
D.C. DEPARTMENT OF GENERAL SERVICES
In-Lease agreement |
1. LEASE NO. |
____________ |
|
|
|
|
|
|
|
AWARD OF IN-LEASE (L-100)
|
|
|
|
|
2. BUILDING NAME AND ADDRESS (No., street, city, state, and zip code) |
|
|
|
|
3924 Minnesota Avenue NE Washington, DC 20019 |
|
|
|
|
|
|
|
|
|
3. Your offer is hereby accepted. This award consummates the lease which consists of the following documents:
|
|||
|
(a) this DC DGS Form L-100 (Award of In-Lease), |
|
|
|
|
(b) DC DGS Form L-102 (Accepted Proposal to Lease Space), |
|
|
|
|
(c) DC DGS Form L-105 (In-Lease Agreement Definitions and Standard Clauses and Provisions), |
|
|
|
|
(d) Exhibit A (Depiction of Premises), (e) Exhibit B (Legal Description of Land), (f) Exhibit C (Work Exhibit for Base Building Work and Tenant Improvements), (g) Exhibit D (Form of Declaration of Delivery), (h) Exhibit E (Rent Schedule of Net Rental), (i) Exhibit F (Form of SNDA), (j) Exhibit G (Form of Tenant Estoppel Certificate), (k) Exhibit H (Form of Declaration of Final Accounting), (l) Exhibit I (Janitorial Specifications, (m) Exhibit J (Depiction of Additional Parking Areas), (n) Exhibit K (Development Area), and (o) Exhibit L (Form of Sublease Recognition Agreement).
(collectively, this “Lease”) |
|
|
|
|
|
|||
|
In the event of conflict, the order of priority between the documents comprising this Lease shall be in the order above, unless otherwise specifically set forth in this Lease. |
|||
|
|
|
|
|
|
4a. Landlord's notice and payment address:
|
|
|
|
PAGE 1 OF 135
3924 Minnesota Avenue NE(as modified) DC DGS FORM L-100 (3/2018)
US 167835565v6
Exhibit 10.4
Execution Version
|
Notice Address:
Cedar-Senator Square, LLC c/o Cedar Realty Trust 44 South Bayles Avenue Port Washington, NY 11050 Attention: Robin McBride Ziegler, Chief Operating Officer
Phone: 516-767-6492 Email address: rzeigler@cdrrt.com
With a copy to:
Cedar-Senator Square, LLC 44 South Bayles Avenue Port Washington, NY 11050 Attention: Adina G. Storch, General Counsel
Phone: 516-944-4583 Email address: astorch@cdrrt.com
Payment Address or Wire/EFT Instructions:
Cedar-Senator Square, LLC c/o Cedar Realty Trust 44 South Bayles Avenue Port Washington, NY 11050
|
|
|
|
|
|
|
|
|
|
4b. District's notice address:
|
|
|
|
|
Government of the District of Columbia Department of General Services 2000 14th Street, N.W., 8th Floor Washington, D.C. 20009 Attn: Director
Email address: keith.anderson@dc.gov |
|
|
|
|
|
|
|
|
|
with a copy to:
Government of the District of Columbia Department of General Services 2000 14th Street, N.W., 8th Floor Washington, D.C. 20009 Attn: General Counsel
Email address: xavier.beltran@dc.gov
and, in the event of an alleged District default, with a copy to:
Government of the District of Columbia Office of the Attorney General for the District of Columbia 441 4th Street, N.W., Suite 1010 South Washington, D.C. 20001 Attention: Deputy Attorney General, Commercial Division
Email address: david.fisher@dc.gov
|
|
|
|
[Signature Pages to Follow]
PAGE 2 OF 135
3924 Minnesota Avenue NE(as modified) DC DGS FORM L-100 (3/2018)
US 167835565v6
Exhibit 10.4
Execution Version
|
|
|
|
|
|
5. Landlord's signature (Insert Landlord’s signature block including name of Landlord and name and title of Signatory): |
|
|
|
|
|
|
|
|
|
5a. SIGNATURE:
Cedar-Senator Square, LLC, a Delaware limited liability company
By:/s/ ROBIN ZEIGLER Name:Robin Zeigler Title:EVP, Chief Operating Officer
|
|
|
|
|
5b. DATE: JUNE 30, 2020 |
|
|
|
[The District’s Signature Page to Follow]
PAGE 3 OF 135
3924 Minnesota Avenue NE(as modified) DC DGS FORM L-100 (3/2018)
US 167835565v6
Exhibit 10.4
Execution Version
|
|
|
|
|
|||
|
THIS DOCUMENT IS NOT BINDING ON THE DISTRICT OF COLUMBIA UNLESS SIGNED BELOW BY THE DIRECTOR OF |
||||||
|
THE DEPARTMENT OF GENERAL SERVICES AND BY THE OFFICE OF THE GENERAL COUNSEL FOR THE DEPARTMENT |
||||||
|
OF GENERAL SERVICES AND, IF THE ANNUAL RENTAL IS EQUAL TO OR EXCEEDS $1,000,000, APPROVED BY THE |
||||||
|
COUNCIL OF THE DISTRICT OF COLUMBIA PURSUANT TO D.C. OFFICIAL CODE § 1-204.51. |
||||||
|
|
|
|
|
|||
|
DISTRICT’S signatures:
|
|
|
|
|||
|
|
|
|
|
|||
|
6. By: NAME OF DIRECTOR: Keith A. Anderson |
|
|
|
|||
|
6a. SIGNATURE OF DIRECTOR: /S/ KEITH A. ANDERSON |
|
|
|
|||
|
6b. DATE: 7/23/2020 |
|
|
|
|||
|
|
|
|
|
|||
|
Approved as to Legal Sufficiency for the District of Columbia by: Office of the General Counsel for the Department of General Services: |
|
|
|
|||
|
7. By: NAME: Katherine Jough |
|
|
|
|||
|
7a. TITLE: Senior Assistant General Counsel |
|
|
|
|||
|
7b. SIGNATURE: /S/ KATHERINE L. JOUGH |
|
|
|
|||
|
7c. DATE: JULY 23, 2020 |
|
|
|
|||
|
|
|
|
|
|||
|
8. LEASE Commencement DATE (Insert the date that this Lease is fully executed above, subject to prior Council Approval, if applicable)
|
||||||
|
July 23, 2020.
|
|
|
|
|||
[L-102 and L-105 to Follow]
PAGE 4 OF 135
3924 Minnesota Avenue NE(as modified) DC DGS FORM L-100 (3/2018)
US 167835565v6
EXECUTION VERSION
PAGE 5 OF 135
3924 Minnesota Avenue NE(as modified) DC DGS FORM L-102 (3/2018)
US 167835565v6
EXECUTION VERSION
|
N/A |
|||||||||||||||||||||||||||
|
13. |
a.Total number of parking spaces in the Parking Facility shall be set forth in the Declaration of Delivery.
