EXHIBIT 10.3
LEASE
BETWEEN
LSAC TEMPE L.P., LANDLORD
AND
(I)STRUCTURE, LLC, TENANT
DATED: DECEMBER 29, 2005
PROPERTY:
2005 E. TECHNOLOGY CIRCLE
TEMPE, ARIZONA
INDEX
Page
ARTICLE 1 PROPERTY AND TERM......................................6
ARTICLE 2 FIXED RENT AND ADDITIONAL RENT.........................9
ARTICLE 3 IMPOSITIONS...........................................11
ARTICLE 4 USE OF PROPERTY.......................................13
ARTICLE 5 CONDITION OF PROPERTY, ALTERATIONS
AND REPAIRS...........................................14
ARTICLE 6 INSURANCE.............................................18
ARTICLE 7 DAMAGE OR DESTRUCTION.................................21
ARTICLE 8 CONDEMNATION..........................................24
ARTICLE 9 ASSIGNMENT AND SUBLETTING.............................26
ARTICLE 10 SUBORDINATION.........................................30
ARTICLE 11 OBLIGATIONS OF TENANT.................................32
ARTICLE 12 DEFAULT; REMEDIES.....................................35
ARTICLE 13 NO WAIVER.............................................41
ARTICLE 14 ESTOPPEL CERTIFICATE..................................42
ARTICLE 15 QUIET ENJOYMENT.......................................42
ARTICLE 16 SURRENDER.............................................42
ARTICLE 17 ACCESS................................................43
ARTICLE 18 ENVIRONMENTAL MATTERS.................................44
ARTICLE 19 FINANCIAL STATEMENTS..................................49
ARTICLE 20 MISCELLANEOUS PROVISIONS..............................49
ARTICLE 21 LEASE GUARANTY........................................52
ARTICLE 22 MEMORANDUM OF LEASE...................................52
ARTICLE 23 LIMITATION OF LIABILITY...............................52
ARTICLE 24 RIGHT OF FIRST OFFER..................................53
Exhibits
Exhibit "A" - Description of the Land 57
Exhibit "B" - Schedule of Removable Personal Property 58
Exhibit "C" - Form of Memorandum of Lease 59
Exhibit "D" - Form of Lease Guaranty 63
LEASE
THIS LEASE (the "Lease") is made as of the 29th day of
December, 2005 between LSAC TEMPE L.P., a Delaware limited partnership
("Landlord"), having an office for the conduct of business at One Penn Plaza,
Suite 4015, New York, New York 10119-4015, and (I)STRUCTURE, LLC, a Delaware
limited liability company ("Tenant"), having an office for the conduct of
business at 2005 E. Technology Circle, Tempe, Arizona.
W I T N E S S E T H:
The parties hereto, for themselves, their heirs, distributees, executors,
administrators, legal representatives, successors and assigns, hereby covenant
as follows:
ARTICLE A
CERTAIN LEASE PROVISIONS
1. Address for 2005 E. Technology Circle the
Property: Tempe, Arizona
2. (a) Term: (i) A Primary Term of approximately Twenty
(20) years, beginning on the Commencement
Date, and ending on the Expiration Date.
(ii) Option to Extend Term: Two (2) renewal
options of ten (10) years each.
(b) Commencement
Date: December 29, 2005
(c) Expiration
Date: Twenty (20) years after the last day in the
calendar month in which the Commencement
Date occurs, unless sooner terminated or
extended pursuant to this Lease.
3. Fixed Rent
During the
Primary Term: $1,127,520.00 per annum in equal monthly
installments of $93,960.00.
4. Use of the
Property: Data center and general office and uses
incidental thereto.
5. Address for Notice:
For Landlord: LSAC Tempe L.P.
c/o Lexington Corporate Properties Trust
One Penn Plaza
Suite 4015
New York, New York 10119-4015
Attention: Mr. John Vander Zwaag
With a copy of
any notices of
default only, to: Crowe Deegan LLP
535 Fifth Avenue, Suite 611
New York, New York 10017
Attention: Richard C. Hamlin, Esq.
For Tenant: (i)Structure, LLC
c/o Infocrossing, Inc.
2 Christie Heights Street
Leonia, NJ 07605
Attention: President and General Counsel
With a copy of
any notices of
default only, to: Gibson Dunn & Crutcher LLP
333 South Grand Avenue
Los Angeles, California 90071-3197
Attention: D. Eric Remensperger , Esq.
6. Guarantor: Infocrossing, Inc.
2 Christie Heights Street
Leonia, NJ 07605
Attention: President
ARTICLE B
CERTAIN DEFINITIONS
"Additional Rent" is defined in Section 2.2.
"Alterations" is defined in Section 5.4.
"Bankruptcy Code" means the provisions of 11 U.S.C. Section
101 et seq. or any statute of similar purpose or nature as
more particularly set forth in Section 9.9.
"Building" means collectively the buildings, building,
equipment and improvements now or hereinafter erected on the Land.
"Business Day" is every day which most large banks based in
New York, New York are open for the ordinary conduct of business.
"Claims" is defined in Section 11.3.
"Commencement Date" is defined in Article A, Section 2(b).
"Corporate Transfer" is defined in Section 9.7(b).
"Default" means an event has occurred which constitutes an
Event of Default or which, with the giving of notice, the lapse of time or both
would constitute an Event of Default.
"Default Rate" means three percent (3%) over the prime
reference rate announced from time to time by Citibank, N.A. in New York, New
York, as such prime reference rate may be adjusted and announced from time to
time, or if unavailable, the parties shall use the prime reference rate for
major New York banks as reported in the Wall Street Journal.
"Deficiency" is defined in Section 12.4(c).
"De Minimis Hazardous Substances" is defined in Section 18.1.
"Environmental Laws" is defined in Section 18.10.
"Event of Default" is defined in Section 12.1.
"Expiration Date is defined in Article A, Section 2(c).
"Extension Term" is defined in Section 1.3.
"Fixed Rent" is defined in Article A, Section 3.
"Ground Lease" means that certain Ground Lease dated October
8, 1984 between Owner as ground lessor and Ground Lessee as amended by that
certain First Amendment to Ground Lease dated June 1, 1991, that certain Second
Amendment to Ground Lease dated November 20, 1992, that certain Third Amendment
to Ground Lease dated December 1, 1995, that certain Fourth Amendment to Ground
Lease dated December 19, 1997 and that certain Fourth Amendment to Ground Lease
[sic] dated April 25, 2002.
"Ground Lessee" means Arizona State University Research Park,
Inc. formerly known as Price-Elliott Research Park, Inc.
"Ground Sublease" means that certain ASU Research Park Lease
dated December 17, 1997 (the "Original Sublease") between Price-Elliott Research
Inc. as landlord and PKS Information Services, Inc. as tenant which was assigned
to and assumed by Tenant pursuant to an Assignment and Assumption Agreement
dated October 12, 2004 and thereafter amended by that certain First Amendment to
ASU Research Park Lease and Consent dated January 28, 2003.
"Guarantor" means Infocrossing, Inc. and its permitted
successors and assigns.
"Guaranty" means that certain Lease Guaranty given by
Guarantor in accordance with Section 21.
"Hazardous Substances" is defined in Section 18.11.
"Impositions" is defined in Section 3.1.
"Indemnified Parties" is defined in Section 11.3.
"Land" means that certain real property described on Exhibit
"A", attached hereto and incorporated herein by this reference.
"Landlord" is defined in the introductory paragraph to this
Lease.
"Lease" means this lease made between Landlord, as landlord,
and Tenant, as tenant.
"Lease Year" shall mean each twelve month period during the
Primary Term and each Extended Term. The first Lease Year shall commence on the
Commencement Date and continue until and include the last day of the calendar
month in which the first anniversary of the Commencement Date occurs, unless the
Commencement Date is on the first day of the month, in which case it shall end
on the day immediately preceding such first anniversary.
"Mortgage" is defined in Section 3.2.
"Mortgagee" is defined in Section 3.2.
"Non-Disturbance Agreement" is defined in Section 10.1.
"Offer" is defined in Section 24.1.
"Owner" means The Arizona Board of Regents acting for and on
behalf of Arizona State University which is the owner in fee simple of the Land.
"Permitted Encumbrances" shall mean those certain liens,
easements, rights of way and other encumbrances now or hereafter encumbering the
Property.
"Property" means collectively Landlord's interest in the Land
and the Building.
"Purchase Date" is defined in Section 24.1.
"Purchase Price" is defined in Section 24.6.
"Remedial Work" is defined in Section 18.7.
"Rent" is defined in Section 2.3.
"Report" is defined in Section 18.1.
"Requirements" is defined in Section 11.1.
"Restoration" is defined in Section 7.1.
"ROFO Notice" is defined in Section 24.2.
"Sale Agreement" means the Agreement for Sale and Leaseback
dated as of November 30, 2005 between Landlord, as buyer, and Tenant, as seller.
"Sublease" is defined in Section 9.1.
"Tenant" is defined in the introductory paragraph to this
Lease.
"Tenant's Knowledge" is defined in Section 18.13 and Section
20.15.
"Term" is defined in Article A, Section 2(a).
"Third Party" means any third party other than Tenant,
Landlord, any affiliate of Landlord and/or any Mortgagee.
"Third Party Contract" is defined in Section 24.3.
"Third Party Price" is defined in Section 24.3.
"Threshold Amount" is defined in Section 5.4.
"Transfer" is defined in Section 9.1.
"Work" is defined in Section 5.5.
ARTICLE 1
PROPERTY AND TERM
Section 1.1. (a) During the Term, Landlord, in consideration
of the rents herein reserved and of the terms, provisions, covenants and
agreements on the part of Tenant to be kept, observed and performed, does hereby
lease and demise the Property unto Tenant, and Tenant does hereby hire and take
the Property from Landlord, subject to each and every matter affecting title to
the Property including, without limitation, all of the following which are in
effect as of the Commencement Date: all easements, rights of way, declarations,
covenants, conditions and restrictions, liens, encumbrances, encroachments,
licenses, notices of pendency, charges, zoning laws, ordinances, regulations,
building codes and other governmental laws, rules and orders affecting the
Property, and other exceptions to Landlord's title, whether or not the same are
of public record.
(b) The parties acknowledge that Landlord's interest
in the Land is in fact a subleasehold interest pursuant to the Ground Sublease,
which interest was assigned by Tenant to Landlord immediately prior to the
Commencement Date pursuant to an Assignment and Assumption of Lease Agreement.
Tenant acknowledges and agrees that in addition to all other obligations for
which it is responsible pursuant to this Lease, during the Term, it shall fully
and timely discharge all of Landlord's obligations as subtenant pursuant to the
Ground Sublease. Tenant shall deliver to Landlord, and Landlord shall deliver to
Tenant, copies of any written notice received by it from Ground Lessee or Owner
no later than one (1) Business Day after its receipt thereof.
Section 1.2. Tenant shall lease the Property for the Term,
unless sooner terminated as hereinafter provided or pursuant to law.
Section 1.3. (a) Provided there is no then uncured Event of
Default, Tenant shall have the right, at its option, to extend the Term for two
(2) additional ten (10) year periods, (each, an "Extension Term") in the manner,
and subject to the conditions, set forth below. The first Extension Term shall
commence on the day after the Expiration Date and shall expire on the day
immediately preceding the tenth anniversary of the Expiration Date unless the
Extension Term shall sooner end pursuant to any of the terms, covenants or
conditions of this Lease or pursuant to law. The second Extension Term shall
commence on the day after the first Extension Term shall expire and shall expire
on the tenth anniversary of the day the second Extension Term commenced, unless
such second Extension Term shall sooner end pursuant to any of the terms,
covenants or conditions of this Lease or pursuant to law. Provided this Lease
shall then be in full force and effect and there is then no uncured Event of
Default hereunder, Tenant may exercise its option to extend the Term by giving
Landlord written notice of such election no sooner than two (2) years prior to
the Expiration Date or the expiration of the then current Extension Term, as the
case may be, and no later than eighteen (18) months prior to the Expiration Date
or the expiration of the then current Extension Term, as the case may be, the
time of exercise being of the essence, and upon the giving of such notice, this
Lease and the Term shall be extended without execution or delivery of any other
or further documents, with the same force and effect as if such Extension Term
had originally been included in the Term and the Expiration Date shall thereupon
be deemed to be the last day of such Extension Term. Notwithstanding Tenant's
exercise of its option under this Section 1.3, if there shall then be an uncured
Event of Default hereunder as of the Expiration Date, as such Expiration Date
may have been extended, Landlord shall have the right to cancel such exercise by
Tenant, in which event the Term shall expire on the Expiration Date or the
expiration date of the then current Extension Term, as the case may be and the
provisions of this Section 1.3 shall be deemed null and void and of no further
force or effect. Except as provided in subsections (b) and (c) below, all of the
terms, covenants and conditions of this Lease shall continue in full force and
effect during each Extension Term, including items of Additional Rent which
shall remain payable on the terms herein set forth.
(b) Fixed Rent during each Extension Term shall be equal to
one hundred (100%) percent of the fair market rent (the "Fair Market Rent") as
determined in accordance with the procedure set forth below.
(c) The Fair Market Rent for the purpose of this Section 1.3
shall be determined in the following manner:
(i) The Fair Market Rent shall be the "triple net" rent generally
payable in the market area in which the Property is located for equivalent space
in a single-tenant Class-A building of approximately the same quality, size and
condition as the Building, giving due consideration to the quality of the design
of the Building, the type of improvements, the condition of the Property as
improved, the location of the Property and the Building, the length of the
extended Term, the credit-worthiness of the Tenant and all other factors that
would be relevant to a willing landlord and a willing tenant unaffiliated with
the Landlord desiring to enter into a lease of the Property for the Term.
Landlord and Tenant shall attempt to reach an agreement as to the determination
of the Fair Market Rent within thirty (30) days after the date of Landlord's
receipt of Tenant's election to renew the Term of the Lease. Tenant shall
specify the name and address of its designated appraiser with each election made
by Tenant to extend the Term of this Lease pursuant to Section 1.3(a). If,
within thirty (30) days after Landlord's receipt of Tenant's election to renew
the Term of the Lease, the parties have not agreed upon the Fair Market Rent,
Landlord shall give written notice to Tenant specifying the name and address of
its designated appraiser within three (3) business days from the last day of
such 30-day period. Such two appraisers shall, within thirty (30) days after the
designation of the Landlord's appraiser, each make their determination of the
Fair Market Rent in writing and simultaneously shall give written notice thereof
to each other and to Landlord and Tenant. Such two appraisers shall have twenty
(20) days after the receipt of notice of each other's determinations to confer
with each other and to attempt to reach agreement as to the determination of the
Fair Market Rent. If such appraisers shall fail to concur as to such
determination within said twenty (20) day period, they shall give written notice
thereof to Landlord and Tenant and shall designate a third appraiser within
three (3) business days from the last day of such 30-day period. If the two
appraisers shall fail to agree upon the designation of such third appraiser
within five (5) days after said twenty (20) day period, either or both of them
shall give written notice of such failure to agree to Landlord and Tenant and,
if Landlord and Tenant fail to agree upon the selection of such third appraiser
within five (5) days after the appraisers appointed by the Landlord and Tenant
give notice as aforesaid, then either party on behalf of both may apply to the
American Arbitration Association or any successor thereto, or on its failure,
refusal, or inability to act, to a court of competent jurisdiction, for the
designation of such third appraiser.
(ii) All appraisers shall be independent MAI real estate
appraisers who shall have had at least fifteen (15) years' continuous experience
in the business of appraising leased real estate in the metropolitan area in
which the Property is located.
(iii) The third appraiser shall conduct such investigations as
he or she may deem appropriate and shall, within twenty (20) days after the date
of his or her designation, make an independent determination of the Fair Market
Rent.
(iv) If none of the determinations of the appraisers varies
from the mean of the determinations of the other appraisers by more than ten
percent (10%), the mean of the determinations of the three appraisers shall be
the Fair Market Rent. If, on the other hand, the determination of any single
appraiser varies from the mean of the determinations of the other two appraisers
by more than ten percent (10%), the mean of the determination of the two
appraisers whose determinations are closest shall be the Fair Market Rent.
(v) The determination of the appraisers, as provided above,
shall be conclusive upon Landlord and Tenant and shall have the same force and
effect as a judgment made in a court of competent jurisdiction.
(vi) Each party shall pay fees, costs and expenses of the
appraiser selected by it and its own counsel fees and one-half (1/2) of all
other expenses and fees of any such appraisal, including, but not limited to,
the fees, costs and expenses of the third appraiser.
(d) If for any reason the Fair Market Rent has not been
determined by the date on which it shall become effective, then, until such Fair
Market Rent has been determined in accordance herewith, the Fixed Rent shall
continue to be the Fixed Rent in effect at the end of current Term, and there
shall be an adjustment of Fixed Rent promptly after determination of Fair Market
Rent in accordance with this Section 1.3.
ARTICLE 2
FIXED RENT AND ADDITIONAL RENT
Section 2.1. Tenant shall pay to Landlord as Fixed Rent for
the Property during the (a) Primary Term the amounts stated in Article A,
Section 3, and (b) each Extension Term the amounts determined in accordance with
Section 1.3(b). Fixed Rent shall be payable in equal monthly installments in
advance on the first day of each and every month during the Term, without
previous demand therefor and without offset or deduction of any kind whatsoever.
Notwithstanding the foregoing, Tenant shall pay the partial month's installment
of Fixed Rent (with respect to the remaining days of the month in which
Commencement Date occurs) on the Commencement Date.
Section 2.2. During the Term, Tenant shall also pay and
discharge as additional rent (the "Additional Rent") all other amounts,
liabilities and obligations of whatsoever nature relating to the Property,
including, without limitation, all Impositions (as defined in Section 3.1),
insurance premiums (as contemplated by Sections 6.1 and 6.10), all of Landlord's
obligations under the Ground Sublease, including the obligation to pay "Annual
Rent" and the "Municipal Services Fee", as each are defined in the Ground
Sublease, as well as any insurance which is required to be carried in favor of
Ground Lessee and Owner, and any obligations arising under any declarations,
easements, restrictions, or other similar agreements affecting the Property or
any adjoining property thereto, and all interest and penalties that may accrue
thereon in the event of Tenant's failure to pay such amounts when due, and all
damages, costs and expenses which Landlord may incur by reason of any default of
Tenant or failure on Tenant's part to comply with the terms of this Lease, all
of which Tenant hereby agrees to pay upon demand or as is otherwise provided
herein. Upon any failure by Tenant to pay any of the Additional Rent, Landlord
shall have all legal, equitable and contractual rights, powers and remedies
provided either in this Lease or by statute or otherwise in the case of
nonpayment of the Fixed Rent. The term Additional Rent shall be deemed rent for
all purposes hereunder.
Section 2.3. All Fixed Rent and all Additional Rent payable to
Landlord hereunder (collectively, "Rent") shall be made payable to Landlord and
sent to Landlord's address set forth in Article A, or to such other person or
persons or at such other place as may be designated by notice from Landlord to
Tenant made in accordance with Section 20.8, from time to time, and shall be
made in United States currency which shall be legal tender for all debts, public
and private. At Landlord's request, Rent shall be payable when due by wire
transfer of immediately available funds to an account designated from time to
time by Landlord. Notwithstanding the foregoing, Impositions and all sums due
pursuant to the Ground Sublease shall be payable to the parties to whom they are
due, except as otherwise provided herein.
Section 2.4. This Lease shall be deemed and construed to be a
"net lease", and Tenant shall pay to Landlord, absolutely net throughout the
Term, the Rent, free of any charges, assessments, impositions or deductions of
any kind and without abatement, deduction or set-off whatsoever, except as
otherwise expressly provided herein. Under no circumstances or conditions,
whether now existing or hereafter arising, or whether beyond the present
contemplation of the parties, shall Landlord be expected or required to make any
payment of any kind whatsoever or be under any other obligation or liability
hereunder, except as herein otherwise expressly set forth. Tenant shall pay all
costs, expenses and charges of every kind and nature relating to the Property,
except debt service on any Mortgage or any other indebtedness of Landlord, which
may arise or become due or payable prior to, during or after (but attributable
to a period falling prior to or within) the Term, as may be extended. Except as
otherwise specifically provided in this Lease, Tenant's obligation to pay Rent
hereunder shall not terminate prior to the date definitely fixed for the
expiration of the Term (as may be extended) notwithstanding the exercise by
Landlord of any or all of its rights under Article 12 hereof or otherwise, and
the obligations of Tenant hereunder shall not be affected (except as is
otherwise specifically provided herein to the contrary) by reason of: any damage
to or destruction of the Property or any part thereof, any taking of the
Property or any part thereof or interest therein by condemnation or otherwise,
any prohibition, limitation, restriction or prevention of Tenant's use,
occupancy or enjoyment of the Property or any part thereof, or any interference
with such use, occupancy or enjoyment by any person or for any reason, any
matter affecting title to the Property any eviction by paramount title or
otherwise, any default by Landlord hereunder, the impossibility,
impracticability or illegality of performance by Landlord, Tenant or both, any
action of any governmental authority, Tenant's acquisition of ownership of all
or part of the Property (unless this Lease shall be terminated by a writing
signed by all persons, including any mortgagee, having an interest in the
Property), any breach of warranty or misrepresentation, or any other cause
whether similar or dissimilar to the foregoing and whether or not Tenant shall,
have notice or knowledge hereof and whether or not such cause shall now be
foreseeable. The parties intend that the obligations of Tenant under this Lease
shall be separate and independent covenants and agreements and shall continue
unaffected unless such obligations have modified or terminated pursuant to an
express provision of this Lease.
