EXHIBIT 10.7
SUBLEASE
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THIS SUBLEASE ("Sublease"), made as of the 4th day of March, 2004
between Millennium Inorganic Chemicals Inc., a Delaware corporation, formerly
known as SCM Chemicals Inc., having an office at 20 Wight Avenue, Suite 100,
Hunt Valley, Maryland 21030 ("Sublessor") CepTor Coproration, a Delaware
corporation ("Subtenant").
WITNESSETH:
1. PREMISES: Sublessor leases to Subtenant a portion of the building
(the "Building") known as CenterPointe on the fifth floor of the Building as
shown on the floor plan attached hereto as EXHIBIT A-1 and made a part hereof,
(the "Subleased Premises"), upon the terms, conditions, covenants and agreements
hereinafter set forth in this Sublease. The parties hereto agree that for
purposes of this Sublease, the Subleased Premises shall be deemed to constitute
5,196 rentable square feet. Subject to the terms and provisions of the
Underlying Lease (as such term is defined below in Paragraph 3) and the
reasonable rules and regulations as may be imposed by Sublessor, Subtenant shall
have nonexclusive access twenty four (24) hours a day seven (7) days a week
(subject to reasonable security procedures) to the main lobby of the Building
and other Building-wide common areas and the elevator banks serving the
Subleased Premises.
2. TERM: The term of this Sublease (the "Term") shall commence on
the date (the "Rent Commencement Date") which is the later of seven (7) days
after the date Sublessor receives the Landlord's Consent (as such terms are
defined below in Paragraph 6 herein), or March 15, 2004 and shall end at the
close of business on December 31, 2006 (the "Expiration Date") or upon such
earlier date upon which the term of this Sublease may expire or be terminated
pursuant to the terms and provisions of this Sublease, including the termination
option, or pursuant to law. The Subtenant shall have a one time termination
option that will allow the Subtenant to terminate the Sublease by December 31,
2005 rather than the Expiration Date. In order to exercise this option,
Subtenant shall provide written notice to Sublessor, no later than June 30, 2005
of its intention to terminate the Sublease on December 31, 2005. Subtenant shall
also provide an early termination payment with said notice ("Termination
Payment") in an amount equal to six (6) months rent, which includes the base
rent plus the additional rent in effect as of June 30, 2005.
3. UNDERLYING LEASE
a. The parties agree that this Sublease shall be subject and
subordinate to all of the terms, covenants, conditions and provisions of the
lease dated as of March 19, 1996, (as amended periodically to add and delete
additional rental area) between CenterPointe Limited Partnership as Landlord
("Landlord") and Sublessor as Tenant, covering the Subleased Premises and other
premises in the Building, (said lease, the "Underlying Lease"). A copy of the
Underlying Lease has been delivered to and examined by Subtenant, and is
attached hereto as Exhibit B.
b. The terms, covenants, conditions and provisions contained in
the Underlying Lease (including but not limited to the remedies provided
thereunder) are incorporated herein by reference and shall, as between Sublessor
and Subtenant, constitute the terms, covenants, conditions and provisions of
this Sublease, as if all references to the Landlord thereunder were references
to Sublessor, and if all references to the tenant thereunder were references to
Subtenant and as if all references to the Premises (as such term is defined in
the Underlying Lease) thereunder were references to the Subleased Premises,
except that all references in the Underlying Lease as incorporated herein by
reference, to "Tenant's Personal Property" shall apply only to Subtenant's
property except to the extent that they are inapplicable to, inconsistent with
or modified by the provisions of this Sublease or specifically excluded by
Paragraph 5(u) of this Sublease. Subtenant agrees to faithfully observe and
perform the terms, covenants, conditions and provisions on its part to be
observed and performed hereunder, as well as those terms, covenants, conditions
and provisions on its part to be observed and performed by the tenant under the
Underlying Lease including, without limitation, the obligation to pay all rent,
additional rent and all other charges and sums thereunder, except to the extent
that they are inapplicable to, inconsistent with, or modified by the provisions
of this Sublease. Sublessor and Subtenant hereunder shall have the respective
remedies of Landlord and Tenant under the Underlying Lease. Nothing contained in
this Sublease shall be construed to create privity of estate or of contract
between Subtenant and Landlord. Subtenant shall not do, or permit to be done,
any act or thing which would constitute a breach or violation of any of the
terms, covenants, conditions or provisions of the Underlying Lease.
c. Subtenant will indemnify and hold Sublessor harmless from and
against all loss, costs, damages, expenses and liability, including, but not
limited to, reasonable attorneys' fees, which Sublessor may incur by reason of
any injuries to person or property occurring in, on or about the Subleased
Premises or arising by reason of any breach or default hereunder on Subtenant's
part; any work done in or to the Subleased Premises by Subtenant or its agents
or contractors , or any act, omission, negligence or other fault on the part of
Subtenant or any of Subtenant's agents, invitees, vendors, customers,
contractors, subtenants, licensees or employees (collectively, "Subtenant
Parties") or any accident, injury or damage whatsoever to any person or entity
occurring during the Term, in or about the Subleased Premises (except to the
extent caused by the willful acts or negligence of Sublessor or its agents,
invitees, vendors, customers, contractors, subtenants (other than Subtenant),
licensees or employees). The foregoing indemnity shall be construed to
supplement Subtenant's obligations in the Underlying Lease, as incorporated in
and made a part of this Sublease. Subtenant shall in no case have any rights
with respect to the Subleased Premises greater than Sublandlord's rights under
the Underlying Lease. Notwithstanding any other provision of this Sublease,
Sublessor shall have the benefit of all rights, waivers, remedies and
limitations of liability enjoyed by Landlord, under the Underlying Lease, but
Sublessor shall have no obligation under this Sublease to perform the
obligations of Landlord under the Underlying Lease, including, without
limitation (i) any obligation to provide services or maintain insurance; (ii)
representations or warranties of the Landlord under the Underlying Lease; (iii)
in any instance where the consent of Landlord is required under the terms of the
Underlying Lease, the consent of Landlord shall be required hereunder and,
unless, as otherwise expressly provided hereunder, the consent of Sublessor
shall also be required; and (iv) Sublessor shall not be liable to Subtenant for
any failure or delay in Landlord's performance of its obligations, as landlord
under the Underlying Lease (but the foregoing shall not affect Sublessor's
obligations under Paragraph 5(r) hereof).
d. Sublessor will indemnify and hold Subtenant harmless from and
against any loss, cost, damage, expense and liability, including, but not
limited to, reasonable attorneys' fees which Subtenant may incur to the extent
arising by reason of any breach or default hereunder, on Sublessor's part, which
is not caused (in whole or in part) by the acts or omission of Subtenant, any
negligence of Sublessor or the termination of both the Underlying Lease and this
Sublease, but only if caused solely by Sublessor and not permitted hereunder.
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e. Sublessor represents and warrants to Subtenant that Sublessor
is the current tenant under the Underlying Lease and has the right to enter into
this Sublease subject to obtaining the Landlord's Consent; the Underlying Lease
is in force and effect and has not been modified or amended; a true and complete
copy of the Underlying Lease (except for certain amendments which do not
adversely affect Subtenant's obligations or rights under this Sublease) is
attached hereto as Exhibit B; to the actual knowledge of Sublessor, neither
Landlord nor Sublessor is in default under the Underlying Lease beyond the
expiration of the applicable grace period set forth therein; and there are no
subleases entered into by Sublessor which are currently in effect and which
affect the use and occupancy of the Subleased Premises. Sublessor shall
indemnify Subtenant from and against any and all reasonable out-of-pocket
losses, costs, damages or expenses (including, without limitation, reasonable
and actual out-of-pocket costs and expenses for temporary office space and
additional construction costs) to the extent caused by the failure of Sublessor
to deliver to Subtenant any portion of the Subleased Premises free and clear of
the rights of all subtenants and occupants as of the applicable commencement
date for the Subleased Premises in question provided and on the express
condition that Subtenant uses reasonable effort to mitigate its losses, costs,
damages and expenses. Sublessor shall not voluntarily terminate the Underlying
Lease except as otherwise expressly provided herein. Sublessor shall promptly
deliver (but in no event more than five days after receipt) to Subtenant a copy
of any notice of default or termination or any notice relating to any casualty
or taking, given by Sublessor to Landlord or received by Sublessor from
Landlord.
f. All capitalized terms used but not defined herein shall have
the respective meanings ascribed to them in the Underlying Lease.
g. This Paragraph 3 shall survive any termination or expiration
of this Sublease.
4. BASE RENT: Subtenant shall pay base rent during the Term at the
following rates, (the "Base Rent):
PERIOD ANNUAL BASE RENT MONTHLY BASE RENT
------ ---------------- -----------------
First Sublease Year (as $74,043.00 $6,170.25
such term is defined below ($14.25 per rentable
in Paragraph 4 (b) square foot)
Second Sublease Year $76,277.28 $6,356.44
($14,68 per rentable
square foot)
Third Sublease Year $65,469.60 $6,546.96
($15.12 per rentable
square foot)
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a. Base Rent shall be payable in equal monthly installments in
advance on the first day of each month during the Term commencing on the Rent
Commencement Date
b. As used herein the term "Rent Commencement Date" shall mean
the earlier of March 1, 2004, or the first day on which Subtenant occupies all
or substantially all of the Subleased Premises; and the term "Sublease Year"
shall mean the 12-month period commencing on the Rent Commencement Date or any
anniversary of the Rent Commencement Date occurring during the Term except that
the fourth Sublease Year shall be the period commencing on the third anniversary
of the Rent Commencement Date and ending on the Expiration Date.
c. SUBTENANT IMPROVEMENTS: Sublessee shall provide at its
expense, the build out of the Subleased Premises based on the improvement
requirements agreed to by Subtenant and Sublessor as provided for in the
Approved Space Plan attached hereto as Exhibit C and as approved by the
Sublessor's Landlord.
d. Sublessor shall sell and Subtenant shall purchase from
Sublessor, furniture identified in the Premises and marked with Subtenant's
name. Subtenant shall pay Sublessor the sum of one dollar ($1) for furniture
which is sold in "as is" condition and without warranties of any kind, either
expressed or implied
e. Services and Utilities shall be provided to Subtenant as
detailed in Paragraph 11 of the Underlying Lease.
5. SPECIFIC COVENANTS OF THE PARTIES: Notwithstanding anything to
the contrary contained herein or in the Underlying Lease, the parties agree as
follows:
a. ADDITIONAL RENT The rent reserved under this Sublease shall
consist of the Base Rent described in Paragraph 4 above and the additional rent
payable hereunder.
(i) Subtenant shall pay to Sublessor as additional rent
("Additional Rent") all other sums of money which become due and payable
hereunder including, but not limited to the payment of Subtenant's
proportionateshare of the Tenant's Share of Increased Operating Costs and
Subtenant's proportionateshare of the Tenant's Fractional Share of Excess Taxes,
as such terms are defined in the Underlying Lease. All Additional Rent shall be
due and payable by Subtenant within thirty (30) days of invoicing by Sublessor.
(ii) For purposes of calculating Additional Rent, such sums
shall be allocated based on a fraction, the numerator of which is the rentable
square feet of the Subleased Premises leased by Subtenant from Sublessor under
this Sublease, and the denominator of which is the total Rental Area of the
Building leased by Sublessor from Landlord under the Underlying Lease. For the
purposes of this Sublease, the Subtenat's proportionate share of the Sublessor's
share shall be nineteen and a half (19.5%) percent.
(iii) The base tax year for purposes of calculating
Subtenant's Additional Rent shall be June 1, 2003 to May 31, 2004.
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b. Subtenant does hereby covenant and agree to pay the Base Rent
and Additional Rent to Sublessor as and when the same shall become due and
payable as herein provided and except as otherwise specifically provided herein,
without demand therefor and without any setoff or deduction whatsoever; and
keep, observe and perform and permit no violation of, each and every of the
covenants, agreements, terms, provisions and conditions herein contained on the
part of Subtenant to be kept, observed or performed.
c. If Subtenant shall pay Base Rent, or any Additional Rent more
than seven (7) days after the same is due and payable, Subtenant shall pay a
late payment charge equal to six (6%) percent of the amount due. Such amount
shall be payable as Additional Rent hereunder, and shall be payable in addition
to any interest payable on such late payment of Base Rent, Additional Rent or
other charges. Notwithstanding the foregoing, Sublessor will be entitled to the
late payment charge during any calendar year only if Subtenant has failed to pay
Base Rent or any Additional Rent within seven (7) days after same is due and
payable on two prior occasions during such calendar year.
d. USE: Subtenant shall use and occupy the Subleased Premises
only for the uses permitted under the Underlying Lease and which shall, in all
events, be in compliance with all legal requirements and in keeping with the
character of the Building, and for no other purpose.
e. CONDITION OF SUBLEASED PREMISES Sublessor and Subtenant
covenant and agree that Subtenant is leasing the subleased premises in its "AS
IS" condition on the date hereof and Sublessor shall have no obligation to
perform any work to the Subleased Premises or to any part of the Building to
prepare the Subleased Premises for occupancy by Subtenant other than as outlined
in Paragraph 4(c) hereof. Sublessor makes no representation or warranty
regarding the condition of the Subleased Premises, or the Building, or title to
the Subleased Premises, except that Sublessor is the tenant under the Underlying
Lease. In making and executing this Sublease, Subtenant has not relied upon, or
been induced by, any statements or representations of any persons, other than
those, if any, set forth expressly in this Sublease with respect to the physical
condition of the Subleased Premises, or the Building, or of any other matter
affecting the Subleased Premises, or this transaction, which might be pertinent
in considering the subleasing of said Subleased Premises or the execution of
this Sublease. Subtenant has, on the contrary, relied solely on such
representations, if any, as are expressly made herein and on such
investigations, examinations and inspections as Subtenant has chosen to make or
have made. Subtenant acknowledges that Sublessor has afforded Subtenant the
opportunity for full and complete investigations, examinations, and inspections
that Subtenant has deemed necessary in order to agree to sublease the Subleased
Premises. If any alterations, improvements or other work is required in order to
separate the Subleased Premises from the balance of the premises demised to
Sublessor under the Underlying Lease, or properly demise the Subleased Premises
to Subtenant, same shall be performed by Subtenant after receiving Sublessor's
written consent and at Subtenant's own cost and expense in accordance with the
terms and provisions of this Sublease except as otherwise provided in Paragraph
4(c) hereof. All trade fixtures, furniture, furnishings and other personal
property currently located in the Subleased Premises will be removed prior to
the applicable Rent Commencement Date except for those furniture, fixtures and
other personal property of Sublessor purchased by Subtenant under the terms of
Paragraph 4(d) hereof.
f. NOTICES AND PAYMENTS: Notices and other communications
hereunder shall be in writing and shall be given or made by nationally
recognized overnight courier service providing for overnight delivery (e.g.
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Federal Express, DHL) or United States certified or registered mail with return
receipt requested, provided the sender shall obtain a written receipt for such
delivery. All notices shall be deemed given when received, when acceptance of
delivery is refused, or when delivery is attempted but cannot be effectuated (as
evidenced by the return receipt). All notices to Sublessor shall be given to it
at the address set forth above. All notices to Subtenant shall be given to it
prior to the Rent Commencement Date, at its address set forth above and on or
after the Rent Commencement at the Subleased Premises in both instances to the
attention of Stuart G. Breslow, Deputy General Counsel. Either party may change
its address or addresses for notice given under this paragraph.
g. TIME LIMITS: The time limits provided in the Underlying Lease
for the giving of notices, making demands, performance of any act, condition or
covenant, or the exercise of any right, remedy or option, are changed for the
purposes of this Sublease, by lengthening the same in each instance by five (5)
days (except that if the time limit provided in the Underlying Lease for the
giving of any notice, making any demand, performing any act, condition or
covenant or exercising any right shall be seven (7) days or less, then such time
limit shall be changed by lengthening the same by three (3) days so that notices
may be given, demands made, or any act, condition or covenant performed, or any
right, remedy or option hereunder exercised, by Sublessor or Subtenant, as the
case may be (and each party covenants that it will do so) within the time limit
relating thereto contained in the Underlying Lease.
h. TERMINATION OF UNDERLYING LEASE If for any reason the term of
the Underlying Lease is terminated or expires prior to the expiration date of
this Sublease, this Sublease shall thereupon automatically be terminated.
i. CASUALTY AND CONDEMNATION: Upon the occurrence of a fire or
other Casualty or a condemnation or taking which permits the Tenant under the
Underlying Lease to terminate the Underlying Lease pursuant to Section 17 or
Section 18 of the Underlying Lease, Sublessor shall have the right, at its
election, to terminate the Underlying Lease without the prior consent of
Subtenant, in which event this Sublease shall automatically terminate (without
any liability to Sublessor).
j. ASSIGNMENT AND SUBLETTING
(i) PROHIBITED WITHOUT SUBLESSOR'S CONSENT: Subtenant agrees
for itself and its permitted successors and assigns in interest hereunder that
it will not assign or otherwise transfer, mortgage or otherwise encumber this
Sublease or any of its rights hereunder; sublet the Subleased Premises or any
part thereof or permit the occupancy or use of the Subleased Premises or any
part thereof by any person other than Subtenant; and/or permit the assignment or
other transfer of this Sublease or any of Subtenant's rights hereunder by
operation of law (each of the events referred to in this foregoing clause being
hereinafter referred to as a "Transfer"), without the prior written consent of
Sublessor in each instance first obtained, which consent may be given or
withheld in Sublessor's sole and absolute subjective discretion and any consent
given shall not constitute a consent to any subsequent Transfer. Any attempted
Transfer without Sublessor's consent shall be null and void and shall not confer
any rights upon any purported transferee, assignee, mortgagee, sublessee or
occupant. No Transfer, regardless of whether Sublessor's consent has been
granted or withheld, shall be deemed to release Subtenant from any of its
obligations hereunder or to alter, impair or release the obligations of any
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person guaranteeing the obligations of Subtenant hereunder. Subtenant hereby
indemnifies Sublessor against liability resulting from any claim made against
Sublessor by any assignee or subtenant or by any broker claiming a commission in
connection with the proposed Transfer. In the event Sublessor shall consent to a
Transfer of this Sublease; any option which Subtenant may have to renew the Term
shall be null and void.
(ii) Provided Subtenant is not in default of any term,
covenant or condition of this Sublease, Subtenant shall have the right to assign
this Sublease or sublet the Subleased Premises to a parent, subsidiary or
affiliate corporation of Subtenant without the consent of Sublessor. Subtenant
shall deliver written notice to Sublessor of any such Transfer. The foregoing
waiver of right to consent does not constitute a waiver of the right of
Sublessor to consent to any Transfer not specifically permitted hereby.
(iii) RENTS FROM TRANSFER: In the event Sublessor shall
consent to a Transfer of this Sublease and the amount of the rents (or other
compensation) to be paid to Subtenant by any such transferee is greater than the
rents required to be paid by Subtenant to Sublessor pursuant to this Sublease or
a premium is to be paid to Subtenant for an assignment of this Sublease,
Subtenant shall pay Sublessor fifty percent (50%) of any such excess or any such
premium, as the case may be, less any improvement allowance or other economic
concessions (planning allowance, moving expense, etc.), paid by Subtenant to
sublesee; broker's commissions; reasonable attorney's fees; and costs of
advertising and/or promoting the space for sublease, upon receipt thereof by
Sublessor from such transferee.
(iv) PROCEDURE FOR OBTAINING LANDLORD'S CONSENT: In the event
that at any time or from time to time prior to or during the Term, Subtenant
desires to Transfer this Sublease, in whole or in part, whether by operation of
law or otherwise, Subtenant shall submit to Sublessor for its consideration in
writing, the name and address of the proposed subtenant or assignee, a
reasonably detailed statement of the proposed subtenant's or assignee's business
and reasonably detailed financial references and information concerning the
financial condition of the proposed subtenant or assignee, a disclosure of the
rents to be paid by any subtenant in excess of the rents reserved hereunder or
the premium to be paid for the assignment, and if a subletting, a description of
the area of the Subleased Premises to be sublet. Subtenant agrees to pay
Sublessor an amount not to exceed five hundred dollars ($500.00) for all costs
incurred by Sublessor in connection with any actual or proposed Transfer,
including, without limitation, the costs of making investigations as to the
acceptability of a proposed subtenant or assignee and legal costs incurred in
connection with any requested consent.
(v) Sublessor's consent to an assignment of this Lease shall
be effective upon the execution by Subtenant, the assignee and Sublessor of an
assignment document prepared by Sublessor in which the assignee shall agree to
assume, observe, perform and be bound by all of Subtenant's obligations under
this Lease and Subtenant shall agree to remain primarily liable for such
obligations.
(vi) Any consent by Sublessor to a subletting of all or a
portion of the Premises shall be deemed to have been given only upon the
delivery by Sublessor to Subtenant of a consent document prepared and executed
by Sublessor expressly consenting to such subletting.
k. HOLDING OVER: Subtenant agrees to vacate the Subleased
Premises at the end of the Term and Sublessor shall be entitled to the benefit
of all summary proceedings to recover possession of the Premises at the end of
the Term. If Subtenant remains in possession of the Subleased Premises after the
expiration of the Term, such action shall not renew this Sublease by operation
of law and nothing herein shall be deemed as consent by Sublessor to Subtenant's
remaining in the Subleased Premises. If Subtenant fails to vacate the Subleased
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Premises as required, Sublessor may consider Subtenant as either a
"Subtenant-at-Will" (i.e. month-to-month subtenant) liable for the payment of
rent at the then market rate as determined by Sublessor or, as a
"Tenant-Holding-Over" liable for an amount equal to the actual damages incurred
by Sublessor as a result of Subtenant's holding over, including, without
limitation, all incidental, prospective and consequential damages and attorney's
fees, but in no event shall such amount be less than an amount equal to twice
the Base Rent and Additional Rent , reserved hereunder, applicable to the period
of the holdover. In either event, all other covenants of this Sublease and the
Underlying Lease shall remain in full force and effect.