Total number of parking spaces in the Additional Parking Areas shall be set forth in the Declaration of Delivery. |
b.Ratio for calculating parking spaces provided with Lease: |
c.Reserved parking spaces for District fleet use: |
N/A |
N/A |
||||||||||||||||||||||
|
d.Unreserved parking spaces for District fleet use: |
150 spaces (location to be specified in the Declaration of Delivery). |
$150/month (escalating pursuant to Section 2 of DC DGS Form L-105) |
|||||||||||||||||||||||||
|
e.Employee rate (if applicable) |
150 spaces (location to be specified in the Declaration of Delivery). |
$150/month (escalating pursuant to Section 2 of DC DGS Form L-105)
|
|||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
14. INITIAL LEASE TERM |
15. RENEWAL OPTIONS (describe the process for exercising a renewal in Section III(19)) |
||||||||||||||||||||||||||
|
a.NUMBER OF YEARS
20 Lease Years and 10 months from the Rent Commencement Date |
b.YEARS FIRM
20 years and 10 months |
c.NUMBER OF DAYS NOTICE REQUIRED FOR GOVERNMENT TO TERMINATE LEASE:
As applicable, see DC DGS Form L-105. |
a.NET RENTAL RATE
N/A |
b.YEARS EACH
N/A |
c.NUMBER OF OPTIONS
0 |
d.NUMBER OF DAYS NOTICE REQUIRED TO EXERCISE RENEWAL OPTION: N/A |
|||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||
|
$50.00 per half-hour per floor (escalating pursuant to Section 11.2 of DC DGS Form L-105)
|
17. District’s Proportionate Share: For Operating Costs: 100% For Real Estate Taxes: 93.1%
|
||||||||||||||||||||||||||
|
NONE. |
|||||||||||||||||||||||||||
|
19.ADDITIONAL REMARKS OR CONDITIONS WITH RESPECT TO THIS LEASE
The number of rentable square feet in the Premises set forth in Section I(3) and Section II(8)(a)(1) and the District’s Proportionate Share in Section III(17) above shall be subject to adjustment pursuant to the terms of this Lease, and set forth in the Declaration of Delivery.
|
|||||||||||||||||||||||||||
|
SECTION IV - OWNER IDENTIFICATION AND CERTIFICATION |
|||||||||||||||||||||||||||
|
20.Ground Tenant (Name and address including ZIP code) |
|||||||||||||||||||||||||||
|
Cedar-Senator Square, LLC, a Delaware limited liability company
c/o Cedar Realty Trust 44 South Bayles Ave, Suite 304 Port Washington, NY 11050
|
|||||||||||||||||||||||||||
[Signature Page to Follow]
PAGE 6 OF 135
3924 Minnesota Avenue NE(as modified) DC DGS FORM L-102 (3/2018)
US 167835565v6
EXECUTION VERSION
[L-105 to Follow]
PAGE 7 OF 135
3924 Minnesota Avenue NE(as modified) DC DGS FORM L-102 (3/2018)
US 167835565v6
EXECUTION VERSION
DEPARTMENT OF GENERAL SERVICES
IN-LEASE AGREEMENT
DEFINITIONS AND
STANDARD CLAUSES AND PROVISIONS
This Lease is entered into between Landlord and the District effective as of the Lease Commencement Date (hereafter defined). All exhibits attached to this DC DGS Form L-105 are incorporated herein.
Table of Contents:
Definitions
§ 1Premises
§ 2Parking
§ 3Use of Premises
§ 4Rules
§ 5Term
§ 6Extension Options
§ 7Annual Rental, Real Estate Taxes, and Operating Costs
§ 8Construction of Tenant Improvements and Base Building Work; Alterations; Delivery Date
§ 9Maintenance and Repairs
§ 10Signs
§ 11Service and Utilities
§ 12Interruption
§ 13Inspection
§ 14Insurance
§ 15Liability of Landlord and the District
§ 16Damage or Destruction
§ 17Condemnation
§ 18Default
§ 19Subordination
§ 20Estoppel Certificate
§ 21Assignment and Subletting
§ 22Holding Over
§ 23Brokers, Agents
§ 25Asbestos Certification
§ 26Specific District of Columbia Law
§ 27District Right of First Offer
Definitions:
“Additional Parking Area” means those parking areas identified on “Exhibit J” attached hereto and made a part hereof, which shall be available for a portion of the Parking Spaces pursuant to Section 2 hereof.
“Additional Rent” means all sums other than Annual Rental, or the components thereof, payable by the District to Landlord under this Lease, including Operating Cost Increases, Tax Increases and Parking Fees.
“Agent” means a Party’s employee, officer, agent or contractor.
“Alteration” means any improvement, addition, alteration, fixed decoration, substitution, replacement or modification, structural or otherwise, elected to be made by the District in or to the Premises or the Building or the Land, but does not include removable fixtures, furniture, or equipment.
“Annual Rental” means the total amount of Net Rental, Initial Operating Costs, Initial Real Estate Taxes, and the amortized Tenant Improvement Allowance, if any (as set forth in Section II(8) of DC DGS Form L-102), due under this Lease. The Annual Rental applicable to the initial Lease Year commencing in 2022 is set forth in Section II(8)(a)(5) of DC DGS Form L-102. For the avoidance of doubt, Annual Rental shall not include Additional Rent.
PAGE 8 OF 135(as modified) DC DGS FORM L-105 (3/2018)
3924 Minnesota Avenue NE
US 167835565v6
EXECUTION VERSION
“Anti-Deficiency Acts” is defined in Section 26.1(a) hereof.
“Base Building Conditions” means the roof, floor slab, exterior walls (excluding doors, windows, and glass), structural portions of the Premises, and any utility lines located on the Land but outside the Building up to the point of entry into the Building.
“Base Building Work” is defined in the Work Exhibit.
“BOMA Measurement Standard” or “BOMA” means the Building Owners and Managers Association Standard Method for Measuring Floor Area in Office Building (BOMA/ANSI Z65.1-2010) for rentable floor area.
“Building” means the building Landlord is to construct on the Land in accordance with this Lease in accordance with the Work Exhibit.
“Building Hours” means Monday through Friday, 7:00 a.m. to 6:00 p.m., and Saturday from 9:00 a.m. to 2:00 p.m., excluding Sundays and holidays observed by the Government of the District of Columbia or the Federal government.
“Building Structures and Systems” means the Building standard mechanical, electrical, telephone/telecommunications systems, lighting, HVAC and plumbing systems, elevator core and mechanical systems, safety and environmental management systems, pipes and conduits, including any system or equipment installed for the purposes of keeping below-grade levels dry, columns, plate glass windows, window cleaning tracks, atrium, loading docks, grounds, the Parking Facility, all mechanical and
janitorial closets, and all other structures or systems serving the Building.
“Business Days” means Monday through Friday, excluding holidays observed by the Government of the District of Columbia and days when the Government of the District of Columbia is officially closed for business.
“Common Areas” means the elevators, hallways, stairways, public bathrooms, sidewalks, driveways, parking areas, loading docks, common entrances, lobbies and other similar public or non-exclusive areas and access ways in or on the Property located outside of the Premises. For avoidance of doubt, all elevator lobbies, hallways and bathrooms on floors leased entirely by the District shall be part of the Premises and not Common Areas; provided, however, elevators, elevator shafts, stairwells, the fitness center and any roof terrace or deck shall be a Common Area.
“CPI” means the revised Consumer Price Index for Urban Wage Earners and Clerical Workers (revised CPI-W), All Items, Washington – Arlington – Alexandria, DC-VA-MD-WV, 1982-84=100, as published by the Bureau of Labor Statistics of the United States Department of Labor. If the CPI is changed so that a base year of other than 1982-84 is used, the CPI used herein shall be converted in accordance with the conversion factor published by the Bureau of Labor Statistics of the United States Department of Labor. If the CPI is discontinued or otherwise revised during the Term, such other government index or computation by which Landlord and the District agree that the CPI has been replaced by shall be used for purposes of this Lease to obtain substantially the same result as would be obtained if the
PAGE 9 OF 135(as modified) DC DGS FORM L-105 (3/2018)
3924 Minnesota Avenue NE
US 167835565v6
EXECUTION VERSION
CPI had not been discontinued or otherwise revised.
“Declaration of Delivery” means that document (the form of which is set forth in “Exhibit D” attached hereto and made a part hereof) to be delivered by Landlord to the District promptly following the satisfaction of Landlord’s Delivery Obligations and to be executed by the District within ten (10) Business Days after the District’s receipt of Landlord’s executed correct version thereof, which sets forth the Rent Commencement Date, Lease expiration date, and final number of rentable square feet in the Premises, as well as sets forth and verifies such other terms and information as is deemed reasonably appropriate by the Parties.