Section 2.5. If Tenant shall fail to make payment of any
installment of Fixed Rent or Additional Rent payable to Landlord hereunder
within five (5) business days from the date upon which the same shall first have
been due hereunder then and in each such event Tenant shall pay Landlord on
demand, in addition to the installment or other payment due, as Additional Rent
hereunder, a late payment fee to compensate Landlord for legal, accounting and
other expenses incurred by Landlord in administering the delinquent account by
reason of such late payment an additional sum of four (4%) percent of the amount
due as a late charge. For the purposes of this Section 2.5, payments shall be
deemed made upon the date of actual receipt by Landlord at the place specified
in or pursuant to Article A, Section 5 hereof. The late payment fee required to
be paid by Tenant pursuant to this Section 2.5 shall be in addition to all other
rights and remedies provided herein or by Law to Landlord for such nonpayment.
ARTICLE 3
IMPOSITIONS
Section 3.1. From and after the Commencement Date and
throughout the Term, Tenant shall pay and discharge not later than fifteen (15)
days before any fine, penalty, interest or cost may be added thereto for the
non-payment thereof, all taxes, assessments, water rents, sewer rents and
charges, duties, impositions, license and permit fees, charges for public
utilities of any kind, common area maintenance charges, assessments and dues
with respect to any Permitted Encumbrances, payments and other charges of every
kind and nature whatsoever, foreseen or unforeseen, general or special, in said
categories, together with any interest or penalties imposed upon the late
payment thereof, which, pursuant to past, present or future law, during, prior
to or after (but attributable to a period falling prior to or within) the Term,
shall have been or shall be levied, charged, assessed, imposed upon or become
due and payable out of or for or have become a lien on the Property or any part
thereof, any improvements or personal property in or on the Property, the Rents
and income payable by Tenant or on account of any use of the Property and such
franchises as may be appurtenant to the use and occupation of the Property (all
of the foregoing being hereinafter referred to as "Impositions"). Tenant shall
submit to Landlord the proper and sufficient receipts or other evidence of
payment and discharge of the same promptly after payment thereof. If any
Impositions are not paid when due under this Lease, Landlord shall have the
right but shall not be obligated to pay the same, provided Tenant does not
contest the same as herein provided. If Landlord shall make such payment,
Landlord shall thereupon be entitled to repayment by Tenant on demand as
Additional Rent hereunder.
Section 3.2. Tenant shall have the right to protest and
contest any Impositions imposed against the Property or any part thereof,
provided (a) the same is done at Tenant's sole cost and expense, (b) nonpayment
will not subject the Property or any part thereof to sale or other liability by
reason of such nonpayment, (c) Landlord shall have the right to require Tenant
to post a bond or other reasonable security with Landlord in order to assure
timely and complete performance by Tenant of its obligations hereunder and (d)
such contest shall not subject Landlord or the holder (the "Mortgagee") of any
mortgage or deed of trust (a "Mortgage") encumbering all or any part of the
Property to the risk of any criminal or civil liability.
Section 3.3. To the extent permitted by law, Tenant shall have
the right to apply for the conversion of any Impositions to make the same
payable in annual installments over a period of years, and upon such conversion
Tenant shall pay and discharge said annual installments as they shall become due
and payable. If such Impositions either (a) are initially imposed prior to the
last three years of the Term (as the same may be extended) or (b) reflect
assessments for public improvements initiated or requested by Tenant, Tenant
shall pay all such deferred installments prior to the expiration or sooner
termination of the Term, notwithstanding that such installments shall not then
be due and payable; provided, however, that (x) any Impositions other than one
converted by Tenant so as to be payable in annual installments as aforesaid or
(y) Impositions which are converted by Tenant so as to be payable in annual
installments during the last three years of the Term and which in either event,
relate to a fiscal period of the taxing authority, a part of which is included
in a period of time after the Expiration Date, shall (whether or not such
Impositions shall be assessed, levied, confirmed, imposed or become payable,
during the Term) be adjusted between Landlord and Tenant as of the Expiration
Date, so that Landlord shall pay that portion of such Impositions which relate
to that part of such fiscal period included in the period of time after the
Expiration Date, and Tenant shall pay the remainder thereof.
Section 3.4. If at any time during the Term, a tax or excise
on Rents or other tax, however described, is levied or assessed with respect to
the Rent or any part thereof (as opposed to the income of Landlord) or against
Landlord as a substitute in whole or in part for any Impositions theretofore
payable by Tenant, other than taxes referenced in Section 3.5 below, Tenant
shall pay and discharge such tax or excise on Rents or other tax before it
becomes delinquent, and the same shall be deemed to be an Imposition levied
against the Property.
Section 3.5. Except as set forth in Section 3.4 above, Tenant
shall not be obligated to pay any franchise, excise, corporate, estate,
inheritance, succession, capital, levy or transfer tax of Landlord or any
income, profits or revenue tax upon the income of Landlord.
Section 3.6. In the event that Landlord is required pursuant
to the terms of any Mortgage to make monthly or other tax escrow payments to any
Mortgagee, or in the event that a Default occurs, Tenant agrees that, on demand
made by Landlord, it shall: (a) deposit with Mortgagee (or with Landlord if
there is no Mortgage), on the day of demand and on the same day each month
thereafter until thirty (30) days prior to the date when the next installment of
impositions is due to the authority or other person to whom the same is paid, an
amount equal to said next installment of Impositions divided by the number of
months over which such deposits are to be made; and (b) thereafter during the
Term deposit with Mortgagee (but not Landlord) an amount each month estimated by
Mortgagee to be adequate to create a fund which, as each succeeding installment
of Impositions becomes due, will be sufficient, thirty (30) days prior to such
due date, to pay such installment in full; provided that the amount and other
terms pertaining to such deposits shall otherwise be consistent with the terms
and provisions of this Article 3. If at any time the amount of any Imposition is
increased or Mortgagee believes that it will be, said monthly deposits shall be
increased upon demand by Mortgagee so that, thirty (30) days prior to the due
date for each installment of Impositions, there will be deposits on hand with
Mortgagee (but not Landlord) sufficient to pay such installments in full. To the
extent permitted by applicable law, Mortgagee shall not be required to deposit
any such amounts in an interest bearing account. For the purpose of determining
whether Mortgagee has on hand sufficient moneys to pay any particular Imposition
at least thirty (30) days prior to the due date therefor, deposits for each
category of Imposition shall be treated separately, it being the intention that
Mortgagee shall not be obligated to use moneys deposited for the payment of an
item not yet due and payable to the payment of an item that is due and payable.
Notwithstanding the foregoing, it is understood and agreed that to the extent
permitted by applicable law, deposits provided for hereunder may be held by
Mortgagee in a single bank account and commingled with other funds of Mortgagee.
Upon a transfer of the Property, the transferor shall be deemed to be released
from all liability with respect to the deposits made hereunder to the extent
that the transferor has transferred deposits of Impositions made hereunder to
the transferee and Tenant agrees to look to the transferee solely with respect
thereto, and the provisions hereof shall apply to each successive transfer of
the said deposits. At such time as any Mortgage is released as a lien on the
Property, any deposit made hereunder shall be transferred to a new Mortgagee, or
if there is no Mortgage, to Landlord to be returned to Tenant.
Section 3.7. Landlord shall not be required to join in any
proceedings referred to in this Article unless the provisions of any law, rule
or regulation at the time in effect shall require that such proceedings be
brought by and/or in the name of Landlord, in which event, Landlord, at Tenant's
sole risk and expense, shall join and cooperate in such proceedings or permit
the same to be brought in its name but shall not be liable for the payment of
any costs or expenses in connection with any such proceedings.
Section 3.8. The provisions of this Article 3 shall survive
the expiration or earlier termination of this Lease.
ARTICLE 4
USE OF PROPERTY
Section 4.1. The Property may be used and occupied only for
the purposes set forth in Article A, Section 4. In addition, Landlord agrees not
to unreasonably withhold, condition or delay its consent to any other lawful use
requested in writing by Tenant provided that: (a) at the time of such request,
Tenant has a tangible net worth at least equal to or better than its tangible
net worth on the Commencement Date, (b) such use will not result in the
production, storage, use or release of Hazardous Materials in violation of
Article 18, (c) such use will not diminish the fair market value of the
Property, and (d) such use will comply with all Permitted Encumbrances and all
other terms of this Lease. Tenant shall not create or suffer to exist any public
or private nuisance, hazardous or illegal condition or waste on or with respect
to the Property.
Section 4.2. Tenant hereby represents and warrants to Landlord
that all necessary certificates of occupancy, permits, licenses and consents
from any or all appropriate governmental authorities have been obtained by or on
behalf of Tenant and are in full force and effect as may be required by law for
Tenant to occupy the Property and conduct business thereon.
ARTICLE 5
CONDITION OF PROPERTY, ALTERATIONS AND REPAIRS
Section 5.1. Tenant has examined the Property, is familiar
with the physical condition, expenses, operation and maintenance, zoning, status
of title and use that may be made of the Property and every other matter or
thing affecting or related to the Property, and is leasing the same in its "As
Is" condition. Landlord has not made and does not make any representations or
warranties whatsoever with respect to the Property or otherwise with respect to
this Lease. Tenant assumes all risks resulting from any defects (patent or
latent) in the Property or from any failure of the same to comply with any
governmental law or regulation applicable to the Property or the uses or
purposes for which the same may be occupied and Tenant hereby waives all claims
with respect to the same, including without limitation, all tort and breach of
warranty claims.
Section 5.2. During the Primary Term and each Extended Term,
at Tenant's sole cost and expense, Tenant shall keep the Property and the
adjoining sidewalks and curbs (unless third parties are responsible for the
cleaning and maintenance of such adjoining sidewalks and curbs), if any, clean
and in good condition and repair, free of accumulations of dirt, rubbish, snow
and ice, and Tenant shall make all repairs and replacements, structural and
non-structural, foreseen and unforeseen, and shall perform all maintenance,
necessary to maintain the Property and any sidewalks and curbs adjacent thereto
in good condition and repair (unless third parties are responsible for the
cleaning and maintenance of such adjoining sidewalks and curbs). When used in
this Section 5.2, the term "repairs" shall include all necessary additions,
alterations, improvements, replacements, renewals and substitutions. All repairs
made by Tenant shall be not less than equal in quality and class to the original
Alteration and shall be made in compliance with all Requirements (hereinafter
defined). Landlord shall not be required to furnish any services or facilities
or to make any repairs or alterations to the Property, and Tenant hereby assumes
the full and sole responsibility for the condition, operation, repair,
replacement, maintenance and management of the Property, and all costs and
expenses incidental thereto.
Section 5.3. Landlord shall not be responsible for the cost of
any alterations of or repairs to the Property of any nature whatsoever,
structural or otherwise, whether or not now in the contemplation of the parties.
To the extent not prohibited by law, Tenant hereby waives and releases all
rights now or hereinafter conferred by statute or otherwise which would have the
effect of limiting or modifying any of the provisions of this Article 5.
Section 5.4. Tenant shall have the right at any time and from
time to time during the Term to make, at its sole cost and expense, changes,
alterations, additions or improvements (collectively, "Alterations") in or to
the Property subject, in each case, to all of the following:
(a) No Alteration shall be undertaken except after fifteen
(15) days' prior notice to Landlord, provided that no such notice shall be
required with respect to any nonstructural Alteration involving an estimated
cost of less than the Threshold Amount (hereinafter defined) (as estimated by a
licensed architect or engineer reasonably approved by Landlord) or involving an
actual cost (based on a lump sum or guaranteed maximum price contract) less than
the Threshold Amount.
(b) No structural Alteration, and no other Alteration
involving an estimated cost of more than the Threshold Amount (as estimated by a
licensed architect or engineer reasonably approved by Landlord) shall be made
without the prior written consent of Landlord, which consent shall not be
unreasonably withheld, delayed or conditioned. Notwithstanding the foregoing,
Tenant may make Alterations consisting of normal painting, carpeting, wall
coverings, installation, removal or reconfiguration of cubicles, demountable
wall partitions or other similar office installations and office decorations
without Landlord's prior written consent.
(c) Any Alteration when completed shall be of such a character
as not to reduce the value of the Property below its value immediately before
such Alteration.
(d) No Alteration shall be performed by Tenant if the same
would materially reduce the cubic content of the usable area of the Building, or
weaken, temporarily or permanently, the structure of the Building or any part
thereof, or impair any zoning or materially impair other amenities of the
Property.
(e) The reasonable cost and expense of Landlord's, and the
cost and expense of Mortgagee's review of any plans and specifications required
to be furnished pursuant to Section 5.5 below shall be paid by Tenant to
Landlord, within ten (10) days after demand, or, at the option of Landlord, as
Additional Rent.
(f) For purposes of Sections 5.4 and 5.5,the "Threshold
Amount" shall mean an amount equal to $250,000.00, exclusive of equipment. For
purposes of determining the Threshold Amount, an Alteration shall include any
series of related improvements (exclusive of equipment) whose cost, in the
aggregate equals or exceeds $250,000.00.
(g) The provisions and conditions of Section 5.5 shall apply
to any work performed by Tenant under this Article.
Section 5.5. Tenant agrees that all Alterations, repairs,
Restoration and other work that Tenant shall be required or permitted to do
under the provisions of this Lease (each hereinafter called the "Work") shall be
(i) performed in a first-class, workmanlike manner, and in accordance with all
Requirements and all requirements set forth in the Ground Sublease, as well as
any plans and specifications therefor which shall have been approved by Landlord
to the extent that such approval is required hereunder, (ii) commenced and
completed promptly and (iii) done in accordance with all of the following terms
and conditions:
(a) If the Work shall (i) involve any structural repair,
Alterations, Restoration or other Work, or (ii) cost in excess of the Threshold
Amount, then the Work shall not be commenced until detailed plans and
specifications (including layout, architectural, mechanical and structural
drawings), prepared by a licensed architect or engineer reasonably approved by
Landlord shall have been submitted to and approved by Landlord, which approval
shall not be unreasonably withheld, conditioned or delayed.
(b) All Work shall be commenced only after all required
municipal and other governmental permits, authorizations and approvals and all
approvals required pursuant to the Ground Sublease shall have been obtained by
Tenant, at its own cost and expense, and the originals or certified copies
thereof delivered to Landlord. Landlord will, on Tenant's written request,
promptly execute any documents necessary to be signed by Landlord to obtain any
such permits, authorizations and approvals, provided that Tenant shall bear any
expense or liability of Landlord in connection therewith.
(c) No Work costing more than $500,000.00 or affecting the
structure of the Improvements shall be undertaken except under the supervision
of a licensed architect or engineer approved by Landlord, which approval shall
not be unreasonably withheld.
(d) If the Work will cost more than the $1,000,000.00 (as
estimated in writing by a licensed architect or engineer reasonably approved by
Landlord or based upon the actual cost of the Work based on a lump sum or
guaranteed maximum price contract for the Work), it shall not be commenced until
Tenant shall have obtained from its general contractor and delivered to
Landlord, a performance bond and a labor and materials payment bond (issued by a
corporate surety licensed to do business in the state in which the Property is
located and reasonably satisfactory to Landlord), each in an amount equal to the
estimated cost of such Work and in form otherwise reasonably satisfactory to
Landlord.
(e) Subject to Tenant's contest rights pursuant to Section
11.4, the cost of all Work shall be paid promptly so that the Property and
Tenant's leasehold estate therein shall at all times be free from (i) liens for
labor or materials supplied or claimed to have been supplied to the Property or
Tenant, and (ii) chattel mortgages, conditional sales contracts, title retention
agreements, security interests and agreements, and financing agreements and
statements.
(f) At all times when any Work is in progress, Tenant shall
maintain or cause to be maintained with such companies and for such periods as
Landlord may require (i) workmen's compensation insurance covering all persons
employed in connection with the Work, in an amount at least equal to the minimum
amount of such insurance required by law; and (ii) for the mutual protection of
Landlord, Tenant and any Mortgagee, (1) builder's risk insurance, completed
value form, covering all physical loss, in an amount reasonable satisfactory to
Landlord, and (2) commercial general liability insurance against all hazards,
with limits for bodily injury or death to any one person, for bodily injury or
death to any number of persons in respect of any one accident or occurrence, and
for Property damage in respect of one accident or occurrence in such amounts as
Landlord may reasonably require. Such commercial general liability insurance may
be satisfied by the insurance required under Section 6.1(a), but may be effected
by an endorsement, if obtainable, upon the insurance policy referred to in said
Section. The provisions and conditions of Article 6 hereof shall apply to any
insurance which Tenant shall be required to maintain or cause to be maintained
under this subsection.
(g) Upon completion of any Work, Tenant, at Tenant's expense,
shall obtain certificates of final approval of such Work required by any
governmental or quasi-governmental authority and shall furnish Landlord with
copies thereof, together with "as-built" plans and specifications for such Work
(if the Work undertaken by Tenant required the filing of any plans with any
governmental authority).
(h) The conditions of Section 5.4 shall have been
complied with, to the extent applicable to the Work.
Section 5.6. Any Work shall be subject to inspection at any
reasonable time and from time to time and when accompanied by a representative
of Tenant (except in the event of an emergency), by Landlord, its architect and
Mortgagee, or their duly authorized representatives, and if Landlord's architect
or Mortgagee upon any such inspection shall be of the opinion, which opinion
shall not be unreasonable, that the Work is not being performed substantially in
accordance with the provisions of this Article 5 or the plans and
specifications, or that any of the materials or Workmanship are not first-class
or are unsound or improper, Tenant shall correct any such failure and shall
replace any unsound or improper materials or workmanship.
Section 5.7. For purposes of this Lease, the word "structural"
when used in connection with any Work shall mean Work affecting the load bearing
walls, support beams, structural components of the roof, any replacement of the
roof (whether or not of structural components), foundation of the Building or
that affects the proper functioning of the Building's mechanical, electrical,
sanitary, plumbing, heating, air-conditioning, ventilating, utility or any other
service systems.
Section 5.8. All fixtures, structures and other improvements
shall become the property of Landlord and shall remain upon and be surrendered
with the Property other than (a) trade fixtures (including, without limitation,
process equipment and compressors), (b) de-mountable wall partitions, and (c)
those items listed on Exhibit "B", whether now installed or installed in or upon
the Property at any time during the Term. Prior to the commencement of any Work,
Landlord will, upon written request by Tenant, notify Tenant whether Landlord
will require such Work to be removed from the Property prior to the Expiration
Date or earlier termination of this Lease. If Tenant fails to request such
determination at the time of any such Work, Landlord may notify Tenant no later
than one hundred twenty (120) days prior to the Expiration Date, that Landlord
elects to have the same removed by the Expiration Date at Tenant's expense. All
property permitted or required to be removed by Tenant at the end of the Term
remaining in the Property after Tenant's removal shall be deemed transferred and
assigned to Landlord and may, at the election of Landlord, either be retained as
Landlord's property or may be removed from the Property by Landlord at Tenant's
expense. Tenant shall be responsible for, and shall reimburse Landlord within
three (3) business days after written demand therefor, any damage to the
Property caused in whole or in part by the removal or demolition of Tenant's
fixtures, structures or other improvements which Tenant is required to remove
pursuant to this Section 5.8 or which Tenant elects under the provisions of this
Lease to remove. The provisions of this Section 5.8 shall survive the expiration
or earlier termination of this Lease.
ARTICLE 6
INSURANCE
Section 6.1. Throughout the Primary Term and each Extended
Term, Tenant shall, at its own cost and expense, provide and keep in force, for
the benefit of Landlord, Tenant and any Mortgagee:
(a) broad form commercial general liability insurance
(including protective liability coverage on operations of independent
contractors engaged in construction and blanket contractual liability insurance
and certified and non-certified acts of terrorism if reasonably available)
protecting Landlord, Tenant and any Mortgagee against all claims for damages to
person or property or for loss of life or of property occurring upon, in, or
about the Property, if any, written on a per-occurrence basis with limits of
liability of not less than $5,000,000.00 with respect to bodily injury and
property damage arising from any one occurrence and $10,000,000.00 in general
aggregate limit and an umbrella policy in an amount not less than $10,000,000.00
in excess coverage, or such greater limits as may be reasonably required from
time to time by any Mortgagee or as may be reasonably required from time to time
by Landlord consistent with insurance coverage on properties similarly
constructed, occupied and maintained. Such coverage shall waive the insurer's
rights of subrogation against Landlord;
(b) a standard all-risk property insurance policy in respect
of the Property and all installations, additions and improvements which may now
or hereafter be erected thereon, including, without limitation, Broad Form Flood
(including back-up of sewers and drains, seepage and surface water), ICC,
demolition coverage of not less than $5,000,000 and full coverage for Contingent
Operation of Building Laws, and, to the extent required by any Mortgagee,
Earthquake (if located within a seismic area), and certified and uncertified
terrorism coverage in an amount equal to the full replacement value of the
Property for non-certified terrorism and no reduction of limits for certified
terrorism, all of the foregoing coverages shall be in an amount sufficient to
prevent Landlord and Tenant from becoming co-insurers and in any event in an
amount not less than one hundred percent (100%) of the actual replacement value
thereof (i.e., including the cost of debris removal but excluding foundations
and excavations) as reasonably determined by Landlord from time to time;
(c) business interruption insurance covering risk of loss due
to the occurrence of any of the hazards covered by the insurance to be
maintained by Tenant described in Section 6.1(b) with coverage, for a period of
at least eighteen (18) months following the insured-against peril plus six (6)
months extended period of indemnity coverage, of 100% of all Rent to be paid by
Tenant under this Lease. Coverage under this section (c) arising out of an act
of terrorism shall be limited to a period of twelve (12) months;
(d) Worker's compensation insurance (including employers,
liability insurance) covering all persons employed at the Property by Tenant to
the extent required by the laws and statutes of the state in which the Property
is located, including, without limitation, during the course of Work to the
Property;
(e) boiler insurance, if applicable, in an amount not less
than one hundred percent (100%) of the actual replacement value thereof and of
any improvements in which any such boiler is located (including the cost of
debris removal but excluding foundations and excavations) as reasonably
determined by Landlord from time to time which insurance includes combined
direct damage and business interruption on a comprehensive basis subject to a
deductible of no greater than $ 25,000;
(f) if a sprinkler system is located in the Building,
sprinkler leakage insurance in amounts reasonably approved by Landlord; and
(g) such other or further insurance, in such amounts and in
such form, as is customarily obtained by owners of properties similarly located,
constructed, occupied and maintained and is available at commercially reasonable
rates, or as otherwise reasonably required by any Mortgagee.