1. BROKER: Subtenant and Sublessor each represent and warrant to
the other that the other party did not negotiate through, or communicate with,
any broker in connection with this transaction other than Trammell Crow Company
on behalf of the Sublessor and Robert Manekin Partners, LLC, on behalf of the
Subtenant, (collectively the "Brokers"). The Brokers shall be paid commissions
by Sublessor and Subtenant pursuant to separate agreements. Subtenant agrees to
indemnify, defend and hold Sublessor harmless from and against any and all
claims, loss, liability, costs and expenses (including, without limitation,
reasonable counsel fees), resulting from any claims that may be made against
Sublessor by any broker or other person claiming a commission, fee or other
compensation by reason of this transaction, if the same shall arise by, through
or on account of any act of Subtenant or its representatives. Sublessor agrees
to indemnify, defend and hold Subtenant harmless from and against any and all
claims, loss, liability, costs and expenses (including, without limitation,
reasonable counsel fees), resulting from any claims that may be made against
Subtenant by any broker or other person claiming a commission, fee or other
compensation by reason of this transaction, if the same shall arise by, through
or on account of any act of Sublessor or its representatives. The provisions of
this clause shall not be construed to be for the benefit of any third party.
m. NO SERVICES BY SUBLESSOR: Subtenant agrees and acknowledges
that Sublessor is not in control of the Subleased Premises, the Building or of
any of the services or facilities that may be appurtenant to or supplied at the
Subleased Premises or by Landlord, including, without limitation, electricity,
heat, air conditioning, water, elevator service, repairs, maintenance, painting
and parking facilities. Sublessor shall not be responsible for any failure or
interruption, for any reason whatsoever, of any of such services or facilities
to be provided by Landlord or to be provided by Sublessor, and Subtenant agrees
that no failure to furnish, or interruption of, any such services or facilities
shall give rise to an abatement, diminution or reduction of Subtenant's
obligations hereunder whether in whole or in part, any constructive eviction,
whether in whole or in part, or any liability on the part of Sublessor. If
Subtenant shall require any service or utility in excess of those provided under
the Underlying Lease at no cost or expense to the Tenant thereunder, Subtenant
shall pay all costs and expenses incurred by Sublessor in providing same
together with a three percent (3%) administrative charge.
n. RENT ABATEMENT: Subtenant shall not be entitled to any rent
abatement pursuant to the Underlying Lease, as incorporated herein by reference
unless, and to the extent, Sublessor shall receive a rent abatement from
Landlord pursuant to the Underlying Lease, as incorporated herein by reference,
with respect to all or part of the Subleased Premises.
o. RECORDATION: This Sublease shall not be recorded in any
public office.
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p. SIGNS: Subtenant may not place any sign in the interior of
the Subleased Premises if it is visible outside of the Subleased Premises, on
the exterior of the Subleased Premises, anywhere in the Building outside of the
Subleased Premises or anywhere on the exterior of the Building in each instance
without Sublessor's consent, which consent will not be unreasonably withheld.
Subtenant will be permitted to have signage identity on the fifth (5th) floor
and in the Building's lobby directory.
q. REFUSAL BY SUBLESSOR: Whenever pursuant to the terms of this
Sublease, or the Underlying Lease, Subtenant shall be required to obtain the
consent or approval of Landlord, and Subtenant delivers to the Sublessor a
request that Landlord give such consent or approval, then Sublessor agrees to
deliver such request to Landlord promptly (but in any event within five (5)
days) after its receipt by Sublessor. If after such delivery of a request for
Landlord to give its consent or approval, Landlord fails or refuses to give such
consent or approval, then, regardless of whether the Underlying Lease provides
that such consent or approval shall not be unreasonably withheld and/or delayed,
Sublessor shall have no liability to Subtenant as a result thereof and Sublessor
shall have no obligation to obtain such consent. Notwithstanding the foregoing,
if the consent or approval of Landlord is required, Landlord fails or refuses to
give such consent or approval pursuant to the Underlying Lease, where Landlord's
consent or approval is not to be unreasonably withheld and Subtenant in good
faith believes that Landlord unreasonably withheld its consent or approval and
promptly after such failure or refusal by Landlord, Subtenant notifies Sublessor
of such good faith belief, then Sublessor agrees to use reasonable efforts (but
at no cost, expense or liability to Sublessor) to cause Landlord to give its
consent or approval to Subtenant with respect to the matter in question and if
pursuant to the Underlying Lease, Landlord is required to provide or perform any
service or obligation, Landlord fails to provide or perform such service or
obligation and Subtenant notifies Sublessor of such failure, then Sublessor
agrees to use reasonable effort, including, if reasonably appropriate, the
commencement of a lawsuit (but at no cost, expense or liability to Sublessor) to
cause Landlord to provide or perform such service or obligation.
r. ALTERATIONS: Subtenant shall make no alterations,
installations, changes, renovations, additions, replacements or improvements
("Alterations") on or about the Subleased Premises without, in each instance
obtaining the prior written consent of Sublessor and complying with the terms
and provisions of the Underlying Lease. Notwithstanding the foregoing, the
consent of Sublessor to an Alteration will not be unreasonably withheld if the
Alteration will not adversely affect any structural or exterior element of the
Building, any area or element of the Building outside of the Subleased Premises,
or any Building system, either the consent of Landlord is not required under the
Underlying Lease or such consent has been obtained and, if required pursuant to
the Underlying Lease or by Landlord, Subtenant agrees to restore the Subleased
Premises at the expiration or early termination of the Term to its condition
prior to such Alteration. All Alterations will be performed by contractors
previously approved by Sublessor, such approval not to be unreasonably withheld.
Sublessor has no objection to Subtenant removing, prior to the end of the Term,
any generator or communication equipment installed in the Subleased Premises by
Subtenant, provided that the foregoing is permitted under the Underlying Lease,
or consented to in writing by Landlord in either instance with no liability or
obligation to Sublessor. With respect to each Alteration, Subtenant will not
have the obligation to restore the Subleased Premises at the expiration or early
termination of the Term, to its condition prior to such Alteration, if Sublessor
has no restoration obligation with respect to such Alteration pursuant to the
Underlying Lease or Landlord agrees, in writing, that Sublessor will have no
restoration obligation with respect to such Alteration and such Alteration is a
customary and standard subtenant improvement for premises used as office space.
9
s. SECURITY DEPOSIT: Upon execution of this Sublease, Subtenant
shall pay to Sublessor a security deposit in the amount of $18,510.75 that is
equivalent to three- (3) months rent. On the first and second anniversary of the
effective date of this Sublease, the Subtenant will provide financial
information to the Sublessor for review. If, in the opinion of the Sublessor,
the financial condition of the Subtenant on each anniversary is at least equal
to or better than its financial condition at the inception of this Sublease,
then the Sublessor will return the equivalent of one months security deposit
($6,170.25) following each anniversary, provided all other obligations of the
Subtenant have been met.
t. PARKING: Subject to the terms and provisions of Article 34.20
of the Underlying Lease, Subtenant shall have the right to use four (4) covered
reserved parking spaces at the Building. The balance of the parking spaces both
covered and uncovered will be a part of the five hundred and sixty (560) free
parking spaces providing at a ratio of 4.4 spaces per one thousand (1,000)
rentable square feet. Roughly one-third of the spaces are under cover in the
Building's attached enclosed parking deck, providing a ratio of one (1) covered
reserved parking space per one thousand (1,000) rentable square feet.
u. INAPPLICABLE PROVISIONS: The following provisions of the
Underlying Lease shall not be part of, and shall not apply to, this Sublease:
Paragraphs 3, 4, 5, 6.1, 16, the second paragraph under 25.2, 32, 34.20,
Schedule A and Schedule X. The terms of this Sublease shall control over any
conflicting provisions of the Underlying Lease.
v. SUBORDINATION: This Sublease and the Term and estate hereby
granted are and shall be subject and subordinate to the lien of each mortgage
which may now or at any time hereafter affect the Building or Sub lessor's
interest therein, the Underlying Lease and all other matters to which the
Underlying Lease is subject. The foregoing provision for the subordination of
this Sublease and the Term and estate hereby granted shall be self-operative and
no further instrument shall be required to effect any such subordination -- but
Subtenant shall, however, upon request by Sublessor, at anytime or times,
execute and deliver any and all reasonable instruments that may be necessary or
proper to effect such subordination or to confirm or evidence the same.
6. LANDLORD'S APPROVAL: This Sublease shall have no effect until
Landlord shall have delivered to Sublessor its written consent to this Sublease
(the "Landlord's Consent") and Sublessee shall not make any improvements to the
Premises in accordance with Exhibit C of Paragraph 4c until Sublessor receives
written consent from the Landlord. Sublessor agrees to use reasonable effort to
obtain the Landlord's Consent.
7. APPORTIONMENT: If the Term does not commence on the first day of
a month or end on the last day of a month, Base Rent, Additional Rent and all
other charges for the partial month(s) will be apportioned.
8. AMENDMENT OF UNDERLYING LEASE: Sublessor shall have the right to
modify or amend the Underlying Lease without the prior written consent of
Subtenant, unless such modification or amendment shortens the term of the
Underlying Lease, terminates this Sublease, reduces any rights or services to be
provided to Subtenant under this Sublease, or the Underlying Lease increases any
financial obligation of Subtenant hereunder, increases (other than in an
insignificant manner) any non-financial obligation of Subtenant hereunder, in
which event Subtenant's consent (not to be unreasonably withheld), to such
modification or amendment shall be required and any reference in this Sublease
10
to the Underlying Lease, shall mean the Underlying Lease as modified or amended
from time to time, provided that if Subtenant properly withholds its consent,
Subtenant shall not be subject to the terms and provisions of such modification
or amendment.
9. GOVERNING LAW: Irrespective of the place of execution or
performance, this Sublease shall be governed by. and construed in accordance
with, the laws of the State of Maryland.
10. INSURANCE
a. SUBTENANT'S INSURANCE Subtenant, at its expense, shall obtain
and maintain in effect, as long as this Sublease remains in effect, and during
such other time as Subtenant occupies the Subleased Premises or any part
thereof, insurance policies in accordance with the following provisions:
b. COVERAGE:
(i) COMMERCIAL GENERAL LIABILITY INSURANCE policy, including
insurance against assumed or contractual liability under this Sublease, with
respect to the Subleased Premises, to afford protection with limits, per
occurrence, of no less than two million dollars ($2,000,000), combined single
limit, with respect to personal injury, bodily injury, including death, and
property damage and four million dollars ($4,000,000) aggregate (occurrence
form).
(ii) ALL-RISK PROPERTY INSURANCE POLICY, including theft,
written at replacement cost value and with replacement cost endorsement,
covering all of Subtenant's Personal Property in the Subleased Premises and
covering loss of income resulting from casualty, such insurance to provide for a
deductible not greater than five hundred thousand dollars ($500,000.00).
(iii) WORKER'S COMPENSATION OR SIMILAR INSURANCE POLICY
offering statutory coverage and containing statutory limits, which policy shall
also provide Employer's Liability Coverage of not less than five hundred
thousand dollars ($500,000.00) per occurrence.
(iv) Subtenant shall require any construction contractor
retained by it to perform work on the Subleased Premises to carry and maintain,
at no expense to Sublessor, during such times as contractor is working in the
Subleased Premises, a NON-DEDUCTIBLE COMMERCIAL GENERAL LIABILITY INSURANCE
POLICY, including, but not limited to, CONTRACTOR'S LIABILITY COVERAGE,
CONTRACTUAL LIABILITY COVERAGE, COMPLETED OPERATIONS COVERAGE, broad form
property damage endorsement and contractor's protective liability coverage, to
afford protection with limits per person and for each occurrence, of not less
than two million dollars ($2,000,000.00), combined single limit, and with
respect to personal injury and death and property damage, four million dollars
($4,000,000.00) aggregate (occurrence form) and two million dollars ($2,000,000)
aggregate completed operations; automobile liability insurance in the amount of
one million dollars ($1,000,000.00) combined single limit for bodily injury and
property damage; and worker's compensation insurance or similar insurance in
form and amounts as required by law.
(v) Notwithstanding anything set forth above in this
Paragraph 10 to the contrary, all dollar limits specified herein shall be
11
increased from time to time as reasonably necessary to effect economically
equivalent insurance coverage, or coverage deemed adequate in light of then
existing circumstances.
c. POLICIES: Such policies shall be maintained with companies
licensed to do business in the State where the Subleased Premises are located
and in form reasonably acceptable to Sublessor and will be written as primary
policy coverage and not contributing with, or in excess of, any coverage which
Sublessor shall carry. Such policies shall be provided on an occurrence form
basis unless otherwise approved by Sublessor and shall include Sublessor as
additional insured as to coverage under Paragraphs 10(b)(i) and 10(b)(iv). Such
policies shall also contain a waiver of subrogation provision and a provision
stating that such policy or policies shall not be canceled, non-renewed, reduced
in coverage or materially altered except after thirty (30) day's written notice,
said notice to be given to Sublessor, Attention: Legal Department. All such
policies of insurance shall be effective as of the date Subtenant occupies the
Subleased Premises and shall be maintained in force at all times during the Term
of this Sublease and all other times during which Subtenant shall occupy the
Subleased Premises. Subtenant shall deposit the policy or policies of such
required insurance or certificates thereof with Sublessor prior to the
Commencement Date.
d. TENANT'S FAILURE TO INSURE: If Subtenant shall fail to obtain
insurance as required under this Paragraph, Sublessor may, but shall not be
obligated to obtain such insurance, and in such event, Subtenant shall pay, as
Additional Rent, the premium for such insurance upon demand by Sublessor.
e. COMPLIANCE WITH POLICIES: Subtenant shall not do or allow to
be done, or keep, or allow to be kept, anything in, upon or about the Subleased
Premises which will contravene Sublessor's policies insuring against loss or
damage by fire, other casualty, or any other cause, including without
limitation, public liability, or which will prevent Sublessor from procuring
such policies in companies acceptable to Sublessor. If any act or failure to act
by Subtenant in and about the Building and the Subleased Premises shall cause
the rates with respect to Sublessor's insurance policies to be increased beyond
those rates that would normally be applicable for such limits of coverage,
Subtenant shall pay, as Additional Rent, the amount of any such increases upon
demand by Sublessor.
f. WAIVER OF RIGHT OF RECOVERY: Neither party shall be liable to
the other party or to any insurance company (by way of subrogation or otherwise)
insuring the other party, for any loss or damage to any Building structure or
other tangible property, or loss of income resulting therefrom, or losses under
worker's compensation laws and benefits even though such loss or damage might
have been occasioned by the negligence of such party, its agents or employees.
The provisions of this Paragraph 10(f) shall not limit the indemnification for
liability to third parties pursuant to Paragraph 3. Sublessor shall not be
obligated to repair any damage to Subtenant's Personal Property or replace the
same.
g. SUBLESSOR'S INSURANCE: Sublessor shall carry comprehensive
general liability insurance with regard to the Property and all-risk property
insurance on the Property, including Subtenant Improvements and Alterations but
excluding Subtenant's Personal Property.
12
11. MISCELLANEOUS
a. PRIOR UNDERSTANDINGS -- ENTIRE AGREEMENT: All understandings
and agreements heretofore had between the parties are merged in this Sublease
and any other written agreement(s) made concurrently herewith, which alone fully
and completely express the agreement of the parties. This Sublease contains a
complete statement of all the agreements and arrangements between the parties
with respect to its subject matter and cannot be changed or terminated orally.
This Sublease shall be construed without any presumption against the party
drafting this Sublease or causing the same to be drafted.
b. SUBMISSION TO JURISDICTION: Subtenant and Sublessor each
irrevocably agree that any suit, action or other legal proceeding arising out
of, or relating to, this Sublease may be brought in the Courts of the State of
Maryland, or of the United States of America, located in Baltimore County,
consents to the jurisdiction of each such court in any such suit, action or
proceeding and waives any objection which it may have to the laying of venue of
any such suit, action or proceeding in any of such courts and any claim that any
such suit, action or proceeding has been brought in an inconvenient forum.
c. CAPTIONS: The marginal captions in this instrument are used
for convenience in finding the subject matters and are not to be taken as part
of this instrument or to be used in determining the intent of the parties or
otherwise interpreting this Sublease.
d. SUBLESSOR'S COST AND EXPENSES: If Subtenant shall be in
default under this Sublease and such default shall remain uncured beyond the
expiration of the applicable grace period set forth herein, or under the
Underlying Lease, as applicable, all attorneys' fees and all other costs and
expenses incurred by Sublessor in enforcing Sublessor's rights hereunder or in
collecting any Base Rent or Additional Rent hereunder shall be payable by
Subtenant within five days after notice from Sublessor.
e. SUBTENANT'S COST AND EXPENSES: If Sublessor shall be in
default under this Sublease and such default shall remain uncured for thirty
(30) days after written notice from Subtenant (provided that if such default
cannot with reasonable diligence be cured within said thirty (30) day grace
period, said grace period shall be extended as long as Sublessor is diligently
proceeding to complete such cure), all attorneys' fees and all other costs and
expenses incurred by Subtenant in enforcing Subtenant's rights thereunder shall
be payable by Sublessor within five (5) days after notice from Subtenant.
f. SUBLESSOR'S RIGHT: Sublessor or Sublessor's agents shall have
the right (but shall not be obligated) to enter the Subleased Premises in any
emergency, at any time and without notice (provided that Sublessor shall give
written notice within one business day after such emergency entry), and at other
times, upon at least one business day's prior written notice during normal
business hours on business days (and at Subtenant's option accompanied by a
representative of Subtenant), to examine or inspect the same and to make such
repairs, replacements, alterations, improvements or additions as Sublessor may
deem necessary or desirable to any portion of the Subleased Premises or the
Building or which Sublessor may elect to perform, in the Subleased Premises or
the Building following Subtenant's failure to make repairs or perform any work
which Subtenant is obligated to perform under this Sublease, or for the purpose
of complying with laws, regulations and other directions of governmental
authorities.
13
Subtenant shall permit Sublessor to use, repair, maintain and replace pipes,
ducts, wires, conduits and appurtenant fixtures in and through the Subleased
Premises and to erect or install new pipes, ducts, wires, conduits and
appurtenant fixtures therein . Sublessor may, during the progress of any work in
the Subleased Premises, take all reasonably necessary materials and equipment
into the Subleased Premises without the same constituting an eviction, nor shall
Subtenant be entitled to any abatement of rent while such work is in progress
nor to any damages by reason of loss or interruption of business or otherwise.
Sublessor agrees when performing work in the Subleased Premises, to use
reasonable effort to minimize interference with Subtenant's business and use of
the Sublease Premises, provided that Sublessor shall have no obligation to pay
workers at so-called overtime rates. If, after giving the notice, if any,
required above, Subtenant is not present to open and permit an entry into the
Subleased Premises, Sublessor or Sublessor's agent may enter the same whenever
such entry may be necessary or permissible by master key or in the event of
emergency (after trying to give written or oral notice to Subtenant) forcibly
and provided reasonable care is exercised to safeguard Subtenant's property and
such entry shall not render Sublessor or its agent liable therefor, nor in any
event shall the obligations of Subtenant hereunder be affected.
g. SUCCESSORS AND ASSIGNS: This Sublease shall apply to all
respective successors and permitted assigns of the parties hereto but this
paragraph shall not be construed as a consent to any assignment or subletting by
Subtenant.
IN WITNESS WHEREOF, this Sublease has been duly executed by
Sublessor and Subtenant as of the day and year first herein above written.
MILLENNIUM INORGANIC CHEMICALS INC.