“Declaration of Final Accounting” means that document (the form of which is set forth in “Exhibit H” attached hereto and made a part hereof) to be executed by the Parties upon completion of the Final Accounting as set forth in the Work Exhibit, which sets forth the Final Accounting, any adjustments to be made to any rental abatement as a result thereof, and any Change Order Costs or Excess Costs, as well as sets forth such other terms and information as is deemed appropriate by the Parties.
“Director” means the Director of the Department of General Services, an executive agency within the Government of the District of Columbia authorized, pursuant to the Department of General Services Establishment Act of 2011, effective September 14, 2011 (D.C. Law 19-21, 58 DCR 6226), D.C. Official Code § 10-551.01 (2011 Supp.), as well as, all regulations, and orders promulgated and related thereto and in furtherance thereof (as all may be amended from time to time), and established to, among other
things, manage certain leased space and other real property assets of the District of Columbia.
“District” means the District of Columbia, by and through its Department of General Services, as the tenant under this Lease and any agency, office or instrumentality of the District of Columbia occupying the Premises (solely in its or their capacity as an occupant under this Lease) during the Lease Term.
“District Default” is defined in Section 18.1(a) hereof.
“District Delay” is defined in the Work Exhibit.
“District Negligence” means the negligence or willful misconduct of the District or its Agent, as determined by the judgment of a court of competent jurisdiction in the event the District disputes that the District or its Agent was negligent or engaged in willful misconduct.
“District of Columbia” means the District of Columbia, a municipal corporation, in its capacity as a sovereign entity, and not in its capacity as the tenant under this Lease.
“District’s Proportionate Share” means the percentage that the total rentable square feet of the Premises bears to the total rentable square feet in the Building. As of the Lease Commencement Date, the District’s Proportionate Share is (1) as set forth on Section III(17) of DC DGS Form L-102; and (2) subject to adjustment following Substantial Completion of the Base Building Work and Tenant Improvements as set forth on the Declaration of Delivery. For purposes of this Lease, all measurements
PAGE 10 OF 135(as modified) DC DGS FORM L-105 (3/2018)
3924 Minnesota Avenue NE
US 167835565v6
EXECUTION VERSION
of rentable square feet of space shall be based upon the BOMA Measurement Standard. Notwithstanding the foregoing, if at some point during the Term the Building or the Property is improved such that the rentable square feet of the Building is increased (including without limitation the construction of an annex or addition to the Building), or the quantity of rentable square feet at the Property is increased (including without limitation the construction of an additional building on the Land), and unless such increased area shall be assessed separately from the Property (which is the subject of this Lease) for purposes of taxation (a “Separate Assessment”), the District’s Proportionate Share shall be reduced to account for the new rentable square feet of the Building or the new amount of rentable square feet at the Property. Landlord shall give prompt notice thereof to the District, and such revised District’s Proportionate Share shall be effective as of the completion of such increase in the rentable square feet of the Building or increase to the amount of rentable square feet at the Property. If Landlord delays in providing such notice to the District, any overpayment by the District to Landlord as a result of such delay shall be a credit to the District against any Annual Rent or Additional Rent coming due under this Lease. Any such reduction in the District’s Proportionate Share shall be set forth on a subsequent declaration of delivery.
“Emergency Condition” is defined in Section 13.1 hereof.
“Environmental Default” means any of the following: (a) a continuing violation beyond any applicable period of notice and cure of Environmental Laws; (b) a release, spill or discharge of Hazardous Materials on or from the Premises, or any
of the Property that is not remediated in accordance with applicable Environmental Laws; (c) an environmental condition requiring responsive action by applicable Environmental Laws; or (d) any combination of the foregoing.
“Environmental Laws” means any applicable laws and any amendments thereto (whether common law, statute, rule, order, regulation or otherwise), permits and other requirements or guidelines of governmental authorities applicable to the Building or the Land and relating to the environment and environmental conditions or to any Hazardous Material (including, without limitation, CERCLA, 42 U.S.C. § 9601 et seq.; the Resource Conservation and Recovery Act of 1976, 42 U.S.C. § 6901 et seq.; the Hazardous Materials Transportation Act, 49 U.S.C. § 1801 et seq.; the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq.; the Clean Air Act, 42 U.S.C. § 7401 et seq.; the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq.; the Safe Drinking Water Act, 42 U.S.C. § 300f et seq.; the Emergency Planning and Community Right‑To‑Know Act, 42 U.S.C. § 1101 et seq.; the Occupational Safety and Health Act, 29 U.S.C. § 651 et seq.; any so‑called “Super Fund” or “Super Lien” law; any law requiring the filing of reports and notices relating to hazardous substances, environmental laws administered by the Environmental Protection Agency and any similar state and local Laws; all amendments or modifications to the foregoing as they may occur from time to time; and, all regulations, orders, decisions and decrees now or hereafter promulgated thereunder).
PAGE 11 OF 135(as modified) DC DGS FORM L-105 (3/2018)
3924 Minnesota Avenue NE
US 167835565v6
EXECUTION VERSION
Code §§ 2-381.01, et seq., as may be amended from time to time.
“Final Accounting” is defined in the Work Exhibit, and shall be set forth in the Declaration of Final Accounting.
“FOIA” means D.C. Freedom of Information Act, D.C. Official Code § 2-531, et seq., as may be amended from time to time.
“Force Majeure Event” means any of the following that directly cause any of a Party’s obligations under this Lease not to be performed in a timely manner: an act of God (including fire, flood, earthquake, hurricane, or other natural disaster); war; acts of terrorism (as defined by the United Nations Security Council); insurrection; riot; a general shortage of labor, equipment, facilities, materials or supplies in the open market; failure or unavailability of transportation; strike, lockout, or other actions of labor unions; a health epidemic or pandemic or similar healthcare emergency, as declared by the Centers for Disease Control, any other applicable federal authority or agency or District of Columbia government officials; or any other cause, whether similar or dissimilar to the foregoing that is not within the reasonable control of the party or caused by the willful misconduct or negligence of Landlord or District Negligence, as applicable; provided, however, that in no event shall a Force Majeure Event excuse the timely payment of monies owed by one Party to another hereunder so long as applicable payment processing systems are not affected by such Force Majeure Event.
“Hazardous Materials” means (a) asbestos and any asbestos containing material and any substance that is then
defined or listed in, or otherwise classified pursuant to, any Environmental Laws or any other applicable Laws as a “hazardous substance,” “hazardous material,” “hazardous waste,” “infectious waste,” “toxic substance,” “toxic pollutant” or any other formulation intended to define, list or classify substances by reason of deleterious properties such as ignitability, corrosivity, reactivity, carcinogenicity, toxicity, reproductive toxicity or Toxicity Characteristic Leaching Procedure (TCLP) toxicity; (b) any petroleum and drilling fluids, produced waters and other wastes associated with the exploration, development or production of crude oil, natural gas or geothermal resources; and (c) any petroleum product, polychlorinated biphenyls, urea formaldehyde, radon gas, radioactive material (including any source, special nuclear or by‑product material), medical waste, chlorofluorocarbon, lead or lead‑based product and any other substance the presence of which could be detrimental to the Building or the Land or hazardous to health or the environment.
“Initial Lease Term” means the period that begins on the Rent Commencement Date, and continues for the period set forth in Section III(14) of DC DGS Form L-102 (such period not including any extensions to the term, if applicable), in all events subject to Section 26.1 hereof.
“Initial Operating Costs” is defined within the definition of “Operating Costs” below.
“Initial Real Estate Taxes” is defined in Section 7.5(a) hereof.
“Interruption” means any event or condition which causes the Premises or a portion thereof to be unfit for its intended
PAGE 12 OF 135(as modified) DC DGS FORM L-105 (3/2018)
3924 Minnesota Avenue NE
US 167835565v6
EXECUTION VERSION
use (and is not so used by the District) or to be inaccessible, including without limitation the following events and conditions: (a) lack of electricity, heating, lighting, ventilation, air conditioning, running water, functioning plumbing, or Building security; (b) if the Premises are located above the ground floor, failure to have at least one (1) passenger elevator operational in the Building servicing the Premises; (c) lack of functioning sprinklers or smoke detectors in the Premises as required by Laws; and (d) flooding or an Environmental Default.