Section 6.2. Whenever under the terms of this Lease Tenant is
required to maintain insurance for the benefit of Landlord, Landlord shall be
(a) an additional insured in all such liability insurance policies and (b) an
additional named insured and as loss payee in all such property policies. In the
event that the Property shall be subject to any Mortgage, the commercial general
liability insurance shall, if required by such Mortgage, name the Mortgagee as
an additional insured and all other insurance provided hereunder shall name the
Mortgagee as an additional insured under a standard "non-contributory mortgagee"
endorsement or its equivalent. All policies of insurance shall provide that such
coverage shall be primary and that any insurance maintained separately by
Landlord or the Mortgagee shall be excess insurance only, except as otherwise
provided in Section 6.10 below. The original certificates of insurance and
endorsements for all policies required to be maintained by Tenant under this
Lease and legible copies of the original property policies shall be delivered to
Landlord and any Mortgagee.
Section 6.3. The amounts payable under any and all insurance
policies insuring against property damage to the Building shall, subject to
Article 7, be made available or "paid over" to Mortgagee or, if there is none,
to Landlord. All property insurance policies required by this Lease shall
provide that all adjustments for claims with the insurers in excess of Fifty
Thousand Dollars ($50,000.00) (exclusive of any deductible) shall be made with
Landlord, Tenant and any Mortgagee. Subject to the terms of any Mortgage, any
adjustments for claims with the insurers involving sums of Fifty Thousand
Dollars ($50,000.00) (exclusive of any deductible) or less shall be made with
Tenant.
Section 6.4. All of the above-mentioned insurance policies
and/or certificates shall be obtained by Tenant and delivered to Landlord on or
prior to the date hereof, and thereafter as provided for herein, and shall be
written by insurance companies: (a) rated A:X or better in "Best's Insurance
Guide" (or any substitute guide acceptable to Landlord); (b) authorized to do
business in the state where the Property is located; and (c) of recognized
responsibility and which are satisfactory to Landlord and any Mortgagee. Any
deductible amounts shall not exceed $25,000 per occurrence under any property
insurance policy and liability insurance policy hereunder. In the event any of
Tenant's insurance policies contain deductible amounts, Tenant agrees to pay the
amount of such deductibles in the event of a claim.
Section 6.5. At least thirty (30) days prior to the expiration
of any policy or policies of such insurance, Tenant shall renew such insurance,
by delivering to Landlord or Mortgagee, within the said period of time,
certificates of insurance (followed by copies of original policies within a
reasonable period of time) evidencing the coverage described in this Article 6.
All coverage described in this Article 6 shall provide Landlord and Mortgagee
with thirty (30) days' notice of cancellation or change in terms. If Tenant
shall fail to procure the insurance required under this Article 6 in a timely
fashion or to deliver certificates of insurance and the original policies as
required hereunder, Landlord may, at its option and in addition to Landlord's
other remedies in the event of a Default by Tenant, upon not less than three (3)
business days written notice to Tenant (unless Tenant's insurance will expire
prior thereto, in which event no such prior notice shall be required), procure
the same for the account of Tenant, and the cost thereof shall be paid to
Landlord as Additional Rent.
Section 6.6. Tenant shall not violate, or permit to be
violated, any of the conditions of any of the said policies of insurance, and
Tenant shall perform and satisfy the requirements of the companies writing such
policies so that companies of good standing, reasonably satisfactory to
Landlord, shall be willing to write and/or continue such insurance.
Section 6.7. Tenant shall not carry separate or additional
insurance effecting the coverage described in Section 6.1 (b) and (c),
concurrent in form and contributing in the event of any loss or damage to the
Property with any insurance required to be obtained by Tenant under this Lease,
unless such separate or additional insurance shall comply with and conform to
all of the provisions and conditions of this Article. Tenant shall promptly give
notice to Landlord of such separate or additional insurance.
Section 6.8. The insurance required by this Lease, at the
option of Tenant, may be effected by blanket and/or umbrella policies issued to
Tenant covering the Property and other properties owned or leased by Tenant,
provided that the policies otherwise comply with the provisions of this Lease
and allocate to the Property the specified coverage, without possibility of
reduction or coinsurance by reason of, or damage to, any other premises named
therein, and if the insurance required by this Lease shall be effected by any
such blanket or umbrella policies, Tenant shall furnish to Landlord or Mortgagee
certified copies or duplicate originals of such policies in place of the
originals, with schedules thereto attached showing the amount of insurance
afforded by such policies applicable to the Property.
Section 6.9. Landlord shall not be limited in the proof of any
damages which Landlord may claim against Tenant arising out of or by reason of
Tenant's failure to provide and keep in force insurance, as aforesaid, to the
amount of the insurance premium or premiums not paid or incurred by Tenant and
which would have been payable under such insurance, but Landlord shall also be
entitled to recover as damages for such breach, the uninsured amount of any
loss, to the extent of any deficiency in the insurance required by the
provisions of this Lease and damages, costs and expenses of suit suffered or
incurred by reason of damage to, or destruction of, the Property, occurring
during any period when Tenant shall have failed or neglected to provide
insurance as aforesaid.
Section 6.10. Anything is this Article 6 to the contrary
notwithstanding, Landlord shall on the Commencement Date obtain and maintain
during the Term of this Leasethe insurance coverages provided for in Section 6.1
(other than liability insurance for Tenant's operations, business interuption
insurance for Tenant's operations and workers' compensation for Tenant's
employees pursuant to Section 6.1(d) above) in accordance with the requirements
of this Article 6. Landlord shall submit to Tenant, and Tenant shall pay as
Additional Rent, the invoices for the premiums for the insurance coverages
obtained by Landlord which shall be billed at Landlord's actual cost as
allocated to the Property and which shall be payable within ten (10) days of
delivery to Tenant. In the event that after the Commencement Date, Landlord
elects to no longer obtain and maintain the insurance coverages provided for in
Section 6.1, Landlord shall give Tenant not less than thirty (30) days notice
thereof in which event Tenant shall obtain and maintain the insurance coverages
provided for in Section 6.1 in accordance with the requirements of this Article
6 with Landlord retaining the right to thereafter obtain and maintain such
insurance coverages on not less than thirty (30) days notice to Tenant in which
event the provisions of this Section 6.1 shall apply.
ARTICLE 7
DAMAGE OR DESTRUCTION
Section 7.1. (a) If the Property or any part thereof shall be
damaged or destroyed by fire or other casualty (including any casualty for which
insurance was not obtained or obtainable) of any kind or nature, ordinary or
extraordinary, foreseen or unforeseen, (i) Landlord shall, subject to Sections
7.2 and 7.3, pay over to Tenant, upon the terms set forth in Section 7.2, any
moneys which may be recovered by Landlord from property insurance, (ii) this
Lease shall be unaffected thereby and shall continue in full force and effect,
and (iii) Tenant shall, at Tenant's sole cost and expense, expeditiously and in
a good and workmanlike manner, cause such damage or destruction to be remedied
or repaired (the "Restoration") by restoring the Property to its condition
immediately prior to such damage, or destruction. All Restoration Work shall be
performed in accordance with the provisions of this Lease, including, without
limitation, the provisions of Sections 5.4 and 5.5 hereof. Tenant hereby waives
the provisions of any law or statute to the contrary and agrees that the
provisions of this Article shall govern and control in lieu thereof. If Tenant
shall fail or neglect to restore the Property with reasonable diligence, or
having so commenced such Restoration, shall fail to complete the same with
reasonable diligence, or if prior to the completion of any such Restoration by
Tenant, this Lease shall expire or be terminated for any reason, Landlord shall
have the right, but not the obligation, to complete such Restoration at Tenant's
cost and expense and the cost thereof shall be payable on demand as Additional
Rent, together with interest thereon at the Default Rate. In addition, if
Landlord so completes the Restoration as provided hereunder, Landlord shall be
entitled to a supervision fee in the amount equal to two and one-half percent (2
1/2 %) of the cost of the Restoration Work from Tenant to compensate Landlord
for administering the Restoration.
(b) Notwithstanding anything contained herein to the contrary,
provided (i) a material portion of the Property is damaged or destroyed by fire
or other casualty and such damage is of such a nature that the Restoration
cannot be substantially completed within eighteen (18) months after the
occurrence of the casualty (it being agreed that substantial completion means
that the Property can then be lawfully occupied by Tenant no later than the end
of such period), as estimated by a licensed architect or engineer retained by
Tenant and reasonably approved by Landlord (for purposes of such estimate, such
Restoration shall not include Alterations made by Tenant and installation of
personal property, equipment and trade fixtures of Tenant), (ii) there is then
no Event of Default (including without limitation any uncured Event of Default
with respect to the matters set forth in Article 6), (iii) the insurance
proceeds actually available to Landlord for Restoration, together with any other
funds Tenant may elect to contribute, equal or exceed the cost of such
Restoration (as estimated in writing by a licensed architect retained by
Landlord), and (iv) such amounts are paid to Landlord, Tenant may terminate this
Lease in which event this Lease shall be of no further force and effect as of
the date of such termination, except that any obligation or liability of Tenant,
actual or contingent, under this Lease which has accrued on or prior to such
termination date shall survive.
Section 7.2. Subject to the provisions of this Article 7,
Landlord shall pay over to Tenant from time to time, upon the following terms,
any moneys which may be received by Landlord from property insurance provided by
Tenant but, in no event, to any extent or in any sum exceeding the amount
actually collected by Landlord upon the loss; provided, however, that Landlord,
before paying such moneys over to Tenant, shall be entitled to reimburse itself
therefrom to the extent, if any, of the reasonable out-of-pocket expenses
actually paid or incurred by Landlord in collection of such moneys. Landlord
shall pay to Tenant, as herein provided, the aforesaid insurance proceeds, for
the purpose of Restoration to be made by Tenant to restore the Property to a
value which shall be not less than their value prior to such fire or other
casualty. Prior to making any Restoration, Tenant shall furnish Landlord with an
estimate of the cost of such Restoration, prepared by a licensed architect or
engineer reasonably approved by Landlord. Such insurance proceeds shall be paid
to Tenant from time to time thereafter in installments as the Restoration
progresses, upon application to be submitted by Tenant to Landlord showing the
cost of labor and material incorporated in the Restoration, or incorporated
therein since the last previous application, and paid for by Tenant. If any
vendor's, mechanic's, laborer's, or materialman's lien is filed against the
Property or any part thereof, or if any public improvement lien is created or
permitted to be created by Tenant and is filed against Landlord, or any assets
of, or funds appropriated to, Landlord, Tenant shall not be entitled to receive
any further installment until such lien is satisfied or otherwise discharged,
unless such lien is contested by Tenant in good faith and Tenant has obtained
and delivered a bond issued by a surety, in an amount equal to the lien amount
and in form otherwise reasonably satisfactory to Landlord. The amount of any
installment to be paid to Tenant shall be such proportion of the total insurance
moneys received by Landlord as the cost of labor and materials theretofore
incorporated by Tenant in the Restoration bears to the total estimated cost of
the Restoration by Tenant, less (a) all payments theretofore made to Tenant out
of said insurance proceeds, and (b) ten percent (10%) of the amount so
determined, provided that Landlord shall release the ten percent (10%) retention
with respect to any contractor, subcontractor, trade or supplier which (x) has
completed its work as certified by Tenant and Tenant's architect, if one is
required pursuant hereto and (y) such contractor, subcontractor, trade or
supplier has delivered an unconditional lien waiver with respect to its work or
materials if the value thereof is in excess of $100,000. Upon completion of and
payment for the Restoration by Tenant, including reimbursement to Tenant of such
ten percent (10%) retention, to the extent not previously released, the balance
of any and all insurance proceeds held by Landlord shall be paid to Landlord. In
the event that the insurance proceeds are insufficient for the purpose of paying
for the Restoration, Tenant shall nevertheless be required to make the
Restoration and pay any additional sums required for the Restoration in
accordance with the provisions of Section 7.4 hereof. Notwithstanding the
foregoing, if Landlord makes the Restoration at Tenant's expense, as provided in
Section 7.1 hereof, then Landlord shall use any amounts held by Landlord to pay
for the cost of such Restoration. Notwithstanding anything contained herein to
the contrary, Tenant may retain insurance proceeds for any Restoration the
estimated cost of which is less than $100,000, provided Tenant uses such
proceeds for such Restoration.
Section 7.3. When insurance proceeds are retained by Landlord
pursuant to Section 7.2 above, Landlord may impose reasonable conditions
precedent to the disbursement of each payment made to Tenant as provided in
Section 7.2 above, including the following:
(a) there shall be submitted to Landlord the certificate from
Tenant or if the restoration amount equals or exceeds $1,000,000, a certificate
of the aforesaid architect, stating (i) that the sum then requested to be
withdrawn either has been paid by Tenant and/or is justly due to contractors,
subcontractors, materialmen, engineers, architects or other persons (whose names
and addresses shall be stated) who have rendered or furnished certain services
or materials for the Work and giving a brief description of such services and
materials and the principal subdivisions or categories thereof and the several
amounts so paid or due to each of such persons in respect thereof, and stating
in reasonable detail the progress of the Work up to the date of said
certificate, (ii) that no part of such expenditures has been or is being made
the basis, in any previous or then pending request, for the withdrawal of
insurance money or has been made out of the proceeds of insurance received by
Tenant, (iii) that the sum then requested does not exceed ninety (90%) percent
of the cost of the services and materials described in the certificate, except
with respect to such contractors or subcontractors who have completed their
portion of the Work (as certified by the architect, or if there is no architect,
Tenant) and provided final lien waivers and (iv) that the balance of any
insurance proceeds held by Landlord, together with such other sums, if any,
which Tenant has made or will (for which evidence of Tenant's intention and
ability shall be to Landlord's reasonable satisfaction) make available for the
Restoration in accordance with Section 7.4 hereof and to Landlord's satisfaction
will be sufficient upon completion of the Restoration to pay for the same in
full, and stating in reasonable detail an estimate of the cost of such
completion;
(b) there shall be furnished to Landlord an official search,
or a certificate of a title insurance company satisfactory to Landlord, or other
evidence satisfactory to Landlord, showing that there has not been filed any
vendor's, mechanic's, laborer's or materialman's statutory or other similar lien
affecting the Property or any part thereof, or any public improvement lien
created or permitted to be created by Tenant affecting Landlord, or the assets
of, or funds appropriated to, Landlord, which has not been discharged of record,
except such as will be discharged upon payment of the amount then requested to
be withdrawn, or unless any such lien is contested by Tenant in good faith and
Tenant has obtained and delivered a bond issued by a surety, in an amount equal
to the lien amount and in form otherwise reasonably satisfactory to Landlord;
and
(c) at the time of making such payment, no Default shall have
occurred and be continuing.
Section 7.4. If the estimated cost of any Restoration,
determined as provided in Section 7.2 hereof, exceeds the net insurance proceeds
then, prior to the commencement of any Restoration, Tenant hereby covenants to
obtain from its general contractor and deliver to Landlord a bond, or other
security satisfactory to Landlord in the amount of such excess, to be held and
applied by Landlord in accordance with the provisions of Section 7.2 hereof, as
security for the completion of the Work, free of public improvement, vendor's,
mechanic's, laborer's or materialman's statutory or other similar liens.
Section 7.5. As material consideration to Landlord for its
agreement to enter into this Lease, the parties agree that, except as expressly
set forth in the provisions of this Article 7, (i) this Lease shall not
terminate or be forfeited or be affected in any manner, and there shall be no
reduction or abatement of the Rent payable hereunder, by reason of damage to or
total, substantial or partial destruction of the Property or any part thereof or
by reason of the untenantability of the same or any part thereof, for or due to
any damage or destruction to the Property from any cause whatsoever, and, (ii)
notwithstanding any law or statute, present or future, Tenant waives any and all
rights to quit or surrender the Property or any part thereof on account of any
damage or destruction of the Property. Tenant expressly agrees that its
obligations hereunder, including the payment of Rent payable by Tenant
hereunder, shall continue as though the Property had not been damaged or
destroyed and without abatement, suspension, diminution or reduction of any
kind.
ARTICLE 8
CONDEMNATION
Section 8.1. If the whole or substantially all of the Property
shall be taken by condemnation or other eminent domain proceedings pursuant to
any law, general or special, then at Tenant's option, this Lease and the Term
shall terminate and expire on the date of such taking and the Rent payable by
Tenant hereunder shall be apportioned as of the date of such taking. If Tenant
chooses to execute the option to cancel the Lease provided for herein, Tenant
shall notify Landlord in writing within thirty (30) days of the date that Tenant
receives notice of such taking. For purposes of this Article 8 "substantially
all of the Property" shall be deemed to mean such portion of the Property as,
when so taken, would leave remaining a balance of the Property which, due either
to the area so taken or the location of the part so taken in relation to the
part not so taken, would not under economic conditions, applicable zoning laws,
building regulations then existing or prevailing, readily accommodate Tenant's
business existing at the date of such taking and after performance of all
covenants, agreements, terms and provisions herein and by law provided to be
performed and paid by Tenant. Tenant, in cooperation with Landlord, shall have
the right to participate in any condemnation proceedings and be represented by
counsel for the purpose of protecting its interests hereunder. Landlord agrees
that it will not enter into any agreement with any condemning authority in
settlement of or on the threat of any condemnation or other eminent domain
proceeding affecting the Property without the consent of Tenant, which consent
shall not be unreasonably withheld or delayed.
Section 8.2. If only a portion of the Property shall be so
taken and Section 8.1 does not apply, this Lease shall be unaffected by such
taking, and Tenant shall continue to pay the Fixed and Additional Rent pursuant
to Article 2 except that the Rent shall be equitably reduced to a just and
appropriate amount according to the nature and extent of the taking as mutually
agreed in writing by Landlord and Tenant. In no event, however, shall Additional
Rent be reduced as a result of any such taking.
Section 8.3. (a) Landlord shall be entitled to receive the
entire award in any proceeding with respect to any taking provided for in this
Article 8 without deduction therefrom for any estate vested in Tenant by this
Lease and Tenant shall receive no part of such award, except as otherwise
provided in Section 8.1 hereof. Tenant hereby assigns to Landlord all of its
right, title and interest in or to every such award. Nothing herein contained
shall be deemed to prohibit Tenant from making a separate claim, to the extent
permitted by law, for the value of Tenant's loss of good will, inventory,
movable trade fixtures, machinery and moving expenses, provided that the making
of such claim does not adversely affect or diminish Landlord's award.
(b) Notwithstanding the foregoing, in the event Section 8.2 is
applicable, Landlord shall pay over to Tenant from time to time any moneys which
may be received by Landlord on account of exercise of the power of eminent
domain with respect to the Property, provided, however, that Landlord, before
paying such moneys over to Tenant, shall be entitled to reimburse itself
therefrom to the extent, if any, of the expenses paid or incurred by Landlord in
the collection of such moneys. Such moneys shall be paid over to Tenant solely
for purposes of the Restoration of the Property, on the terms and subject to the
conditions set forth in Article 7, as if, for this purpose, such moneys were
insurance proceeds resulting from casualty to the Property. Tenant agrees to
undertake such Restoration on such terms and subject to such conditions. Any
funds remaining after the completion of such Restoration shall belong to and be
retained by Landlord.
Section 8.4. In the event of any taking of the Property which
does not result in a termination of this Lease, Tenant at Tenant's expense,
subject to the provisions of Articles 5 and 7 and whether or not any award or
awards shall be sufficient for the purpose, shall proceed with reasonable
diligence to Restore the remaining parts of the Property to substantially the
condition existing immediately prior to the date of taking to the extent that
the same may be feasible and so as to constitute a complete and tenantable
Property. If the proceeds of such award or awards are not sufficient to pay the
full cost thereof as estimated by a licensed architect or engineer approved by
Landlord, Tenant shall pay such deficit, and if the cost of the Restoration will
cost more than $1,000,000, Tenant shall obtain from its general contractor and
deliver to Landlord a bond or other security reasonably satisfactory to Landlord
and Mortgage in the amount of such deficiency to be held as security for the
completion of such Work. If, upon completion of Restoration any portion of the
award shall remain, Landlord shall retain same.