By: /s/ Myra J. Peterson
---------------------------------------
Name: Myra J. Peterson
Title: SVP, Human Resources
CEPTOR CORPORATION
By: /s/ Donald W. Fallon
---------------------------------------
Name: Donald W. Fallon
Title: SVP, Finance and Administration
14
LIST OF EXHIBITS
Exhibit A-1 Floor Plan of Fifth Floor of the Building Highlighting the
Subleased Premises
Exhibit B Copy of the Underlying Lease
Exhibit C Approved Space Plan
EXHIBIT A
EXHIBIT B
MARYLAND FULL-SERVICE OFFICE LEASE
CENTERPOINTE
by and between
CENTERPOINTE LIMITED PARTNERSHIP, Landlord
by ROUSE OFFICE MANAGEMENT, INC., Managing Agent,
and
SCM CHEMICALS, INC., Tenant
TABLE OF CONTENTS
1. SUMMARY OF TERMS.............................................................4
2. DEFINITIONS..................................................................6
3. LEASED PREMISES; MEASUREMENT; EXPANSION......................................7
4. TERM AND COMMENCEMENT OF TERM................................................8
5. TENANT IMPROVEMENTS AND ACCEPTANCE OF PREMISES..............................10
6. RENT........................................................................12
7. OPERATING COST ESCALATIONS..................................................13
8. USE, CARE AND REPAIR OF PREMISES BY TENANT..................................18
9. RULES AND REGULATIONS.......................................................19
10. COMMON AREA................................................................20
11. SERVICES AND UTILITIES.....................................................21
12. ELECTRIC CURRENT...........................................................22
13. LOSS, DAMAGE AND INJURY....................................................23
14. REPAIRS BY LANDLORD........................................................23
15. ALTERATIONS, TITLE AND PERSONAL PROPERTY...................................24
16. INSURANCE..................................................................25
17. DAMAGE AND DESTRUCTION.....................................................27
18. CONDEMNATION...............................................................28
19. BANKRUPTCY.................................................................29
20. DEFAULT PROVISIONS APPLICABLE TO TENANT AND REMEDIES AVAILABLE TO LANDLORD.30
21. Intentionally deleted......................................................34
22. INDEMNITY..................................................................34
23. LIMITATION ON LANDLORD LIABILITY...........................................34
24. LANDLORD OBLIGATIONS.......................................................34
25. ASSIGNMENT AND SUBLETTING..................................................35
26. FOLDING OVER...............................................................37
27. SUBORDINATION AND ATTORNMENT...............................................37
28. ESTOPPEL CERTIFICATES......................................................38
29. PEACEFUL AND QUIET POSSESSION..............................................39
30. LANDLORD'S ACCESS TO PREMISES..............................................39
31. Intentionally deleted......................................................39
32. BROKERS, COMMISSIONS, ETC..................................................39
33. RECORDATION................................................................39
34. MISCELLANEOUS..............................................................40
SCHEDULES
A - Pbat showing location of the Premises
B - Plans and Specifications for Tenant Improvements
C - Rules and Regulations
D - Janitorial Specifications
X - Method of Floor Measurement
MARYLAND FULL-SERVICE OFFICE LEASE
CENTERPOINTE
THIS LEASE is made and entered into as of the day of , 1996, by and
between CENTERPOINTE LIMITED PARTNERSHIP a Maryland limited partnership
("Landlord") by ROUSE OFFICE MANAGEMENT, INC., Managing Agent, and SCM
CHEMICALS, INC. a Delaware corporation ("Tenant").
In consideration of the rents hereinafter reserved and the
agreements hereinafter set forth, Landlord and Tenant mutually agree as follows:
1. SUMMARY OF TERMS.
The following is a summary of the principal terms of the Lease. Any
capitalized term set forth below shall, for the purposes of this Lease, have the
meaning ascribed to it in this Section 1.
A. DESCRIPTION OF PREMISES
(1) BUILDING: The building known as CenterPointe and located at 200
International Circle, Hunt Valley, Maryland 21031.
(2) BUSINESS COMMUNITY: Shawan Center and Hunt Valley business
community north of Shawan Road.
(3) PREMISES: Approximately 18,102 square feet of Rental Area on the
fifth floor of the Building as shown on SCHEDULE A.
B. RENT
(1) ANNUAL BASIC RENT
PERIOD ANNUAL BASIC RENT MONTHLY INSTALLMENT
------ ----------------- -------------------
7/1/96-12/3.1/96* Abated Abated
1/1/97-12/31/97 $303,208.56 $25,267.38
1/l/98-12/31/98 $312,259.56 $26,021.63
1/1/99-12/31/99 $321,310.56 $26,775.88
1/1/00-12/31/00 $330,361.56 $27,530.13
1/1/01-12/31/01 $339,412.56 $28,284.38
1/l/02-12/31/02 $351,178.80 $29,264.90
1/1/03-12/31/03 $362,945.16 $30,245.43
1/1/04-12/31/04 $374,711.40 $31,225.95
1/l/05-12/31/05 $386,477.64 $32,206.47
1/1/06-12/31/06 $398,244.00 $33,187.00
* Subject to adjustment in the event of a delay caused solely by
Landlord in accordance with Section 1.B.(4) below
(2) ADVANCE RENT: Twenty-five. Thousand Two Hundred Sixty-seven
Dollars and Thirty-eight Cents ($25,267.38) representing the installment of
Annual. Basic Rent for the seventh leasehold month of the Term.
(3) SECURITY DEPOSIT: None.
(4) ABATEMENT: Notwithstanding anything to the contrary contained
herein, Tenant shall not be liable for the payment of Annual Basic Rent and
Tenant's Share of Increased Operating Costs and Tenant's Fractional Share of
Excess Taxes for the first six (6) leasehold months of the Term ("Abatement
Period"), subject, however, to the provisions of Section 20.3.
In the event Landlord is delayed in delivering the Premises to Tenant
because of a delay caused solely by Landlord, and the Lease Commencement Date is
adjusted as a result thereof, notwithstanding such delay, Tenant shall be
entitled to a full six (6) month abatement, with the Abatement Period commencing
from the adjusted Lease Commencement Date. In the event the Abatement Period
ends on any day other than the last day of the month, the Annual Basic Rent
payable, by Tenant for such month shall be prorated for the period commencing on
the day immediately following the last day of the Abatement Period through the
last day of the month in which the Abatement Period ends.
C. ADJUSTMENTS.
(1) BASE OPERATING COSTS: The Base Operating Costs for the Premises
shall be the Operating Costs for the Operating Year which commenced January 1,
1996, multiplied by Tenant's Fractional Share.
(2) BASE TAXES: The Base Taxes for the Premises shall be the actual
Taxes for the Property attributable to the Tax Year commencing July 1, 1996 and
ending June 30, 1997, multiplied by Tenant's Fractional Share.
2
(3) ADJUSTMENT PERIOD CONSUMER PRICE INDEX. Intentionally omitted.
D. TERM
(1) TERM: Ten (10) years and six (6) months, subject to Section 4.
(2) LEASE COMMENCEMENT DATE: July 1, 1996, subject to Section 4.
(3) TERMINATION DATE: December 31, 2006, subject to Section 4.
E. NOTICE AND PAYMENT
(1) Tenant Notice SCM Chemicals
Address: Suite 5000
200 International Circle
Hunt Valley, Maryland 21031
Attention: Vice President-Employee/Community Relations
with a copy to:
SCM Chemicals
Suite 5000
200 International Circle
Hunt Valley, Maryland 21031
Attn: Vice President, General Counsel & Secretary
(2) Landlord Notice Rouse Office Management, Inc.
Address: 11311 McCormick
Road Suite 180
Hunt Valley, Maryland 21031-1001
with a copy to: Rouse Office Management, Inc.
c/o The Rouse Company
10275 Little Patuxent Pkwy
Columbia, Maryland 21044
Attention: General Counsel
(3) Landlord Payment Rouse-Teachers Properties, Inc.
Address: P.O. Box 64727
Baltimore, MD 21264-4727
3
F. Broker: T. Courtenay Jenkins, III
CRA Group
c/o Casey & Associates
300 E. Lombard, Suite 1440
Baltimore, Maryland 21201
2. DEFINITIONS.
For purposes of this Lease, the Schedules attached and made a part hereof
and all agreements supplemental to this Lease, the following terms shall have
the respective meanings as set forth in the following Section, subsection,
paragraph and Schedule references:
Reference
Abatement Period .....................................................1.B.(4)
Additional Rent ..........................................................6.3
Additional Premises ........................................................3
Advance Rent .........................................................1.B.(2)
Alterations .............................................................15.1
Annual Basic Rent ....................................................1.B.(1)
Bankruptcy Code .........................................................19.1
Base Operating Cost ..................................................1.C.(2)
Building .............................................................l.A.(1)
Casualty ................................................................17.1
Common Area .............................................................10.1
Default Rate .............................................................6.5
Excess Taxes .............................................................7.3
Event of Default ........................................................20.1
Event of Tenant's Bankruptcy ............................................19.1
Fractional Share .........................................................7.1
Insolvency Laws .........................................................19.1
Landlord Notice Address .................................................1.E.
Landlord Payment Address ................................................1.E.
Lease Commencement Date ..............................................1.D.(2)
Mortgage ..................................................................27
Mortgagee .................................................................27
Operating Costs ..........................................................7.1
Operating Costs Statement ................................................7.2
Operating Year ...........................................................7.1
Plans and Specifications .................................................5.1
Premises .............................................................l.A.(3)
Prevailing Market Rate (Renewal Term) ....................................4.3
Property.................................................................7.1.
Public Areas.......................................................Schedule C
Ready for Occupancy ......................................................4.2
Renewal Term .............................................................4.3
4
Rental Area.................................................................3
Rental Year ..............................................................6.1
Rules and Regulations ......................................................9
Surviving Corporation ...................................................25.2
Tenant Allowance .........................................................5.1
Tenant Improvements ......................................................5.1
Tenant Notice Address ...................................................1.E.
Tenant's Parent Company..................................................25.2
Tenant's Share of Increased Operating Costs ..............................7.2
Tenant's Personal Property ..............................................15.3
Term......................................................................4.1
Termination Date .....................................................1.D.(3)
Transfer ..................................................................25
3 LEASED PREMISES; MEASUREMENT; EXPANSION.
3.1 LEASED PREMISES; MEASUREMENT. Landlord hereby .leases to Tenant, and
Tenant hereby. leases from Landlord, the Premises as shown on the plan attached
hereto as Schedule A, together with the right to use, in common with others, the
Common Area. The rental area of the Premises ("Rental Area") has been computed
in accordance with the applicable formula set forth in Schedule X attached
hereto and made a part hereof.
3.2 RIGHT OF FIRST REFUSAL. Landlord and Tenant agree that commencing with
the Lease Commencement Date and continuing throughout the initial Term, provided
Tenant is in possession of the Premises and is not in default of any of the
terms, covenants and conditions of this Lease, Tenant shall, have a right of
first refusal to lease from Landlord any space on the fifth floor which becomes
vacant and available for leasing (the "Additional Premises"); such Additional
Premises shall be leased to Tenant on the same terms and at the same rate of
Annual Basic Rent per square foot as applicable to the original Premises, except
there shall be no abatement of rent. The Rental Area of the Additional Premises
will be computed in accordance with the formula for divided floors set forth in
SCHEDULE X.
The Tenant Improvements to be provided by Landlord to the Additional
Premises will be constructed at a cost per rentable square foot of such
Additional Premises equal to the product of $25.00 multiplied by a fraction, the
numerator of which is the number of months remaining in the Te time Tenant
begins paying rent on the Additional Premises, and the denominator of which is
the number -of months during the initial Term of the Lease. Such improvements
shall be constructed with a level of finishes comparable to those provided in
the construction of the initial Tenant Improvements.
Tenant shall exercise its right of first refusal by written notice to
Landlord within ten (10) business days following receipt of written notice from
Landlord of a third party's offer to lease the Additional Premises. In the event
that Tenant exercises the right granted herein, Landlord and Tenant .shall enter
into an amendment to this Lease to incorporate the Additional Premises and to
make necessary adjustments to the Annual Basic Rent and similarly affected
provisions of this Lease. In the event Tenant declines to exercise its right as
above provided for, or fails to deliver notice thereof within the time period
stipulated above, or fails to execute the requisite amendment to this Lease,
this right of first refusal shall lapse and be of no further force and effect as
to the instant offer; however, the right of first refusal shall remain in full
force and effect as to any subsequent leasing of the Additional Premises,
excluding renewal or extension of an existing lease. This right of first refusal
5
shall not be severed from this lease or separately sold, assigned or
transferred.
4. TERM AND COMMENCEMENT OF TERM.
4.1 TERM. The term of this Lease (the "Term") shall commence on the Lease
Commencement Date; provided, however, that if the Premises are not Ready for
Occupancy as of such Lease Commencement Date for any reason, except for delays
caused solely by. Tenant, then the Lease Commencement Date shall be delayed
until the earlier of:
a. the date on which Tenant shall take possession of all or any
portion of the Premises, provided that such possession shall be only with the
written approval of Landlord; or
b. the date the Premises are Ready for Occupancy;
and, if necessary, the Termination Date shall be adjusted to effect the total
number of years in the Term, as set forth in subsection 1. D. plus the part of
the month, if any, from the adjusted Lease Commencement Date to the first full
month of the Term.
In the event the Premises are not Ready for Occupancy by the Lease
Commencement Date, as initially set forth above, because of a' delay caused
solely by Tenant, then said Lease Commencement Date shall not be delayed and
Tenant's obligations shall commence as of said date, notwithstanding the status
of construction.
The Term shall be for the period of time specified in Section 1.D.(1) plus
the part of the month, if any, from the Lease Commencement Date to the first day
of the first full calendar month in the Term, unless earlier terminated pursuant
to any other provision of this Lease or pursuant to law. At Landlord's request,
Tenant shall promptly enter into one or more supplementary written agreements,
in such form as Landlord shall reasonably prescribe, specifying the Lease
Commencement Date and the Termination Date.
4.2 READY FOR OCCUPANCY. For purposes hereof, the Premises shall be deemed
conclusively ready for occupancy ("Ready for Occupancy") upon the completion of
the following conditions:
a. Landlord has substantially completed its work on the Tenant's
Improvements except for punch list items; and
b. Landlord shall have received any governmental approvals which are
necessary in order for Tenant to occupy the Premises, unless Tenant's acts or
omissions have caused such approvals to be denied, in which case Tenant shall be
deemed to have waived this condition 4.2.b.
4.3 OPTIONS TO RENEW. Provided Tenant is in possession of the Premises and
is not in default of any term, covenant or condition of this Lease, Tenant shall
have the option to renew the Term of this Lease for two (2) additional periods
of five (5) years each ("Renewal Term") to commence immediately upon the
expiration of the initial Term, or the immediately preceding Renewal Term, as
the case may be, upon the same terms, covenants and conditions as contained in
this Lease, except that (i) the Annual Basic Rent during each Renewal Term shall
be at the "Prevailing Market Rate"; (ii) there shall be no further option to
6
renew except as specifically provided herein; (iii) there shall be no abatement
of rent; and (iv) Landlord shall not be obligated to construct, pay for or grant
an allowance with respect to tenant improvements unless otherwise specifically
provided for in this Lease. "Prevailing Market Rate" shall mean the annual
amount per rentable square foot that a willing, comparable, non-equity,
non-renewal, non-expansion new tenant would pay and a willing, comparable
landlord of a first class office building in the Business Community would accept
at arm's length, giving appropriate consideration to annual rental rates per
rentable square foot, the type of escalation clauses (including, without
limitation, operating expenses, real estate taxes, CPI, etc.), the extent of
liability under the escalation clauses (e.g. whether determined on a "net lease"
basis or by increase over a particular base year or base dollar amount),
abatement provisions reflecting free rent, brokerage commissions (if any),
length of lease term, size and location of premises being leased, building
standard work letter and/or tenant improvement allowances (if any), and other
generally applicable terms and conditions of tenancy for the space in question.
Landlord shall take into consideration Tenant's existing level of finishes in
considering improvement allowances as part of the consideration for determining
Prevailing Market Rate.
In order to exercise the option granted herein, Tenant shall notify
Landlord, in writing, not less than twelve (12) months prior to the expiration
of the initial Term, or the immediately preceding Renewal Term, as the case may
be that it is considering exercising its option to renew the Term. On receipt of
such notice, Landlord will, in writing, not later than thirty (30) days after
receipt of the notice from Tenant, quote to Tenant what the new Annual Basic
Rent will be for the ensuing Renewal Term. Tenant shall then notify Landlord, in
writing, not later than thirty (30) days after notice received of such Annual
Basic Rent, as to whether or not it will exercise the option herein granted and
if no such notice of exercise of the option is received, the option shall be
deemed waived. Notwithstanding the foregoing, in the event Tenant's thirty day
notice period has lapsed and the parties _have not agreed on the terms of the
renewal or extension,, Tenant's option to renew the Term of this Lease shall
remain open for an additional period not to exceed six (6) months, provided
Landlord and Tenant are actively engaged in good-faith negotiations for such
renewal or extension. If Landlord and Tenant have not executed a renewal or
extension amendment within the aforesaid six (6) month period, the provisions of
this Section 4.3 shall no longer be applicable, and Tenant's option to renew the
Term shall be deemed waived.
In the event Tenant exercises the option, Landlord and Tenant shall
execute a modification to this Lease acknowledging such renewal and setting
forth the new Annual Basic Rent.
Upon commencement of the first Renewal Term, Landlord will provide a
refurbishment allowance equal to Five Dollars ($5.00) per square foot of the
Rental Area of the Premises. Any repairs and/or improvements to the Premises
pursuant to this provision shall be performed by Landlord in accordance with
Section 15 hereof and Landlord shall construct such repairs and/or improvements
with a level of finishes comparable to those provided in the construction of the
initial Tenant Improvements.
The option shall be void if, at the time of exercise of such option,
Tenant is not in possession of the Premises or is in default under this Lease or
if Tenant fails to deliver the requisite notice thereof within the time period
specified above. The options granted herein shall not be severed from this
Lease, separately sold, assigned or transferred, or exercised collectively.
7
5. TENANT IMPROVEMENTS AND ACCEPTANCE OF PREMISES
Tenant Improvements. Prior to the Lease Commencement Date, Landlord shall
make improvements the Premises ("Tenant Improvements") in accordance with plans
and specifications ("Plans and Specifications") to be prepared by Landlord and
Tenant as described in the following sentence. The Plans and Specifications
shall comprise, among other things, (i) the architectural plans which shall be
prepared by Tenant and submitted to Landlord for its written approval, and (ii)
the mechanical and electrical drawings which shall be prepared by Landlord and
submitted to Tenant for its written approval. Landlord and Tenant mutually agree
not to unreasonably withhold or delay their respective approval of the other
party's plans. Once the Plans and Specifications are acceptable to both parties,
it is agreed that same shall be attached hereto and become a part of this Lease,
being identified as Schedule B. Except as otherwise specifically provided in the
following paragraph, Landlord shall not be responsible for performing or paying
for the moving or installation of telephone and computer systems, wiring or
cabling, or the acquisition, moving or installation of Tenant's furnishings,
fixtures and equipment in the Premises. Landlord agrees to bear the cost of the
Tenant Improvements in an amount not to exceed Four Hundred Fifty-two Thousand
Five Hundred Fifty Dollars and No Cents ($452,550.00) ("Tenant Allowance"). The
Tenant Allowance shall not include the cost of any demolition work nor the cost
of constructing the interior partitioning for the corridor demising walls to
convert t the fifth floor into a multi-tenant floor. Landlord shall be solely
responsible for all such costs.
In the event the cost of constructing the Tenant Improvements is less than
the Tenant Allowance, Landlord shall pay to Tenant a moving allowance not to
exceed Three Dollars ($3.00) per square foot of the Rental Area of the Premises,
provided the payment of such moving allowance does not exceed the total Tenant
Allowance and provided Tenant provides Landlord with copies of paid receipts
documenting such costs and expenses. Such moving allowance shall include,
without limitation, the cost of communications installation, equipment
installation, furniture assembly, consulting and engineering services... In the
event the total cost of constructing the Tenant Improvements exceeds such Tenant
Allowance, at Tenant's option, Tenant shall either (i) pay such excess costs to
Landlord, as Additional Rent, within thirty (30) days of receipt of an invoice
therefor from Landlord; or (ii) pay such excess costs, as Additional Rent, such
excess costs to be amortized at a rate of eleven percent (11 %) per annum,
calculated on a straight-line basis over the Term of the Lease (excluding the
Abatement Period). Tenant shall elect either option within thirty (30) days
after the Lease Commencement Date.
Any other improvements to the Premises requested by Tenant which are not
shown on the Plans and Specifications shall be subject to Landlord's prior
written approval which approval shall not be unreasonably withheld or delayed.
Such additional improvements shall be performed by Landlord, and the cost
thereof shall be paid by Tenant to Landlord within thirty (30) days following
receipt of an invoice for same from Landlord.
Tenant shall be permitted to include up to three (3) general contractors
in Landlord's bidding process. Landlord agrees to review all bids and/or
contract proposals with Tenant prior to commencement of construction. Landlord
and Tenant shall mutually agree on the final selection of the contractor(s).
Landlord shall supervise all construction and agrees to use all reasonable
efforts to monitor the general contractor's work in an effort to assure cost
management and a timely completion of the Tenant Improvements.
8
The Tenant Allowance and any additional amount payable by Tenant hereunder
shall include Landlord's construction management fee of ten percent (10%)
computed on the total cost of construction, including but not limited to the
cost of developing, preparing and modifying construction drawings.
5.1 ACCEPTANCE OF PREMISES. Prior to occupancy, Landlord and Tenant shall
conduct a joint. inspection of Premises during which they shall develop a
mutually agreeable punchlist of items to be completed by Landlord. Tenant's
occupancy of the Premises shall be deemed to constitute acceptance of the
Premises and acknowledgment by Tenant that Landlord has fully complied with its
obligations hereunder to construct and deliver the Premises to Tenant, except
for latent defects and except for the punchlist items (which shall be completed
by Landlord within a reasonable time thereafter). Landlord shall have the right
to enter the Premises to complete or repair any such punchlist items and entry
by Landlord, its agents, employees or contractors for such purpose shall not
constitute an actual or constructive eviction, in whole or in part, or entitle
Tenant to any abatement or diminution of rent or relieve Tenant of any of its
obligations under this Lease, or impose any liability upon Landlord or its
agents, employees or contractors. Landlord shall use commercially reasonable
efforts not to interfere with or disrupt Tenant's business activities in the
Premises while it is completing or repairing the punchlist items.