“Land” means the real property upon which the Building is located, the legal description of which is set forth in “Exhibit B” attached hereto and made a part hereof, which is subject to modification upon the creation of an A&T Lot for the portion of Land on which the Building will be located pursuant to Section 7.5(b) hereto.
“Landlord” means Cedar-Senator Square, LLC, a Delaware limited liability company, and its successors and permitted assigns.
“Landlord Default” is defined in Section 18.2(a) hereof.
“Landlord Payment Address” means the address set forth in Section 4(a) of DC DGS Form L-100, as may be revised in accordance with the notice provisions of this Lease.
“Landlord’s Delivery Obligations” means (i) Landlord’s Substantial Completion of the Base Building Work and Tenant Improvements (including all HVAC, plumbing, electrical and other mechanical systems, in accordance with the terms and conditions of the Work Exhibit, in good working order and
condition, and the Premises is in compliance with all applicable Laws), (ii) Landlord’s delivery of the Premises to the District in the condition required by clause (i), (iii) Landlord making the Parking Spaces available for the District’s use, and (iv) Landlord obtaining all permits and approvals required from all applicable governmental authorities to enable the District to occupy the Premises (including Landlord’s delivery of a certificate of occupancy for the Premises to the District provided that Landlord shall be deemed to have satisfied clause (iv) if it has delivered temporary certificates of occupancy that allow for the District’s uninterrupted and unrestricted occupancy provided Landlord delivers permanent certificates of occupancy within ninety (90) days after otherwise satisfying Landlord’s Delivery Obligations). The satisfaction of such Landlord’s Delivery Obligations will be evidenced by full execution of the Declaration of Delivery provided that neither the failure to deliver the Declaration of Delivery nor the District’s failure to timely execute a correct Declaration of Delivery shall constitute a failure of Landlord’s Delivery Obligations.
“Laws” means all applicable laws (including, without limitation (i) the Americans with Disabilities Act (the “ADA”), 101 P.L. 336; 104 Stat. 327, together with the requirements under Title II and Title III of the ADA, and (ii) the Human Rights Act of 1977, D.C. Law 2-38; D.C. Official Code §2-1401.01, et seq.) and the orders, rules and regulations promulgated with respect to all such laws, as the same may be amended from time to time, including but not limited to all applicable ordinances (including without limitation, zoning ordinances and land
PAGE 13 OF 135(as modified) DC DGS FORM L-105 (3/2018)
3924 Minnesota Avenue NE
US 167835565v6
EXECUTION VERSION
use requirements) and codes of the District of Columbia, the United States, and any other governmental or quasi-governmental entities with jurisdiction over the Property.
“Lease” is defined in Section 3 of DC DGS Form L-100.
“Lease Commencement Date” means the date the Parties fully execute and deliver this Lease and this Lease is in full force and effect, which date is set forth in Section 8 of DC DGS Form L-100.
“Lease Term” or “Term” means the Initial Lease Term, as may be extended, in all events subject to Section 26.1 hereof.
“Lease Year” means a period of twelve (12) consecutive months commencing on the Rent Commencement Date, and each successive twelve (12) month period thereafter until the Lease Term ends; provided, however, that if the Rent Commencement Date occurs on a day other than the first day of a month, the first Lease Year shall begin on the Rent Commencement Date and end one year from the last day of the month in which the Rent Commencement Date occurs. Each “month” during the Lease Term shall consist of the actual number of days elapsed therein.
“MDF” means the information technology main distribution facility in the Building servicing the Premises, together with any intermediate distribution facility co-located therein.
“Net Rental” means the portion of Annual Rental due from the District as base rent for the Premises. The Net Rental applicable to the initial Lease Year is set forth in Section II(8)(e) of DC DGS
Form L-102. The Net Rental shall escalate as set forth in Section 7.1 and on the Rent Schedule attached hereto as “Exhibit E”.
“Operating Costs” means that portion of Annual Rental (as Initial Operating Costs) and Additional Rent (as Operating Cost Increases) payable monthly, in arrears, by the District in consideration for Landlord’s provision of services to, and the repair, maintenance and operation of, the Premises, Building and Land in accordance with the terms of this Lease. The Operating Costs applicable to the initial Lease Year (“Initial Operating Costs”) are set forth in Section II(8)(b) of DC DGS Form L-102. Initial Operating Costs are subject to escalation pursuant to Section 7.6 hereof.
“Parking Facility” means the parking garage located within the Building.
“Parking Spaces” is defined in Section 2.2 hereof.
“Parties” means Landlord and the District.
“Party” means either Landlord or the District.
“Permitted Use” means any lawful use of the Premises excluding: (i) any direct medical use (i.e., in-patient or out-patient provision of medical services); (ii) any direct provision of social services (i.e., service windows); (iii) a Department of Motor Vehicles service center; (iv) a jail, police station or similar facility related to the criminal justice system unless such facility is used entirely as an office (e.g., no temporary or permanent placement of or visits by criminal offenders or alleged criminal offenders shall be permitted); and (v) a school or similar facility
PAGE 14 OF 135(as modified) DC DGS FORM L-105 (3/2018)
3924 Minnesota Avenue NE
US 167835565v6
EXECUTION VERSION
providing direct educational services, a community center or a homeless shelter unless such facility is used entirely as an office, and provided that the use of a conference room within the Premises by an Advisory Neighborhood Commission or other community organization shall not constitute a violation of the foregoing (and such use of a conference room shall not require the consent of Landlord).
“Premises” means the premises containing the approximate rentable square feet as set forth in Sections I(3)(d) and I(2)(b) of DC DGS Form L-102, and as more particularly depicted in “Exhibit A” attached hereto and made a part hereof, subject to the provisions of Section 1.1 hereof.
“Project Architect” is defined in the Work Exhibit.
“Property” means the Building and Land.
“Real Estate Taxes” is defined in Section 7.5(c) hereof.
“Rent Commencement Date” means the date upon which all of Landlord’s Delivery Obligations have been satisfied as set forth herein, which date shall be identified in the Declaration of Delivery.
“Representatives” means that Party’s respective Agents, affiliates, shareholders, partners, directors, officers, trustees, employees, members, agents and representatives as applicable to that Party (and any board member, partner, trustee, director, member, officer, employee, agent, representative or advisor of any of them).
“Substantially Complete” and “Substantial Completion” are defined in
the Work Exhibit.
“Tax Increases” is defined in Section 7.5(a) hereof.
“Tenant Improvement Allowance” means the amount set forth in Section II(9)(a) of DC DGS Form L-102, which allowance shall be applied towards any Tenant Improvements. For the avoidance of any doubt, in no event shall the termination of this Lease prior to the expiration of the Initial Lease Term result in (i) any continued or accelerated payment by the District of any amortization rental payments for, or the principal of, the Tenant Improvement Allowance, or (ii) any payment of or reimbursement for the Tenant Improvement Allowance (with the exception that any unamortized portion of the Tenant Improvement Allowance may be included within the calculation of actual damages to which Landlord may argue that it may be entitled to by reason of an early termination of this Lease arising by reason of an uncured District Default).
“Tenant Improvements” are the improvements to the Premises to be provided by Landlord in accordance with the terms and conditions set forth in, and as are more particularly defined in, the Work Exhibit. For the avoidance of any doubt, Tenant Improvements constituting furniture or equipment shall be the personal property of the District.
“Work Exhibit” means the provisions setting forth the terms and conditions for Landlord’s completion of the Tenant Improvements and the Base Building Work. The Work Exhibit is contained in “Exhibit C” attached hereto and made a part hereof.