Section 8.5 If during the Initial Term, the temporary use or
occupancy of all or any part of the Property shall be lawfully taken by
condemnation or in any other manner for any public or quasi-public use or
purpose, Landlord shall be entitled to receive all of the award for such taking
and this Lease shall continue and remain unaffected by such taking. If the
temporary use or occupancy of all or any part of the Property shall be lawfully
taken by condemnation or in any other manner for any public or quasi-public use
or purpose during the Primary Term or any Extended Term of this Lease, Tenant
shall be entitled, except as hereinafter set forth, and unless a Default shall
occur and be continuing, to receive that portion of the award for such taking
which represents compensation for the use and occupancy of the Property and, if
so awarded, for the taking of Tenant's loss of good will, inventory, movable
trade fixtures, machinery and for moving expenses, and that portion which
represents reimbursement for the cost of Restoration of the Property. This Lease
shall be and remain unaffected by such taking and Tenant shall be responsible
for all obligations hereunder not affected by such taking and shall continue to
pay in full when due the Fixed Rent, Additional Rent and all other sums required
to be paid by Tenant pursuant to the provisions of this Lease. If the period of
temporary use or occupancy shall extend beyond the Expiration Date, that part of
the award which represents compensation for the use or occupancy of the Property
(or a part thereof) shall be divided between Landlord and Tenant so that Tenant
shall receive so much thereof as represents the period to and including the
Expiration Date and Landlord shall receive so much as represents the period
subsequent to the Expiration Date and Landlord shall be entitled to receive that
portion which represents reimbursement for the cost of Restoration of the
Property and the remainder of such award.
Section 8.6. In case of any governmental action, not resulting
in the taking or condemnation of any portion of the Property but creating a
right to compensation therefor, such as the changing of the grade of any street
upon which the Property abut, this Lease shall continue in full force and effect
without reduction or abatement of Rent and the award shall be paid to Landlord.
ARTICLE 9
ASSIGNMENT AND SUBLETTING
Section 9.1. (a) Tenant shall not sell, assign, mortgage or
otherwise transfer (a "Transfer") all or any portion of its interest in this
Lease without the prior written consent of Landlord, which shall not be
unreasonably withheld, conditioned or delayed, and any Mortgagee and to the
extent required, the Ground Lessee. Landlord's consent shall not be considered
unreasonably withheld if (i) the proposed transferee's financial condition does
not meet Landlord's criteria, provided however, that the proposed transferee's
financial condition shall not require Landlord's review and approval where the
proposed Transfer is a sublease and provided further, that for any other
proposed Transfer, if the proposed transferee's net worth equals or exceeds that
of Tenant at the Commencement Date, the transferee shall be deemed financially
responsible; (ii) the proposed transferee's business is not suitable for the
Building; (iii) the proposed use is different than the permitted use pursuant to
Article A, Section 4, (iv) the proposed transferee is a government agency; or
(v) there is an Event of Default outstanding. Tenant acknowledges that the
foregoing is not intended to be an exclusive list of the reasons for which
Landlord may reasonably withhold its consent to a proposed Transfer.
(b) Tenant shall have the right to sublease all or any portion
of the Property without Landlord's consent provided that (i) such sublease (a
"Sublease") is in full compliance with the use restrictions set forth in this
Lease, (ii) Tenant shall provide Landlord with a fully executed and complete
copy of the Sublease prior to its commencement date and (iii) such Sublease
shall otherwise comply with the requirements of this Article 9 with respect to
Subleases.
(c) Notwithstanding anything to the contrary herein, Tenant
may, without the written consent of, but with written notice to, Landlord,
assign, transfer or sublet to any Affiliate of Tenant, provided such Affiliate
remains an Affiliate of Tenant and such Transfer is subject to the remaining
provisions of this Article 9. For purposes of this Article 9, the term Affiliate
shall mean any entity controlling, controlled by or under common control with
Tenant and the terms "control" or "controlling" shall mean possession, direct or
indirect, of the power to direct, or cause the direction of, the management and
policies of any person or entity, whether through the ownership of voting
securities, or partnership interest, by contract or otherwise.
Section 9.2 If Tenant shall desire Landlord's consent to a
Transfer, Landlord shall be given not less than twenty (20) days' advance
written notice of the proposed effective date of such Transfer, which written
notice shall be delivered to Landlord together with (a) either an executed
counterpart or, if unavailable, a copy of the proposed instrument(s) of the
Transfer and (b) such other documents as Landlord may reasonably request.
Section 9.3 Any consent by Landlord under this Article 9 shall
apply only to the specific transaction thereby authorized and shall not relieve
Tenant from the requirement of obtaining the prior written consent of Landlord
to any further Transfer of this Lease. No Transfer or Sublease of all or a
portion of this Lease shall release or relieve the transferor from any
obligations of Tenant hereunder, or Guarantor from its obligations under the
Guaranty and the transferor and Guarantor shall remain liable for the
performance of all obligations of Tenant hereunder. Any Transfer hereunder
(regardless of whether the consent of Landlord is required) shall be only for
the permitted use pursuant to Article A, Section 4 and for no other purpose.
Section 9.4. In the event of a Sublease, Tenant shall cause
each subtenant permitted pursuant to this Article 9 (a "Subtenant") to comply
with its obligations under its respective sublease, and Tenant shall diligently
enforce all of its rights as the sublandlord thereunder in accordance with the
terms of such Sublease and this Lease.
Section 9.5. The fact that a violation or breach of any of the
terms, provisions or conditions of this Lease results from or is caused by an
act or omission by any of the subtenants shall not relieve Tenant of Tenant's
obligation to cure the same. Tenant shall take all necessary steps to prevent
any such violation or breach.
Section 9.6. If this Lease is assigned or sublet, Landlord
may, after termination of this Lease, collect Rent from the assignee or
subtenant, and apply the net amount collected to the Rent herein reserved, but
no such assignment or collection shall be deemed a waiver of Tenant's covenant
to pay Rent, or the acceptance of the assignee or subtenant as tenant, or a
release of Tenant from the further performance by Tenant of the terms,
covenants, and conditions on the part of Tenant to be observed or performed
hereunder. After any assignment, Tenant's liability with respect to any
subsequent modification or amendment hereof shall apply only to the extent that
Tenant has consented to such modification or amendment and with respect to those
obligations hereunder which have not been increased by such modification or
amendment. In addition, Tenant's liability shall continue in the event that
Landlord elects to release any subsequent tenant hereunder from any liability,
to all of which Tenant hereby consents in advance. The consent by Landlord to
any Transfer shall not in any way be construed to relieve Tenant from obtaining
the express written consent of Landlord to any further Transfer.
Section 9.7. (a) If the proposed Transfer constitutes the sale
or assignment of all of the membership interests in Tenant and the successor
entity provides to Landlord a new guarantor in substitution of the Guarantor,
Landlord shall release the Guarantor named herein from any further liability
under the Guaranty arising from and after the effective date of such Transfer if
(i) the successor tenant or corporate guarantor of this Lease either has a
tangible net worth of not less than $200 million or its senior unsecured debt is
rated BBB- or better by Standard & Poor's Rating Group and Baa 3 by Moody's
Inc.; (ii) there is no Event of Default then outstanding; and (iii) Tenant
otherwise complies with the requirements of Sections 9.1 and 9.3. Tenant shall
have the right to effect compliance of subsection (i) of the preceding sentence
by a guaranty of this Lease in form and content acceptable to Landlord from a
parent of the successor owner or an Affiliate thereof.
(b) Notwithstanding anything to the contrary
contained herein, and except as set forth
in Section 9.7(a), Tenant may assign its entire interest under this Lease or
sublet the Property to an Affiliate of Tenant or to any successor to Tenant by
purchase, merger, consolidation or reorganization (hereinafter collectively
referred to as "Corporate Transfer") without the consent of Landlord, provided:
(i) there is no uncured Event of Default then outstanding; (ii) if such proposed
transferee is a successor to Tenant by purchase, said proposed transferee shall
acquire all or substantially all of the stock or assets of Tenant's business or,
if continuing or surviving corporation shall own all or substantially all of the
assets of Tenant and shall have a net worth which is at least equal to Tenant's
net worth on the Commencement Date; and (iii) such proposed transferee operates
the business in the Premises for the permitted use pursuant to Article A,
Section 4 and no other purpose. Tenant shall give Landlord written notice at
least thirty (30) days prior to the effective date of such Corporate Transfer.
Section 9.8. Tenant covenants and agrees that all Subleases
hereafter entered into affecting the Property shall provide that (a) they are
subject to this Lease and each subtenant shall comply with the terms, covenants
and conditions of Lease, excepting only (i) the obligation to pay Fixed Rent as
provided in this Lease and (ii) the Term of this Lease, (b) the term thereof
should end one (1) day or more prior to the Expiration Date hereof, but not
later than one (1) day prior to the Expiration Date hereof, unless Landlord
shall consent otherwise, which consent may be withheld in Landlord's sole
discretion, (c) the subtenants will not do, authorize or execute any act, deed
or thing whatsoever or fail to take any such action which will or may cause
Tenant to be in violation of any of its obligations under this Lease, (d) the
subtenants will not pay rent or other sums under the Subleases with Tenant for
more than one (1) month in advance, (e) the subtenants shall give to Landlord at
the address and otherwise in the manner specified in Section 20.8 hereof, a copy
of any notice of default by Tenant as the sublandlord under the subleases at the
same time as, and whenever, any such notice of default shall be given by the
subtenants to Tenant, and (f) in the event of the termination or expiration of
this Lease prior to the Expiration Date hereof, any such subtenant, at
Landlord's election (in its sole and absolute discretion) or as may be required
by law, shall be obligated to attorn to and recognize Landlord as the lessor
under such Sublease, in which event such Sublease shall continue in full force
and effect as a direct lease between Landlord and the subtenant upon all the
terms and conditions of such Sublease, except as hereinafter provided. If
Landlord does not elect to require such attornment, the termination of this
Lease shall effect the immediate termination of such Sublease, the subtenant
shall immediately surrender physical possession of the Property to Landlord and
Landlord shall be without duty or liability to such subtenant by reason of the
early termination of its Sublease. Any attornment required by Landlord of such
subtenant shall be effective and self-operative as of the date of any such
termination or expiration of this Lease without the execution of any further
instrument; provided, however, that such subtenant shall agree, upon the request
of Landlord, to execute and deliver any such instruments in recordable form and
otherwise in form and substance satisfactory to Landlord to evidence such
attornment. With respect to any attornment required by Landlord of any subtenant
hereunder, (i) at the option of Landlord, Landlord shall recognize all rights of
Tenant as the lessor under such Sublease and the subtenant thereunder shall be
obligated to Landlord to perform all of the obligations of the subtenant under
such Sublease and (ii) Landlord shall have no liability, prior to its becoming
lessor under such Sublease, to such subtenant nor shall the performance by such
subtenant of its obligations under the Sublease, whether prior to or after any
such attornment, be subject to any defense, counterclaim or setoff by reason of
any default by Tenant in the performance of any obligation to be performed by
Tenant as lessor under such Sublease, nor shall Landlord be bound by any
prepayment of more than one (1) month's rent unless such prepayment shall have
been expressly approved in writing by Landlord. The provisions of this Section
9.8 shall survive the expiration or earlier termination of the Term.
Section 9.9. If Tenant assumes this Lease and proposes to
assign the same pursuant to the provisions of Title 11 of the United States Code
or any statute of similar purpose or nature (the "Bankruptcy Code") to any
person or entity who shall have made a bona fide offer to accept an assignment
of this Lease on terms acceptable to the Tenant, then notice of such proposed
assignment shall be given to Landlord by Tenant no later than twenty (20) days
after receipt of such offer by Tenant, but in any event no later than ten (10)
days prior to the date that Tenant shall file any application or motion with a
court of competent jurisdiction for authority and approval to enter into such
assumption and assignment. Such notice shall set forth (a) the name and address
of the assignee, (b) all of the terms and conditions of such offer, and (c) the
proposal for providing adequate assurance of future performance by such person
under the Lease, including, without limitation, the assurance referred to in
Section 365 of the Bankruptcy Code. Any person or entity to which this Lease is
assigned pursuant to the provisions of the Bankruptcy Code shall be deemed
without further act or deed to have assumed all of the obligations arising under
this Lease from and after the date of such assignment. Any such assignee shall
execute and deliver to Landlord upon demand an instrument confirming such
assumption.
Section 9.10. The term "adequate assurance of future
performance" as used in this Lease shall mean (in addition to the assurances
called for in Bankruptcy Code Section 365(l)) that any proposed assignee shall,
among other things, (a) deposit with Landlord on the assumption of this Lease an
amount equal to the greater of (i) three (3) times the then monthly Fixed Rent
and Additional Rent or (ii) such other amount deemed by the Bankruptcy Court to
be reasonably necessary for the adequate protection of Landlord under the
circumstances, as security for the faithful performance and observance by such
assignee of the terms and obligations of this Lease, (b) furnish Landlord with
financial statements of such assignee for the prior three (3) fiscal years, as
finally determined after an audit and certified as correct by a certified public
accountant, which financial statements shall show a net worth at least equal to
the amount of the deposit referenced in (a) above, (c) if determined by the
Bankruptcy Court to be appropriate under the circumstances, grant to Landlord a
security interest in such property of the proposed assignee as Landlord shall
deem necessary to secure such assignee's future performance under this Lease,
and (d) provide such other information or take such action as Landlord, in its
reasonable judgment, shall determine is necessary to provide adequate assurance
of the performance by such assignee of its obligations under the Lease.
Section 9.11. The provisions of Sections 9.6, 9.7, 9.8, 9.9,
and 9.10 hereof shall survive the expiration or earlier termination of this
Lease.
Section 9.12. In no event shall Tenant mortgage, encumber,
pledge, grant a security interest in, collaterally assign or conditionally
transfer this Lease or any Subleases or any of the rents, issues and profits
therefrom.
ARTICLE 10
SUBORDINATION
Section 10.1. This Lease shall be subject and subordinate to
all Mortgages now or hereinafter in effect and to all renewals, modifications,
consolidations, replacements and extensions of any such Mortgages; provided,
however, that the Mortgagee shall execute and deliver to Tenant an agreement in
such form as may be reasonably requested by the Mortgagee (the "Non-Disturbance
Agreement") to the effect that, if there shall be a foreclosure of its Mortgage,
such Mortgagee will not make Tenant a party defendant to such foreclosure,
unless necessary under applicable law for the Mortgagee to foreclose, or if
there shall be a foreclosure of such Mortgage, such Mortgagee shall not evict
Tenant, disturb Tenant's leasehold estate or rights hereunder, in all events
provided that no Event of Default then exists, and Tenant shall attorn to the
Mortgagee or any successor-in-interest to Landlord or the Mortgagee. Tenant
shall, together with the Mortgagee, execute and deliver promptly any certificate
or further agreement that Landlord may request in confirmation of such
subordination. If, in connection with the financing of the Property, any lending
institution or Landlord shall request reasonable modifications of this Lease
that do not increase the monetary obligations of Tenant under this Lease or
materially increase the other obligations of Tenant under this Lease or
materially and adversely affect the rights of Tenant under this Lease, Tenant
shall make such modifications. Any Non-Disturbance Agreement may be made on the
condition that neither the Mortgagee nor anyone claiming by, through or under
such Mortgagee shall be:
(a) liable for any act or omission of any prior Landlord
(including, without limitation, the then defaulting Landlord), or
(b) subject to any defense or offsets which Tenant may have
against any prior Landlord (including, without limitation, the then defaulting
Landlord), or
(c) bound by any payment of Rent which Tenant might have paid
for more than the current month to any prior Landlord (including, without
limitation, the then defaulting Landlord), or
(d) bound by any obligation to make any payment to Tenant
which was required to be made prior to the time such Landlord succeeded to any
prior Landlord's interest (other than in connection with the release of
insurance proceeds and/or condemnation awards), or
(e) bound by any obligation to perform any work or to make
improvements to the Property.
If required by any Mortgagee, Tenant promptly shall join in
any Non-Disturbance Agreement to indicate its concurrence with the provisions
thereof and its agreement, in the event of a foreclosure of any Mortgage or the
cancellation, expiration or termination of any superior lease to attorn to such
Mortgagee, as Tenant's landlord hereunder. Tenant shall promptly accept, execute
and deliver any Non-Disturbance Agreement proposed by any Mortgagee which
conforms with the provisions of this Section 10.1. Any Non-Disturbance Agreement
may also contain other terms and conditions as may otherwise be required by any
Mortgagee which do not materially increase Tenant's monetary obligations or
materially and adversely affect the rights or obligations of Tenant under this
Lease.
Section 10.2. Tenant hereby agrees to give to any Mortgagee
copies of all notices given by Tenant of default by Landlord under this Lease at
the same time and in the same manner as, and whenever, Tenant shall give any
such notice of default to Landlord, provided the name and address of such
Mortgagee has been furnished in writing to Tenant. Such Mortgagee shall have the
right to remedy any default under this Lease, or to cause any default of
Landlord under this Lease to be remedied, and for such purpose Tenant hereby
grants such Mortgagee such period of time as may be reasonable to enable such
Mortgagee to remedy, or cause to be remedied, any such default in addition to
the period given to Landlord for remedying, or causing to be remedied, any such
default which is a default. Tenant shall accept performance by such Mortgagee of
any term, covenant, condition or agreement to be performed by Landlord under the
Lease with the same force and effect as though performed by Landlord. No default
under the Lease shall exist or shall be deemed to exist (a) as long as such
Mortgagee, in good faith, shall have commenced to cure such default and shall be
prosecuting the same to completion with reasonable diligence, subject to force
majeure, or (b) if possession of the Property is required in order to cure such
default, or if such default is not susceptible of being cured by such Mortgagee,
as long as such Mortgagee, in good faith, shall have notified Tenant that such
Mortgagee intends to institute proceedings under the Mortgage and, thereafter,
as long as such proceedings shall have been instituted and shall prosecute the
same with reasonable diligence and, after having obtained possession, prosecutes
the cure to completion with reasonable diligence. Neither such Mortgagee nor its
designee or nominee shall become liable under the Lease unless and until such
Mortgagee or its designee or nominee becomes, and then only for so long as such
Mortgagee or its designee or nominee remains, the fee owner of the Property.
Such Mortgagee shall have the right, without Tenant's consent, to foreclose the
Mortgage or to accept a deed in lieu of foreclosure of such Mortgage.
ARTICLE 11
OBLIGATIONS OF TENANT
Section 11.1. Tenant shall promptly comply with all laws,
ordinances, orders, rules, regulations, and requirements of all federal, state,
municipal or other governmental or quasi-governmental authorities or bodies then
having jurisdiction over the Property (or any part thereof) and/or the use and
occupation thereof by Tenant, whether any of the same relate to or require (a)
structural changes to or in and about the Property, or (b) changes or
requirements incident to or as the result of any use or occupation thereof or
otherwise (collectively, the "Requirements"), and subject to Article 7, Tenant
shall so perform and comply, whether or not such laws, ordinances, orders,
rules, regulations or requirements shall now exist or shall hereafter be enacted
or promulgated and whether or not the same may be said to be within the present
contemplation of the parties hereto.
Section 11.2(a). Tenant agrees to give Landlord notice of any
law, ordinance, rule, regulation or requirement which to Tenant's knowledge is
enacted, passed, promulgated, made, issued or adopted by any of the governmental
departments or agencies or authorities hereinbefore mentioned affecting in a
material adverse manner (i) the Property, or (ii) Tenant's use thereof, a copy
of which is served upon or received by Tenant, or a copy of which is posted on,
or fastened or attached to the Property, or otherwise brought to the attention
of Tenant, by mailing within seven (7) business (or such later time if such
disclosure would violate applicable securities laws or regulations) days after
such service, receipt, posting, fastening or attaching or after the same
otherwise comes to the attention of Tenant, a copy of each and every one thereof
to Landlord. At the same time, Tenant will inform Landlord as to the Work which
Tenant proposes to do or take in order to comply therewith.
(b) Notwithstanding the foregoing, however, if such Work would
require any Alterations which would, in Landlord's opinion, reduce the value of
the Property or change the general character, design or use of the Building or
other improvements thereon, and if Tenant does not desire to contest the same,
Tenant shall, if Landlord so requests, defer compliance therewith in order that
Landlord may, if Landlord wishes, contest or seek modification of or other
relief with respect to such Requirements, so long as Tenant is not put in
violation of any law, ordinance, rule, regulation or requirement enacted,
passed, promulgated, made, issued or adopted by any such governmental
departments or agencies or authorities, but nothing herein shall relieve Tenant
of the duty and obligation, at Tenant's sole cost and expense, to comply with
such Requirements, or such Requirements as modified, whenever Landlord shall so
direct.
(c) Tenant shall have the right to contest any such
Requirement provided (i) the same is done at Tenant's sole cost and expense,
(ii) such contest will not subject Tenant or the Property to penalty or
forfeiture, (iii) such contest will not adversely affect Landlord's interest in
the Property, (iv) Landlord shall have the right to require Tenant to post a
bond or other reasonable security with Landlord in order to assure timely and
complete performance by Tenant of its obligations hereunder and (v) such contest
shall not subject Landlord or any Mortgagee to the risk of any criminal or civil
liability.