6. RENT.
6.1 ANNUAL BASIC RENT. Tenant shall pay to Landlord during each Rental
Year of the Term fixed rent equal to the Annual Basic Rent as set forth in
Section 1.B.(1). Annual Basic Rent shall be payable in advance on the first day
of each month of the Term in equal monthly installments, without notice, demand,
abatement (except as otherwise specifically provided in this Lease), deduction
or set-off. If the Term of this Lease shall commence on a day other than the
first day of a month, the first payment shall include any prorated Annual Basic
Rent for the period from the Lease Commencement Date to the first day of the
first full calendar month of the Term.
"Rental Year" shall mean each successive twelve (12) calendar month period
occurring during the Term of this Lease, or portion of such a period, with the
first Rental Year commencing as of the Lease Commencement Date and ending on the
last day of the twelfth full calendar month thereafter and the last Rental Year
ending on the Termination Date. For any Rental Year of less or more than twelve
full months, Annual Basic Rent shall be adjusted accordingly. All Annual Basic
Rent-and Additional Rent shall be paid to Landlord at the Landlord Payment
Address.
6.2 INTENTIONALLY OMITTED.
6.3 ADDITIONAL RENT. Tenant shall pay to Landlord as additional rent
("Additional Rent") all other sums of money which shall become due and payable
hereunder, including but not limited to the payment of Tenant's Share of
Increased Operating Costs and Tenant's Fractional Share of Excess Taxes. Unless
a date for payment is otherwise specified herein, all Additional Rent shall be
due and payable within thirty (30) days of invoicing by Landlord.
6.4 ADVANCE RENT. Tenant shall, upon execution of this Lease, pay to
Landlord an amount equal to the Advance Rent which shall be held by Landlord as
security for the performance by Tenant of all of its obligations occurring prior
to the Lease Commencement Date. If Tenant shall default in the performance of
such obligations, Landlord may retain the Advance Rent as an offset against any
damages thereby incurred by Landlord provided that the retention of such Advance
Rent. shall not preclude Landlord from pursuing any other remedy which it might
have against Tenant. If no default shall occur by Tenant then the Advance Rent
9
shall be applied against the installment of Annual Basic Rent payable for the
month identified in Section 1.B.(2).
6.5 LATE CHARGE. If Tenant fails to make any payment of Annual Basic Rent,
Additional Rent, or other sums required to be paid hereunder on or before the
date when payment is due, Tenant shall pay to Landlord, as Additional Rent, a
late charge to cover extra administrative costs and loss of use of funds equal
to (a) six percent (6%) of the amount due for the first month or portion thereof
that such amount is past due plus (b) interest on the amount remaining unpaid
thereafter at the rate of eighteen percent (18 %) per annum; provided, however,
that should such late charge at any time violate any applicable law, the late
charge shall be reduced to the highest rate permitted by law (the foregoing rate
being herein referred to as the "Default Rate"). Landlord's acceptance of any
rent after it has become due and payable shall not excuse any delays with
respect to future rental payments or constitute a waiver of any of Landlord's
rights under this Lease.
Notwithstanding the above, the late charge set forth above shall be waived
up to two (2) times in any twelve (12) month period, provided that Tenant pays
the above described sums within ten (10) days after the date due.
7. OPERATING COST ESCALATIONS.
7.1 DEFINITIONS. For purposes of this Lease, the following definitions
shall apply:
a. "Operating Year" means each respective calendar year or part
thereof during the Term of this Lease or any renewal thereof.
b. "Property" means the Building, the land upon which the Building
is situated, the Common Area, and such additional facilities in subsequent years
as may be determined by Landlord to be reasonably necessary or desirable for the
management, maintenance or operation of the Building.
c. "Operating Costs" means all expenses and costs (but not specific
costs which are allocated or separately billed to and paid by specific tenants)
of every kind and nature which Landlord, consistent with generally accepted
accounting principles, shall pay or become obligated to pay because of or in
connection with owning, operating, managing, painting, repairing, insuring and
cleaning the Property, subject to and including, but not limited to, the
following:
(i) cost of all supplies and materials used, and labor charges
incurred, in the operation, maintenance, decoration, repairing and cleaning of
the Property, including janitorial service for all floor area leased to tenants;
(ii) cost of all equipment purchased or rented which is
utilized in the performance of Landlord's obligations hereunder, and the cost of
maintenance and operation of any such equipment;
(iii) cost of all maintenance and service agreements for the
Property and the equipment therein, including, without limitation, alarm
service, security service, window cleaning, and elevator maintenance;
(iv) accounting costs, including the cost of audits by
certified public accountants, outside legal fees and outside engineering fees
and expenses incurred in connection with the operation and management of the
Property, taking into account, the square footage of the Property;
10
(v) wages, salaries and related expenses of all on-site and
off-site agents or employees engaged in the operation, maintenance, security and
management of the Property; provided, however, the wages, salaries and related
expenses of any agents or employees not exclusively engaged in the operation,
maintenance, security and management of the Property shall be apportioned as
deemed appropriate by Landlord, taking into account, the square footage of the
Property;
(vi) cost of repairs, replacements and general maintenance to
the Property, including without limitation the mechanical, electrical and
heating, ventilating and air-conditioning equipment and/or systems (excluding
alterations attributable solely to tenants, capital improvements unless they are
included under c(x), and repairs and general maintenance paid by proceeds of
insurance or by tenants or other third parties);
(vii) any and all normal and customary Common Area
maintenance, repair or redecoration (including repainting) and exterior and
interior landscaping;
(viii) cost of removal of all normal and customary trash,
rubbish, garbage and other refuse from the Property (specifically excluding
extraordinary trash, rubbish and garbage generated by other tenants in the
Building) as well -as removal of ice and snow from. the sidewalks on or adjacent
to the Property;
(ix) all charges for electricity, gas, water, sewerage
service, heating, ventilation and air-conditioning and other utilities furnished
to the Property, including legal, architectural and engineering fees incurred in
connection with the day-to-day operation, maintenance and management of the
Property (excluding all costs incurred from excess use of utility services by
other tenants and after hour HVAC services provided to other tenants);
(x) amortization of capital improvements made to the Building
after the year of substantial completion of the Building, which improvements
were undertaken by Landlord with the reasonable expectation that the same would
result in a reduction of cost and a more efficient operation of the Building or
are made by Landlord pursuant to any governmental law, regulation or action not
applicable to the Building at commencement of construction of the Building;
provided that the cost of each such capital improvement, together with any
financing charges incurred in connection therewith, shall be amortized over the
useful life thereof and only that portion attributable to each Operating Year
shall be included herein for such Operating Year;
(xi) a management fee for the operation and management of the
Property (as of the Lease Commencement Date, the management fee is three and
one-half percent (3-1/2 %) of Landlord's gross revenues for the Property, and is
subject to increases from time to time; provided, however, Landlord agrees that
(a) said management fee shall not exceed six percent (6 %) of Landlord's gross
revenues for the Property during the Term of this Lease, and (b) said management
fee shall not increase more than one percent (1 %) in any Operating Year);
(xii) costs and expenses incurred in order to comply with
covenants and conditions contained in liens, encumbrances and other matters of
public record affecting the Property; and
(xiii) cost of all insurance coverage for the Property from
time to time maintained by Landlord, including but not limited to the costs of
premiums for insurance with respect to personal injury, bodily injury, including
death, property damage, business interruption, workmen's compensation insurance
covering personnel and such other insurance as Landlord shall deem necessary,
11
which insurance Landlord may maintain under policies covering other properties
owned by Landlord in which event the premium shall be reasonably allocable.
Any of the foregoing costs which under generally accepted accounting
principles, consistently applied, would be considered capital expenditures shall
be amortized in accordance with generally accepted accounting principles.
Notwithstanding the above, Operating Costs shall not include (a)
payments of principal and interest on any mortgages, deeds of trust or other
financing instruments relating to the financing of the Property; (b) leasing
commissions or brokerage fees; (c) costs associated with preparing, improving or
altering for space for any leasing or releasing of any space within the
Building; (d) professional fees and expenses (except as otherwise specifically
included), provided, in any event, that Operating Costs shall not include legal,
architectural and/or engineering services incurred in connection. with a matter
bearing on tenant services to the extent such matter pertains to a defect in
original design or construction and equipment warranties or a dispute between
Landlord and Tenant or other tenants bearing on tenant services; (e) fines,
penalties and late charges; (f) promotional, advertising, travel and
entertainment expenses attributable to marketing or leasing space; (g)
management fees except as permitted under 7.1.c.(xi); (h) expenses directly
attributable to any individual tenant or tenant space; (i) any expenses incurred
by reason of Landlord's negligence or failure to perform a legal duty; (j) cost
of collection of any obligation due Landlord from any tenant; (k) all items and
services for which Tenant (other than through Operating Costs or Tenant's Share
of Increased Operating Costs) or any other tenant in the Building reimburses
Landlord, or which Landlord provides selectively to one or more tenants (other
than Tenant) without reimbursement; and (1) Landlord's general corporate
overhead and corporate general and administrative expenses, to the extent such
overhead and expenses exceed the management fee.
Landlord further agrees that since one of the purposes of Operating
Expenses and the Increase in Operating Costs provision is to allow the Landlord
to require the Tenant to pay for the costs attributable to its Premises,
Landlord agrees that Landlord will not collect or be entitled to collect
Operating Costs from all of its tenants in an amount which is in excess of 100%
of the Operating Costs actually paid by Landlord in connection with the
operation of the Building.
For any Operating Year during which less than ninety-five percent
(95 %) of the Rental Area of the Building is occupied, the calculation of that
portion of Operating Costs which vary with occupancy shall be adjusted to equal
the Operating Costs which Landlord projects would have been incurred had the
Building been ninety-five percent (95 %) occupied during such Operating Year.
d. "Taxes" means all real estate taxes, assessments (special or
otherwise), levies, ad valorem charges, benefit charges, water and sewer rents,
rates and charges, privilege permits and any other governmental liens,
impositions or charges of a similar or dissimilar nature, and any payments in
lieu of such charges, regardless of whether any such items shall be
extraordinary or ordinary, general or special, foreseen or unforeseen, levied,
assessed, or imposed on or with respect to all or any part of the Property or
upon the rent due and payable hereunder by any governmental authority; provided,
however, that if at any time during the Term or any extension thereof the method
of taxation prevailing at the commencement of the Term shall be altered or
eliminated so as to cause the whole or any part of the above items which would
otherwise be included in the Taxes to be replaced by a levy, assessment or
imposition, which is (A) a tax assessment, levy, imposition or charge based on
the rents received from the Property whether or not wholly or partially a
capital levy or otherwise, or (B) a tax, assessment, levy, imposition or charge
measured by or based in whole or in part upon all or any portion of the Property
and imposed on Landlord, or (C) a license fee measured by the rent payable by
Tenant to Landlord, or (D) any other tax, levy, assessment or imposition shall
be included in the Taxes; provided, however, in no event shall Tenant be
12
required to pay any inheritance, estate, succession, income, profits or
franchise taxes unless they are in lieu of or in substitution for any of the
above items which would otherwise be included in the Taxes.
e. "Tax Year" means each twelve (12) month period established as the
real estate tax year by the taxing authorities having lawful jurisdiction over
the Property.
f. "Fractional Share" means a fraction, the numerator of which is
the Rental Area of the Premises and the denominator of which is the Rental Area
of the Building. For the purposes of this Subparagraph f, the Rental Area of the
Building shall mean the sum of the Rental Area on all floors of the Building as
determined by Landlord. As of the Lease Commencement Date, Tenant's Fractional
Share is 14.01 % of the Rental Area of the Building.
7.2 PAYMENT OF OPERATING COST ESCALATION. For each Operating Year,
commencing January 1, 1997, Tenant shall pay to Landlord, in the manner provided
herein, Tenant's Share of Increased Operating Costs which shall be computed by
multiplying the Operating Costs for the Operating Year by Tenant's Fractional
Share and subtracting the Base Operating Costs from the result obtained;
provided, however, that for the Operating Years during which the Term begins and
ends, Tenant's Share of Increased Operating Costs shall be prorated based
upon.the actual number of days Tenant occupied, or could have occupied, the
Premises during each such Operating Year.
Tenant's Share of Increased Operating Costs shall be paid, in advance,
without notice, demand, abatement (except as otherwise specifically provided in
this Lease), deduction or set-off, on the first day of each calendar month
during the Term, said monthly amounts to be determined on the basis of estimates
prepared by Landlord on an annual basis and delivered to Tenant prior to the
commencement of each Operating Year. If, however, Landlord fails to furnish any
such estimate prior to the commencement of an Operating Year, then (a) until the
first day of the month following the month in which such estimate is furnished
to Tenant, Tenant shall pay to Landlord on the first day of each month an amount
equal to the monthly sum payable by Tenant to Landlord under this subsection 7.2
in respect of the last month of the preceding Operating Year; (b) promptly after
such estimate is furnished to Tenant, Landlord shall give notice to Tenant
whether the installments of Tenant's Share of Increased Operating Costs paid by
Tenant for the current Operating Year have resulted in a deficiency or
overpayment compared to payments which would have been paid under such estimate,
and Tenant, within ten (10) days after receipt of such estimate, shall pay any
deficiency to Landlord and any overpayment shall be credited against Tenant's
next owing installment of Annual Basic Rent and Additional Rent; and (c) on the
first day of the month following the month in which such estimate is furnished
to Tenant and monthly thereafter throughout the remainder of the Operating Year,
Tenant shall pay to Landlord the monthly payment shown on such estimate.
Notwithstanding (a) above, Tenant will not be .responsible for the payment of
any estimate of Tenant's Share of Increased Operating Costs for the 1997
Operating Year until such estimate is furnished to Tenant; provided, however,
any estimate furnished after January 1, 1997, shall be adjusted from January 1,
1997 through the month such estimate, is furnished. Landlord may at any time or
from time to time (but not more than twice in any Operating Year) furnish to
Tenant a revised estimate of Tenant's Share of Increased Operating Costs for
such Operating Year, and in such -case, Tenant's monthly payments shall be
adjusted and paid or credited, as the case may be, substantially in the same
manner as provided in the preceding sentence.
After the end of each Operating Year, Landlord shall determine actual
Operating Costs for such Operating Year and shall provide to Tenant an
"Operating Costs Statement" setting forth the actual Tenant's Share of Increased
Operating Costs for such Operating Year. Within thirty (30) days after delivery
of the Operating Costs Statement, Tenant shall pay Landlord any deficiency
between the amount shown as Tenant's Share of Increased Operating Costs in the
13
Operating Costs Statement and the total of the estimated payments made by Tenant
during the Operating Year. In the event of overpayment, such amount shall be
credited against Tenant's next owing installment of Annual Basic Rent and
Additional Rent, or if the Term has expired, Landlord shall refund to Tenant the
amount of any overpayment.
Each Operating Costs Statement provided by Landlord shall be conclusive
and binding upon Tenant unless within ninety (90) days after receipt thereof,
Tenant notifies Landlord that it disputes the correctness thereof, specifying
those respects in which it claims the Operating Costs Statement to be incorrect.
Unless resolved by the parties, such dispute shall be determined by arbitration
in accordance with the then prevailing rules of the American Arbitration
Association. If the arbitration proceedings result in a determination that the
Operating Costs Statement contained an aggregate discrepancy of less than five
percent (5 %), Tenant shall bear all costs in connection with such arbitration.
If the arbitration proceedings result in a determination that the Operating
Costs Statement contained an aggregate discrepancy of greater than five percent
(5 %), Landlord shall bear all costs in connection with such arbitration.
Pending determination of the dispute, Tenant shall pay any amounts due from
Tenant in accordance with the Operating Costs Statement, but such payment shall
be without prejudice to Tenant's claims. Tenant, for a period of ninety (90)
days after delivery of the Operating Costs Statement in each Operating Year and
upon at least ten (10) days written notice to Landlord, shall have reasonable
access during normal business hours to the books and records of Landlord
relating to Operating Costs for the purpose of verifying the Operating Costs
Statement, Tenant to bear all costs relating to such inspection. Tenant shall
reimburse Landlord for the reasonable cost of photocopying that it desires.
7.3 PAYMENT OF TAX ESCALATION. Commencing July l, 1997, Tenant shall pay
its Fractional Share of all Taxes in excess of the Base Taxes set forth in
Section 1.C.(2) of this Lease ("Excess Taxes") which shall be computed by
multiplying the actual Taxes assessed for the Tax Year in question by Tenant's
Fractional Share, and subtracting the Base Taxes from the product thereof. Such
Excess Taxes shall be paid to Landlord as Additional Rent within thirty (30)
days of invoicing by Landlord.
Landlord reserves the right to increase or decrease the allocation of real
estate taxes to Tenant to reflect the value of all Tenant Improvements and
Alterations relative to the value of the leasehold improvements of all tenants
in the Building.
8. USE, CARE AND REPAIR OF PREMISES BY TENANT.
8.1 PERMITTED USES. Tenant shall use and occupy the Premises solely for
general office purposes in accordance with applicable zoning regulations and for
no other purpose. Tenant shall not do anything or permit anything to be done in
or on the Premises, or bring or keep anything therein which will, in any way,
obstruct., injure, annoy or interfere with the rights of . Landlord or other
tenants, or subject Landlord to any liability for injury to persons or damage to
property, or interfere with the good order of the Building, or conflict with the
laws, rules or regulations of any Federal, state or city authority.
8.2 CARE OF PREMISES. Tenant shall, at its sole expense, keep the Premises
and the improvements and appurtenances therein in good order and condition
consistent with the operation of a first-class office building, and at the
expiration of the Term, or at the sooner termination of this Lease as herein
provided, deliver up the same broom clean and in as good order and condition as
at the beginning of the Term, ordinary wear and tear and damage by fire or other
casualty excepted. Tenant, at its sole expense, shall promptly replace damaged
or broken doors and glass in and about the interior of the Premises and shall be
responsible for the repair and maintenance of all Tenant Improvements and
Alterations, including, without limitation, the repair and replacement of
appliances and equipment installed specifically for Tenant such as
14
refrigerators, disposals, computer room air conditioning, sinks and special
plumbing, special light fixtures and bulbs for those fixtures, non-standard
outlets and plug-in strips, and special cabinetry. Consistent with the
provisions of Section 22, Tenant shall pay for all damage to the Property and
any fixtures and appurtenances related thereto, as well as for all property
damage sustained by other tenants or occupants of the Building, due to any
waste, misuse or neglect of the Premises caused by Tenant or its employees,
agents, representatives or invitees, and any fixtures and appurtenances related
thereto or due to any breach of this Lease by Tenant, its employees, agents,
representatives or invitees.
8.3 HAZARDOUS SUBSTANCES. For purposes of this provision, "Hazardous
Substances" shall mean. any hazardous or toxic substance, material or waste, now
or hereafter defined or regulated under the Resource Conservation and Recovery
Act (42 U.S.C. ss. 6901 et se q.), the Comprehensive Environmental Response,
Compensation, and Liability Act (42 U.S.C. ss. 9601 et seq.), the Clean Water
Act (33 U.S.C. ss. 1251 et sec .), the Clean Air Act (42 U.S.C. ss. 7401 et
set.), and the Toxic Substances Control Act (15 U.S.C. ss. 2601 et seq.), and
all similar federal, state and local statutes, laws, rules and regulations in
connection with environmental conditions, health and safety, including without
limitation, asbestos and petroleum products (collectively, "Environmental
Laws"). Tenant covenants and agrees that it will not use or allow the Premises
to be used for the storage, use, treatment or disposal of any Hazardous
Substance, without Landlord's prior written consent. Notwithstanding the
foregoing, Landlord's prior written consent shall not be required with respect
to Tenant's use, storage or sale of certain supplies or products, which might
contain or might be considered a Hazardous Substance, in the normal course of
Tenant's business in accordance with the specific use permitted by this Lease,
provided, however, that .Tenant shall (i) comply with all other provisions of
this Section; (ii) notify Landlord in writing from time to time of the identity
and approximate quantity of such Hazardous Substance; and (iii) keep each such
Hazardous Substance on the Premises in quantities as small as reasonably
practicable, but in no event large enough to activate reporting requirements
under any Environmental Law.
Tenant shall indemnify and hold harmless Landlord, its partners,
affiliates and agents from and against any damages, claims, judgments, fines,
penalties, costs, liabilities (including sums paid in settlement of claims) or
loss including reasonable attorneys' fees, reasonable consultants' fees, and
reasonable expert fees incurred by any of them to the extent resulting from
Tenant's use, handling, generation, treatment, storage, disposal, other
management or release of any Hazardous Substance at or from the Premises or the
Property, whether or not Tenant has acted negligently with respect to such
Hazardous Substance. This indemnity shall survive the expiration or earlier
termination of this Lease.
8.4 COMPLIANCE WITH LAWS.
Tenant, at its sole cost and expense, shall conform to and comply with and
shall cause the Premises to conform to and comply with all federal, state,
county, municipal and other governmental statutes, laws, rules, orders,
regulations, and ordinances applicable to Tenant or resulting from Tenant's use
or occupancy of the Premises or the Property or any part thereof.