PAGE 15 OF 135(as modified) DC DGS FORM L-105 (3/2018)
3924 Minnesota Avenue NE
US 167835565v6
EXECUTION VERSION
(a)The District leases the Premises from Landlord and Landlord demises the Premises to the District for the term and upon the conditions and covenants set forth in this Lease. The Parties hereby acknowledge that as of the Lease Commencement Date this Lease is a sublease, as Landlord leases the Land (along with additional property) from Celia Properties Limited Partnership, a District of Columbia limited partnership (“Ground Lessor”) under that certain Deed of Lease, by and between Ground Lessor and Landlord, dated as of August 21, 2018 (as amended, the “Ground Lease”). As such, references hereunder to “lease”, “landlord” and “tenant” shall be deemed to mean “sublease”, “sublessor” and “subtenant”, respectively, as applicable, unless context dictates otherwise. Landlord shall cause a final measurement of the Premises and of the Building to be taken upon Landlord’s Substantial Completion of the Base Building Work and the Tenant Improvements, as set forth in the Work Exhibit. Such final measurements shall be: (i) set forth on the Declaration of Delivery, (ii) determined based on the actual measurement of the Project Architect, (iii) in accordance with the BOMA Measurement Standard, and (iv) subject to approval by the District.
(b)In connection with the Ground Lease, Landlord hereby represents and warrants (and covenants, where applicable) to the District that: (i) as of the Lease Commencement Date and at all times during the Lease Term, Landlord’s execution of, and
performance under, this Lease is permitted under the Ground Lease; (ii) any consents that are required to be obtained from any third party to permit Landlord to enter into this Lease have been obtained; (iii) the term of the Ground Lease does not expire until after the expiration of the Lease Term; (iv) during the Lease Term, Landlord shall not (x) terminate the Ground Lease, or (y) cancel or otherwise amend the Ground Lease to shorten its term; and (v) the terms and conditions of the Ground Lease are not incorporated herein. In addition to (and not in lieu of) any other indemnification or remedy set forth in this Lease, Landlord shall and does hereby indemnify, defend, and hold the District harmless from and against any and all claims, liabilities, costs and expenses, including, without limitation, reasonable attorneys’ fees, resulting from any claim alleging or arising out of a breach of any representation, warranty or covenant set forth in this Section 1.1(b). This Section 1.1(b) shall survive the expiration or early termination of this Lease.
1.2Landlord hereby grants to the District and its Agents, employees, licensees and invitees the exclusive right to use the Common Areas in the Building (excluding sidewalks, driveways, freight elevators, the passenger elevator(s) serving the Parking Facility and ground floor, the Parking Facility, common entrances, non-private lobbies, the loading dock and internal non-public freight access to the loading dock, all of which the District shall have a non-exclusive right to use), in accordance with the terms of this Lease. The District and its Agents, employees, licensees and invitees shall have access and rights of ingress and egress to the Building, the Premises, the Common Areas, the
PAGE 16 OF 135(as modified) DC DGS FORM L-105 (3/2018)
3924 Minnesota Avenue NE
US 167835565v6
EXECUTION VERSION
Parking Facility and the All Access Additional Area Parking Spaces (as defined in, and subject to the terms of Section 2 hereof) 24-hours each day of the Lease Term (including elevator service).
1.3Landlord shall deliver the Premises to the District at such time as all of the Landlord’s Base Building Work and the Tenant Improvements are Substantially Complete, as hereinafter provided. Landlord hereby represents, warrants, and covenants that, as of the Rent Commencement Date, the Property and the Building will comply with Laws subject to any “grandfathering” provisions, and that the Premises, including without limitation all HVAC, plumbing, electrical and other mechanical systems, shall be in good working order and condition. Following the Rent Commencement Date, Landlord shall be responsible for complying with all Laws pertaining to the Building, Common Areas, Base Building Conditions, and Building Structures and Systems, including any required changes to the Building (but not the Premises), at Landlord’s sole cost and expense (meaning that such costs and expenses are already included in Annual Rental and shall not be billed as Additional Rent). Following the Rent Commencement Date, Landlord shall cause all such future changes, additions and/or work to the Building, Common Areas, Base Building Conditions or Building Structures and Systems: (i) to the extent commercially reasonable, to be performed after Building Hours, unless such change, addition and/or work (w) does not interfere in any material, adverse manner with the District’s use and enjoyment of the Premises, as determined by the District in the District’s sole but reasonable discretion, (x) resulted from
the acts or omissions of the District or any of the District’s Agents, (y) is required because of an emergency or (z) involves the build-out of any portion of the Building leased by other non-office tenants; and (ii) if such change, addition and/or work is in the Premises, to be behind walls or above ceilings. Landlord shall: (A) restore the Premises to substantially the same condition and finish as existed immediately prior to any such change, addition and/or work if such change, addition and/or work resulted in any material change to the condition of the Premises not required by Laws; (B) use commercially reasonable efforts to minimize disruption to the District’s operations during any such change, addition and/or work; and (C) ensure that the District has reasonable access to, and ingress and egress from, the Building, the Premises, the Parking Facility and the Additional Parking Areas during any such change, addition and/or work. Notwithstanding the foregoing, Landlord shall not be responsible for any non-compliance of the Premises with Laws that is solely attributable to the District’s use or occupancy of the Premises (including Alterations in and to the Premises by the District) throughout the Lease Term. If the District elects to use the Premises in a way that necessitates changes or additions to the Premises in order to comply with Laws solely due to the District’s specific use or occupancy of the Premises, the District shall either cease such use or be responsible for those changes or additions, subject to the certification of the availability of appropriated funds for such purpose.
1.4Subject to the terms and conditions of this Lease (including but not limited to Landlord’s Substantial Completion of the Base Building Work and the Tenant Improvements), Landlord
PAGE 17 OF 135(as modified) DC DGS FORM L-105 (3/2018)
3924 Minnesota Avenue NE
US 167835565v6
EXECUTION VERSION
shall deliver the Premises to the District and the District shall accept the Premises, Building and Land in its “as-is” condition, and in accordance with the terms of this Lease (including without limitation that Landlord shall deliver the Premises to the District pursuant to the terms of the Work Exhibit). The Parties acknowledge that the Premises will initially be occupied by the District of Columbia Department of General Services.
1.5In addition to the Premises, the District hereby exclusively leases from Landlord 300 rentable square feet of space in the Parking Facility for an MDF (such space, the “MDF Room”), the location of which shall reasonably be agreed upon by Landlord and the District. The District shall pay an annual rent of Fifteen Dollars ($15.00) per rentable square foot for the MDF Room for the first Lease Year, payable on a monthly basis as Additional Rent, which shall be paid in arrears together with Annual Rental. Commencing on the first day of the second Lease Year and on the first day of each subsequent Lease Year thereafter during the Term, the then current rental rate for the MDF Room shall escalate by an amount equal to 2.75% of the rental rate for the immediately preceding Lease Year. As part of the Tenant Improvements, and subject and pursuant to the terms of the Work Exhibit, Landlord shall (i) purchase and install equipment in the MDF Room pursuant to specifications provided by the District (the “MDF Equipment”); (ii) purchase and install a supplemental HVAC unit for the MDF Room pursuant to specifications provided by the District (the “MDF Supplemental HVAC Unit”); and (iii) have the MDF Room separately metered for electricity (the “MDF Sub-Meter”) for the MDF
Equipment and the MDF Supplemental HVAC Unit (the foregoing items (i) through (iii) being, collectively, the “MDF Work”). The Parties acknowledge and agree that the MDF Work shall be paid from the Tenant Improvement Allowance pursuant to the terms of this Lease and the Work Exhibit. Landlord shall procure a separate electrical utility account for the MDF Sub-Meter, and shall not be responsible for payments for such separate account. Landlord shall be responsible for the maintenance and repair of the MDF Room, at its own cost, provided that if any defect or damage to the MDF Room arises from District Negligence the District shall be responsible for the same, pursuant to and in accordance with the terms of Section 9.1 hereof. Subject to Section 15.1, the District shall be responsible for the maintenance and repair of the MDF Equipment. Landlord shall be responsible for the maintenance and repair of the MDF Supplemental HVAC Unit pursuant and subject to the terms of Section 9.6 hereof. For the avoidance of doubt, the MDF Room shall not constitute a portion of the Premises and the rentable square footage of the MDF Room shall not be included for purposes of determining Annual Rental or the District’s Proportionate Share.