Section 11.3. Tenant shall, to the extent not caused by the
gross negligence or willful misconduct of Landlord, defend, indemnify and save
harmless Landlord, any partners or members of Landlord, any partners of any
partners of Landlord or any members of any members of Landlord and any officers,
stockholders, directors or employees of any of the foregoing (collectively,
"Indemnified Parties") from (a) any and all liabilities, losses, claims, causes
of actions, suits, damages and expenses (collectively, "Claims") arising from
(i) any Work or thing whatsoever done, or any condition created in or about the
Property during the Term other than as may result from any Work by Landlord or
parties (other than Tenant) claiming through Landlord, (ii) any use, non-use,
possession, occupation, Alteration, repair, condition, operation, management or
maintenance of the Property or any part thereof or of any street, alley,
sidewalk, curb, vault, passageway, common area or space comprising a part
thereof or adjacent thereto during the Term, (iii) any act or omission of Tenant
or any of its subtenants or licensees or its or their employees, agents,
contractors or subcontractors, (iv) any accident, injury (including death) or
damage to any person or property occurring in, on or about the Property or any
part thereof or in, on or about any street, alley, sidewalk, curb, vault,
passageway, common area or space comprising a part thereof or adjacent thereto,
(v) any contest by, or at the request of, Tenant of Impositions, Requirements or
other matters permitted by this Lease and (vi) any breach, violation or
non-performance of any covenant, condition or agreement in this Lease to be
fulfilled, kept, observed or performed by Tenant; and (b) all costs, expenses
and liabilities incurred, including, without limitation, attorney's fees and
disbursements through and including appellate proceedings, in or in connection
with any of such Claims. If any action or proceeding shall be brought against
any of the Indemnified Parties by reason of any such Claims, Tenant, upon notice
from any of the Indemnified Parties, shall resist and defend such action or
proceeding, at its sole cost and expense by counsel chosen by Tenant who shall
be reasonably satisfactory to such Indemnified Party. Tenant or its counsel
shall keep each Indemnified Party fully apprised at all times of the status of
such defense. Counsel for Tenant's insurer shall be deemed satisfactory to such
Indemnified Party. Notwithstanding the foregoing, if an Indemnified Party
reasonably determines that there is a conflict of interest with Tenant, an
Indemnified Party may retain its own attorneys to defend or assist in defending
any Claim and the Tenant shall pay the reasonable fees and disbursements of such
attorneys. The provisions of this Section 11.3 shall survive the expiration or
earlier termination of this Lease.
Section 11.4. If at any time prior to or during the Term (or
within the statutory period thereafter if attributable to Tenant), any
mechanic's or other lien or order for payment of money, which shall have been
either created by, caused (directly or indirectly) by, or during the Primary
Term and any Extended Term, suffered against Tenant, shall be filed against the
Property or any part thereof (other than as may result from any Work by Landlord
or parties, other than Tenant, claiming through Landlord), Tenant, at its sole
cost and expense, shall cause the same to be discharged by payment, bonding or
otherwise, within twenty (20) days after the filing thereof. Tenant shall, upon
notice and request in writing by Landlord, defend for Landlord, at Tenant's sole
cost and expense, any action or proceeding which may be brought on or for the
enforcement of any such lien or order for payment of money, and will pay any
damages and satisfy and discharge any judgment entered in such action or
proceeding and save harmless Landlord from any liability, claim or damage
resulting therefrom. In default of Tenant's procuring the discharge of any such
lien as aforesaid Landlord may, without notice, and without prejudice to its
other remedies hereunder, procure the discharge thereof by bonding or payment or
otherwise, and all cost and expense which Landlord shall incur shall be paid by
Tenant to Landlord as Additional Rent forthwith.
Section 11.5. EXCEPT AS EXPRESSLY PROVIDED IN THIS LEASE,
LANDLORD SHALL NOT UNDER ANY CIRCUMSTANCES BE LIABLE TO PAY FOR ANY WORK, LABOR
OR SERVICES RENDERED OR MATERIALS FURNISHED TO OR FOR THE ACCOUNT OF TENANT UPON
OR IN CONNECTION WITH THE PROPERTY, AND NO MECHANIC'S OR OTHER LIEN FOR SUCH
WORK, LABOR OR SERVICES OR MATERIAL FURNISHED SHALL, UNDER ANY CIRCUMSTANCES,
ATTACH TO OR AFFECT THE REVERSIONARY INTEREST OF LANDLORD IN AND TO THE PROPERTY
OR ANY ALTERATIONS, REPAIRS, OR IMPROVEMENTS TO BE ERECTED OR MADE THEREON.
NOTHING CONTAINED IN THIS LEASE SHALL BE DEEMED OR CONSTRUED IN ANY WAY AS
CONSTITUTING THE REQUEST OR CONSENT OF LANDLORD, EITHER EXPRESS OR IMPLIED, TO
ANY CONTRACTOR, SUBCONTRACTOR, LABORER OR MATERIALMEN FOR THE PERFORMANCE OF ANY
LABOR OR THE FURNISHING OF ANY MATERIALS FOR ANY SPECIFIC IMPROVEMENT,
ALTERATION TO OR REPAIR OF THE PROPERTY OR ANY PART THEREOF, NOR AS GIVING
TENANT ANY RIGHT, POWER OR AUTHORITY TO CONTRACT FOR OR PERMIT THE RENDERING OF
ANY SERVICES OR THE FURNISHING OF ANY MATERIALS ON BEHALF OF LANDLORD THAT WOULD
GIVE RISE TO THE FILING OF ANY LIEN AGAINST THE PROPERTY.
Section 11.6. Neither Landlord nor its agents shall be liable
for any loss of or damage to the property of Tenant or others by reason of
casualty, theft or otherwise, or for any injury or damage to persons or property
resulting from any cause of whatsoever nature, unless caused by or due to the
negligence or willful misconduct of Landlord, its agents, servants or employees.
Section 11.7. Landlord shall not be required to furnish to
Tenant any facilities or services of any kind whatsoever, including, but not
limited to, water, steam, heat, gas, oil, hot water, and/or electricity, all of
which Tenant represents and warrants that Tenant has obtained from the public
utility supplying the same, at Tenant's sole cost and expense. Upon Tenant's
written request, however, Landlord agrees to cooperate with Tenant (at no cost
to Landlord) with respect to such services.
ARTICLE 12
DEFAULT; REMEDIES
Section 12.1. Each of the following shall be deemed an event
of default (an "Event of Default") and a breach of this Lease by Tenant:
(a) If the Fixed Rent which is due and payable shall not be
paid by Tenant for a period of five (5) business days after Landlord has
provided written notice of such failure.
(b) If Tenant shall fail to pay any Additional Rent required
to be paid by Tenant hereunder which is due and payable for a period of ten (10)
business days after Landlord has provided written notice of such failure.
(c) If Tenant shall Default in the performance or observance
of any of the other agreements, conditions, covenants or terms herein contained,
then if such Default shall continue for twenty (20) Business Days after written
notice by Landlord to Tenant (or if such Default is of such a nature that it
cannot be completely remedied within said twenty (20) Business Day period, then
if Tenant does not agree in writing within such twenty (20) Business Day period
to cure the same, commence and thereafter diligently prosecute the cure and
complete the cure within a reasonable period of time under the circumstances
after such original written notice of default by Landlord to Tenant).
(d) If Tenant abandons the Property.
(e) If Tenant shall Transfer all or any of its interest in
this Lease without complying with the provisions of this Lease applicable
thereto.
(f) If (i) Tenant or Guarantor shall commence any case,
proceeding or other action (A) under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief entered
with respect to Tenant and/or Guarantor, as the case may be, or seeking to
adjudicate Tenant and/or Guarantor a bankrupt or insolvent, or seeking
reorganization, arrangement, adjustment, liquidation, dissolution, composition
or other relief with respect to Tenant or Tenant's debts, or Guarantor or
Guarantor or Guarantor's debts or (B) seeking appointment of a receiver,
trustee, custodian or other similar official for Tenant or for all or any
substantial part of Tenant's property and/or Guarantor's property; or (ii)
Tenant or Guarantor shall make a general assignment for the benefit of Tenant's
creditors or Guarantor's creditors, as the case may be; or (iii) there shall be
commenced against Tenant and/or Guarantor any case, proceeding or other action
of a nature referred to in clause (i) above or seeking issuance of a warrant of
attachment, execution, distraint or similar process against all or any
substantial part of Tenant's property, or of Guarantor's property, as the case
may be, which case, proceeding or other action (A) results in the entry of an
order for relief or (B) remains un-dismissed, un-discharged or un-bonded for a
period of sixty (60) days; or (iv) Tenant or Guarantor shall take any action
consenting to or approving of any of the acts set forth in clause (i) or (ii)
above; or (v) Tenant shall generally not, or shall be unable to, pay Tenant's
debts as they become due or shall admit in writing Tenant's inability to pay
Tenant's debts; or (vi) Guarantor shall generally not, or shall be unable to,
pay Guarantor's debts as they become due or shall admit in writing Guarantor's
inability to pay Guarantor's debts .
(g) If Tenant shall cease to exist as a valid legal entity in
accordance with the laws of any state of the United States, then if Tenant does
not completely remedy such default immediately.
(h) If Guarantor shall default in any obligation, covenant or representation set
forth in the Guaranty and such default remains uncured after any required notice
and applicable grace period.
(i) If Tenant shall cause any default under the Ground Sublease which is not
cured at least ten (10) days prior to the expiration of any applicable cure
period provided for in the Ground Sublease.
Section 12.2. If an Event of Default shall occur, Landlord may
elect to declare all Rent for the remainder of the Term (as same may be extended
as provided herein) due and payable and, if Landlord shall make such an
election, the present value of the Rent shall be due and payable five (5) days
after written notice by Landlord to Tenant of such election. The aforesaid
present value shall be determined by discounting each monthly installment of
Rent for the remainder of the Term from the date such installment would have
been due and payable to the date of Landlord's election to accelerate, by a rate
of one (1%) percent per annum less than the interest rate paid under a United
States Treasury Bond of comparable duration. Landlord also may elect to proceed
by appropriate judicial proceedings, either at law or in equity, to enforce
performance or observance by Tenant of the applicable provisions of this Lease
and/or to recover damages for breach thereof.
Section 12.3. (a) If an Event of Default (i) described in
Sections 12.1(c), (e) or (h) hereof shall occur and Landlord, at any time
thereafter, at its option, gives written notice to Tenant stating that this
Lease shall terminate on the date specified in such written notice, which date
shall be not less than five (5) days after the giving of such written notice,
and if, on the date specified in such notice, Tenant shall have failed to cure
the default which was the basis for the Event of Default, or (ii) described in
Sections 12.1 (a), (b), (d), (f), (g) or (i) hereof shall occur, then all rights
of Tenant under this Lease shall terminate and Tenant immediately shall quit and
surrender the Property, which termination shall not relieve Tenant from any
liability then or thereafter accruing hereunder.
(b) If an Event of Default described in Sections 12.1(a) or
(b) hereof shall occur, or this Lease shall be terminated as provided in Section
12.2 hereof, Landlord, without notice, and with or without court proceedings,
(i) may re-enter and repossess the Property, or (ii) may dispossess Tenant by
summary proceedings or otherwise, which re-entry and repossession by Landlord
shall not relieve Tenant from any liability then or thereafter accruing
hereunder.
Section 12.4. If this Lease shall be terminated as provided in
Section 12.2 hereof and/or Tenant shall be dispossessed by summary proceedings
or otherwise as provided in Section 12.3 (b) hereof:
(a) Tenant shall pay to Landlord all Rent payable under this
Lease by Tenant to Landlord to the date upon which this Lease shall have been
terminated or to the date of re-entry upon the Property by Landlord, as the case
may be.
(b) Landlord may repair and alter the Property in such manner
as Landlord may deem necessary or advisable without relieving Tenant of any
liability under this Lease or otherwise affecting any such liability, and/or let
or relet the Property or any parts thereof for the whole or any part of the
remainder of the Term or for a longer period, in Landlord's name or as agent of
Tenant, and out of any rent and other sums collected or received as a result of
such reletting Landlord shall: (i) first, pay to itself the cost and expense of
terminating this Lease, re-entering, retaking, repossessing, repairing and/or
altering the Property, or any part thereof, and the cost and expense of removing
all persons and property therefrom, including in such costs, brokerage
commissions, advertising costs, legal expenses and attorneys' fees and
disbursements, (ii) second, pay to itself the cost and expense sustained in
securing any new tenants and other occupants, including in such costs, brokerage
commissions, advertising costs, legal expenses and attorneys' fees and
disbursements and other expenses of, preparing the Property for reletting, and,
if Landlord shall maintain and operate the Property, the cost and expense of
operating and maintaining the Property, and (iii) third, pay to itself any
balance remaining on account of the liability of Tenant to Landlord. Landlord in
no way shall be responsible or liable for any failure to relet the Property or
any part thereof, or for any failure to collect any rent due on any such
reletting, and no such failure to relet or to collect rent shall operate to
relieve Tenant of any liability under this Lease or to otherwise affect any such
liability;
(c) Tenant shall be liable for and shall pay to Landlord, as
damages, any deficiency ("Deficiency"), between the Rent reserved in this Lease
for the period which otherwise would have constituted the unexpired portion of
the Term and the net amount, if any, of rents collected under any reletting
effected pursuant to the provisions of Section 12.4(b) hereof for any part of
such period, first deducting from the rents collected under any such reletting
all of the payments to Landlord described in Section 12.4(b) hereof; any such
Deficiency shall be paid in installments by Tenant on the days specified in this
Lease for payment of installments of Rent and Landlord shall be entitled to
recover from Tenant each Deficiency installment as the same shall arise, and no
suit to collect the amount of the Deficiency for any installment period shall
prejudice Landlord's right to collect the Deficiency for any subsequent
installment period by a similar proceeding; and
(d) whether or not Landlord shall have collected any
Deficiency installments as aforesaid, Landlord shall be entitled to recover from
Tenant, and Tenant shall pay to Landlord, on demand, in lieu of any further
Deficiencies, as and for liquidated and agreed final damages (it being agreed
that it would be impracticable or extremely difficult to fix the actual damage),
a sum equal to the amount by which the Rent reserved in this Lease for the
period which otherwise would have constituted the unexpired portion of the Term
exceeds the then fair and reasonable rental value of the Property for the same
period, both discounted to present worth at a rate equal to one percent less
than the then applicable rate of United States Treasury Bonds having terms to
maturity most closely matching the unexpired portion of the Term, less the
aggregate amount of Deficiencies theretofore collected by Landlord pursuant to
the provisions of Section 12.4(c) hereof for the same period; it being agreed
that before presentation of proof of such liquidated damages to any court,
commission or tribunal, if the Property, or any part thereof, shall have been
relet by Landlord for the period which otherwise would have constituted the
unexpired portion of the Term, or any part thereof, the amount of rent reserved
upon such reletting shall be deemed, prima facie, to be the fair and reasonable
rental value for the part or the whole of the Property so relet during the term
of the reletting.
Section 12.5. No termination of this Lease pursuant to Section
12.2 hereof, and no taking possession of and/or reletting the Property, or any
part thereof, pursuant to Sections 12.3(b) and 12.4(b) hereof, shall relieve
Tenant of its liabilities and obligations hereunder, all of which shall survive
such expiration, termination, repossession or reletting.
Section 12.6. To the extent not prohibited by law, Tenant
hereby knowingly and voluntarily waives and releases all rights (legal and
equitable) now or hereafter conferred by statute or otherwise which would have
the effect of limiting or modifying any of the provisions of this Article 12.
Tenant shall execute, acknowledge and deliver any instruments which Landlord may
request, whether before or after the occurrence of an Event of Default,
evidencing such waiver or release.
Section 12.7. The Rent payable by Tenant hereunder and each
and every installment thereof, and all costs, actual and customary attorneys'
fees and disbursements and other expenses which may be incurred by Landlord in
enforcing the provisions of this Lease on account of any delinquency of Tenant
in carrying out the provisions of this Lease shall be and are hereby declared to
constitute a valid lien upon the interest of Tenant in this Lease and in the
Property.
Section 12.8. Suit or suits for the recovery of damages, or
for a sum equal to any installment or installments of Rent payable hereunder or
any Deficiencies or other sums payable by Tenant to Landlord pursuant to this
Article 12, may be brought by Landlord from time to time at Landlord's election,
and nothing herein contained shall be deemed to require Landlord to await the
date whereon this Lease or the Term would have expired by limitation had there
been no Event of Default by Tenant and termination.
Section 12.9. Nothing contained in this Article 12 shall limit
or prejudice the right of Landlord to prove and obtain as liquidated damages in
any bankruptcy, insolvency, receivership, reorganization or dissolution
proceeding an amount equal to the maximum allowed by a statute or rule of law
governing such proceeding and in effect at the time when such damages are to be
proved, whether or not such amount shall be greater than, equal to or less than
the amount of the damages referred to in any of the preceding Sections of this
Article 12.
Section 12.10. No receipt of moneys by Landlord from Tenant
after termination of this Lease, or after the giving of any notice of the
termination of this Lease shall reinstate, continue or extend the Term or affect
any of the right of Landlord to enforce the payment of Rent payable by Tenant
hereunder or thereafter falling due, or operate as a waiver of the right of
Landlord to recover possession of the Property by proper remedy, except as
herein otherwise expressly provided or as provided by applicable law, it being
agreed that after the service of notice to terminate this Lease or the
commencement of any suit or summary proceedings, or after a final order or
judgment for the possession of the Property, Landlord may demand, receive and
collect any monies due or thereafter falling due without in any manner affecting
such notice, proceedings, order, suit or judgment, all such monies collected
being deemed payments on account of Tenant's liability hereunder.
Section 12.11. Except as otherwise expressly provided herein
or as prohibited by applicable law, Tenant hereby expressly knowingly and
voluntarily waives the service of any notice of intention to re-enter provided
for in any statute, or of the institution of legal proceedings to that end, and
Tenant, for and on behalf of itself and all persons claiming through or under
Tenant, also knowingly and voluntarily waives any and all right of redemption
provided by any law or statute now in force or hereafter enacted or otherwise,
or re-entry or repossession or to restore the operation of this Lease in case
Tenant shall be dispossessed by a judgment or by warrant of any court or judge
or in case of re-entry or repossession by Landlord or in case of any expiration
or termination of this Lease, and Landlord and Tenant waive and shall waive
trial by jury in any action, proceeding or counterclaim brought by either of the
parties hereto against the other on any matter whatsoever arising out of or in
any way connected with this Lease, the relationship of Landlord and Tenant,
Tenant's use or occupancy of the Property, or any claim of injury or damage.
Section 12.12. No failure by Landlord to insist upon the
strict performance of any covenant, agreement, term or condition of this Lease
or to exercise any right or remedy consequent upon a breach thereof, and no
acceptance of full or partial Rent during the continuance of any such breach,
shall constitute waiver of any such breach or of such covenant, agreement, term
or condition. No covenant, agreement, term or condition of this Lease to be
performed or complied with by Tenant, and no breach thereof, shall be waived,
altered or modified except by a written instrument executed by Landlord. No
waiver of any breach shall affect or alter this Lease, but each and every
covenant, agreement, term and condition of this Lease shall continue in full
force and effect with respect to any other then existing or subsequent breach
hereof.
Section 12.13. In the event of the occurrence of any Event of
Default, Landlord shall be entitled to a decree compelling performance of any of
the provisions hereof, and shall have the right to invoke any rights and
remedies allowed at law or in equity or by statute or otherwise as though
re-entry, summary proceedings, and other remedies were not provided for in this
Lease.
Section 12.14. Tenant shall pay to Landlord all costs and
expenses, including, without limitation, attorneys' fees and disbursements,
incurred by Landlord in any action or proceeding to which Landlord may be made a
party by reason of any act or omission of Tenant. Tenant also shall pay to
Landlord all costs and expenses, including, without limitation, attorneys' fees
and disbursements, incurred by Landlord in enforcing any of the covenants and
provisions of this Lease and incurred in any action brought by Landlord against
Tenant on account of the provisions hereof, and all such costs, expenses and
attorneys' fees and disbursements may be included in and form a part of any
judgment entered in any proceeding brought by Landlord against Tenant on or
under this Lease. All of the sums paid or obligations incurred by Landlord as
aforesaid, with interest and costs, shall be paid by Tenant to Landlord on
demand.
Section 12.15. If an Event of Default shall occur under this
Lease or Tenant shall fail to comply with its obligations under this Lease,
Landlord may: (a) perform the same for the account of Tenant and/or (b) make any
expenditure or incur any obligation for the payment of money in connection with
any obligation owed to Landlord, including, but not limited to, attorney's fees
and disbursements in instituting, prosecuting or defending any action or
proceeding, with interest thereon at the Default Rate and such amounts shall be
deemed to be Additional Rent hereunder and shall be paid by Tenant to Landlord
immediately upon demand therefor. Default Rate shall have the meaning ascribed
to it in Article B of this Lease; provided, however, that for purposes of this
Article 12, such Default Rate shall never exceed the maximum non-usurious rate
permitted by applicable law.
Section 12.16. If Tenant shall fail to pay any installment of
Fixed Rent when due or any Additional Rent within ten (10) days after the date
when such payment is due, Tenant shall pay to Landlord, in addition to such
installment of Fixed Rent or such Additional Rent, as the case may be, interest
on the amount unpaid at the Default Rate, computed from the date such payment
was due to and including the date of payment.
Section 12.17. Unless otherwise provided herein to the
contrary, following an Event of Default by Tenant, Landlord shall be entitled to
enjoin such breach and shall have the right to invoke any right or remedy
allowed at law or in equity or by statute or otherwise as though entry,
re-entry, summary proceedings and other remedies were not provided for in this
Lease, provided however, that in the event of a Default by Tenant which creates
an imminent threat of loss of life or injury to property or both, Landlord shall
be entitled to enjoin such breach or seek other injunctive relief.
Section 12.18. Each right or remedy of Landlord provided for
in this Lease shall be cumulative and shall be in addition to every other right
or remedy provided for in this Lease or now or hereafter existing at law or in
equity or by statute or otherwise, and the exercise or the beginning of the
exercise by Landlord of any one or more of the rights or remedies provided for
in this Lease or now or hereafter existing at law or in equity or by statute or
otherwise shall not preclude the simultaneous or later exercise by Landlord of
any or all other rights or remedies provided for in this Lease or now or
hereafter existing at law or in equity or by statute or otherwise.