Subject to the following paragraph, Landlord, at its sole cost and
expense, shall conform to and comply with and shall cause the Property to
conform to and comply with all federal, state, county,, municipal and other
governmental statutes, laws, rules, orders, regulations, and ordinances
applicable to Landlord or resulting from Landlord's use of the Property or any
part thereof.
Landlord warrants and represents to Tenant that, as of the Lease
Commencement Date, Landlord is in the process of implementing a compliance plan
15
for the Building, substantially in accordance with the requirements of The
Americans With Disabilities Act of 1990, and Landlord will proceed to execute
such plan throughout the Term, subject to the provisions of Sections 7 and 15.1
of this Lease.
9. RULES AND REGULATIONS.
Tenant and its agents and invitees shall abide by and observe the rules
and regulations attached hereto as SCHEDULE C for the operation and maintenance
of the Building or any new rules and regulations which may from time to time be
issued by Landlord ("Rules and Regulations"), provided that any new rules or
regulations are not inconsistent with the provisions of this Lease. Nothing in
this Lease shall be interpreted to impose upon Landlord any duty or obligation
to enforce any such rules and regulations against any other tenant in the
Building, and Landlord shall not be liable to Tenant for any violation of these
rules and regulations by any other tenant or its agents or invitees.
All rules and regulations promulgated by Landlord shall be reasonable,
shall not materially alter the terms of this Lease and any enforcement shall be
uniform with respect to all tenants' use and occupancy of the Building and
Common Area.
Notwithstanding anything contained in the Rules and Regulations or this
Lease to the contrary, Tenant is hereby permitted to install a vending machine
within the Premises for the sole use of its employees and invitees.
10. COMMON AREA.
10.1 DEFINITION OF COMMON AREA. As used herein, "Common Area" mean those
areas, parking garage and facilities which may be furnished by Landlord on or
near the Property, as designated by Landlord from time to time, intended for the
general common use and benefit of all tenants of the Building and their agents,
representatives, licensees, employees and invitees, including, without
limitation, any and all stairs, landings, roofs, utility and mechanical rooms
and equipment, service closets, corridors, elevators, lobbies, lavatories and
other public areas of the Building and parking garage, access roads, pedestrian
walkways, plazas and landscaped areas.
10.2 USE OF COMMON AREA. Tenant shall have the non-exclusive right to use
the Common Area in common with Landlord, other tenants in the Building, and
others entitled to the use thereof, subject to such reasonable rules and
regulations governing the use of the Common Area as Landlord may from time to
time prescribe and subject to such easements therein as Landlord may from time
to time grant to others. Tenant shall not obstruct in any way any portion of the
Common Area or in any way interfere with the rights of other persons entitled to
use the Common Area and shall not, without the prior written consent of
Landlord, use the Common Area in any manner, directly or indirectly, for the
location or display of any merchandise or property belonging to Tenant or for
the location of signs relating to Tenant's operations in the Premises. The
Common Area shall at all times be subject to the exclusive control and
management of Landlord.
10.3 ALTERATIONS TO THE COMMON AREA. Landlord reserves the right at any
time and from time to time (i) to change or alter the location, layout, nature
or arrangement of the Common Area or any portion thereof, including but not
limited to the arrangement and/or location of entrances, passageways, doors,
corridors, stairs, lavatories, elevators, parking garage, and other public areas
of the building, and (ii) to construct additional improvements on the Property
and make alterations thereof or additions thereto and build additional stories
on or in any such buildings or build adjoining same; provided, however, that no
such change or alteration shall deprive Tenant of access to the Premises or
reduce the Rental Area of the Premises, unless such reduction is required by
Federal, State or local laws or regulations, in which event, a reduction in the
16
Premises shall be permitted with a commensurate reduction in rent. Landlord
shall have the right to close temporarily all or any portion of the Common Area
to such extent as may, in the reasonable opinion of Landlord, be necessary to
prevent a dedication thereof to the public, provided that Tenant is not thereby
denied .access to the Premises, or for repairs, replacements or maintenance to
the Common Area, provided such repairs, replacements or maintenance are
performed expeditiously and in such a manner as not to deprive Tenant of access
to the Premises.
10.4 MAINTENANCE. Landlord covenants to keep, maintain, manage and operate
the Common Area in a manner consistent with the operation of a first class
office building and to keep the sidewalks and driveways, if any, constituting a
portion of the Common Area clean and reasonably clear of snow and ice. Landlord
reserves the right of access to the Common Area through the Premises for the
purposes of operation, decoration, cleaning, maintenance, safety, security,
alterations and repairs.
11. SERVICES AND UTILITIES.
So long as Tenant is not in an Event of Default under this Lease, Landlord
shall provide the following facilities and services to Tenant as part of
Landlord's Operating Costs (except as otherwise provided herein):
a. At least one elevator (if the building contains an elevator) subject to
call at all times, including Sundays and holidays.
b. During "normal business hours" as hereinafter defined, central heating
and air conditioning ("HVAC") during the seasons of the year when these services
are normally and usually furnished within the following temperature ranges:(i)
heating of 70(degree)+/- 2(degree) fahrenheit inside with an outside temperature
of 13(degree) fahrenheit, and (ii) cooling of 76(degree) +/- 2(degree)
Fahrenheit (dry bulb) inside with an outside temperature of 77(degree)
fahrenheit (dry bulb) and 91' fahrenheit (wet bulb); provided, however, that if
a recognized energy conservation law, program, guideline, regulation or
recommendation promulgated by federal, state, city or other governmental or
quasi-governmental bureau, board, department, agency, office, commission or
other subdivision thereof shall provide for a reduction in operations below said
standards, Landlord shall cause the HVAC systems be operated so as to provide
reduced service in accordance with such. law, program, guideline, regulation or
recommendation. For the purposes of this paragraph b, the term "normal business
hours".shall mean the periods from :00 a.m. until 6:00 p.m. on business days.
Landlord shall provide the aforesaid services at other times, at Tenant's
expense, provided Tenant gives Landlord notice by 1:00 p.m. on weekdays for
after-hour service on the next weekday, by 1:00 p.m. the day before a holiday
for service on a holiday, and by 1:00 p.m. on Friday for after-hour service on
Saturday or service on Sunday the holidays observed by Landlord are New Year's
Day, Memorial Day observed, Independence Day, Labor Day, Thanksgiving, and
Christmas). Such after-hour, holiday or special weekend service shall be charged
to Tenant at rates to be calculated by Landlord based on Landlord's costs, which
costs, as of the Lease Commencement Date, is Thirteen Dollars ($13.00) per hour
per wing. Landlord reserves the right to adjust, from time to time; the rate at
which such services shall be provided corresponding to adjustments in Landlord's
costs (such rates shall be given to Tenant on request). Tenant shall pay for
such service, as Additional Rent, promptly upon receipt of an invoice with
respect thereto.
c. Except with respect to Tenant's proposed computer room within the
Premises which will be separately metered, reasonable amounts of electric
current for lighting and normal and customary items of office equipment (subject
to the provisions of Section 12 below).
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d. Cleaning in Landlord's standard manner in accordance with the cleaning
specifications attached hereto as SCHEDULE D. Landlord reserves the right, in
its sole discretion, to change such cleaning specifications from time to time;
provided, however, Landlord's cleaning services shall, at all times during the
Term of this Lease, be consistent with the standard cleaning services being
provided in other first class office buildings in the Business Community.
e. Replacement of light tubes or bulbs for building standard lighting
fixtures. All light tube or bulb .replacements for special non-standard lighting
fixtures shall be furnished and installed by Landlord at Tenant's expense.
f. Rest room facilities and necessary lavatory supplies, including hot and
cold running water at the points of supply, as provided for general use of all
tenants in the Building and routine maintenance, painting, and electric lighting
service for all public areas of the Building in such manner as Landlord deems
reasonable.
Any failure by Landlord to furnish the foregoing services, resulting from
circumstances beyond Landlord's reasonable control or from interruption of such
services due to repairs or maintenance shall not render Landlord liable in any
respect for damages to either person or property, nor be construed as an
eviction of Tenant, nor cause an abatement of rent hereunder, nor relieve Tenant
from any of its obligations hereunder. Notwithstanding the foregoing sentence,
Landlord shall be liable for all damages to person or property to the extent
such damages are the result of Landlord's, its agent's or employee's negligence
or. willful misconduct. If any public utility or governmental body shall require
Landlord or Tenant to restrict the consumption of any utility or reduce any
service for the Premises or the Building, Landlord and Tenant shall comply with
such requirements, whether or not the utilities and services referred to in this
Section 11 are thereby reduced or otherwise affected, without any liability on
the part of Landlord to Tenant or any other person or any reduction or
adjustment in rent payable hereunder. Landlord and its agents shall be permitted
reasonable access to the Premises for the purpose of installing and servicing
systems within the Premises deemed necessary by Landlord to provide the services
and utilities referred to in this Section 11 to Tenant and other tenants in the
Building.
Landlord reserves the right to charge Tenant the reasonable cost, based on
usage, of the removal of all trash and the reasonable cost of water/sewerage or
electric service to the extent Tenant's trash disposal, water/sewerage and/or
electrical usage exceeds, in Landlord's reasonable opinion, normal usage for an
office tenant.
12. ELECTRIC CURRENT.
Landlord shall be under no obligation to furnish electrical energy to
Tenant in amounts greater than needed for lighting and normal and customary
items of equipment for general office purposes, and, Tenant shall not install or
use on the Premises any electrical equipment, appliance or machine which shall
require amounts of electrical energy exceeding the standard wattage provided for
the Building, unless the installation and use of such additional electrical
equipment, appliance, or machine has been approved by Landlord pursuant to terms
and conditions set forth in a separate agreement, which approval may be
conditioned upon the payment by Tenant, as Additional Rent, of the cost of the
additional electrical energy and modifications to the Building's electrical
system required for the operation of such electrical equipment, appliance, or
machine.
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13. LOSS, DAMAGE AND INJURY.
To the maximum extent permitted by law, Tenant shall occupy and use the
Premises, the Building and the Common Area at Tenant's own risk. Consistent with
the provisions of subsection 16.4, Tenant's Personal Property and the property
of those claiming by, through or under Tenant, located in or on the Premises or
the Building, shall be and remain at the sole risk of Tenant or such other
person.
Notwithstanding any provision to the contrary contained in the foregoing
paragraph, Landlord's limitation from liability and damages under this paragraph
..13, shall not extend to liability or damages arising from the negligence or
willful misconduct of Landlord, its agents or employees.
No representation, guaranty, assurance, or warranty is made or given by
Landlord that the communications or security systems, devices or procedures
used, if any, will be effective to prevent injury to Tenant or any other person
or damage to, or loss (by theft, or otherwise) of any of Tenant's Personal
Property or of the property of any other person, and Landlord reserves the right
to modify at any time such communications or security systems, devices, or
procedures without liability to Tenant.
14. REPAIRS BY LANDLORD.
Landlord shall keep the Premises and the Building and all machinery,
equipment, fixtures and systems of every kind attached. to, or used in
connection with the operation of, the Building, including all electrical.,
heating, mechanical, sanitary, sprinkler, utility, power, plumbing, cleaning,
refrigeration, ventilating, air conditioning and elevator systems and equipment
(excluding, however, lines, improvements, systems and machinery for water, gas,
steam and electricity owned and maintained by any public utility company or
governmental agency or body) in good order and repair consistent with the
operation of the Building as a first-class office building. Landlord, at its
expense (subject to reimbursement by Tenant pursuant to Section 7),. shall make
all repairs and replacements necessary to comply with its obligations set forth
in the immediately preceding sentence, except for (a) repairs required to be
made by Tenant pursuant to Section 8 and (b) notwithstanding the provisions of
Section 16.4, repairs caused by the negligence or willful misconduct of Tenant,
its agents, employees, invitees and guests, which repairs shall be made by
Landlord at the cost of Tenant, and for which Tenant shall pay promptly, as
Additional Rent, upon receipt of an invoice setting forth the cost of such
repairs. There shall be no abatement in rents due and payable hereunder and no
liability on the part of Landlord by reason. of any inconvenience or annoyance
arising from Landlord's making repairs, additions or improvements to the
Building in accordance with its obligations hereunder.
Landlord agrees to commence repairs as soon as reasonably possible after
notice from Tenant and shall diligently work to complete such repairs. In
addition, Landlord agrees to use all reasonable efforts not to interfere with or
disrupt Tenant's business operations while working on repairs in the Premises.
Notwithstanding any provision to the contrary contained in the foregoing
paragraph, Landlord's limitation from liability under this Section 14, shall not
extend to liability for damages arising from the negligence or willful
misconduct of Landlord, its agent or employees.
15. ALTERATIONS, TITLE AND PERSONAL PROPERTY.
15.1 ALTERATIONS. Tenant shall in no event make or permit to be made any
alteration, modification, substitution or other change of any nature to. the
mechanical, electrical, plumbing, HVAC and sprinkler systems within or serving
the Premises. After completion of Tenant's Improvements within the Premises,
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Tenant shall not make or permit any other improvements, alterations, fixed
decorations, substitutions or modifications, structural or otherwise, to the
Premises or the Building ("Alterations") without the prior written approval of
Landlord. Landlord shall not unreasonably withhold or delay its consent to
Alterations which do not affect the structural, mechanical, plumbing or
electrical elements or systems of the Building and which are not visible from
outside the Premises, provided such work conforms with the design criteria,
standards and architectural guidelines for the Building. Landlord's approval
shall include the conditions under which acceptable Alterations may be made.
Alterations shall include, but not be limited to, the installation or
modification of carpeting, walls, partitions, counters, doors, shelves, lighting
fixtures, hardware, locks, ceiling, window and wall coverings; but shall not
include the initial Tenant's Improvements placed within the Premises pursuant to
Section 5.1. All Alterations shall be based on complete plans and specifications
prepared and submitted by Tenant to Landlord for approval, except in the
instance of cosmetic changes, such as painting and carpeting, in which case
Tenant shall provide Landlord with samples showing colors, styles, etc. All
Alterations shall be made by Landlord at Tenant's sole cost, payable by Tenant,
as Additional Rent, within thirty (30) days after receipt of an invoice for same
from Landlord, which cost shall include Landlord's standard construction
management fee, which fee shall not exceed (i) fifteen percent (15%) of the
total cost of construction for all Alterations under $1,000.00, and (ii) twelve
percent (12%) of the total cost of construction for all Alterations in excess of
$1,000.00. Tenant shall be responsible for the cost of any additional
improvements within the Premises or the Common Area required by The Americans
with Disabilities Act of 1990 as a result of Tenant's Alterations.
If Tenant makes any Alterations without the prior consent of Landlord,
then, in addition to Landlord's other remedies, Landlord may correct or remove
such Alterations and Tenant shall pay the cost thereof, as Additional Rent, on
demand.
15.2 TITLE. The Tenant Improvements, all Alterations and all equipment,
machinery, furniture, furnishings, and other property or improvements installed
or located in the Premises by or on behalf of Landlord or Tenant, other than
Tenant's Personal Property, (a) shall immediately become the property of
Landlord and (b) shall remain upon and be surrendered to Landlord with the
Premises as a part thereof at the end of the Term. Notwithstanding the
foregoing, Landlord may, upon notice to Tenant at the time Alterations are
approved by Landlord, elect that any Alterations be removed at the end of the
Term, and thereupon, Landlord shall at Tenant's sole expense, cause such
Alterations to be removed and restore the Premises to its condition prior to the
making of such Alterations, reasonable wear and tear excepted. Tenant shall
promptly reimburse Landlord, as Additional Rent, for the cost of such work,
which reimbursement. obligation shall survive termination of the Lease.
15.3 TENANT'S PERSONAL PROPERTY. "Tenant's Personal Property" means all
equipment, machinery, furniture, furnishings and/or other property now or
hereafter installed or placed in or on the Premises by Tenant with respect to
which Tenant has not been granted any credit or allowance by Landlord and which
(a) is not used, or was not procured for use, in connection with the operation,
maintenance or protection of the Premises or the Building; (b) is removable
without damage to the Premises or the Building; and (c) is not a replacement of
any property of Landlord, whether such replacement is made at Tenant's expense
or otherwise. Notwithstanding any other provision of this Lease, Tenant's
Personal Property shall not include any Alterations or any improvements or other
property installed or placed in or on the Premises as part of Tenant's
Improvements, whether or not installed at Tenant's expense. Tenant shall
promptly pay all personal property taxes on Tenant's Personal Property, as
applicable. Tenant may remove all Tenant's Personal Property from the Premises
at the termination of this Lease. Any property belonging to Tenant or any other
person which is left in the Premises after the date the Lease is terminated for
any reason shall be deemed to have been abandoned. In such event, Landlord shall
have the right to declare itself the owner of such property and to dispose of it
in whatever manner Landlord considers appropriate without waiving its right to
20
claim from Tenant all expenses and damages caused by Tenant's failure to remove
such property, and Tenant shall not have any right to compensation or claim
against Landlord as a result..
16. INSURANCE.
16.1 TENANT'S INSURANCE. Tenant, at its expense, shall obtain and maintain
in effect as long as this Lease remains in effect and during such other time as
Tenant occupies the Premises or any part thereof insurance policies in
accordance with the following provisions.
A. COVERAGE.
(i) commercial general liability insurance policy, including
insurance against assumed or contractual liability under this Lease, with
respect to the Property, to afford protection with limits, per occurrence, of
not less than Two Million Dollars ($2,000,000), combined single limit, with
respect to personal injury, bodily injury, including death, and property damage
and Four Million Dollars ($4,000,000) aggregate (occurrence form), such
insurance to provide for no deductible;
(ii) all-risk property insurance policy, including theft, written at
replacement cost value and with replacement cost endorsement, covering all of
Tenant's Personal Property in the Premises, and covering loss of income
resulting from casualty, such insurance to provide for a deductible not greater
than $500,000.00.
(iii) worker's compensation or similar insurance policy offering
statutory coverage and containing statutory limits, which policy shall also
provide Employer's Liability Coverage of not less than Five Hundred Thousand
Dollars ($500,000) per occurrence.
(iv) Tenant shall require any construction contractor retained by it
to perform work on the Premises to carry and maintain, at no expense to
Landlord, during such times as contractor is working in the Premises, a
non-deductible (a) commercial general liability insurance policy, including, but
not limited to, contractor's liability coverage, contractual liability coverage,
completed operations coverage, broad form property damage endorsement and
contractor's protective liability coverage, to afford protection with limits per
person and for each occurrence, of not less than Two Million Dollars
($2,000,000), combined single limit, and with respect to personal injury and
death and property damage, Four Million Dollars ($4,000,000) aggregate
(occurrence form) and Two Million Dollars ($2,000,000) aggregate completed
operations; (b) automobile liability insurance in the amount of One Million
Dollars ($1,000,000) combined single limit for bodily injury and property
damage; and (c) worker's compensation insurance or similar insurance in form and
amounts as required by law.
(v) Notwithstanding anything set forth above in this subsection 16.1
to the contrary, all dollar limits specified herein shall be increased from time
to time as reasonably necessary to effect economically equivalent insurance
coverage, or coverage deemed adequate in light of then existing circumstances.
B. POLICIES.
Such policies shall be maintained with companies licensed to do business
in the State where the Premises are located and in form reasonably acceptable to
Landlord and will be written as primary policy coverage and not contributing
with, or in excess of, any coverage which Landlord shall carry. Such policies
shall be provided on an occurrence form basis unless otherwise approved by
Landlord and shall include Landlord and its managing agent as additional insured
21
as to coverage under paragraphs 16.1. A. (i) and 16.1.A.(iv). Such policies
shall also contain a waiver of subrogation provision and a provision stating
that such policy or policies shall not be canceled, non-renewed, reduced in
coverage or materially altered except after thirty (30) day's written notice,
said notice to be given in the manner required by this Lease to Landlord,
Attention: Risk Management Department. All such policies of insurance shall be
effective as of the date Tenant occupies the Premises and shall be maintained in
force at all times during the Term of this Lease and all other times during
which Tenant shall occupy the Premises. Tenant shall deposit the policy or
policies of such required insurance or certificates thereof with Landlord prior
to the Lease Commencement Date.
16.2 TENANT'S FAILURE TO INSURE. If Tenant shall fail to obtain insurance
as required under this . Section 16, Landlord may, but shall not be obligated
to, obtain such insurance, and in such event, Tenant shall pay, as Additional
Rent, the premium for such insurance upon demand by Landlord.
16.3 COMPLIANCE WITH POLICIES. Tenant shall not do or allow to be done, or
keep, or allow to be kept, anything in, upon or about the Premises which will
contravene Landlord's policies insuring against loss or damage by fire, other
casualty, or any other cause, including without limitation, public liability, or
which will prevent Landlord from procuring such policies in companies acceptable
to Landlord.. If any act or failure to act by Tenant in and about the Building
and the Premises shall cause the rates with respect to Landlord's insurance
policies to be increased beyond those rates that would normally be applicable
for such limits of coverage, Tenant shall pay, as Additional Rent, the amount of
any such increases upon demand by Landlord.
16.4 WAIVER OF RIGHT OF RECOVERY. Except as provided in Section 8.3,
neither party, including Landlord's managing agent, shall be liable to the other
party, including Landlord's managing agent, or to any insurance company (by way
of subrogation or otherwise) insuring the other party, for any loss or damage to
any building, structure or other tangible property, or loss of income resulting
therefrom, or losses under worker's compensation laws and benefits even though
such loss or damage might have been occasioned by the negligence of such party,
its agents or employees. The provisions of this Section 16.4. shall not limit
the. indemnification for liability to third parties pursuant to Section 22.