2.1During the Lease Term, Landlord shall provide to the District 300 unreserved spaces within the Parking Facility and the Additional Parking Areas as provided below for use by (i) government fleet vehicles and other official governmental uses (the “Fleet Vehicle Spaces”), and (ii) vehicles of District Agents (“Employee Spaces”, and the Employee Spaces together with
PAGE 18 OF 135(as modified) DC DGS FORM L-105 (3/2018)
3924 Minnesota Avenue NE
US 167835565v6
EXECUTION VERSION
the Fleet Vehicle Spaces, being the “Parking Spaces”), together with a monthly parking permit for each Parking Space (each, a “Fee Permit”). The Parking Spaces within the Parking Facility will contain at least 139 Parking Spaces (no more than 58 of which shall be tandem or stacked) to be allocated among Fleet Vehicle Spaces and Employees Spaces during the planning and development process set forth in Section 2.5 hereto, and all remaining required Parking Spaces shall be provided in the Additional Parking Areas. Subject to Section 2.5 hereto, the final allotment of the Fleet Vehicle Spaces and Employee Spaces among the Parking Facility and the Additional Parking Areas shall be determined pursuant to this Section 2 and set forth on the Declaration of Delivery. All Parking Spaces within the Parking Facility and approximately fifty (50) of the Parking Spaces within the Additional Parking Areas shall be available for use by the District and its employees and agents 24 hours each day, 7 days per week (the “All Access Additional Parking Spaces”). In addition, the District and its employees and agents shall have access to the Additional Parking Area Parking Spaces, other than the All Access Additional Parking Spaces, during Building Hours. Commencing as of the Rent Commencement Date, the District shall pay as Additional Rent a “Parking Fee” in the monthly amount of $150.00 per Fee Permit for each Fleet Vehicle Space within the Parking Facility and the Additional Parking Areas, which shall be paid in the same manner as Annual Rental, including in arrears. The Parking Fee shall not be subject to any abatements provided for Annual Rental herein. The Parking Fee shall be subject to an annual escalation commencing at the beginning
of the second Lease Year of 2.5%. “District Parking Rate” means the then current Parking Fee as escalated by such 2.5% yearly escalations.
2.2There shall be no Additional Rent due by, or any other charge to, the District for the Employee Spaces within the Parking Facility or the Additional Parking Areas. Each District Agent recipient of an Employee Space shall enter into a separate agreement with Landlord or, at Landlord’s election, with the Parking Facility operator or the Additional Parking Area operator(s), as applicable, for the use of such Fee Permit and the payment therefor. Each such agreement shall provide for a monthly parking fee at the then applicable District Parking Rate. As of the Rent Commencement Date, Landlord shall make available to the District up to one hundred and fifty (150) Employee Spaces in the Parking Facility and/or the Additional Parking Areas. If, on or before the date that is six (6) months after the Rent Commencement Date, the District’s Agents have not obtained Fee Permits with Landlord or its parking operator(s) for all one hundred and fifty (150) Employee Spaces, then Landlord may allow other users to obtain parking permits for such unused spaces. Thereafter, Landlord shall provide the District’s Agents with the first opportunity to obtain any vacated Employee Spaces (up to the maximum of one hundred and fifty (150) Employee Spaces) at the District Parking Rate prior to offering any such space to other users.
2.3The District’s use of the Parking Facility and the Additional Parking Areas may be subject to rules and regulations promulgated by Landlord, the Parking Facility operator or the
PAGE 19 OF 135(as modified) DC DGS FORM L-105 (3/2018)
3924 Minnesota Avenue NE
US 167835565v6
EXECUTION VERSION
Additional Parking Area operator(s), as applicable, which are reasonable and in accordance with Laws (to be promulgated and enforced without discrimination against the District) regarding the use of the Parking Facility and the Additional Parking Areas, as applicable, which rules and regulations must be in writing and delivered to the District. If any provision of this Lease conflicts with any provision of such Parking Facility or Additional Parking Area rules and regulations, such provision of this Lease shall govern. Landlord may undertake a parking study regarding the Parking Facility and the Additional Parking Areas. Based on the results of such study, changes to the Additional Parking Areas may be proposed by Landlord in writing, which shall be subject to the District’s approval, not to be unreasonably withheld, delayed or conditioned. In all events, the District shall deliver to Landlord its written notice of approval or disapproval (and if disapproval the reason(s) therefor must be clearly identified) within ten (10) Business Days after receipt of such proposal. Upon the approval of such new arrangement, the Parties shall execute an acceptable amendment to this Lease to reflect the same.
2.4The contractor or contractors operating the Parking Facility and the Additional Parking Areas during the Lease Term shall each be a Small Business Enterprise (“SBE”) or a Certified Business Enterprise (“CBE”), as such terms are defined under D.C. Official Code Section 2-218.02, as amended from time to time; provided, however, that in the event less than three (3) SBE or CBE parking operators with experience managing a parking facility of similar size and of a similar quality to the Parking Facility conduct business in the
District of Columbia, Landlord shall not be required to hire a SBE or CBE parking operator, but shall use good faith, commercially reasonable efforts to do so.
2.5Notwithstanding anything to the contrary in this Section 2, during the design and development of the Base Building Work and Tenant Improvements pursuant to the Work Exhibit, Landlord may suggest to the District a change to the Parking Facility that would allow the Parking Facility to accommodate additional Parking Spaces. Provided that such change does not reduce the number of Parking Spaces available to the District in the Parking Facility below 139 spaces (no more than 58 of which shall be tandem or stacked), the District shall not unreasonably withhold, delay or condition its approval of such change. In such event, if the number of spaces in the Parking Facility provided to the District increases above 139 (no more than 58 of which shall be tandem or stacked), the number of spaces required in the Additional Parking Areas shall be reduced by such number of additional Parking Spaces (above 139) in the Parking Facility, and any such adjustment shall be set forth on the Declaration of Delivery. Further, the District understands that Landlord or its affiliates are developing the areas adjacent to the Land, all as shown on “Exhibit K” attached hereto and made a part hereof (the “Development Area”). As such, from time to time, upon 60-day prior written notice to the District, Landlord may change the location of the Additional Parking Areas and provide Parking Spaces in lieu of the then current location of such Additional Parking Areas, without District approval, provided that such new or modified locations are among the locations
PAGE 20 OF 135(as modified) DC DGS FORM L-105 (3/2018)
3924 Minnesota Avenue NE
US 167835565v6
EXECUTION VERSION
identified on “Exhibit J” attached hereto and made a part hereof.