ARTICLE 13
NO WAIVER
Section 13.1. No receipt of moneys by Landlord from Tenant
after the termination or cancellation of this Lease shall reinstate, continue or
extend the Term, or affect any notice heretofore given to Tenant, or operate as
a waiver of the right of Landlord to enforce the payment of Fixed Rent or
Additional Rent then due, or thereafter falling due, or operate as a waiver of
the right of Landlord to recover possession of the Property by proper suit,
action, proceeding or remedy; it being agreed that, after the service of notice
to terminate or cancel this Lease, or the commencement of suit, action or
summary proceedings, or any other remedy, or after a final order or judgment for
the possession of the Property, Landlord may demand, receive and collect any
moneys due, or thereafter falling due, without, in any manner whatsoever,
affecting such notice, proceeding, suit, action, order or judgment; and any and
all such moneys collected shall be deemed to be payments on account of the use
and occupation of the Property or, at the election of Landlord, on account of
Tenant's liability hereunder.
Section 13.2. The failure of Landlord or Tenant to enforce any
agreement, condition, covenant or term, by reason of its breach by Tenant or
Landlord, as the case may be, shall not be deemed to void, waive or affect the
right of Landlord or Tenant to enforce the same agreement, condition, covenant
or term on the occasion of a subsequent default or breach.
Section 13.3. The specific remedies to which Landlord may
resort under the terms of this Lease are cumulative and are not intended to be
exclusive of any other remedies or means of redress to which Landlord may be
lawfully entitled in case of any breach or threatened breach by Tenant of any of
the terms, covenants and conditions of this Lease. Unless otherwise agreed in
writing by Landlord, the failure of Landlord or Tenant to insist in any one or
more cases upon the strict performance of any of the terms, covenants and
conditions of this Lease, or to exercise any right or remedy herein contained,
shall not be construed as a waiver or relinquishment for the future performance
of such terms, covenants and conditions. The receipt by Landlord, or payment by
Tenant, of Rent with knowledge of the breach of any of such terms, covenants and
conditions shall not be deemed a waiver of such breach. The acceptance of any
check or payment bearing or accompanied by any endorsement, legend or statements
shall not, of itself, constitute any change in or termination of this Lease. No
surrender of the Property by Tenant (prior to any termination of this Lease)
shall be valid unless consented to in writing by Landlord. In addition to the
other remedies in this Lease provided, Landlord or Tenant shall be entitled to
the restraint by injunction of the violation or attempted or threatened
violation or any of the terms, covenants and conditions of this Lease or to a
decree compelling performance of any of such terms, covenants and conditions.
ARTICLE 14
ESTOPPEL CERTIFICATE
Section 14.1. Each party agrees that it shall, at any time and
from time to time in connection with the financing or sale of the Property, upon
not less than ten (10) Business Days prior notice by the requesting party
execute, acknowledge and deliver to the requesting party or any other party
specified by the requesting party a statement in writing certifying that this
Lease is unmodified and in full force and effect (or if there have been any
modifications, that the Lease is in full force and effect as modified and
stating the modifications), the dates to which the Fixed Rent and Additional
Rent have been paid, and stating whether or not the requesting party is in
default in keeping, observing or performing any term, covenant, agreement,
provision, condition or limitation contained in this Lease and, if in default,
specifying each such default, the Commencement Date and Expiration Date for the
current Term, and any other matters reasonably requested by the requesting
party; it being intended that any such statement delivered pursuant to this
Article 14 may be relied upon by the requesting party or any prospective
purchaser of the Property or any Mortgagee thereof or any assignee of any
Mortgage upon the Property.
ARTICLE 15
QUIET ENJOYMENT
Section 15.1. Tenant, upon payment of the Rents herein
reserved and upon the due performance and observance of all the covenants,
conditions and agreements herein contained on Tenant's part to be performed and
observed, shall and may at all times during the Term peaceably and quietly have,
hold and enjoy the Property without any manner of suit, trouble or hindrance of
and from any person claiming by, through or under Landlord, subject,
nevertheless, to the terms and provisions of this Lease. No failure by Landlord
to comply with the foregoing covenant shall give Tenant any right to cancel or
terminate this Lease or to abate, reduce or make a deduction from or offset
against the Fixed Rent or any Additional Rent, or to fail to perform any other
obligation of Tenant hereunder.
ARTICLE 16
SURRENDER
Section 16.1. Tenant shall, on the last day of the Term, or
upon the sooner termination of the Term, quit and surrender to Landlord the
Property vacant, free of all equipment, furniture and other movable personal
property of Tenant, and in good order and condition, reasonable wear and tear
and damage due to casualty (subject to the provisions of Article 7) or
condemnation (subject to the provisions of Article 8) excepted, and Tenant shall
remove or demolish all of the fixtures, structures and other improvements which
Landlord shall have elected to cause Tenant to remove pursuant to and in
accordance with Section 5.8 hereof. Tenant's obligation to observe and perform
this covenant shall survive the expiration or earlier termination of the Term.
Section 16.2. Upon the expiration of the Term, all Fixed Rent
and Additional Rent and other items payable by Tenant under this Lease shall be
apportioned to the date of termination.
Section 16.3. Tenant acknowledges that possession of the
Property must be surrendered to Landlord at the expiration or sooner termination
of the Term of this Lease. Tenant agrees to indemnify Landlord against and save
Landlord harmless from all costs, claims, loss or liability resulting from the
failure or delay by Tenant in so surrendering the Property, including, without
limitation, any claims made by any succeeding tenant founded on such failure or
delay. The parties recognize and agree that the damage to Landlord resulting
from any failure by Tenant to timely surrender possession of the Property as
aforesaid will be extremely substantial, will exceed the amount of the Fixed
Rent and Additional Rent theretofore payable hereunder, and will be impossible
to accurately measure. Tenant therefore agrees that if possession of the
Property is not surrendered to Landlord upon the expiration or sooner
termination of the Term of this Lease, then Tenant shall pay to Landlord, as
liquidated damages for each month and for each portion of any month during which
Tenant holds over in the Property after the expiration or sooner termination of
the Term of this Lease, in addition to any sums payable pursuant to the
foregoing indemnity, one hundred fifty percent (150%) of the Fixed Rent and
Additional Rent which was payable under this Lease with respect to the last
month of the Term hereof. Nothing herein contained shall be deemed to permit
Tenant to retain possession of the Property after the expiration or sooner
termination of the Term of this Lease. If Tenant holds over in possession after
the expiration or termination of the Term of the Lease, such holding over shall
not be deemed to extend the Term or renew this Lease, but the tenancy thereafter
shall continue as a tenancy from month to month upon the terms and conditions of
this Lease at the Fixed Rent and Additional Rent as herein increased. Tenant
hereby knowingly and voluntarily waives the benefit of any law or statute or
equitable right in effect in the state where the Property is located which would
contravene or limit the provisions set forth in this Section 16.3. This
provision shall survive the expiration or earlier termination of this Lease.
ARTICLE 17
ACCESS
Section 17.1. Landlord shall at all times during the Term have
the right and privilege to enter the Property at reasonable times during
business hours upon reasonable advance notice which shall not unreasonably
interfere with normal operations of the Property for the purpose of inspecting
the same or for the purpose of showing the same to prospective purchasers or
Mortgagees thereof; provided however, that access to Tenant's data center room
shall be subject to Tenant's reasonable security guidelines as the same may be
in effect from time to time. Landlord shall also have the right and privilege at
all times during the Term to post notices of non-responsibility for Work
performed by or on behalf of Tenant and, during the last eighteen (18) months of
the Term, Landlord shall have the right and privilege (a) to display the
customary "For Sale" sign on the Building and (b) following reasonable notice
from Landlord and so long as such entry does not unduly interfere with Tenant's
normal business operations, to enter the Property at reasonable times during
business hours for the purpose of exhibiting the same to prospective new tenants
and to display the customary "To Let" signs on the Building.
Section 17.2. Landlord shall at all times during the Term have
the right to enter the Property or any part thereof, following reasonable notice
from Landlord (except in the event of an emergency) and so long as Landlord uses
its reasonable best efforts to not unduly interfere with Tenant's normal
business operations, for the purpose of making such repairs or Alterations
therein as Landlord deems necessary or advisable, but such right of access shall
not be construed as obligating Landlord to make any repairs to or replacements
to the Property or as obligating Landlord to make any inspection or examination
of the Building.
ARTICLE 18
ENVIRONMENTAL MATTERS
Section 18.1. Landlord has caused to be performed a Phase I
environmental site assessment dated November 18, 2005, prepared by URS
Corporation (the "Report"). Tenant represents and warrants to Landlord that
Tenant has conducted an appropriate inquiry and that, to Tenant's Knowledge, and
except as set forth in the Report, no Hazardous Substance (as defined below) has
been used, generated, manufactured, produced, stored, released, discharged or
disposed of on, under, from, adjacent to or about the Property and that no
Hazardous Substance is located on or below the Property, except for quantities
of Hazardous Substances utilized in the construction of the Building or
customarily employed in the ordinary course of businesses similar to Tenant ("De
Minimis Hazardous Substances") provided such Hazardous Substances are used and
maintained in accordance with Environmental Laws (as defined below) (e.g. the
use of solvents and fungicides in cleaning the Property, the use of pesticides
in rendering the Property free of vermin and insects or the use of herbicides in
maintaining the landscaping of the Property). Tenant will not use, generate,
manufacture, produce, store, release, discharge or dispose of on, under, from or
about the Property or transport to or from the Property any Hazardous Substance,
except in accordance with Environmental Laws, and will use its best efforts not
to allow or suffer any other person or entity to do so.
Section 18.2. Tenant shall keep and maintain the Property in
compliance with, and shall not use, cause, permit or suffer the Property to be
in violation of any Environmental Law.
Section 18.3. Tenant represents and warrants to Landlord that
Tenant has not received any notice of a violation of any Environmental Law, nor
incurred any previous liability therefor with respect to the Property. Tenant
shall give prompt written notice to Landlord of:
(i) Tenant's logs maintained in the ordinary course of its
business which document any use, generation, manufacture, production, storage,
release, discharge or disposal of any Hazardous Substance on, under, from or
about the Property or the migration thereof to or from other property, including
specifically those Hazardous Substances used in Tenant's business
notwithstanding the fact that such Hazardous Substances are used in compliance
with Environmental Laws, provided that such logs shall only be produced upon
Landlord's written request therefore and no more frequently than quarterly;
(ii) Tenant's receipt of notice of the commencement,
institution or threat of any proceeding, inquiry or action by or notice from any
local, state or federal governmental authority with respect to the use or
presence of any Hazardous Substance on the Property or the migration thereof
from or to other property;
(iii) Tenant's actual knowledge of all claims made or
threatened by any third party against Tenant or the Property relating to any
damage, contribution, cost recovery, compensation, loss or injury resulting from
any Hazardous Substance;
(iv) Tenant's actual knowledge of any occurrence or condition
on any real property adjoining or in the vicinity of the Property that could
cause the Property or any part thereof to be subject to any restrictions on the
ownership, occupancy, transferability or use of the Property under any
Environmental Law, or any regulation adopted in accordance therewith, or to be
otherwise subject to any restrictions on the ownership, occupancy,
transferability or use of the Property under any Environmental Law; and
(v) Tenant's actual knowledge of any incurrence of expense by
any governmental authority or others in connection with the assessment,
containment or removal of any Hazardous Substance located on, under, from or
about the Property or any property adjoining or in the vicinity of the Property.
Section 18.4. Landlord shall have the right, but not the
obligation, to join and participate in, as a party if it so elects, any legal
proceedings or actions initiated with respect to the Property in connection with
any Environmental Law and have its attorneys' fees and disbursements in
connection therewith paid by Tenant or be defended by Tenant from and against
any such proceedings or actions with counsel chosen by Landlord (provided that
Landlord and Tenant shall attempt, in good faith, to agree on one counsel to
represent both Landlord and Tenant, if in Landlord's good faith determination
such joint representation is feasible or appropriate under the circumstances),
and shall have the right to make inquiry of and disclose all information to
appropriate governmental authorities when advised by counsel that such
disclosure may be required under applicable law.
Section 18.5. Without Landlord's prior written consent, which
consent shall not be unreasonably withheld or delayed, Tenant shall not take any
remedial action, other than pursuant to the plan developed in accordance with
Section 18.7, in response to the presence of any Hazardous Substance on, under,
from or about the Property, nor enter into any settlement, consent or compromise
which might, in Landlord's judgment, impair the value of Landlord's interest in
the Property under this Lease; provided, however, that Landlord's prior consent
shall not be necessary if the presence of Hazardous Substance on, under, from or
about the Property either poses an immediate threat to the health, safety or
welfare of any individual or is of such a nature that an immediate remedial
response is necessary and it is not practical or possible to obtain Landlord's
consent before taking such action. In such event Tenant shall notify Landlord as
soon as practicable of any action so taken. Landlord agrees not to withhold its
consent, where such consent is required hereunder, if either (a) a particular
remedial action is ordered by a court or any agency of competent jurisdiction,
or (b) Tenant establishes to the reasonable satisfaction of Landlord that there
is no reasonable alternative to such remedial action which would result in less
impairment of Landlord's security hereunder.
Section 18.6. Tenant shall protect, indemnify and hold
harmless the Indemnified Parties from and against any and all claims, losses,
damages, costs, expenses, liabilities, fines, penalties, charges, administrative
and judicial proceedings and orders, judgments, remedial action requirements,
enforcement actions of any kind (including, without limitation, attorneys' fees
and disbursements) directly or indirectly arising out of or attributable to, in
whole or in part, the breach of any of the covenants, representations and
warranties of this Article 18 or the use, generation, manufacture, production,
storage, release, threatened release, discharge, disposal, or presence of a
Hazardous Substance on, under, from or about the Property, or any other activity
carried on or undertaken on or off the Property, whether prior to or during the
Term and whether by Tenant or any predecessor in title or any employees, agents,
contractors or subcontractors of Tenant or any predecessor in title, or any
third persons at any time occupying or present on the Property, in connection
with the handling, treatment, removal, storage, decontamination, clean-up,
transport or disposal of any Hazardous Substance at any time located or present
on, under, from or about the Property, including, without limitation: (a) the
costs of any required or necessary repair, cleanup or detoxification of the
Property and the preparation and implementation of any closure, remedial or
other required plans including, without limitation, (i) the costs of removal or
remedial action incurred by the United States Government or the state in which
the Property is located, or response costs incurred by any other person, or
damages from injury to, destruction of, or loss of natural resources, including
the costs of assessing such injury, destruction on loss, incurred pursuant to
any Environmental Law; (ii) the clean-up costs, fines, damages or penalties
incurred pursuant to the provisions of applicable state law; and (iii) the cost
and expenses of abatement, correction or clean-up, fines, damages, response
costs or penalties which arise from the provisions of any other statute, state
or federal; and (b) liability for personal injury or property damage, including
damages assessed for the maintenance of the public or private nuisance, response
costs or for the carrying on of an abnormally dangerous activity.
The foregoing indemnity shall further apply to any residual
contamination on, under, from or about the Property, or affecting any natural
resources arising in connection with the use, generation, manufacturing,
production, handling, storage, transport, discharge or disposal of any such
Hazardous Substance, and irrespective of whether any of such activities were or
will be undertaken in accordance with Environmental Law or other applicable
laws, regulations, codes and ordinances. This indemnity is intended to be
operable under 42 U.S.C. Section 9607(e)(1), and any successor section thereof
and shall survive the expiration or earlier termination of this Lease and any
transfer of all or a portion of the Property by Tenant.
The foregoing indemnity shall in no manner be construed to
limit or adversely affect Landlord's rights under this Article 18, including,
without limitation, Landlord's rights to approve any Remedial Work (as defined
below) or the contractors and consulting engineers retained in connection
therewith.
Section 18.7. In the event that any investigation, site
monitoring, containment, cleanup, removal, restoration or other remedial Work of
any kind or nature (the "Remedial Work") is required by any applicable local,
state or federal law or regulation, any judicial order, or by any governmental
entity or person because of, or in connection with, the current or future
presence, suspected presence, release or suspected release of a Hazardous
Substance in or into the air, soil, groundwater, surface water or soil vapor at,
on, about, under or within the Property (or any portion thereof), Tenant shall
promptly, but in no event later than forty five (45) days after written demand
for performance thereof by Landlord (or such shorter period of time as may be
required under any applicable law, regulation, order or agreement), commence to
perform, or cause to be commenced, and thereafter diligently prosecute to
completion within such period of time as may be required under any applicable
law, regulation, order or agreement, all such Remedial Work at Tenant's sole
expense in accordance with the requirements of any applicable governmental
authority or Environmental Law. All Remedial Work shall be performed by one or
more contractors, approved in advance in writing by Landlord, and under the
supervision of a consulting engineer approved in advance in writing by Landlord,
which approvals shall not be unreasonably withheld. All costs and expenses of
such Remedial Work shall be paid by Tenant, including, without limitation, the
charges of such contractor(s) and/or the consulting engineer, and Landlord's
reasonable attorneys' fees and disbursements incurred in connection with
monitoring or review of such Remedial Work. In the event Tenant shall fail to
timely commence, or cause to be commenced, or fail to complete the Remedial Work
within the time required above, Landlord may, but shall not be required to,
cause such Remedial Work to be performed and all costs and expenses thereof, or
incurred in connection therewith shall be Additional Rent.
Section 18.8. Upon the reasonable belief that an Environmental
Law has been violated, Landlord shall have the right to engage or cause Tenant
to engage, each at Tenant's sole cost and expense, an environmental consultant
acceptable to both Landlord and Tenant, to review compliance by Tenant with all
applicable Environmental Laws and Requirements and standards existing at such
time with respect to the practice relating to contamination or hazardous waste
methods, conditions and procedures and Tenant's development of a plan to
identify, contain and remediate problems caused by such Hazardous Substances. In
the event that Landlord reasonably believes that there has been a violation or
threatened violation by Tenant of any Environmental Law or a violation or
threatened violation by Tenant of any covenant under this Article 18, Landlord
is authorized, but not obligated, by itself, its agents, employees or workmen to
enter at any reasonable time upon any part of the Property for the purposes of
inspecting the same for Hazardous Substances and Tenant's compliance with this
Article 18, and such inspections may include, without limitation, soil borings.
Tenant agrees to pay to Landlord, upon Landlord's demand, all expenses, costs or
other amounts incurred by Landlord in performing any inspection for the purposes
set forth in this Section 18.8.
Section 18.9. All costs and expenses incurred by Landlord
under this Article 18 shall be immediately due and payable as Additional Rent
upon demand and shall bear interest at the Default Rate from the date of notice
of such payment by Landlord and the expiration of any grace period provided
herein until repaid.
Section 18.10. "Environmental Laws" shall mean any federal,
state or local law, statute, ordinance or regulation pertaining to health,
industrial hygiene, hazardous waste or the environmental conditions on, under,
from or about the Property, including, without limitation, the laws listed in
the definition of Hazardous Substances below.
Section 18.11. "Hazardous Substances" shall mean any element,
asbestos, compound, chemical mixture, contaminant, pollutant, infectious
substance, material, waste or other substance which is defined, determined or
identified as a "hazardous substance," "hazardous waste" or "hazardous material"
under any federal, state or local statute, regulation or ordinance applicable to
any real property or the Property, as well as any amendments and successors to
such statutes and regulations, as may be enacted and promulgated from time to
time, including, without limitation, the following: (i) the Comprehensive
Environmental Response, Compensation and Liability Act of 1980 (codified in
scattered sections of 26 U.S.C., 33 U.S.C., 42 U.S.C. and 42 U.S.C. ss. 9601 et
seq.); (ii) the Resource Conservation and Recovery Act of 1976 (42 U.S.C. ss.
6901 et. seq.); (iii) the Hazardous Materials Transportation Act (49 U.S.C. ss.
1801 et. seq.); (iv) the Toxic Substances Control Act (15 U.S.C. ss. 2601 et.
seq.); (v) the Clean Water Act (33 U.S.C. ss. 1251 et. seq.); (vi) the Clean Air
Act (42 U.S.C. ss. 7401 et. seq.); (vii) the Safe Drinking Water Act (21 U.S.C.
ss. 349; 42 U.S.C. ss. 201 and ss. 300f et. seq.); (viii) the National
Environmental Policy Act of 1969 (42 U.S.C. ss. 3421); (ix) the Superfund
Amendment and Reauthorization Act of 1986 (codified in scattered sections of 10
U.S.C., 29 U.S.C., 33 U.S.C. and 42 U.S.C.); and (x) Title III of the Superfund
Amendment and Reauthorization Act (40 U.S.C. 1101 et. seq.). Hazardous
Substances shall also be deemed to include any and all biohazardous wastes,
substances and materials which are, or in the future become, regulated under
applicable Environmental Laws for the protection of health or the environment or
which are classified as hazardous or toxic substances, materials, wastes,
pollutants or contaminants, including without limitation radioactive materials
and waste, any medical waste including without limitations any blood-containing
or blood-tainted items or materials, animal remains or waste and materials that
threaten human health, ecology or the environment.
Section 18.12. All representations and warranties contained in
this Article 18 shall supersede any previous disclosures, written or oral, made
by Tenant or its agents to Landlord with respect to the Property. Landlord and
any Mortgagee shall be entitled to rely on the representations and warranties
contained herein in pursuit of its rights and remedies for a breach thereof
without regard to any such previous disclosures.