Landlord shall not be obligated to repair any damage to Tenant's Personal
Property or replace the same.
16.5 LANDLORD'S INSURANCE. Landlord shall carry comprehensive general
liability insurance with regard the Property and all-risk property insurance on
the Property, including Tenant Improvements and Alterations but excluding
Tenant's Personal Property.
17. DAMAGE AND DESTRUCTION.
17.1 LANDLORD'S OBLIGATION TO REPAIR AND RECONSTRUCT. If, as the result of
fire, the elements, accident or other. casualty (any of such causes being
referred to herein as a "Casualty"), the Premises shall be rendered wholly or
partially untenantable (damaged to such an extent as to preclude Tenant's use of
the Premises for the purposes originally intended), then, subject to the
provisions of subsection 17.2, Landlord shall cause such damage to be repaired,
including Tenant Improvements and Alterations, to the extent insurance proceeds
are paid to Landlord, and the Annual Basic Rent and Additional Rent (but not any
Additional Rent due Landlord either by reason of Tenant's failure to perform any
of its obligations hereunder or by reason of Landlord's having provided Tenant
with additional services hereunder) shall be abated proportionately as to the
portion of the Premises rendered untenantable during the period of such
untenantability. All such repairs shall be made at the expense of Landlord,
subject to the availability of insurance proceeds and Tenant's responsibilities
set forth herein. Landlord shall not be liable for interruption to Tenant's
business or for damage to or replacement or repair of Tenant's Personal
22
Property, all of which replacement or repair shall be undertaken and completed
by Tenant, at Tenant's expense.
If the Premises shall be damaged by Casualty, but the Premises shall not
be thereby rendered wholly or partially unterantable, Landlord shall promptly
cause such damage to be repaired and there shall be no abatement of rent
reserved hereunder.
17.2 TERMINATION OF LEASE. If the Premises are (a) rendered wholly
untenantable, or (b) damaged as a result of any cause which is not covered by
Landlord's insurance, or if the Building is damaged to the extent of fifty
percent (50 %) or more of the gross leasable area thereof, or if, for reasons
beyond Landlord's control or by virtue of the terms of any financing of the
Building, sufficient insurance proceeds are not available for the reconstruction
or restoration of the Building or Premises, then, in any of such events,
Landlord may elect to terminate this Lease by giving to Tenant notice of such
election, within ninety (90) days after the occurrence of such event, or after
the insufficiency of such proceeds becomes known to Landlord, whichever is
applicable. If such notice is given, the rights and obligations of the parties
shall cease as of the date set forth in such notice, and the Annual Basic Rent
and Additional. Rent (but not any Additional Rent due Landlord either by reason
of Tenant's failure to perform any of its obligations hereunder or by reason of
Landlord's having provided Tenant with additional services hereunder) shall be
adjusted as of the date set forth in. such notice, or, if the Premises were
rendered untenantable, as of the date of the Casualty.
Within ninety (90) days following a Casualty, Landlord shall notify Tenant
in writing of the date on which Landlord, in its best professional judgment,
estimates restoration will be substantially completed. If restoration is
expected to exceed one hundred eighty (180) days from the date of Landlord's
notice, then Tenant shall have the right to terminate this Lease on written
notice to Landlord within fifteen (15) days after receipt of Landlord's notice.
17.3 DEMOLITION OF THE BUILDING. If the Building shall be so substantially
damaged that it is reasonably necessary, in Landlord's judgment, to demolish the
Building for the purpose of reconstruction, Landlord may demolish the same, in
which event the Annual Basic Rent and Additional Rent (but not any Additional
Rent due Landlord either by reason of Tenant's failure to perform any of its
obligations hereunder or by reason of Landlord's having provided Tenant with
additional services hereunder) shall be abated to the same extent as if the
Premises were rendered wholly untenantable by a Casualty.
17.4 INSURANCE PROCEEDS. If the Lease is not terminated pursuant to
subsection 17.2, Landlord shall, subject to the terms of any Mortgage, disburse
and apply any insurance proceeds received by Landlord to the restoration and
rebuilding of the Building in accordance with subsection 17.1 hereof. All
insurance proceeds payable with respect to the Premises and the Building shall
belong to and shall be payable to Landlord.
18. CONDEMNATION.
18.1 TERMINATION. If either the entire Premises or the Building shall be
acquired or condemned by any governmental authority under its power of eminent
domain for any public or quasi-public use or purpose, this Lease shall terminate
as of the date of vesting or acquisition of title in the condemning authority
and the rents hereunder shall be abated on that date. If less than the whole but
more than fifty percent (50%) of the Rental Area of the Premises or more than
fifty percent (50%) of the total area of the Building (even if the Premises are
unaffected) or such portion of the Common Area as shall render the Premises or
the Building untenantable should be so acquired or condemned, Landlord and
Tenant shall each have the option to terminate this Lease by notice given to the
other within ninety (90) days of such taking. In the event that such a notice of
23
termination is given, this Lease shall terminate as of the date of vesting or
acquisition of title in the condemning authority and the Annual Basic Rent and
Additional Rent (but not any Additional Rent due Landlord either by reason of
Tenant's failure to perform any of its obligations hereunder, or by reason of
Landlord's having provided Tenant with additional services hereunder) shall be
adjusted as of such date.
If (a) neither Landlord nor Tenant shall exercise their respective options
to terminate this Lease, as hereinabove set forth, or (b) some lesser portion of
the Premises or the Building or Common Area, which does not give rise to a right
to terminate pursuant to this subsection 18.1, is taken by the condemning
authority, this Lease shall continue in force and effect, but from and after the
date of the vesting of title in the condemning authority, the Annual Basic Rent
payable hereunder during the unexpired portion of the Term shall be reduced in
proportion to the reduction in the total Rental Area of the Premises, and any
Additional Rent (but not any Additional Rent due Landlord either by reason of
Tenant's failure to perform any of its obligations hereunder, or by reason of
Landlord's having provided Tenant with additional services hereunder) payable
pursuant to the terms hereof shall be adjusted to reflect the diminution of the
Premises and/or the Building, as the case may be.
18.2 RIGHTS TO AWARD. Tenant shall have no claim against Landlord arising
out of the taking or condemnation, or arising out of the cancellation of this
Lease as a result of any such taking or condemnation, or for any portion of the
amount that may be awarded as damages as a result of any taking or condemnation,
or for the value of any unexpired portion of the Term, or for any property lost
through condemnation, and Tenant hereby assigns to Landlord all its right, title
and interest in and to any such award with regard to the Premises; provided,
however, that, in the event of a total taking, Tenant may assert any claim it
may have against the condemning authority "for compensation for Tenant's
Personal Property lost thereby, loss of income, excess value of the Lease,
unamortized Tenant Improvement costs and for any relocation expenses compensable
by statute and-receive such awards therefor as may be allowed in the
condemnation proceedings provided that such awards shall be made in addition to,
and stated separately from, the award made for the Building, the underlying land
and the Premises. Landlord shall have no obligation to contest any taking or
condemnation.
19. BANKRUPTCY.
19.1 Event of Bankruptcy. For purposes of this Lease, each of the
following shall be deemed an "Event of Tenant's Bankruptcy":
(a) if Tenant becomes insolvent, as defined in the Bankruptcy Code,
or under the Insolvency Laws;
(b) the commencement of any action or proceeding for the
dissolution or liquidation of Tenant or for the appointment of
a receiver or trustee of the property of Tenant, whether
instituted by or against Tenant, if not bonded or discharged
within thirty (30) days of the date of the commencement of such
proceeding or action;
(c) if Tenant files a voluntary petition under the Bankruptcy Code
or Insolvency Laws;.
(d) if there is filed an involuntary petition against Tenant as the
subject debtor under the Bankruptcy Code or Insolvency laws,
which is not dismissed within sixty (60) days of filing, or
results in issuance of an order for relief against the debtor;
and
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(e) if Tenant makes or consents to an assignment of its assets, in
whole or in part, for the benefit of creditors, or to a common
law composition of creditors.
As used herein, (i) "Bankruptcy Code" means title 11 of the United States
Code, 11 U.S.C. Section 101 et. seq. as amended or any successor statute and
(ii) Insolvency Laws means the insolvency laws of any state or territory of the
United States.
19.2 ASSUMPTION BY TRUSTEE. If Tenant becomes the subject debtor in a case
pending under the Bankruptcy Code, Landlord's right to terminate this Lease
under Section 20 hereof shall be subject to the applicable rights (if any) of
the Trustee in Bankruptcy to assume or assign this Lease as then provided for in
the Bankruptcy Code. However, the Trustee in Bankruptcy must give to Landlord
and Landlord must receive proper written notice of the Trustee's assumption or
rejection of this Lease, within sixty (60) days (or such other applicable period
as is provided for in the Bankruptcy Code) after the date of the Trustee's
appointment. The failure of the Trustee to give notice of the assumption within
the period shall conclusively and irrevocably constitute the Trustee's rejection
of this Lease and waiver of any rights of the Trustee to assume or assign this
Lease. The Trustee shall not have the right to assume or assign this Lease
unless the Trustee (i) promptly and fully cures all defaults under this Lease,
(ii), promptly and fully compensates Landlord for all monetary damages incurred
as a result of such default, and (iii) provides to Landlord adequate assurance
of future performance. In the event Tenant is unable to: (i) cure its defaults,
(ii) reimburse Landlord for its monetary damages, or (iii) pay the Rent due
under this Lease on time, then Tenant hereby agrees in advance that it has not
met its burden to provide adequate assurance of future performance, and this
Lease may, be terminated by Landlord in accordance with Section 20. The
provisions of this Section 19.2 are not intended to waive any. rights which
Tenant may, otherwise, be entitled to under applicable Bankruptcy Code.
20. DEFAULT PROVISIONS APPLICABLE TO TENANT AND REMEDIES AVAILABLE TO
LANDLORD.
20.1 EVENTS OF DEFAULT. Each of the following shall be deemed an Event of
Default by Tenant under this Lease:
a. failure of Tenant to pay Annual Basic Rent, Additional Rent, or
any other sum required to be paid under the terms of this Lease, including late
charges, within ten (10) days after notice from Landlord of non-payment;
b. failure by Tenant to perform or observe any other term, covenant,
agreement or condition of this Lease, on the part of Tenant to be performed
(other than those obligations of Tenant set forth in subsection 16.2 for which
Tenant shall be entitled to receive no prior notice, and other than the
conditions set forth in paragraphs 20.1.a, c, d, e, f and g, which shall be
governed solely by the provisions set forth herein), within thirty (30) days
after notice thereof from the Landlord, unless such performance shall reasonably
require a longer period, in which case Tenant shall not be deemed in default if
Tenant commences the required performance promptly and thereafter pursues and
completes such action diligently and expeditiously and in any event within not
more than sixty (60) days;
c. the filing of a tax or mechanic's lien against any property of
Tenant which is not bonded or discharged within thirty (30) days of the date
such lien is filed;
d. abandonment of the Premises by Tenant; provided, however, that
Tenant shall not be deemed to be in default hereunder so long as Tenant shall
continue the payment of Annual Basic Rent and Additional Rent under this Lease;
25
e. an Event of Tenant's Bankruptcy;
f. the sale of Tenant's interest in the Premises under attachment,
execution or similar legal process; and
g. the failure of Tenant to vacate the Premises upon the expiration
of the Term, or the earlier termination thereof pursuant to the. other
provisions hereof.
20.2 REMEDIES. Upon the occurrence of an Event of Default, Landlord, with
notice to Tenant may do any one or more of the following:
(a) Intentionally deleted
(b) perform, on behalf and at the expense of Tenant, any
obligation of Tenant under this Lease which Tenant has
failed to perform and of which Landlord shall have given
Tenant notice, the cost of which performance by Landlord,
together with interest thereon at the Default Rate from
the date of such expenditure, shall be payable by Tenant
to Landlord, as Additional Rent, upon demand.
Notwithstanding the provisions of this clause (b) and
regardless of whether an Event of Default shall have
occurred, Landlord may exercise the remedy described in
clause (b) without any notice to Tenant if Landlord, in
its good faith judgment, believes it would be materially
injured by failure to take rapid action or if the
unperformed obligation of Tenant constitutes an
emergency;
(c) elect to terminate this Lease and the tenancy created
hereby by giving notice of such election to Tenant, and
reenter the Premises, by summary proceedings, and remove
Tenant and all other persons and property from the
Premises, and store such property in a public warehouse
or elsewhere at the cost of and for the account of
Tenant;
(d) declare any option which Tenant may have to renew the
Term or expand the Premises to be null and void and of no
further force and effect; or
(e) exercise any other legal or equitable right or remedy
which it may have.
Any reasonable costs and expenses incurred by Landlord (including, without
limitation, reasonable attorneys' fees) in enforcing any of its rights or
remedies under this Lease shall be paid to Landlord by Tenant, as Additional
Rent, upon demand.
20.3 DAMAGES. If this Lease is terminated by Landlord pursuant to Section
20.2.(c), Tenant nevertheless shall remain liable for (a) any Annual Basic Rent,
Additional Rent, and damages which may be due or sustained prior to such
termination, and (b) all reasonable costs, fees and expenses including, but not
limited to, attorneys' fees, costs and expenses incurred by Landlord in pursuit
of its remedies hereunder or in renting the Premises to others from time to
time. If Landlord terminates the Lease pursuant to this Section 20, all rent
which would have been payable to Landlord prior to the termination date, but for
any abatement set forth in Section 1.B., shall immediately become due and
payable, as Additional Rent, and any abatement scheduled to occur after the
termination date shall immediately become void. In addition, Landlord may
recover from Tenant additional damages to compensate Landlord for loss of rent
26
resulting from termination of the Lease, which, at the election of Landlord,
shall be either:
(i) An amount equal to the rent which, but for termination of
this Lease, would have become due during the remainder of
the Term, less the amount of rent, if any, which Landlord
shall receive during such period from others to whom the
Premises may be rented (other than any Additional Rent
received by Landlord as a result of any failure of such
other person to perform any of its obligations to
Landlord), in which case such damages shall be computed
and payable in monthly installments, in advance, on the
first day of each calendar month following termination of
the Lease and continuing until the date on which the Term
would have expired but for such termination; any suit or
action brought to collect any such damages for any month
shall not in any manner prejudice the right of Landlord
to collect any damages for any subsequent month by a
similar proceeding; or
(ii) an amount equal to the present worth (as of the date of
such termination) of rent which, but for termination of
this Lease, would have become due during the remainder of
the Term, in which case such damages shall be payable to
Landlord in one lump sum on demand and shall bear
interest at the Default Rate until paid. For purposes of
this clause (ii), "present worth" shall be computed by
discounting such amount to present worth at a discount
rate equal to one percentage point above the discount
rate then in effect at the Federal Reserve Bank nearest
to the location of the Property.
Damages shall be due and payable immediately upon demand by Landlord
following any termination of this Lease pursuant to Section 20.2. In the event
Landlord re-leases the Premises prior to the expiration of the Term at an Annual
Basic Rent (annualized to account for any rent abatement, free rent period or
similar concession) equal to or greater than that reserved under this Lease,
Landlord shall refund to Tenant any amounts paid by. Tenant pursuant to Section
20.3.(ii) applicable to the portion of the Term coinciding with the term of the
replacement lease.
If this Lease is terminated pursuant to Section 20.2., Landlord may
re-lease the Premises or any part thereof, alone or together with other
premises, for such term(s) (which may be greater or less than the period which
otherwise would have constituted the balance of the Term) and on such terms and
conditions (which may include concessions or free rent and alterations of the
Premises) as Landlord, in its sole discretion, may determine. The failure or
refusal of Landlord to re-lease the Premises or any part or parts thereof shall
not release or affect Tenant's liability for damages. Notwithstanding anything
to the contrary in this Section 20.3, Landlord shall use reasonable efforts to
re-lease the Premises, provided that - Landlord shall not be required to (i) use
methods or procedures other than its usual methods and procedures for finding
tenants for comparable space in the Building; (ii) lease the Premises in
preference to any other space in the Building. available for lease, regardless
of when such other space became available for lease; (iii) lease the Premises at
rents lower than the rate at which Landlord would otherwise offer such space to
a third party; (iv) to make improvements to the Premises at Landlord's expense;
and (v) lease the Premises for any purpose or use other than that specifically
permitted by this Lease. Landlord shall not be liable to Tenant for Landlord's
failure to re-lease the Premises despite the exercise of reasonable efforts
pursuant to this paragraph, and no such re-leasing shall relieve Tenant of its
27
obligations under the terms of this Lease, including, without limitation, the
payment of rent as set forth herein.
Nothing contained in this Lease shall limit or prejudice the right of
Landlord to prove and obtain in proceedings for the termination of this Lease by
reason of bankruptcy or insolvency, an amount equal to the maximum allowed by
any statute or rule of law in effect at the time when, and governing the
proceedings in which, the damages are to be proved.
20.4 NO WAIVER. No act or omission by Landlord shall be deemed to be an
acceptance of a surrender of the Premises or a termination of Tenant's
liabilities hereunder, unless Landlord shall execute a written release of
Tenant. Tenant's liability hereunder, shall not be terminated by the execution
by Landlord of any new lease for all or any portion of the Premises or the
acceptance of rent from any assignee or subtenant.
20.5 REMEDIES NOT EXCLUSIVE. All rights and remedies of Landlord set forth
in this Lease shall be cumulative, and none shall exclude any other right or
remedy, now or hereafter allowed by or available under any statute, ordinance,
rule of court, or the common law, either at law or in equity, or both. For the
purposes of any suit brought or based hereon, this Lease shall be construed to
be a divisible contract, to the end that successive actions may be maintained on
this Lease as successive periodic sums shall mature hereunder. The failure of
Landlord to insist, in any one or more instances, upon a strict performance of
any of the covenants, terms and conditions of this Lease or to exercise any
right or option herein contained shall not be construed as a waiver or a
relinquishment for the future, of such covenant, term, condition, right or
option, but the same shall continue and remain in full force and effect unless
the contrary is expressed by Landlord in writing. The receipt by Landlord of
rents hereunder, with knowledge of the breach of any covenant hereof or the
receipt by Landlord of less than the full rent due hereunder, shall not be
deemed a waiver of such breach or of Landlord's right to receive the full rents
hereunder, and no waiver by Landlord of any provision hereof shall be deemed to
have been made unless expressed in writing and signed by Landlord.
20.6 LANDLORD'S DEFAULT. In the event of a default by Landlord in the
performance of any obligation under this Lease, Tenant shall give a written
notice of such default to Landlord, and unless a different period be specified
herein, Landlord shall be entitled to thirty (30) days after receipt of such
notice to cure such default before being deemed in default unless such default
cannot be cured within such thirty (30) day period in which event Landlord shall
be entitled to a reasonable time to cure such default; provided, however, that
within such thirty (30) day period, Landlord shall promptly commence and
thereafter, diligently prosecute to completion the curing of such default.
21. Intentionally deleted.
22. INDEMNITY.
To the maximum extent permitted by law, Tenant shall indemnify, hold
harmless and (at Landlord's option) defend Landlord, its agents, servants and
employees from and against all claims, actions, losses, costs and expenses
(including attorneys' and other professional fees), judgments, settlement
payments, and, whether or not reduced to final judgment, all liabilities,
damages, or fines paid, incurred.or suffered by any third parties to the extent
arising directly or indirectly from (a) any default by Tenant under the terms of
this Lease, (b) the use or occupancy of the Property by Tenant or any person
claiming through or under Tenant, and/or (c) any acts or omissions of Tenant or
any contractor, agent, employee, invitee or licensee of Tenant in or about the
Property. The foregoing indemnity is in addition to, and not in substitution
for, any indemnity given by Tenant to Landlord under Section 8.3.
28
To the maximum extent permitted by law, Landlord shall indemnify, hold
harmless and defend Tenant, its agents, servants and employees from and against
all claims, actions, losses, costs and expenses (including attorneys' and other
professional fees), judgments, settlement payments, and, whether or not reduced
to final judgment, all liabilities, damages, or fines paid, incurred or suffered
by said third parties to the extent arising directly or indirectly from (a) any
default by Landlord under the terms of this. Lease, (b) the use or occupancy of
the Common Area by Landlord or its contractors, agents, or employees, (c) any
acts or omissions of Landlord or any contractor, agent, or employee of Landlord
in or about the Common Area, and/or (d) any acts or omissions of Landlord or any
contractor,. agent, or employee of Landlord while in the Premises.
23. LIMITATION ON LANDLORD LIABILITY.
The term "Landlord" as used in this Lease shall mean only the owner or the
Mortgagee or its trustees, as the case may be, then in possession of the
Property so that in the event of any transfer by Landlord of its interest in the
Property, the Landlord in possession immediately prior to such transfer shall
be, and hereby is, entirely released and discharged from all covenants,
obligations and liabilities of Landlord under this Lease accruing after such
transfer. In consideration of the benefits accruing hereunder, Tenant, for
itself, its successors and assigns, covenants and agrees that, in the event of
any actual or alleged failure, breach or default hereunder by the Landlord, and
notwithstanding anything to the contrary contained elsewhere in this Lease, the
remedies of Tenant under this Lease shall be solely and exclusively limited to
Landlord's interest in the Property.