3.USE OF PREMISES
3.1The District shall use and occupy the Premises solely for the Permitted Use. By executing this Lease, Landlord acknowledges and pre-approves occupancy for such purposes by any District of Columbia agency or instrumentality as the District may elect during the Lease Term. Substitution of an agency or instrumentality shall not constitute an assignment or sublet or be subject to Landlord’s approval, so long as the substituted agency uses the Premises for the Permitted Use. The District shall endeavor to provide at least 30 days prior written notice to Landlord of any such substitution, but any failure to provide such notice shall not constitute a default under this Lease. The District shall comply with all Laws applicable to it concerning the use, occupancy and condition of the Land, Building or Premises and all machinery, equipment, furnishings, fixtures, and improvements therein, all of which shall be complied with in a timely manner, provided that the District shall not be required to construct or alter the elements of the Base Building Conditions or Building Structures and Systems within the Premises unless required by reason of either (i) the District’s particular use of the Premises, or (ii) any Alteration. If the District is so required to construct or alter any elements of the Base Building Conditions or Building Structures and Systems as aforesaid, all such construction or alteration shall be Alterations and shall be subject to the terms and provisions of Sections 8.2 and 8.3 of this Lease. If any such Laws requires an occupancy or use permit or license for the Premises or the operation of the business conducted
therein (other than a certificate of occupancy), then the District shall obtain and keep current such permit or license; provided, however, that Landlord shall be responsible for obtaining any necessary licenses or permits to perform the Tenant Improvements and the Base Building Work, and Landlord shall ensure that the Tenant Improvements and Base Building Work comply with all Laws, and, upon Substantial Completion of the same, Landlord shall deliver the appropriate certificate(s) of occupancy to the District. Use of the Premises is subject to all covenants, conditions and restrictions of record, which Landlord represents and warrants do not and will not adversely impact the Permitted Use hereunder. Nothing in this Section 3.1 is intended to prevent Landlord from pursuing remedies against the District pursuant to Section 18.1 hereof for any breaches of the foregoing provisions.
3.2The District shall pay before delinquency any business, rent or other taxes or fees that are now or hereafter levied, assessed or imposed directly upon the District by any governmental authority due to its use or occupancy of the Premises, the conduct of the District’s business at the Premises or the District’s equipment, fixtures, furnishings, inventory or personal property, subject to the certification of the availability of appropriated funds for such purpose and Section 26.1 hereof. If any such tax or fee is enacted or altered so that such tax or fee is levied against Landlord or so that Landlord is responsible for collection or payment thereof, then the District shall pay such tax or fee with the monthly payment of Annual Rental next becoming due and payable, subject to the certification of the availability of appropriated funds for such purpose and Section 26.1 hereof.
PAGE 21 OF 135(as modified) DC DGS FORM L-105 (3/2018)
3924 Minnesota Avenue NE
US 167835565v6
EXECUTION VERSION
(a)The District and the District’s Agents shall not introduce or cause any Hazardous Materials to be generated, used, treated, released, stored, or disposed of in or about the Premises, the Building, the Land or the Additional Parking Areas; provided, the District may use and store normal and reasonable quantities of standard cleaning and office materials as may be reasonably necessary for the District to conduct normal operations in the Premises so long as such materials are stored and used by the District in accordance with applicable Laws. At the expiration or earlier termination of this Lease, the District shall surrender the Premises to Landlord free of Hazardous Materials introduced by the District or the District’s Agents, and in compliance with all Environmental Laws (excluding violations caused by parties other than the District or the District’s Agents).
(b)Each of the District and Landlord shall (i) give the other prompt oral and follow-up written notice of any actual or threatened Environmental Default affecting the Premises or any other portion of the Property which could affect occupants or invitees of the District or any other users of the Building, including an Environmental Default affecting the Parking Facility, the Additional Parking Areas or Common Areas (an “Environmental Area”), about which it becomes aware; and (ii) promptly deliver to the other copies of any notices or other items received from or submitted to any governmental or quasi‑governmental agency, or any claim instituted or threatened by any third party concerning an Environmental Area. Subject to the Anti-Deficiency Acts, the District shall promptly cure any
Environmental Default to the extent caused by District Negligence and shall undertake the same in accordance with all Environmental Laws and only after the District has obtained Landlord’s prior written consent, which shall not be unreasonably withheld, conditioned or delayed. Upon any Environmental Default, in addition to all other rights available to Landlord under this Lease, at law or in equity, Landlord shall have the right but not the obligation to immediately enter the Premises, to supervise and approve, in a reasonable manner, any actions taken by the District to address the Environmental Default, and, if District fails to promptly address the same in compliance with applicable Laws, to perform any lawful action necessary to address such Environmental Default.
(c)Landlord represents, warrants, and covenants that, as of the Rent Commencement Date, the Premises will comply in all material respects with applicable Environmental Laws. Following the Rent Commencement Date, Landlord shall promptly abate, remediate, or otherwise cure any Environmental Default caused by Landlord or its Representatives in accordance with all Environmental Laws. In the event of an Environmental Default affecting an Environmental Area caused by Landlord or its Representatives, within ten (10) days of Landlord’s actual knowledge of such Environmental Default, Landlord shall notify the District in writing of the default (“Environmental Notice”) which Environmental Notice shall (i) state Landlord’s reasonable determination of the time necessary to cure the Environmental Default and (ii) state whether Landlord elects not to cure the
PAGE 22 OF 135(as modified) DC DGS FORM L-105 (3/2018)
3924 Minnesota Avenue NE
US 167835565v6
EXECUTION VERSION
Environmental Default because insurance proceeds payable are insufficient to pay for the costs of such cure. The District shall have the right to terminate this Lease on 30 days prior written notice to Landlord (i) given within thirty (30) days after receipt of the Environmental Notice if the Environmental Notice states that Landlord cannot cure the Environmental Default within 180 days after the date of the Environmental Notice (which time period includes the time needed for effecting a satisfactory settlement with any insurance company involved, removal of debris, preparation of plans and issuance of all required governmental permits), and (ii) given within thirty (30) days after delivery of receipt of the Environmental Notice if Landlord elects pursuant thereto not to cure the Environmental Default. Landlord and the District shall each have the right to terminate this Lease on thirty (30) days prior written notice given to the other Party within thirty (30) days of the date of the Environmental Default caused by Landlord and its Representatives if less than one year is then remaining in the Lease Term.
(d)If this Lease is terminated pursuant to this Section 3.3, then Annual Rental and any Additional Rent shall be apportioned (based on the portion of the Premises that is usable or used after such Environmental Default caused by Landlord or its Representatives) and paid to the date of termination. Whether or not the Lease is terminated as a result of such Environmental Default, then until cure of such Environmental Default, District shall be required to pay Annual Rental and any Additional Rent only for that portion of the Premises that is usable while such cure is being performed.
indemnifies, releases, and holds the District and its Representatives harmless, from all damages or injury resulting from (i) any Hazardous Materials present on the Premises, Building, or Land in violation of applicable Environmental Laws prior to the Rent Commencement Date, and (ii) an Environmental Default to the extent caused by Landlord or its Representatives.
3.4Landlord hereby represents and warrants to the District, and covenants to the District during the Lease Term, that: (i) Landlord holds (and shall hold) a ground lease interest in the Property and has (and shall have) the full right and power to provide (and shall provide) to the District, full use and quiet enjoyment of the Premises and Property in accordance with the provisions of this Lease (including without limitation the full right and power to provide the District with the use of the Parking Spaces and for the District’s unfettered ingress and egress to and from the Property, the Building, the Parking Facility, the Additional Parking Areas and the Premises); and (ii) there are (and shall be) no matters of public record encumbering the Property and no agreements to which Landlord is a party, which would (A) interfere with or adversely affect District’s use and enjoyment of the Premises or prevent the District from operating within the Premises in accordance with the terms of this Lease, (B) adversely affect any right granted to the District under this Lease, or (C) impose on the District any obligation in excess of those set forth in this Lease.
4.RULES
The District shall abide by and observe any reasonable rules that Landlord may promulgate from time to
PAGE 23 OF 135(as modified) DC DGS FORM L-105 (3/2018)
3924 Minnesota Avenue NE
US 167835565v6
EXECUTION VERSION
time for the operation and maintenance of the Building, provided: (i) Landlord gives the District reasonable prior written notice thereof; (ii) such rules are not inconsistent with the provisions of this Lease or any applicable Laws; (iii) no rule discriminates against the District in the enforcement or promulgation thereof; and (iv) the District approves such rules, such approval not to be unreasonably withheld, delayed or conditioned. If any provision of this Lease conflicts with any provision of any Building rule, such provision of this Lease shall govern.
5.1The Initial Lease Term shall expire at 11:59 p.m. of the last day of such period, subject to any properly exercised extension of the term of this Lease.