Section 18.13. As used in this Article 18, the term to
"Tenant's Knowledge" shall mean the actual and constructive knowledge of the
officers, directors and senior management of Tenant as well as all employees
having responsibility for the management of the Property and compliance with
Environmental Laws.
Section 18.14. All representations, warranties, covenants and
indemnities of Tenant in this Article 18 shall continue to be binding upon
Tenant, and its successors and assigns, after the expiration or earlier
termination of this Lease.
ARTICLE 19
FINANCIAL STATEMENTS
Section 19.1. Tenant shall make available to Landlord not
later than one hundred (100) days after the end of its fiscal year, an audited
balance sheet of Guarantor as of the close of such year, together with the
related statements of profit and loss and changes in financial position for such
period, setting forth in each case, in comparative form, the corresponding
figures for the preceding fiscal year, audited and certified by an independent
certified public accounting firm of recognized standing. In addition, upon
request from Landlord, within one hundred (100) days after the end of each of
the first three (3) quarters of each of its respective fiscal years, the Tenant
shall furnish an unaudited balance sheet as of the close of such quarter,
together with the related unaudited statement of profit and loss and changes in
financial position, all certified by a treasurer or comptroller of the Tenant.
All financial statements furnished by Tenant to Landlord hereunder shall be
prepared in accordance with generally accepted accounting principles
consistently applied.
Section 19.2. Notwithstanding the provisions of Section 19.1,
during any period that Guarantor is a public company and its current financial
statements are publicly available through the Securities and Exchange
Commission, Tenant will not be obligated to separately and directly provide the
financial statements of Guarantor to Landlord or otherwise comply with the
requirements of Section 19.1.
ARTICLE 20
MISCELLANEOUS PROVISIONS
Section 20.1. It is mutually agreed by and between Landlord
and Tenant that the respective parties shall and they hereby do waive trial by
jury in any action, proceeding or counterclaim brought by either of the parties
hereto against the other on any matters whatsoever arising out of or in any way
connected with this Lease, Tenant's use or occupancy of the Property, and/or any
claim of injury or damage excluding any claim for personal injury or property
damage.
Section 20.2. Upon Landlord's prior written approval, Tenant
may place such signs on the Property as Tenant deems appropriate to indicate the
nature of the business of Tenant and such parties. The signs shall be lawful
under applicable sign codes and subdivision covenants and Tenant shall obtain
all appropriate licenses and approvals in connection with such signs. Signs
existing on the Commencement Date shall be deemed approved by Landlord provided
such signs comply with all applicable sign codes and laws.
Section 20.3. (a) The term "Landlord" as used herein shall
mean only the owner for the time being of the Property, so that in the event of
any sale, transfer or conveyance of the Property, Landlord shall be and hereby
is entirely freed and relieved of all agreements, covenants and obligations of
Landlord thereafter accruing hereunder, and it shall be deemed and construed
without further agreement between the parties or their successors in interest or
between the parties and the purchaser, transferee or grantee at any such sale,
transfer or conveyance that such purchaser, transferee or grantee has assumed
and agreed to carry out any and all agreements, covenants and obligations of
Landlord hereunder.
(b) The term "Tenant" as used herein shall mean the
tenant named herein, and from
and after any valid assignment or transfer in whole of said Tenant's interest
under this Lease pursuant to the provisions of Article 9, shall mean only the
assignee or transferee thereof; but the foregoing shall not release the assignor
or transferor from liability under this Lease.
(c) The words "enter", "re-enter", "entry" and
"re-entry" as used in this Lease
shall not be restricted to their technical legal meaning.
(d) The use herein of the neuter pronoun in any
reference to Landlord or Tenant shall be deemed to include any individual
Landlord or Tenant, and the use herein of the words "successor and assigns" or
"successors or assigns" of Landlord or Tenant shall be deemed to include the
heirs, executors, administrators, representatives and assigns of any individual
Landlord or Tenant.
Section 20.4. The headings herein are inserted only as a
matter of convenience and for reference and in no way define, limit or describe
the scope or intent of this Lease.
Section 20.5. This Lease shall be governed by and construed in
accordance with the substantive laws of the State of Arizona. Under no
circumstances whatsoever shall this Lease be construed as creating either a
partnership, an agency or an employment relationship between the parties hereto.
Section 20.6. This Lease contains the entire agreement between
the parties with respect to the leasing of the Property and may not be extended,
renewed, terminated or otherwise modified in any manner except by an instrument
in writing executed by the party against whom enforcement of any such
modification is sought. All prior understandings and agreements between the
parties and all prior working drafts of this Lease are merged in this Lease,
which alone expresses the agreement of the parties. The parties agree that no
inferences shall be drawn from matters deleted from any working drafts of this
Lease.
Section 20.7. The agreements, terms, covenants and conditions
herein shall bind and inure to the benefit of Landlord and Tenant and their
respective heirs, personal representatives, successors and, except as is
otherwise provided herein, their assigns.
Section 20.8. Notice whenever provided for herein shall be in
writing and shall be given either by personal delivery, overnight express mail
or by certified or registered mail, return receipt requested, to Landlord and
Tenant at the addresses hereinabove set forth in Article A, Section 5 or to such
other persons or at such other addresses as may be designated from time to time
by written notice from either party to the other. Notices shall be deemed given
(i) when delivered personally if delivered on a business day (or if the same is
not a business day, then the next business day after delivery), (ii) three (3)
business days after being sent by United States mail, registered or certified
mail, postage prepaid, return receipt requested or (iii) if delivery is made by
Federal Express or a similar, nationally recognized overnight courier service
for 10:00 a.m. delivery, then on the date of delivery (or if the same is not a
business day, then the next business day after delivery), if properly sent and
addressed in accordance with the terms of this Section 20.8.
Section 20.9. If any provision of this Lease shall be invalid
or unenforceable, the remainder of the provisions of this Lease shall not be
affected thereby and each and every provision of this Lease shall be enforceable
to the fullest extent permitted by law.
Section 20.10. Tenant represents and warrants to Landlord that
Tenant has not dealt with any real estate broker in connection with this Lease
and that the only advisor that it has used in this transaction is Banc of
America leasing, whose fee shall be paid by Tenant pursuant to a separate
written agreement. Tenant agrees to indemnify the Landlord and save the Landlord
harmless from any and all claims for brokerage commissions by any person, firm,
corporation or other entity claiming to have brought about this Lease
transaction as a result of Tenant's actions. Landlord represents and warrants to
Tenant that Landlord has not dealt with any real estate broker in connection
with this transaction. Landlord agrees to indemnify and hold Tenant harmless
from any and all claims for brokerage commissions by any person, firm,
corporation or other entity claiming to have brought about this Lease
transaction as a result of Landlord's actions. The provisions of this Section
20.10 shall survive the expiration or earlier termination of this Lease.
Section 20.11. The parties took equal part in drafting this
Lease and no rule of construction that would cause any of the terms hereof to be
construed against the drafter shall be applicable to the interpretation of this
Lease.
Section 20.12. Upon the occurrence and during the continuance
of an Event of Default, Tenant shall and hereby does appoint Landlord the
attorney-in-fact of Tenant, irrevocably, to execute and deliver any documents
provided for in Section 14.1 for and in the name of Tenant, such power, being
coupled with an interest, being irrevocable.
Section 20.13. TIME IS STRICTLY OF THE ESSENCE with respect to
each and every term and provision of this Lease.
Section 20.14. Tenant represents and warrants to Landlord
that: (a) Tenant is a limited liability duly formed, validly existing and in
good standing under the laws of the State of Delaware, (b) the persons executing
this Lease and the other documents executed herewith on behalf of Tenant are
duly appointed and authorized by Tenant to execute such documents, (c) this
Lease and the other documents which will be delivered and executed by Tenant
will, when delivered, have been duly authorized and executed by Tenant and will
constitute the legal, valid and binding obligations of Tenant, enforceable
against Tenant in accordance with their terms subject to applicable bankruptcy,
insolvency, reorganization, moratorium, or other laws affecting the rights of
creditors, generally, (d) Tenant has full power and authority to execute,
deliver and perform its obligations under this Lease and the other documents
which are executed and delivered by Tenant and to carry on its business as
presently conducted, (e) Tenant has obtained all necessary permits, licenses,
entitlements and/or approvals required to comply with the provisions of this
Lease and the other documents which are executed and delivered by Tenant, and
(f) the execution, delivery and performance of this Lease and the other
documents executed and delivered herewith do not violate any provisions of any
agreement or document to which Tenant is a party or by which Tenant is bound, or
of any order or regulation of any court, regulatory body, administrative agency
or governmental body having jurisdiction over Tenant.
Section 20.15. Notwithstanding anything to the contrary
provided in this Lease, in any instance where the consent of Mortgagee is
required, Landlord shall not be required to give its consent unless the
Mortgagee has given its consent.
ARTICLE 21
GUARANTY
Section 21.1. Simultaneously herewith, Tenant is causing the
delivery to Landlord of the Guaranty in the form attached hereto as EXHIBIT "D"
duly executed by Guarantor.
ARTICLE 22
MEMORANDUM OF LEASE
Section 22.1. Landlord and Tenant shall execute a memorandum
of lease in the form attached hereto as EXHIBIT "C" and thereafter either party
shall have the right at any time to record the same with the County Recorder in
and for the County in which the Property is located. Tenant hereby agrees that,
in the event a memorandum of lease is recorded, on or prior to the Expiration
Date (or earlier termination of this Lease) Tenant shall execute and deliver to
Landlord a termination of such memorandum of lease in such form as is required
to record and discharge such memorandum of lease from record.
ARTICLE 23
LIMITATION OF LIABILITY
Section 23.1. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN
THIS LEASE, THE LIABILITY OF LANDLORD (AND OF ANY SUCCESSOR LANDLORD HEREUNDER)
TO TENANT FOR ANY MONETARY DAMAGES OR JUDGMENT SHALL BE LIMITED TO THE INTEREST
OF LANDLORD IN THE PROPERTY (INCLUDING RENTAL INCOME AND THE PROCEEDS FROM THE
SALE OF THE PROPERTY), AND TENANT AGREES TO LOOK SOLELY TO LANDLORD'S INTEREST
IN THE PROPERTY FOR THE RECOVERY OF ANY JUDGMENT OR AWARD AGAINST THE LANDLORD,
IT BEING INTENDED THAT LANDLORD SHALL NOT BE PERSONALLY LIABLE FOR ANY JUDGMENT
OR DEFICIENCY. NOTHING HEREIN SHALL BE DEEMED TO LIMIT TENANT'S RIGHT TO SEEK
SPECIFIC PERFORMANCE OR AN INJUNCTION.
ARTICLE 24
RIGHT OF FIRST OFFER
24.1 Offer and Price. If Landlord decides to offer the Property for
sale to any third party, Landlord shall first offer by written notice (the
"Offer") to sell the Property to Tenant for a specific purchase price (the
"Purchase Price") and, upon such terms and conditions as Landlord, in Landlord's
sole discretion, would otherwise intend to offer to sell the Property, prior to
Landlord's offering to sell the Property to any such third party, except that
the terms and conditions of any such sale to Tenant shall be consistent with the
terms and provisions of this Article 24. If Landlord shall make the Offer, then,
whether or not Tenant has accepted the Offer, Landlord shall have the unilateral
right, in Landlord's sole discretion, to revoke the Offer if an Event of Default
exists under this Lease on the date on which Landlord shall give, or would
otherwise be required to give, Tenant the Offer.
24.2 Acceptance by Tenant. Tenant shall have the right to accept the
Offer only by giving Landlord written notice of such acceptance (the "ROFO
Notice") within 30 days after delivery by Landlord to Tenant of the Offer. Time
shall be of the essence with respect to such 30-day period and delivery of the
ROFO Notice by Tenant. Upon Tenant's acceptance of the Offer, Tenant shall
execute, upon the request of Landlord, any documentation reasonably required by
Landlord to reflect Tenant's acceptance of the Offer. Notwithstanding anything
to the contrary contained in this Lease, subject only to the provisions of
Section 24.4 below, upon the delivery of the ROFO Notice by Tenant, no event or
circumstances affecting the Property including, but not limited to, a
condemnation or casualty, shall give Tenant any right or option of Tenant to
cancel, surrender or otherwise terminate this Lease, and any other right or
option of Tenant under the Lease to acquire the Property, shall automatically be
deemed to have been waived by Tenant for all purposes under this Lease.
24.3 Rejection by Tenant and Second Option. If Tenant does not accept,
or fails to timely accept, the Offer in accordance with the provisions herein,
Landlord shall be under no further obligation with respect to such Offer
pursuant to the terms contained herein, and Tenant shall have forever waived and
relinquished its right to such Offer. Landlord shall at any and all times
thereafter be entitled to market the Property to others upon such terms and
conditions as Landlord in its sole discretion may determine, except that if the
price ("Third Party Price") for which Landlord enters into a binding contract
("Third Party Contract") to sell the Premises is less than ninety (90%) of the
Offer, Tenant shall have 20 days in which to accept the Third Party Price.
Tenant shall, within 10 business days after Landlord's request therefore,
deliver an instrument in form reasonably satisfactory to Landlord confirming the
aforesaid waiver, but no such instrument shall be necessary to make the
provisions hereof effective.
24.4 Restrictions. Notwithstanding anything to the contrary contained
herein, the provisions of this Article 24 shall not apply to or prohibit (i) any
mortgaging, subjection to deed of trust or other hypothecation of Landlord's
interest in the Property, (ii) any sale of the Property pursuant to a private
power of sale under or judicial foreclosure of any Mortgage or other security
instrument or device to which Landlord's interest in the Property is now or
hereafter subject, (iii) any transfer of Landlord's interest in the Property to
a Lender, beneficiary under deed of trust or other hold of a security interest
therein or their designees by deed in lieu of foreclosure, (iv) any transfer of
the Property to any governmental or quasi-governmental agency with power of
condemnation, (v) any transfer of the Property to any Affiliate of Landlord or
Lexington Corporate Properties Trust, (vi) a transfer to any person or entity to
whom Landlord or Lexington Corporate Properties Trust sells all or substantially
all of its assets or (vii) any transfer of the Property to any of the successors
or assigns of any of the persons or entities referred to in the foregoing
clauses (i) through (iv).
24.5 Title. If the Property is purchased by Tenant pursuant to this
Article 24, Landlord need not convey any better title thereto than that which
was conveyed to Landlord, and Tenant shall accept such title, subject, however,
to all liens, exceptions and restrictions on, against or relating to any of the
Property as of the commencement of the Term and as may thereafter have been
created, consented to or approved by Tenant and to all applicable Laws, but free
of the lien of and security interest created by any mortgage or assignment of
leases and rents and liens, exceptions and restrictions on, against or relating
to the Property which have been created by or resulted solely from acts of
Landlord after the date of this Lease, unless the same are Permitted
Encumbrances or customary utility easements benefiting the Premises or were
created with the concurrence of Tenant or as a result of a default by Tenant
under this Lease or otherwise constitute part of the Offer, that is, if the
Offer requires the assumption of any existing mortgage loan, Landlord shall have
no obligation to satisfy or remove the lien of such loan as a condition to the
sale to Tenant.
24.6 Purchase Date and Completion of Sale. Upon the date fixed for a
purchase of the Property pursuant to this Article 24 which shall be a date
mutually acceptable to Landlord and Tenant that is no later than 60 days
following acceptance of the Offer or the date specified in the Third Party
Contract, if applicable, (the "Purchase Date"), Tenant shall pay to Landlord, or
to any person or entity to whom Landlord directs payment, the Purchase Price and
all other sums payable by Tenant under the Offer, by federal funds wire
transfer, and Landlord shall deliver to Tenant (i) grant deed which describe the
Property being conveyed and conveys the title thereto as provided in Section
24.5 above and (ii) such other instruments as shall be necessary to transfer the
Property to Tenant or its designee; provided, that if any payment of Rent and
all other sums payable by Tenant under this Lease to Landlord or any Third Party
in behalf of Landlord ("Monetary Obligations") remain outstanding on the
Purchase Date, then Landlord may add to the Purchase Price the amount of such
Monetary Obligations. If on the Purchase Date any Monetary Obligations remain
outstanding Tenant shall pay to Landlord on the Purchase Date the amount of such
Monetary Obligations. Upon the completion of such purchase, this Lease and all
obligations and liabilities of Tenant hereunder shall terminate, except any
obligations of Tenant under this Lease, actual or contingent, which arise on or
prior to the expiration or termination of this Lease or which survive such
expiration or termination by their own terms. Any prepaid Monetary Obligations
paid to Landlord shall be prorated as of the Purchase Date, and the prorated
unapplied balance shall be deducted from the Purchase Price due to Landlord.
24.7 Delay of Sale. If the completion of the purchase by
Tenant pursuant to this Article 24 shall be delayed after the date scheduled for
such purchase, Fixed Rent and Additional Rent shall continue to be due and
payable until completion of such purchase.
[Balance of Page Left Blank Intentionally]
The parties hereto have executed this Lease as of the day and
year first above set forth.
LANDLORD:
LSAC TEMPE L.P.
BY: LSAC TEMPE MANAGER LLC, ITS GENERAL PARTNER
By: /s/ SAM SALANT
-------------------
Sam Salant
Its: Vice President
TENANT:
(I)STRUCTURE, LLC
By: /s/ ZACH LONSTEIN
-------------------
Zach Lonstein
Its: Chairman & CEO
EXHIBIT "A"
DESCRIPTION OF THE LAND
THAT PORTION OF THE NORTHEAST QUARTER OF SECTION 13, TOWNSHIP 1 SOUTH, RANGE 4
EAST OF THE GILA AND SALT RIVER BASE AND MERIDIAN, MARICOPA COUNTY, ARIZONA, AND
BEING A PART OF THE ARIZONA STATE UNIVERSITY RESEARCH PARK - MAP OF DEDICATION
AS RECORDED IN BOOK 275 OF MAPS, PAGE 26, MARICOPA COUNTY RECORDER'S OFFICE,
MORE PARTICULARLY DESCRIBED AS FOLLOWS;
COMMENCING AT THE NORTHEAST CORNER OF SAID SECTION 13;
THENCE SOUTH 89 DEGREE 57 MINUTES 14 SECONDS WEST, ALONG THE NORTH LINE OF SAID
SECTION 13, A DISTANCE OF 2590.16 FEET;
THENCE SOUTH 1 DEGREE 09 MINUTES 55 SECONDS WEST, A DISTANCE OF 60.01 FEET TO
THE NORTHEAST CORNER OF THE TEMPE ROYAL PALMS UNIT 18 AS RECORDED IN BOOK 227,
PAGE 18, MARICOPA COUNTY RECORDER'S OFFICE;
THENCE SOUTH 1 DEGREE 09 MINUTES 55 SECONDS WEST, ALONG THE EAST LINE OF SAID
TEMPE ROYAL PALMS UNIT 18, A DISTANCE OF 1541.03 FEET TO THE TRUE POINT OF
BEGINNING;
THENCE SOUTH 83 DEGREES 55 MINUTES 28 SECONDS EAST, A DISTANCE OF 425.69 FEET TO
A POINT ON A NON-TANGENT CURVE TO THE LEFT, WHOSE RADIUS POINT BEARS SOUTH 29
DEGREE 16 MINUTES 59 SECONDS EAST, A DISTANCE OF 119.50 FEET;
THENCE ALONG SAID CURVE, THROUGH A CENTRAL ANGLE OF 250 DEGREES 08 MINUTES 05
SECONDS, A DISTANCE OF 521.70 FEET TO A POINT OF NONTANGENCY;
THENCE SOUTH 44 DEGREES 11 MINUTES 39 SECONDS EAST, A DISTANCE OF 459.66 FEET;
THENCE SOUTH 41 DEGREES 47 MINUTES 43 SECONDS WEST, A DISTANCE OF 147.52 FEET;
THENCE SOUTH 29 DEGREES 08 MINUTES 28 SECONDS WEST, A DISTANCE OF 172.73 FEET;
THENCE NORTH 88 DEGREES 50 MINUTES 05 SECONDS WEST, A DISTANCE OF 752.13 FEET TO
A POINT ON THE EAST LINE OF SAID TEMPE ROYAL PALMS UNIT 18;
THENCE NORTH 1 DEGREE 09 MINUTES 55 SECONDS EAST, ALONG THE EAST LINE OF SAID
TEMPE ROYAL PALMS UNIT 18, A DISTANCE OF 705.00 FEET TO THE TRUE POINT OF
BEGINNING.
EXHIBIT "B"
SCHEDULE OF REMOVABLE PERSONAL PROPERTY
(Omitted)
EXHIBIT "C"
FORM OF MEMORANDUM OF LEASE
(Omitted)
EXHIBIT "D"
FORM OF LEASE GUARANTY
THIS LEASE GUARANTY dated as of December __, 2005 ("Guaranty"), by
INFOCROSSING, INC., a corporation formed under the laws of the state of Delaware
("Guarantor"), having an office at 2 Christie Heights Street, Leonia, NJ 07605,
Attention: Nick Letizia, Esq. .
RECITALS
A. (I) STRUCTURE LLC ("Tenant"), a Delaware limited liability
company, is about to enter into a lease of even date herewith (the "Lease"),
between LSAC TEMPE L.P. ("Landlord"), as landlord, and Tenant, as tenant ,
covering certain premises (the "Premises") known as 2005 E. Technology Circle,
Tempe, Arizona and more particularly described in the Lease. The Lease, together
with all other certificates, statements, instruments and documents executed and
delivered in connection therewith or with the transactions contemplated therein,
being herein referred to, collectively, as the "Documents".