24. LANDLORD OBLIGATIONS.
Landlord agrees to perform all of its obligations under this Lease in a
first class manner consistent with the standards applicable to similar buildings
in the vicinity of the Building. Landlord shall be excused for the period of any
delay in the performance of any of its obligations when the delay is due to any
cause or causes beyond Landlord's control which include, without limitation,
acts of God, all labor disputes, governmental regulations or controls, civil
unrest, war, adverse weather condition, fire or other casualty, inability to
obtain any material or services unless otherwise provided for in this Lease.
Except where specifically set forth in this Lease, there shall be no abatement,
set-off or deduction of Annual Basic Rent or Additional Rent due under this
Lease.
25. ASSIGNMENT AND SUBLETTING.
25.1 PROHIBITED WITHOUT LANDLORD'S CONSENT. Tenant agrees for itself and
its permitted successors and assigns in interest hereunder that it will not (a)
assign or otherwise transfer, mortgage or otherwise encumber this Lease or any
of its rights hereunder; (b) sublet the Premises or any part thereof or permit
the occupancy or use of the Premises or any part thereof by any person other
than Tenant; and/or (c) permit the assignment or other transfer of this Lease or
any of Tenant's rights hereunder by operation of law (each of the events
referred to in the foregoing clauses (a), (b) and (c) being hereinafter referred
to as a "Transfer"), without the prior written consent of Landlord in each
instance first obtained, which consent may be given or withheld in Landlord's
sole and absolute subjective discretion, and any consent given shall not
constitute a consent to any subsequent Transfer. Any attempted Transfer without
Landlord's consent shall be null and void and shall not confer any rights upon
any purported transferee, assignee, mortgagee, sublessee, or occupant. No
Transfer, regardless of whether Landlord's consent has been granted or withheld,
shall be deemed to release Tenant from any of its obligations hereunder or to
alter, impair or release the obligations of any person guaranteeing the
obligations of Tenant hereunder. Tenant hereby indemnifies Landlord against
liability resulting from any claim made against Landlord by any assignee or
subtenant or by any broker claiming a commission in connection with the proposed
29
Transfer. In the event Landlord shall consent to a Transfer of this Lease, any
option which Tenant may have to renew the Term shall be null and void.
Notwithstanding the foregoing, Landlord shall not unreasonably withhold
its consent to a sublet or assignment of this Lease by Tenant provided that: (a)
the proposed transferee has a financial capacity and net worth sufficient to
fulfill the terms of this Lease, as determined by Landlord based on financial
information about such transferee provided by Tenant or such transferee; (b) the
proposed use of the Premises by the proposed transferee is permitted by this
Lease and is compatible with the operation of the Building; (c) the proposed
transferee is not an existing tenant in the Building within six (6) months prior
to the proposed Transfer, and (d) an Event of Default does not exist under this
Lease.
Provided Tenant is not in default of any term, covenant or condition of
this Lease, Tenant shall have the right to assign this Lease or sublet the
Premises to a parent, subsidiary or affiliate corporation of Tenant without the
consent of Landlord. Tenant shall deliver written notice to Landlord of any such
Transfer. The foregoing waiver of right to consent does not constitute a waiver
of the right of Landlord to consent to any Transfer not specifically permitted
hereby.
25.2 STOCK TRANSFER. If Tenant is a privately-held corporation, then each
of the following events shall be deemed a prohibited Transfer under this Section
25 if such event results in a change in control of Tenant: any transfer of
Tenant's issued and outstanding capital stock; any issuance of additional
capital stock; or the redemption of any issued and outstanding stock.
Landlord acknowledges that Tenant is a wholly-owned subsidiary of Hanson
PLC, which is a publicly-held corporation ("Tenant's Parent Company"). Landlord
further acknowledges that Tenant's Parent Company proposes to effect three
demergers to create four (4) quoted companies by way of dividends-in-kind to
existing shareholders of Tenant's Parent Company; Tenant warrants and represents
to Landlord that one of the newly created quoted companies will become Tenant's
parent company, however, SCM Chemicals, Inc. will continue to be the Tenant
after such demergers. Landlord agrees that so long as Tenant's new parent
company remains a publicly held-corporation, Tenant shall not be in default of
this subsection 25.2.
Notwithstanding the foregoing, Landlord shall not unreasonably withhold
its consent to a transfer or change of ownership of the voting corporate stock
of Tenant which results in a change in control of Tenant, provided that (a) the
net assets of the Tenant are not substantially decreased by the change in the
corporate stock ownership; (b) Tenant, on demand from Landlord, properly
documents any changes in the net assets of Tenant caused by the change in
control of Tenant, so that Landlord can make an accurate judgment as to (a)
hereof; and (c) Tenant, after the change in control, continues to use the
Premises for uses permitted under this Lease and operates its business in a
manner which is consistent with the standards of operation for this Building.
The foregoing does not constitute a waiver of the right of Landlord to consent
to any subletting or any assignment.
25.3 RENTS FROM TRANSFER. In the event Landlord shall consent to a
Transfer of this Lease and the amount of the rents (or other compensation) to be
paid to Tenant by any such transferee is greater than the rents required to be
paid by Tenant to Landlord pursuant to this Lease or a premium is to be paid to
Tenant for an assignment of this Lease, Tenant shall pay to Landlord fifty
percent (50%) of any such. excess or any such premium, as the case may be, less
(a) any improvement allowance or other economic concession (planning allowance,
moving expense, etc.), paid by Tenant to sublessee; (b) broker's commissions;
(c) reasonable attorneys' fees; and (d) costs of advertising and/or promoting
the space for sublease, upon receipt thereof by Tenant from such transferee.
30
25.4 PROCEDURE FOR OBTAINING LANDLORD'S CONSENT.
A. In the event that, at any time or from time to time prior to or during
the Term, Tenant desires to Transfer this Lease in whole or in part, whether by
operation of law or otherwise, Tenant shall submit to Landlord for its
consideration (a) in writing, the name and address of the proposed subtenant or
assignee, a reasonably detailed statement of the proposed subtenant's or
assignee's business and reasonably detailed financial references and information
concerning the financial condition of the proposed subtenant or assignee, (b) a
disclosure of the rents to be paid by any subtenant in excess of the rents
reserved hereunder or the premium to be paid for the assignment, and (c) if a
subletting, a description of the area of the Premises to be sublet. Tenant
agrees to pay Landlord an amount not to exceed Five Hundred Dollars ($500.00)
for all costs incurred by Landlord in connection with any actual or proposed
Transfer, including, without limitation, the costs of making investigations as
to the acceptability of a proposed subtenant or assignee and legal costs
incurred in connection with any requested consent.
B. Landlord's consent to an assignment of this Lease shall be effective
upon the execution by Tenant, the assignee, and Landlord of an assignment
document prepared by Landlord in which the assignee shall agree to assume,
observe, perform, and be bound by, all of Tenant's obligations under this Lease
and Tenant shall agree to remain primarily liable for such obligations.
Any consent by Landlord to a subletting of all or a portion of the
Premises shall be deemed to have been given only upon the delivery by Landlord
to Tenant of a consent document prepared and executed by Landlord expressly
consenting to such subletting.
26. FOLDING OVER.
Tenant agrees to vacate the Premises at the end of the Term, and Landlord
shall be entitled to the benefit of all summary proceedings to recover
possession of the Premises at the end of the Term. If Tenant remains in
possession of the Premises after the expiration of the Term, such action shall
not renew this Lease by operation of law and nothing herein shall be deemed as a
consent by Landlord to Tenant's remaining in the Premises. If Tenant fails to
vacate the Premises as required, Landlord may consider Tenant as either (a) a
"Tenant-at-Will" (i.e. month-to-month tenant) liable for the payment of rent at
the then market rate as determined by Landlord or (b) as a "Tenant-Holding Over"
liable for an amount equal to the actual damages incurred by Landlord as a
result of Tenant's holding over, including, without limitation, all incidental,
prospective and consequential damages and attorney's fees, but in no event shall
such amount be less than an amount equal to twice the. Annual Basic Rent, and
Additional Rent, reserved hereunder applicable to the period of the holdover. In
either event, all other covenants of this Lease shall remain in full force and
effect.
Notwithstanding the foregoing paragraph, for a period not to exceed sixty
(60) days following the Termination Date, provided Landlord and Tenant are
engaged in good-faith negotiations for a renewal or extension of this Lease,
Tenant will be considered a Tenant "Tenant-at Will", liable for the same Annual
Basic Rent which was due and payable under the Lease at the end of the Term.
If such negotiations terminate before the expiration of said 60-day
period, or if Landlord and. Tenant have not executed a renewal lease or an
extension of this Lease within the aforesaid 60-day period, the provisions of
this Section 26 shall apply. Nothing herein shall be construed to obligate
Landlord to negotiate with Tenant for a renewal or extension of this Lease.
31
27. SUBORDINATION AND ATTORNMENT.
This Lease is subject and subordinate to the liens of all mortgages, deeds
of trust and other security instruments now or hereafter placed upon the
Building or the Property or any portion thereof and all ground and other
underlying leases from which Landlord's interest is derived (said mortgages,
deeds of trust, other security instruments, and ground leases being hereinafter
referred to as "Mortgages" and the mortgagees, beneficiaries, secured parties,
and ground lessors thereunder from time to time being hereinafter called
"Mortgagees"), and to any and all renewals, extensions, modifications, or ref
nancings thereof, without any further act of the Tenant. If requested by
Landlord, however, Tenant shall promptly execute any certificate or other
document confirming such subordination. Tenant agrees that, if any proceedings
are brought for the foreclosure of any of the Mortgages, Tenant, if requested to
do so by the purchaser at the foreclosure sale, shall attorn to the purchaser,
recognize the purchaser as the landlord under this Lease, and make all payments
required hereunder to such new landlord without any deduction or set-off of any
kind whatsoever. Tenant waives the provisions of any law or regulation, now or
hereafter in effect, which may give, or purport to give, Tenant any right to
terminate this Lease or to alter the obligations of Tenant hereunder in the
event that any such foreclosure or termination or other proceeding is prosecuted
or completed.
Notwithstanding anything contained herein to the contrary, any Mortgagee
may at any time subordinate the lien of its Mortgages to the operation and
effect of this Lease without obtaining the Tenant's consent thereto, by giving
the Tenant written notice thereof, in which event this Lease shall be deemed to
be senior to such Mortgages without regard to the-respective dates of execution
and/or recordation of such Mortgages and this Lease and thereafter such
Mortgagee shall have the same rights as to this Lease as it would_ have had were
this Lease executed and delivered before the execution of such Mortgages. Upon
Tenant's written request, Landlord shall use reasonable efforts, excluding the
payment of money, to obtain a non-disturbance agreement from Landlord's
Mortgagee with respect to this Lease. Landlord agrees to submit to such
Mortgagee on Tenant's behalf a non-disturbance agreement prepared by Tenant,
however, Landlord makes no representation that its Mortgagee will execute any
such agreement.
If, in connection with obtaining financing for the Building, a Mortgagee
shall request reasonable modifications in this Lease as a condition to such
financing, Tenant will not unreasonably withhold, delay or defer its consent
thereto, provided that such modifications do not materially adversely increase
the obligations of Tenant hereunder, or materially adversely affect the
leasehold interest hereby created or Tenant's use and enjoyment of the Premises,
or increase the amount of Annual Basic Rent and Additional Rent payable
hereunder.
28. ESTOPPEL CERTIFICATES.
Tenant shall, without charge, at any time and from time-to-time, within
fifteen (15) days after receipt of request therefor by Landlord, execute,
acknowledge and deliver to Landlord a written estoppel certificate, in such form
as may be determined by Landlord, certifying to Landlord, Landlord's Mortgagee,
any purchaser of Landlord's interest in the Building, or any other person
designated by Landlord, as of the date of such estoppel certificate, the
following, without limitation: (a) whether Tenant is in possession of the
Premises; (b) whether this Lease is in full force and effect; (c) whether there
have been any amendments to this Lease, and if so, specifying such amendments;
(d) whether there are then existing any set-offs or defenses against the
enforcement of any rights hereunder, and if so, specifying such matters in
detail; (e) the dates, if any, to which any rent or other charges have been paid
in advance and the amount of any Security Deposit held by Landlord; (f) that
Tenant has no knowledge of any then existing defaults of Landlord under this
Lease, or if there are such defaults, specifying them in detail; (g) that Tenant
32
has no knowledge of any event having occurred that authorizes the termination of
this Lease by Tenant, or if such event has occurred, specifying it in detail;
and. (h) the address to which notices to Tenant under this Lease should be sent.
Any such certificate may be relied upon by the person or entity to whom it is
directed or by any other person or entity who could reasonably be expected to
rely on it in the normal course of business. The failure of Tenant to execute,
acknowledge and deliver such a certificate in accordance with this Section 28
within fifteen (15) days after a request therefor by Landlord shall constitute
an acknowledgment by Tenant, which may be relied on by any person who would be
entitled to rely upon any such certificate, that such certificate as submitted
by Landlord to Tenant is true and correct.
29. PEACEFUL AND QUIET POSSESSION.
Tenant, if and so long as it pays all rents due hereunder and performs and
observes the other terms and covenants to be performed and kept by it as
provided in this Lease, shall have the peaceable and quiet possession of the
Premises during the Term free of any claims of Landlord or anyone lawfully
claiming by, through or under Landlord, subject, however, to the terms of this
Lease and to matters of public record existing as of the date of this Lease.
30. LANDLORD'S ACCESS TO PREMISES.
Landlord and its agents may at any reasonable time and without incurring
any liability to Tenant, other than liability for personal injuries and damages
resulting solely from the negligence and willful misconduct of Landlord or its
agents, enter the Premises to inspect them or to make alterations or repairs or
for any purpose which Landlord considers necessary for the repair, operation, or
maintenance of the Building; provided, however, that in the case of an
emergency, Landlord. may enter the Premises at any time. Tenant shall allow the
Premises to be exhibited by Landlord (a) at any time to any representative of a
lender or to any prospective purchaser of the Building or Landlord's interest
therein or (b) within six (6) months of the end of the Term to any persons who
may be interested in leasing the Premises.
Notwithstanding the foregoing, Landlord shall use reasonable efforts to
telephone Tenant twenty-four (24) hours prior to any inspection except in cases
of emergencies. Emergencies for the purpose of this Section shall be deemed to
mean anyone or anything in the Premises, Building and/or Common Area requiring
immediate response. In any event, Tenant agrees to cooperate when access to the
Premises is requested by Landlord.
31. Intentionally deleted.
32. BROKERS, COMMISSIONS, ETC.
Landlord and Tenant acknowledge, represent and warrant each to the other
that, except as listed. in Section 1. F., no broker or real estate agent brought
about or was involved in the making of this Lease and that no brokerage fee or
commission is due to any other party as a result of the execution of this Lease.
Each of the parties hereto agrees to indemnify and hold harmless the other
against any claim by any broker, agent or finder based upon the execution of
this Lease and predicated upon a breach of the above representation and
warranty. Landlord shall be responsible for the payment of the commission due
CRA Group for brokerage services provided in connection with this Lease.
33
33. RECORDATION.
Neither Landlord nor Tenant shall record this Lease, any amendment to this
Lease or any other memorandum of this Lease without the prior written consent of
the other party, which consent may be withheld in the sole discretion of either
party and, in the event such consent is given, the party requesting such consent
and recording shall pay all transfer taxes, recording fees and other charges in
connection with such recording. Notwithstanding the above, Tenant covenants that
if at any time any mortgagee or ground lessor relating to the financing of the
Property shall require the recordation of this Lease, or if the recordation of
this Lease shall be required by any valid governmental order, or if any
governmental authority having jurisdiction in the matter shall assess and be
entitled to collect transfer taxes, documentary stamp taxes, or both, on this
Lease, Tenant, upon the request of Landlord, shall execute such instruments,
including a Memorandum of this Lease, as may be necessary to record this Lease,
and Landlord shall pay all recording fees, transfer taxes and documentary stamp
taxes, payable on,. or in connection with, this Lease or such recordation.
34. MISCELLANEOUS.
34.1 SEPARABILITY. If any term or provision of this Lease or the
application thereof to any person or circumstance shall, to any extent, be,
invalid or unenforceable, the remainder of this Lease or the application of such
term or provision to persons or circumstances other than those as to which it is
held invalid or unenforceable, shall not be affected thereby, and each term and
provision of this Lease shall be valid and enforceable to the fullest extent
permitted by law.
34.2 APPLICABLE LAW. This Lease shall be given effect and construed by
application of the laws of the state where the Property is located, and any
action or proceeding arising hereunder shall be brought in the courts of the
State where the Premises are located.
34.3 AUTHORITY. If Tenant is a corporation or partnership, the person
executing this Lease on behalf of Tenant represents and warrants that Tenant is
duly organized and validly existing; that this Lease has been authorized by all
necessary parties, is validly executed by an authorized officer or agent of
Tenant and is binding upon and enforceable against Tenant in accordance with its
terms.
The undersigned agent of Landlord represents and warrants that it is
authorized and empowered to enter into this Lease Agreement on behalf of the
Landlord.
34.4 NO DISCRIMINATION. [Intentionally Deleted at the request of Tenant.]
34.5 INTEGRATION OF AGREEMENTS. This writing is intended by the parties as
a final expression of their agreement and is a complete and exclusive statement
of its terms, and all negotiations, considerations and representations between
the parties hereto are incorporated herein. No course of prior dealings between
the parties or their agents shall be relevant or admissible to supplement,
explain, or vary any of the terms of this Lease. Acceptance of, or acquiescence
to, a course of performance rendered under this Lease or any prior agreement
between the parties or their agents shall not be relevant or admissible to
determine the meaning of any of the terms or covenants of this Lease. Other than
as specifically set forth in this Lease, no representations, understandings or
agreements have been made or relied upon in the making of this Lease. This Lease
can only be modified by a writing signed by each of the parties hereto.
34
34.6 THIRD PARTY BENEFICIARY. Except as expressly provided elsewhere in
this Lease, nothing contained in this Lease shall be construed so as to confer
upon any other party the rights of a third party beneficiary.
34.7 CAPTIONS; GENDER. The captions used in this Lease are for convenience
only and do not in any way limit or amplify the terms and provisions hereof. As
used in this Lease and where the context so requires, the singular shall be
deemed to include the plural and the masculine shall be deemed to include the
feminine and neuter, and vice versa.
34.8 SUCCESSORS AND ASSIGNS. Subject to the express provisions of this
Lease to the contrary (e.g., Section 25), the terms, provisions and covenants
contained in this Lease shall apply to, inure to the benefit of, and be binding
upon the parties hereto and their respective heirs, personal representatives,
successors and assigns.
34.9 WAIVER OF JURY TRIAL. Landlord and Tenant hereby expressly waive
trial by jury in any action or proceeding or counterclaim brought by either
party hereto against the other party on any and every matter, directly or
indirectly arising out of or with respect to this Lease, including, without
limitation, the relationship of Landlord and Tenant, the use and occupancy by
Tenant of the Premises, any statutory remedy and/or claim of injury or damage
regarding this Lease.
34.10 Intentionally deleted.
34.11 NOTICES. All notices, demands and requests required under this Lease
shall be in writing. All such notices, demands and requests shall be deemed to
have been properly given if sent by United States certified mail, return receipt
requested, postage prepaid, or hand delivered, or overnight delivery, addressed
to Landlord or Tenant, at the Landlord Notice Address and Tenant Notice Address,
respectively. Either party may designate a change of address by written notice
to the other party, in the manner set forth above. Notice, demand and requests
which shall be served by certified mail in the manner aforesaid, shall be deemed
to have been given three (3) days after mailing. Notices sent by overnight
delivery shall be deemed to have been given the day after sending. Without
intending to limit the generality of the foregoing requirement that all notices,
demands and requests be in writing, there are certain provisions in this Lease
where, for emphasis alone, such requirement is reiterated.
34.12 EFFECTIVE DATE OF THIS LEASE. Unless otherwise expressly provided,
all terms, conditions and covenants by Tenant contained in this Lease shall be
effective as-of the date first above written.
34.13 MECHANICS' LIENS. In the event that any mechanics' or materialmen's
liens shall at any time be filed against the Premises purporting to be for work,
labor, services or materials performed or furnished to Tenant or anyone holding
the Premises through or under Tenant, Tenant shall cause the same to be
discharged of record or bonded within thirty (30) days after the filing thereof.
If Tenant shall fail to cause such lien to be discharged within thirty (30) days
after the filing thereof, then, in addition to any other right or remedy of
Landlord, Landlord may, but shall not be obligated to, discharge the same by
paying the amount claimed to be due; and the amount so paid by Landlord, and all
costs and expenses, including reasonable attorneys' fees incurred by Landlord in
procuring the discharge of such lien, shall be due and payable by Tenant to
Landlord, as Additional Rent, on the first day of the next succeeding month.
Notice is hereby given that Landlord shall not be liable for any labor or
materials furnished to Tenant upon credit and that no mechanics', materialmen's
or other liens for any such labor or materials shall attach to or affect the
estate or interest of Landlord in and to the land and improvements of which the
Premises are a part.
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34.14 WAIVER OF RIGHT OF REDEMPTION. Tenant hereby expressly waives (to
the extent legally permissible) for itself and all persons claiming by, through
or under it, any right of redemption or right to restore the operation of this
Lease under any present or future law in the event Tenant is dispossessed for
any proper cause, or in the event Landlord shall obtain possession of the
Premises pursuant to the terms of this Lease. Tenant understands that the
Premises are leased exclusively for business, commercial and mercantile purposes
and therefore shall not be redeemable under any provision of law.