5.2Until the Rent Commencement Date no Annual Rental or any Additional Rent shall accrue, and the District shall not be obligated to pay any Annual Rental or any Additional Rent.
7.ANNUAL RENTAL, real estate taxes, and operating Costs
7.1The District shall pay to Landlord the Annual Rental for the Premises during the Lease Term, payable in equal monthly installments in arrears. Monthly installments of Annual Rental shall be paid to Landlord by the District on or before the 5th day of the calendar month following the month in which such Annual Rental accrued. Annual Rental for the initial Lease Year is the amount set
forth in Section II(8)(a) of DC DGS Form L-102. Commencing on the first day of the second Lease Year and on the first day of each subsequent Lease Year thereafter during the Term, the then current Net Rental shall escalate by an amount equal to 2.5% of the Net Rental for the immediately preceding Lease Year as set forth on the rent schedule attached hereto as “Exhibit E” (the “Rent Schedule”).
7.2If the Rent Commencement Date or such other date upon which rent payments commence under this Lease is not the first day of a month, then the Annual Rental and any Additional Rent due from such date until the first day of the following month shall be prorated on a per diem basis based on the number of days in the subject month, and the District shall pay such prorated first installment of the Annual Rental, and any Additional Rent due, in arrears on or before the 5th day of the month following the month when such rent accrued.
7.3The District shall pay Annual Rental (and Additional Rent, if any) to Landlord, at the Landlord Payment Address, or to such other place or to such other agent as Landlord may from time to time designate in writing, by good check, wire transfer or other funds, without setoff, deduction or demand except as expressly permitted under this Lease. Landlord’s acceptance of any installment of Annual Rental after it shall have become due and payable shall not excuse a delay upon any subsequent occasion or constitute a waiver of any of Landlord’s rights hereunder. Landlord (including any successor landlord) acknowledges that Landlord must deliver certain documents and information, including without limitation, IRS Form W-9 and a business license number from the District of Columbia Department of
PAGE 24 OF 135(as modified) DC DGS FORM L-105 (3/2018)
3924 Minnesota Avenue NE
US 167835565v6
EXECUTION VERSION
Consumer and Regulatory Affairs, in order for the District to make payments to Landlord, and agrees to promptly provide such documents and information to the District upon request so that the District may make payments hereunder on a timely basis.
7.4Landlord Credit; Premises Refresh Allowance.
(a)Notwithstanding anything in this Section 7 to the contrary, (i) Landlord hereby grants to the District a rental abatement of Annual Rental payable hereunder in the total amount of $18,105,241.42, which is equal to the total of (x) 10 months of Annual Rental in the amount of $11,276,595.00 plus (y) the additional rental abatement in the amount of $6,828,646.42 referenced in Section 23.3(ii) hereof (such total amount, the “Landlord Credit”), which shall, at the District’s election, be applied toward (A) Annual Rental commencing on the Rent Commencement Date, and/or (B) any obligation the District may have to pay for any of the Tenant Improvements (in excess of the Tenant Improvement Allowance) in accordance with the Work Exhibit; and (ii) in the event Landlord does not deliver the Declaration of Delivery for execution by the Parties within 45 calendar days after the satisfaction of Landlord’s Delivery Obligations, then for each month or partial month following such 45 day period that Landlord fails to deliver the Declaration of Delivery for execution by the Parties, the District shall be entitled to an abatement of Annual Rental and Additional Rent equal to $2,000 per day for each day that Landlord does not deliver the Declaration of Delivery after such 45 day period. Landlord shall have satisfied its obligation to deliver the Declaration of Delivery if it delivers a
fully completed Declaration of Delivery to the District, even if the District disputes any provision thereof. The District may be entitled to an additional rent abatement pursuant and subject to the terms of the Work Exhibit.
(b)In addition to the Tenant Improvement Allowance, any time between the 10th and 12th Lease Years of the Lease Term, the District shall be entitled to a Premises improvement allowance from the Landlord in the total amount of $2,250,000.00. Such allowance shall be applied by the District towards refreshing the Premises (e.g. paint and carpet) (the “Premises Refresh Allowance”) by providing written notice to Landlord not later than the end of the 11th Lease Year; provided that not less than nine (9) months and not more than twelve (12) months prior to the expiration of the 11th Lease Year, Landlord shall provide the District with written notice inquiring as to whether the District will elect to utilize the Premises Refresh Allowance. If Landlord fails to timely deliver such notice, then the District may elect to provide its notice to Landlord as to the application of the Premises Refresh Allowance after the 11th Lease Year so that the District is afforded no less than nine (9) months and no more than twelve (12) months to determine how to apply the Premises Refresh Allowance and, in such event, the Premises Refresh Allowance may be applied by the District after the 12th Lease Year. In no event shall any amount be due or payable by the District to Landlord in connection with the amortization or other repayment of the Premises Refresh Allowance.
(a)The District shall pay to Landlord Real Estate Taxes assessed
PAGE 25 OF 135(as modified) DC DGS FORM L-105 (3/2018)
3924 Minnesota Avenue NE
US 167835565v6
EXECUTION VERSION
against the Property and paid by Landlord each Lease Year as set forth below. The initial real estate taxes shown on Section of II(8)(c)(5) of DC DGS Form L-102 are to be paid by the District as a component of Annual Rental (the “Initial Real Estate Taxes”). In the event that in any Lease Year hereunder the total amount of Real Estate Taxes assessed against the Property exceeds the Initial Real Estate Taxes, then the District shall pay the District’s Proportionate Share of such excess amount of such Real Estate Taxes (“Tax Increases”) to Landlord as Additional Rent. The amount of such Tax Increases shall be due and payable to Landlord by the District semi-annually within 90 days of the date of receipt by the District of a statement from Landlord, which statement shall include copies of all actually paid real estate tax bills (and Landlord’s evidence of the payment thereof), for such applicable semi-annual District of Columbia real property tax billing cycle (each, a “Tax Statement”). The District’s Proportionate Share of Real Estate Taxes as of the Rent Commencement Date is set forth in Section III(17) of DC DGS Form L-102. Notwithstanding the foregoing or anything else contained in this Lease, Landlord shall not be permitted to charge the District (and the District shall not be obligated to pay) for any Tax Increases for any semi-annual District of Columbia real property tax billing cycle if Landlord fails to first deliver to the District a Tax Statement by the date that is 120 days after the due date for Landlord’s payment of real estate taxes under such semi-annual District of Columbia real property tax billing cycle. For any partial Lease Years, Tax Increases shall be appropriately prorated based upon the number of days in such partial Lease Year within the semi-annual District of
Columbia real property tax billing cycle. Notwithstanding any provision of this DC DGS Form L-105 to the contrary, the District and Landlord stipulate that Real Estate Taxes for the first Lease Year are the amount set forth in Section II(8)(c)(5) of DC DGS Form L-102, and that the District has no audit right with regard to Initial Real Estate Taxes or Tax Increases other than to confirm the calculation of Tax Increases, and to review the real estate tax bills generated by the taxing authority and Landlord’s evidence of its payment of the same.
(b)For the purposes of this Section 7.5, the term “Building” shall be deemed to include the Land, the roof of the Building and any extensions therefrom, and, to the extent that such elements exist, any balconies extending from the Building, and any driveways or sidewalks. The District recognizes that prior to the Rent Commencement Date, Landlord shall have created a separate A&T Lot for the Property. Thereafter, as part of the development of the Development Area, Landlord shall have the right to change the A&T Lot provided that the same shall not result in the District being required to pay any more Real Estate Taxes or Tax Increases then it otherwise would have been required to pay hereunder absent such change to the A&T Lot.
(c)“Real Estate Taxes” means: (i) all ad valorem real property taxes, vault space rental fees, and any special assessment, foreseen or unforeseen (including without limitation any assessments imposed in connection with business improvement or similar districts), which are imposed upon Landlord in connection with its ownership or control of the Property;