34.15 MORTGAGEE'S PERFORMANCE. If requested by any Mortgagee, Tenant shall
give such Mortgagee written notice of any default by Landlord under this Lease
and a reasonable opportunity to cure such default. Tenant shall accept
performance of any of Landlord's obligations hereunder by any ground lessor or
mortgagee relating to the financing of the Property.
34.16 MORTGAGEE'S LIABILITY. No mortgagee or ground lessor relating to the
financing of the Property, not in possession of the Premises or the Building,
shall have any liability whatsoever hereunder.
34.17 SCHEDULES. Each writing or plat referred to herein as being attached
hereto as a schedule or exhibit is hereby made a part hereof, with the same full
force and effect as if such writing or plat were set forth in the body of this
Lease.
34.18 TIME OF ESSENCE. Time shall be of the essence of this Lease with
respect to the performance by Tenant and Landlord of their obligations
hereunder.
34.19 AMENDMENT. This Lease may be amended by and only by an instrument
executed and delivered by each party hereto. No amendments of this Lease entered
into by Landlord and Tenant, as aforesaid, shall impair or otherwise affect the
obligations of any guarantor of Tenant's obligations hereunder, all of which
obligations shall remain in full force and effect and pertain equally to any
such amendments, with the same full force and effect as if the substance of such
amendments was set forth in the body of this Lease.
34.20 PARKING. During the Term, Tenant shall have the exclusive right to
use eighteen (18) reserved covered-parking spaces on the building's parking.
deck, free of charge. Such parking spaces shall be assigned and identified by
Landlord in its sole discretion. Landlord agrees to use all reasonable efforts
to locate two (2) of the eighteen parking spaces close to the lower level
elevator lobby.
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IN WITNESS WHEREOF, the parties hereto have executed this Lease under
their respective seals as of the day and year first above written.
ATTEST: LANDLORD:
CENTERPOINTE LIMITED PARTNERSHIP
By: ROUSE OFFICE MANAGEMENT,
INC., Managing Agent
____________________________________ By:____________________________(SEAL)
Assistant Secretary Vice President
ATTEST: TENANT:
SCM CHEMICALS, INC.
____________________________________ By:____________________________(SEAL)
Secretary of Corporation Vice President
37
Schedule A-1
[FLOOR PLAN GRAPHIC OMITTED]
38
SCHEDULE C
RULES AND REGULATIONS
1. Tenant shall not obstruct or encumber the Common Area, and the
sidewalks, driveways, and other public portions of the Property (herein "Public
Areas") and such Public Areas shall not be used for any purpose other than
ingress and egress to and from its Premises. Tenant shall not permit any of its
employees, agents, licensees or invitees to congregate or loiter in any of the
Public Areas. Tenant shall not invite to, or permit to visit, its Premises
persons in such numbers or under such conditions as may interfere with the use
and enjoyment by others of the Public Areas. Fire exits and stairways are for
emergency use only, and they shall not be used for any other purpose. Landlord
reserves the right to control, operate, restrict and regulate the use of the
Common Areas, public facilities, and any facilities furnished for the common use
of the tenants in such manner as it deems best for the benefit of the tenants,
including but not limited to the allocation of elevators for delivery service,
and the right to designate which Building entrances shall be used for
deliveries. No doormat of any kind whatsoever shall be placed or left in any
public hall or outside any entry door of the Premises.
2. No awnings or other projections shall be attached to the outside walls
of the Building. No curtains, blinds, shades or screens shall be attached to,
hung in, or used in connection with any window or door of its Premises, without
the consent of Landlord. Such window or door coverings must be of a quality,
type, design and color approved by Landlord and further they must be installed
in. a manner approved by Landlord. In order that the Building can and will
maintain a uniform appearance to those persons outside of the Building, each
tenant occupying the perimeter areas of the Building shall (a) use only
building-standard lighting in areas where lighting is visible from the outside
of the Building, and (b) ,use only building-standard blinds in window areas
which are visible from the outside of the Building.. Notwithstanding anything to
the contrary contained in this paragraph 2, Tenant shall be permitted to use
desk lamps in the Premises.
3. Except as otherwise provided in the Lease, no sign, insignia,
advertisement, lettering, notice or other object shall be exhibited, inscribed,
painted or affixed by Tenant on any part of the exterior or interior of the
Premises or the Building or on doors, corridor walls, the Building directory or
in the elevator cabs without the prior approval of Landlord. Landlord shall
review the size, color, style, content and location of any proposed signage.
Landlord shall have the right to prohibit any advertising or identifying sign by
Tenant which, in the sole judgment of Landlord, impairs the appearance,
reputation, or the desirability of the Building as a first-class office
building. Upon Landlord's approval, Tenant shall obtain all necessary approvals
and permits from governmental or quasi-governmental authorities in connection
with such signs. Further, approved signs shall be inscribed, painted or affixed
by signmakers approved by Landlord at Tenant's sole cost. in the event of a
violation of the foregoing by Tenant, upon written notice from Landlord, Tenant
shall refrain from and discontinue such advertising or identifying sign. In the
event that Tenant does not promptly correct said violation, Landlord may remove
such signs without any liability, and may charge the expense incurred in such
removal to the Tenant violating this Rule and Tenant hereby agrees to pay
Landlord, as Additional Rent, any such expense promptly upon demand.
4. No bicycles, vehicles, animals (except seeing eye dogs), fish or birds
of any kind shall be brought into or kept in or about the Premises.
5. Nothing shall be done or permitted by Tenant which would impair or
interfere with the use or enjoyment by any other occupant of the Building,
including the playing of music.
6. Nothing shall be done or permitted in the Premises and nothing shall be
brought into, installed or kept in or about the Premises, which would impair or
interfere with any of the HVAC, plumbing, electrical, structural. components of
the Building or the services of the Building or the proper and economic heating,
cleaning or other services of the Building or the Premises. Tenant nor its
employees, agents, licensees or invitees shall at any time bring or keep upon
the Premises any flammable, combustible or explosive fluid, chemical or
substance.
7. No additional locks or, bolts of any kind shall be placed upon any of
the doors or windows by Tenant, nor shall any changes be made in locks or the
mechanism thereof. Duplicate keys for the Premises and restrooms shall be
procured only from Landlord and Landlord may make a reasonable charge therefor.
Tenant shall, upon the termination of the Lease, turn over to Landlord all keys
to stores, offices and restrooms. In the event of the loss of any keys furnished
by Landlord, Tenant shall pay to Landlord the cost of replacement locks and
Tenant hereby agrees to pay said cost to Landlord, as Additional Rent, promptly
upon demand.
8. Any delivery or moving of any safes, freight, furniture, packages,
boxes, crates or any other such object shall take place at such time and in such
manner so as not.to interfere with other occupants of the Building. Tenant
hereby acknowledges that this may involve overtime work for Landlord's
employees. Landlord reserves the right to inspect all objects to be brought into
the Building and to exclude from the Building any objects which may in
Landlord's sole discretion violate the Lease and/or any of these Rules and
Regulations. Tenant hereby agrees to pay any such costs to Landlord, as
Additional Rent, promptly upon demand.
No hand trucks shall be used for such moving activities except for those
equipped with rubber tires, side guards and such other safeguards as Landlord
shall require.
Landlord may require any person leaving the Building with any package or
other object to submit a statement indicating the tenant from whose premises the
package or object is being removed, however, Landlord and Tenant hereby
acknowledge that the establishment and enforcement of such requirement does not
impose any responsibility on Landlord for the protection of Tenant against the
removal of property from the Premises of Tenant. Landlord shall in no way be
liable to Tenant for damages or loss arising from the admission, exclusion or
ejection of any person to or from the Premises or the Building under the
provisions of this Rule.
9. Tenant shall not use or occupy its Premises, or permit any portion
thereof to be used or occupied for telephone or secretarial service, messenger
service, wholesale or discount shop for sale of merchandise, retail service
shop, labor union, company engaged in the business of renting office or desk
space, a hiring or employment agency, or for any use which constitutes a
nuisance, or is hazardous, or, in Landlord's opinion, likely to injure the
reputation of a first-class office building. o No tenant shall engage or pay any
employee on its Premises, except those actually employed by such tenant, nor
advertise for laborers giving an address at the Building. Except as specifically
approved by Landlord in writing, no tenant shall use or permit the use of its
Premises or any part thereof as a restaurant, shop, booth or other stand, or for
the conduct of any business or occupation which predominantly involves direct
patronage of the general public, manufacturing, or the sale at auction of
merchandise, goods or property of any kind. This paragraph is not intended to
prohibit Tenant from hiring or engaging the services of temporary employees,
consultants or contractors in the Premises in connection with the operation of
its business therein (i.e. Tenant's full-time travel agent).
10. All entrance doors in Tenant's Premises shall be kept locked when not
in use. Entrance doors shall not be left open at any time.
2
11. If Tenant shall request Landlord to perform any work on the Premises
or Property, Tenant shall make such request at the management office for the
Building. Tenant shall not request employees of Landlord to perform any work or
do anything outside of 'their regular duties, unless under special instructions
from Landlord.
12. Canvassing, soliciting and peddling in the Building are prohibited and
Tenant shall cooperate to prevent the same.
13. Tenant shall not cause or permit any odors of cooking or other
processes, or any unusual or objectionable odors, to emanate from its Premises
which would annoy other tenants or create a public or private nuisance. No
cooking shall be done in Tenant's Premises, except for a household microwave
oven or as is expressly permitted in the Lease, or otherwise consented to in
writing by the Landlord..
14. All paneling, doors, trim or other wood products not considered
furniture shall be treated with fire-retardant materials. Before installation of
any such materials, certification of the materials' fire-retardant
characteristics shall be submitted to and approved by Landlord, and all such
materials shall be installed in a manner approved by Landlord.
15. Whenever Tenant submits any plan, agreement or other document for the
consent or approval of Landlord, Landlord may charge, on demand, a reasonable
processing fee for the review thereof, which shall include the cost of any
services of an architect, engineer or attorney employed by Landlord to review
such plan, agreement or document. Tenant hereby agrees to pay any such
processing fee to Landlord, as Additional Rent, promptly upon demand.
16. No contract of any kind with any supplier of towels, water, ice,
toilet articles, waxing, rug :shampooing, venetian blind washing, furniture
polishing, lamp servicing, cleaning of electrical fixtures, .removal of waste
papers, rubbish or garbage, or any other cleaning, janitorial or like service
shall be entered into by Tenant without the prior written consent of Landlord.
Further, no vending machine of any kind shall be installed in the Building or on
or about the Property without the prior written consent of Landlord.
Landlord shall not be responsible to Tenant for any loss of property from
its Premises however occurring, or for any darn age done to the effects of
Tenant by Landlord's janitors or any of its employees, or by any other person or
any other cause. The janitor's service furnished by Landlord does not include
the beating or cleaning of area rugs.
17. When electric wiring of any kind is introduced, it must be connected
as directed by Landlord, and no stringing or cutting of wires will be allowed,
except with the prior written consent of Landlord, and shall be done only by
contractors approved by Landlord. The number and locations of telephones,
telegraph instruments, electric appliances, call boxes, etc., shall be subject
to Landlord's approval. Tenant shall not lay linoleum or other similar floor
covering so that the same shall be in direct contact with the floor of the
Premises; and if linoleum or other similar floor covering is desired to be used,
an interlining of builder's deadening felt shall be first affixed to the floor
by a paste or other material, the use of cement or other similar adhesive
material being expressly prohibited..
18. Landlord hereby reserves* to itself any and all rights not granted to
Tenant hereunder, including, but not limited to, the following rights which are
reserved to Landlord for its purposes in operating the Building:
3
(a) the exclusive right to use of the name of the Building for all
purposes, except that Tenant may use the name as ifs business
address and for no other purpose;
(b) the right to change the name or address of the Building, without
incurring any liability to Tenant for so doing;
(c) the right to install and maintain a sign or signs on the exterior of
the Building;
(d) the exclusive right to use or dispose of the use of the roof of the
Building;
(e) the right to limit the space on the directory of the Building to be
allotted to Tenant; and
(f) the right to grant anyone the right to conduct any particular
business or undertaking in the Building.
19. Tenant and its employees shall park their cars only in those portions
of the parking area designated by Landlord. .
20. Tenant shall not permit undue accumulations of garbage, trash, rubbish
or any other refuse, and will keep such refuse in proper containers in, the
'interior of the Tenant's Premises or other places designated by the Landlord.
21. Tenant shall not conduct or permit any bankruptcy sales, unless
directed by order of a court of competent jurisdiction, or any fictitious fire
or going out of business sale.
22. Landlord shall have the right to close and securely. lock the Building
during generally accepted holidays and during such other times as Landlord may,
in its sole discretion, deem advisable for the security of the Building and its
tenants. Landlord shall give Tenant twenty-four (24) hours notice before so
closing and securely locking the Building except in an emergency.
23. Landlord reserves the right to rescind, alter, waive or add any rule
or regulation at any time prescribed for the Building when Landlord deems it
necessary or desirable for the reputation, safety, character, security, care,
appearance or interests of the Building, the preservation of good order therein,
the operation or maintenance of the Building or the equipment thereof, or the
comfort of tenants or others in the Building. No rescission, alteration, waiver
or addition of any rule or regulation with respect to .one tenant shall operate
as a rescission, alteration or waiver in respect of any other tenant.
4
SCHEDULE D
JANITORIAL SPECIFICATIONS
ROUSE OFFICE MANAGEMENT
HUNT VALLEY
1. TENANT AREA
A. NIGHTLY
1. Empty and clean all waste receptacles, wash when necessary and
change liners as needed.
2. Empty and damp wipe all ash trays.
3. Hand dust with treated cloths and wipe clean all furniture,
fixtures and exposed desk and file cabinet areas.
4. Vacuum all rugs and carpeted areas, moving light furniture and
spot cleaning when necessary.
5. Sweep and damp mop all vinyl tile floors.
6. Remove all gum and foreign matter from all floor areas.
7. Remove all fingerprints, smudges and other. marks from
partitions, glass, doors and other surfaces.
8. Thoroughly wash, clean and sanitize all water coolers, coffee and
food areas and vending machines. Exterior surfaces of microwave
and refrigerators should be wiped clean.
9. Clean glass entrance doors and windows to tenant spaces.
B. WEEKLY
1. Detail dust and damp wipe all shelving, window sills, telephones,
moldings, chair rails,. baseboards, picture frames and trim.
2. Detail vacuum all corners and edges.
C. MONTHLY
1. Vacuum all upholstered furniture.
2. Spray buff and wax all tile areas.
3. Dust and wipe clean all lighting fixtures.
4. Hand vacuum all corners of ceilings and walls.
5. Shampoo carpet in elevator lobbies, if applicable.
Page 1
D. QUARTERLY
1. Strip and refinish all vinyl tile areas.
2. Dust and wipe clean all HVAC vents and light lenses.
3. Dust and wipe clean all window blinds.
2. COMMON AREAS
A. Nightly
1. Empty and wipe clean all ash and trash receptacles. Replace sand
in ash receptacles as needed.
2. Clean, sanitize and polish all water fountains.
3. Vacuum all carpeted corridors, elevator cabs and entrance mats.
Spot clean when necessary.
4. Sweep, damp mop and buff granite floor in main lobby, if
applicable.
5. Dust and wipe clean all tenant directories and tenant door signs.
6. Dust and wipe clean all window sills, heaters, baseboards,
telephones, fire extinguishers and chrome work.
7. Wipe clean and polish elevator tracks, doors, panels, signs and
buttons, if applicable.
8. Sweep down stairwells and spot clean where necessary.
9. Spot clean walls and doors throughout corridors and stairwells.
10. Wash clean all glass entrance doors and windows.
11. Clean and polish stone marble where necessary, if applicable.
B. WEEKLY
1. Wet mop stairwells.
2. Detail vacuum all corners and edges.
3. Detail clean all fingerprints, smudges, etc. on doors, walls,
light covers and other surface areas.
4. Clean and polish all decorative wood panels, if applicable.
5. Wipe clean stairwell handrailings, if applicable.
6. Shampoo carpet in elevator cabs, if applicable..
page 2
C. MONTHLY
1. Hand vacuum all corners of ceilings and walls.
2. Wash clean all glass in Lobby area.
D. QUARTERLY
1. Dust and wipe clean all. HVAC vents, light lenses and plumbing
pipes.
3. LAVATORIES
A. NIGHTLY
1. Sweep and wash floors with disinfectant. Wash and polish all
mirrors, powder shelves, bright work and enamel surfaces.
2. Wash and disinfect basins, urinals and bowls using a solution to
remove stains, making certain to clean under sides of rim.
3. Wash and disinfect both sides of toilet seats.
4. Dust and wipe clean, washing where necessary, all partitions,
tile walls, dispensers and receptacles.
5. Empty trash receptacles and replace liners.
6. Fill toilet tissue, soap and towel dispensers.
7. Plunge stopped-up toilets when necessary.
8. Sanitary napkin receptacles shall be emptied, cleaned and
disinfected, properly dried and provided a new liner (wax paper
bag type) nightly.
B. MONTHLY
1. Wipe down all tile walls with disinfectant.
2. Dust and wipe clean all light lenses.
3. Machine scrub (rotowash) floors, with particular attention to
corners and edges.
4. Hand-vacuum all corners of ceilings and walls.
Janitorial service will not be provided on the following holidays:
New Year's Day Labor Day
Memorial Day Thanksgiving
Independence Day Christmas
Page 3
MISCELLANEOUS
1. All janitorial closets throughout the building are to be kept neat and
clean at all times. Mop sinks will be clean and mops will be hung to
dry. Sour smelling mops/or closets will not be tolerated.
2. Nightly means five times a week, Monday through Friday, after 5:45
p.m.
3. All cleaning and supervisory personnel are to be employees of
contractor, but subject at all time to approval of the building
management. Supervisors assigned to the building will not be
reassigned to any other location without approval of the building
management.
4. Employees shall keep tenant area locked at all times - even while
being cleaned.
5. At all times, exercise safety precautions for the benefit of
contractor employees, the owner and tenants. Material Safety Data
Sheets (MSDSs) will be provided to Rouse Office Management for all
cleaning products.
6. Report all defective or broken building equipment or fixtures, any
unlocked doors, stains not removable and any unusual events to owner.
Rouse Office Management is available 24hours a day should a serious
situation merit immediate attention.
7. Gum and foreign matter to be removed nightly when in or on something
cleaned under this contract.
8. All restroom supplies except for sanitary napkins and tampons are to
be provided by janitorial contractor and sufficient stock is to be
kept in janitorial closets at all times. The contractor will be
responsible for restocking the restrooms on a nightly basis.
9. Contractor will provide sufficient employees to clean the building in
a first-class manner and in keeping with the above specifications and
to include the following:
A. At least one working supervisor must be in the building during
all work hours. Supervisor must be the last person to leave the
building.
B. Employees who are to be permanently assigned to the building
shall be carefully interviewed, screened and bonded. They shall
be neat and clean in appearance. All employees are subject to the
approval of owner.
C. Employees will conduct themselves professionally at all times.
(Boom boxes will not be permitted, use of the tenants telephone
system will not be tolerated, no horse play, etc. )
10. All contractor employees, including working supervisors, will be
required to wear uniforms. Uniforms will consist of a minimum of
matching smocks and/or shirts identified with the contractor and
employee name.
11. Contractor will furnish all equipment and cleaning supplies, and trash
bags, necessary to perform the work as stated in the specifications.
12. Worker's Compensation, comprehensive liability insurance, public
liability insurance and property damage insurance must be carried by
the contractor. Insurance requirements are specified in the Agreement
for Janitorial Service. All employees must be bonded.
13. A cancellation clause providing for thirty (30) day written notice by
Rouse Office Management, Inc. for cancellation without cause is to be
included in the cleaning contract.
Page4
14. Lights will be turned off and all doors secured at the completion of
the cleaning shift.
15. Excluded from the contract are:
- cleaning mechanical and electrical rooms
- day porter service
- exterior and interior glass window washing except glass doors,
view panels, etc.
- cleaning exterior plazas or garages, if applicable.
- cleaning the loading dock, except trash will be placed in the
dumpster and compacted, if applicable. Trash bins are not to be
left on the loading dock.
- cleaning inside tenant refrigerators and microwaves.
16. The contractor's supervisor will be responsible for picking up and
signing out the keys at the start of each shift and returning the keys
and signing them in at the conclusion of the shift to Rouse Office
Management - 11311 McCormick Road, Hunt Valley. At no time will the
doors to the building be left propped open. Loss of keys will result
in rekeying. The cost of rekeying. will be reimbursed by the
janitorial contractor.
Page 5
EXHIBIT C
Millennium has agreed to provide the space in turn-key condition as listed
below:
1. Paint-touch-up the premises as needed.
2. Shampoo carpet and patch as needed.
3. Remove wall to create a reception area.
4. Install building standard suite entry door to code and
install new building standard exit door to code.
5. Enclose rear exit door room using building standard
finishes.
6. reconstruct conference room in SE corner using building
standard materials.
7. Close existing case opening in small office.
Move Sublandlord's excess existing furniture presently located in the premises
to the extent available, into all offices
SUBTENANT'S INITIAL ______________
[GRAPHIC OMITTED]