B. Tenant is a wholly owned, direct subsidiary of Guarantor.
C. Landlord is unwilling to enter into the Lease unless
Guarantor executes and deliver this unsecured Guaranty.
D. Accordingly, in order to induce Landlord to enter into the
Lease, Guarantor hereby agrees as follows:
1. UNCONDITIONAL GUARANTY. Guarantor absolutely, unconditionally and irrevocably
guarantees to Landlord (a) the due, complete and punctual payment by Tenant of
all Fixed Rent and Additional Rent (as such terms are defined in the Lease); (b)
the due, complete and punctual performance and observance of all of the terms,
covenants and conditions of the Lease, to be paid, performed and observed by
Tenant during the term of the Lease (herein called the "Term"); (c) the accuracy
of each representation and warranty made by Tenant in the Lease; and (d) the
full and prompt payment of all legal and other costs and expenses paid or
incurred by the Landlord in the enforcement of this Guaranty, including, without
limitation, reasonable attorneys' fees, all irrespective of the validity,
binding effect, legality or enforceability against Tenant of the Documents, or,
except as provided in Section 3(e) below, any other circumstance which might now
or hereafter otherwise constitute a legal or equitable discharge or defense of
Guarantor (the items referred to in (a) through (c) above are hereinafter
referred to collectively as the "Obligations"). Guarantor hereby agrees that
upon the occurrence of an "Event of Default" (as such term is defined in Section
12.1 of the Lease) by Tenant in (i) the complete payment when due of any amounts
payable under any of the Documents, or (ii) in the performance or observance of
any term, covenant or condition of the Lease, Guarantor shall upon written
demand specifying the nature of such Event of Default remaining to be cured,
cure such Event of Default by payment or performance in accordance with the
terms of the Lease. Guarantor acknowledges that it has received copies of the
Documents and that the same are legal, valid and binding instruments enforceable
against Tenant, in accordance with their respective terms and except as provided
in Section 3(e) below, Guarantor waives any notice under any of the Documents.
2. LANDLORD WAIVER. Any act of Landlord consisting of a waiver of any of the
terms, covenants or conditions of the Lease or the giving of any consent under
the Lease, or the granting of any indulgences or extensions of time to Lessee,
may be done without notice to or consent from Guarantor and without releasing
Guarantor of its obligations hereunder. Any such waiver shall not constitute a
waiver of any future or other defaults by Lessee.
3. WAIVER OF DEFENSES. (a) Except as otherwise specifically provided in this
Guaranty, the obligations and liability of Guarantor under this Guaranty shall
be absolute and unconditional, shall not be subject to any counterclaim,
set-off, deduction or defense based upon any claim which Guarantor may have
against Landlord and shall remain in full force and effect without regard to,
and shall not be released, discharged or terminated or in any other way affected
by, any circumstance or condition (whether or not Guarantor shall have any
knowledge or notice thereof), including, without limitation: (i) any amendment,
modification, extension or renewal of the Lease (except that the liability of
Guarantor hereunder shall be deemed to apply to the Lease as so amended,
modified, extended or renewed); (ii) any exercise or nonexercise by Landlord of
any right, power or remedy under or in respect of the Lease or any waiver,
consent, indulgence or other action, inaction or omission under or in respect of
the Lease; (iii) except pursuant to an assignment of the Lease satisfying the
conditions of Section 9.7 of the Lease (in which event Guarantor's obligations
hereunder shall cease), any assignment, sale, sublease, surrender, forfeiture,
reentry, re-letting or other transfer by Landlord or Tenant in respect of the
Lease or any interest in the Premises; (iv) any bankruptcy, insolvency,
receivership, reorganization, composition, adjustment, dissolution, liquidation
or other like proceeding involving or affecting Tenant, or Landlord or their
obligations, properties or creditors, or any action taken with respect to such
obligations or properties or the Lease, by any trustee or receiver of Landlord
or Tenant, or by any court of competent jurisdiction, in any such proceeding;
(v) any invalidity or unenforceability, in whole or in part of any obligation of
Tenant under the Lease, or of any term of the Lease; or (vi) any transfer by
Guarantor of any or all of the membership interests of Tenant or the direct or
indirect control thereof.
(b) The obligations of Guarantor shall not be affected by the exercise of any
renewal or expansion option provided in the Lease, and this Guaranty shall be
deemed to include, without limitation and without amendment or modification, all
additional liabilities and obligations of Tenant to Landlord resulting from the
exercise of any such option.
(c) By its acceptance of this Guaranty, Landlord covenants and agrees to make a
good faith effort to provide Guarantor with a copy of any notice of default sent
to Tenant pursuant to Section 12.1 of the Lease, provided that (i) Tenant's
default shall not be excused, or delayed performance accepted, by reason of
Landlord's failure to send, or Guarantor's failure to receive, such notice of
default, (ii) no remedy available to Landlord shall be conditioned upon, or
enforcement delayed or deferred, by reason of Landlord's failure to send, or
Guarantor's failure to receive, such notice of default and (iii) Landlord will
have no liability to Guarantor or Tenant in damages or otherwise for any failure
to send any notice of default to Guarantor.
(d) Guarantor shall have no obligation to pay Landlord any amount with respect
to which Tenant has obtained a final, non-appealable judgment confirming that
Tenant has no obligation to pay such amount. In addition, in the event that
Landlord obtains a judgment against Tenant which is paid by either Tenant or
Guarantor and which is subsequently reversed on appeal, Landlord will refund to
Tenant or Guarantor, as the case may be, so much of the judgment as may be
required by the appellate court order.
(e) Anything in this Guaranty to the contrary notwithstanding, in the event that
Landlord exercises the right set forth in this Guaranty and proceeds directly
against Guarantor (either alone or in a proceeding in which Tenant is also a
defendant), there shall be available to Guarantor any defense or claim, or any
limitation of liability provided for in, or otherwise available under, the Lease
that Guarantor would have had under the Lease had Guarantor been the original
party thereunder in lieu of Tenant. However, Guarantor shall not be entitled to
assert, and the liability of Guarantor and the rights of Landlord hereunder
shall not be diminished or affected by, any claim, defense, release or discharge
based on the capacity or authority of Tenant to enter into the Lease, perform
its obligations thereunder or generally to conduct its business, or based on any
other disability of Tenant, or based on the application to or effect upon Tenant
of any state or federal bankruptcy, insolvency, reorganization, fraudulent
conveyance, creditors' rights or similar laws, or based on any other matter
similarly unique to Tenant. In addition, in the event that Landlord proceeds
against Tenant first and obtains a judgment against Tenant, Guarantor shall be
precluded from, and hereby waives any defense to enforcement of that judgment
which was asserted, or could have been asserted, by Tenant in the original
action.
4. LANDLORD'S RIGHTS OF ACTION. This Guaranty is an unsecured absolute and
unconditional guaranty of payment and performance and not merely of collection.
Guarantor acknowledges and agrees that its liability hereunder shall be primary
and that in any right of action which shall accrue to Landlord under the Lease,
Landlord may, at its option, (a) proceed against Guarantor and Tenant jointly
and severally; (b) Landlord may proceed against Guarantor under this Guaranty
without commencing any suit or proceeding of any kind or nature whatsoever
against Tenant or without having obtained any judgment against Tenant and
without any presentment, and demand for payment, notice of nonpayment, notice of
dishonor, protest, notice of protest, nonperformance or nonobservance, or of any
notice of acceptance of this Guaranty or of any other notice or demand to which
Guarantor might otherwise be entitled, all of which Guarantor hereby expressly
waives; and (c) proceed against any party obligated under the terms of any of
the Documents, Guarantor or any other guarantor or surety in such order, either
concurrently or consecutively, as Landlord may designate or only against such
parties as Landlord may wish to proceed. All rights, remedies and recourse
afforded to herein or in any of the other Documents or otherwise available at
law or in equity shall be deemed separate, cumulative and concurrent and not
alternative; may, to the extent permitted by law, be pursued separately,
successively or concurrently against Guarantor, Tenant, or anyone else obligated
under the Documents, or any one or more of them, at the sole discretion of
Landlord; and may be exercised as often as occasion therefor arises, it being
understood that the exercise or the failure to exercise, or election not to
exercise any of the same or of any other right, remedy or recourse available to
Landlord and no single or partial exercise of any such right, remedy or recourse
shall preclude any other or future exercise thereof or of any other right,
remedy or recourse or limit or prejudice any other legal or equitable remedy
that Landlord may have.
5. WAIVER OF TRIAL BY JURY. Guarantor and Landlord each waive trial by jury of
all issues arising in any action, suit or proceeding to which Landlord and
Guarantor may be parties in connection with this Guaranty.
6. RESTRICTIONS ON DISPOSITION OF ASSETS. Guarantor shall not directly or
indirectly sell, lease or otherwise dispose of all or substantially all of its
properties or assets unless (a) the acquiring person shall expressly assume in
writing all obligations of Guarantor under this Guaranty and (b) immediately
after giving effect to such transaction (and such assumption), no default shall
exist under this Guaranty. In addition, this Guaranty shall terminate on the
effective date of the assignment of the Lease to an entity satisfying the
requirements and the terms and conditions of Section 9.7 of the Lease. No
termination of this Guaranty shall relieve Guarantor of any liability accruing
prior to the effective date of the termination of this Guaranty.
7. FURTHER ASSURANCES. Guarantor, at its expense, shall execute, acknowledge and
deliver all instruments, take all action and furnish such information as
Landlord from time to time may reasonably request for the assuring to Landlord
the full benefits intended to be created by this Guaranty.
8. REPRESENTATIONS AND WARRANTIES. Guarantor represents and warrants to Landlord
that:
8.1 Guarantor is a corporation duly organized, validly existing and in good
standing under the laws of the state of Delaware.
8.2 Guarantor has full power, authority and legal right to execute, deliver,
perform and observe the provisions of this Guaranty, including, without
limitation, the payment of all moneys hereunder.
8.3 The execution, delivery and performance by Guarantor of this Guaranty has
been duly authorized by all necessary corporate action.
8.4 Guarantor, as of the date of the execution of this Guaranty, has not
received notice of, nor, to the best of its knowledge, is it in violation of any
decree, ruling, judgment, order or injunction applicable to it nor any law,
ordinance, rule or regulation of whatever nature nor are there any actions,
proceedings or investigations pending or, to the best of its knowledge,
threatened against or affecting Guarantor (or any basis therefor known to
Guarantor) before or by any court, arbitrator, administrative agency or other
governmental authority or entity, any of which violations, actions, proceedings
or investigations, if adversely decided, would materially and adversely affect
its ability to carry out any of the terms, covenants and conditions of this
Guaranty.
8.5 No authorization, approval, consent or permission (governmental or
otherwise) of any court, agency, commission or other authority or entity, which,
if not granted, would materially and adversely affect its ability to carry out
any of the terms, covenants and conditions of this Guaranty, is required for the
due execution, delivery, performance or observance by Guarantor of this Guaranty
or for the payment of any sums hereunder. Guarantor covenants that if any such
authorization, approval, consent, filing or permission shall be required in the
future in order to permit or effect performance of the obligations of Guarantor
under this Guaranty, Guarantor shall promptly inform Landlord or its successors
or assigns and shall use its best efforts to obtain promptly such authorization,
approval, consent, filing or permission.
8.6 Guarantor, as of the date of the execution of this Guaranty, has not
received notice of, and, to the best of its knowledge is not in default in the
observance or performance of the terms and conditions of any loan or other
agreement, instrument, guaranty, indenture, charter or other document to which
it is a party or by which it is bound (collectively, "Guarantor's Other
Obligations"), which default might materially and adversely affect its ability
to carry out any of the terms, covenants or conditions of this Guaranty.
Guarantor shall promptly comply with all of Guarantor's Other Obligations,
whether currently or hereafter in force, the default of which would materially
and adversely affect its ability to carry out any of the terms, covenants or
conditions of this Guaranty.
8.7 Neither the execution and delivery of this Guaranty, nor the consummation of
the transactions herein contemplated, nor compliance with the terms and
provisions hereof, conflict or will conflict with or result in a breach of any
of the terms, conditions or provisions of the certificate of incorporation or
by-laws of Guarantor, or similar documents of Guarantor, or of any order, writ,
injunction or decree of any court of competent jurisdiction or governmental
authority, or of any agreement or instrument to which Guarantor is a party or by
which it is bound, or constitutes or will constitute a default thereunder.
8.8 Guarantor owns or controls one hundred percent (100%) of the membership
interests of Tenant.
8.9 The financial statements of Guarantor furnished to the Landlord are true and
correct in all material respects and fairly present the financial condition of
Guarantor at such respective dates. No material adverse change has occurred in
the business or financial condition of the Guarantor reflected in such financial
statements since the respective dates of such financial statements which might
materially and adversely affect its ability to carry out any of the terms,
covenants and conditions of this Guaranty.
8.10 This Guaranty is in furtherance of the business purposes of Guarantor and
Guarantor expects to derive substantial benefit from the performance
contemplated by the terms of the Documents.
8.11 There is no default on the part of Guarantor under this Guaranty and no
event has occurred and is continuing which with notice or lapse of time or both
would constitute a default hereunder.
8.12 To the best knowledge of Guarantor, Guarantor (i) has filed all tax returns
which are required to be filed, (ii) is not in default in the payment of taxes
(including interest and penalties) levied or assessed against it or any of its
assets, and (iii) has not been advised of any proposed deficiency with respect
to any income taxes for any period. All charges, accruals and reserves for
Federal, state and other such taxes, assessments, liens and charges applicable
to Guarantor are adequate.
9. CONTINUING GUARANTY. This Guaranty shall continue in full force and effect
throughout the Term (as such term is defined in the Lease) and thereafter so
long as any obligation or liability of Tenant under the Lease shall remain
unperformed or unsatisfied (whether or not the Lease shall have terminated), but
this Guaranty shall terminate and be of no further force or effect upon the full
performance and satisfaction by Guarantor and Tenant of all of their respective
obligations and liabilities hereunder and under the Documents.
10. NO WAIVER FOR DELAY. No delay on the part of Landlord in exercising any
right, power or privilege under this Guaranty nor any failure to exercise the
same shall operate as a waiver of or otherwise affect any right, power or
privilege, nor shall any single or partial exercise thereof preclude any other
or further exercise thereof or the exercise of any other right, power or
privilege.
11. FINAL JUDGMENTS. Guarantor agrees that any final judgment against Guarantor
from which Guarantor has not appealed, or is not permitted to appeal further,
shall be conclusive and binding upon Guarantor and, so far as is permitted under
applicable law, shall be enforced in any of the courts to the jurisdiction of
which Guarantor is subject, by a suit upon such judgment and that Guarantor
shall not assert any defense in any such suit upon such judgment.
12. CORPORATE EXISTENCE. Guarantor shall preserve, maintain and keep in full
force and effect and good standing its corporate existence and all rights,
privileges and franchises which are necessary or desirable in the normal conduct
of its business. Notwithstanding the foregoing, this covenant shall not be
deemed to be violated if Guarantor (a) converts from a corporation to another
legal form of ownership or (b) merges, consolidates or reorganizes into a
successor corporation or other entity as long as such transaction does not have
an adverse effect on Guarantor's (or its successor's) financial or legal
capacity to discharge its obligations under this Guaranty.
13. NOTICE OF INTERFERENCE WITH ABILITY TO COMPLY. Guarantor shall promptly
notify Landlord of the occurrence of any event relating to it which would
interfere with the ability of Guarantor to perform its obligations under this
Guaranty.
14. WAIVER OF NOTICE OF MODIFICATION OF OBLIGATIONS. Guarantor agrees that,
without the necessity of any reservation of rights against Guarantor, the
Obligations or rights of offset with respect thereto, and the Documents, or any
of them, may, from time to time, in whole or in part, be renewed, extended,
amended, modified, accelerated, compromised, released (whether by operation of
law or otherwise) or waived by Landlord, all without notice to or further
consent by Guarantor and Guarantor will remain bound hereunder and Guarantor
expressly waives such notice or further consent, notwithstanding any such
renewal, extension, amendment, modification, acceleration, compromise, release
or waiver.
15. BANKRUPTCY. Should Landlord be obligated by any bankruptcy or other law to
(a) repay to Tenant or Guarantor or to any trustee, receiver or other
representative of any of them, any amounts previously paid by Guarantor pursuant
to this Guaranty or by Tenant or pursuant to the Documents, or (b) reconvey to
Guarantor or Tenant any property previously conveyed by any of them to Landlord
or its designee in total or partial satisfaction of the Obligations, then, to
the extent permitted by law, this Guaranty shall be reinstated with respect to
the amount of the indebtedness satisfied by the payment or conveyance before it
was caused to be returned.
16. INDEMNITY. Guarantor hereby agrees to and hereby does indemnify and hold
Landlord harmless from and against all loss, cost, liability or expense
(including, without limitation, reasonable attorneys' fees and disbursements)
incurred in connection with the enforcement of any of the Obligations or this
Guaranty or the collection of any amounts due thereunder or hereunder, or by
reason of the assertion by Tenant of any defense to the performance of the
Obligations or the assertion by Guarantor of any defense to its Obligations
hereunder; provided, that the foregoing provisions of this paragraph 16 shall be
of no force or effect if Guarantor shall be the prevailing partly in any such
enforcement action.
17. NO SUBROGATION. No payment by Guarantor pursuant to any provisions of this
Guaranty shall entitle Guarantor, by subrogation or otherwise, to any of the
rights of Landlord to any payment by Tenant or out of the property of Tenant,
except after payment in full of all sums (including interest, costs and
expenses) which may be or become payable by Tenant to Landlord at any time or
from time to time and until the Obligations have been completely performed.
18. WAIVER OF NOTICE. Except as provided in Section 3(c) above, Guarantor waives
(a) any and all notice of the creation, renewal, extension, accrual or
acceptance of any of the Obligations or this Guaranty or of the reliance by
Landlord upon this Guaranty and (b) any other notice or demand to which
Guarantor might otherwise by entitled, except as otherwise specifically provided
in this Guaranty.
19. FINANCIAL STATEMENTS. As long as this Guaranty shall be in force and effect,
in the event that Guarantor is no longer a public company filing its annual
financial statements with the Securities and Exchange Commission, Guarantor
shall furnish to Landlord, an unaudited annual financial statement as of the
last day of such accounting period, prepared in the same form as the financial
statement delivered to Landlord prior to the Lease Date and, if prepared, its
annual audited financial statement, promptly when available after the close of
each annual financial accounting period of Guarantor.
20. NOTICES Any notice or other communication hereunder shall be in writing and
shall be deemed duly served upon receipt (or refusal to accept receipt) and
shall be sent by mail, or by nationally recognized overnight courier service
providing next day, receipted delivery, addressed if to Guarantor, to it at the
address of Guarantor set forth herein or such other address as Guarantor shall
have last designated by notice to Landlord, and addressed if to Landlord, One
Penn Plaza, Suite 4015, New York, New York 10119-4015, or such other address as
Landlord shall have last designated by notice to Guarantor. Copies of all
communications shall also be delivered to the holder of the First Mortgage (as
defined in the Lease) in the manner and at the address set forth in a written
notice to Guarantor.
21. AMENDMENTS IN WRITING. This Guaranty may not be changed, modified,
discharged or terminated orally or in any manner other than by an agreement in
writing signed by Guarantor and Landlord, or their respective successors and
assigns.
22. GOVERNING LAW. (A) THIS GUARANTY AND THE OBLIGATIONS ARISING HEREUNDER SHALL
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN THE STATE OF NEW YORK AND ANY
APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.
(B) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS GUARANTY AND ANY ACTION
FOR ENFORCEMENT OF ANY JUDGMENT IN RESPECT THEREOF MAY BE BROUGHT IN THE COURTS
OF THE STATE OF NEW YORK OR OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN
DISTRICT OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS GUARANTY GUARANTOR
ACCEPTS, AND BY ITS ACCEPTANCE OF THIS GUARANTY LANDLORD HEREBY ACCEPTS, EACH
FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE
NON-EXCLUSIVE JURISDICTION OF THE AFORESAID COURTS AND APPELLATE COURTS.
LANDLORD AND GUARANTOR EACH IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT
OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE
MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO
SUCH PARTY AT THE ADDRESS FOR NOTICES SET FORTH HEREIN. GUARANTOR AND LANDLORD
EACH HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE
TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR PROCEEDINGS ARISING
OUT OF OR IN CONNECTION WITH THIS GUARANTY BROUGHT IN THE COURTS REFERRED TO
ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN
ANY SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS
BEEN BROUGHT IN AN INCONVENIENT FORUM.
23. PARTIAL INVALIDITY. If any provision of this Guaranty or the application
thereof to any person or circumstance shall to any extent be held void,
unenforceable or invalid, then the remainder of this Guaranty or the application
of such provision to persons or circumstances other than those as to which it is
held void, unenforceable or invalid, shall not be affected thereby, and each
provision of this Guaranty shall be valid and enforceable to the fullest extent
permitted by law.
24. PERSON DEFINED. The word "person" when used in this Guaranty shall mean any
natural person, partnership, trust, corporation or any other form of business or
legal entity.
25. SUCCESSORS AND ASSIGNS. This Guaranty shall inure to the benefit of and may
be enforced by Landlord and its successors or assigns, and shall be binding upon
and enforceable against Guarantor and its successors and assigns.
26. COLLATERAL ASSIGNMENT OF MORTGAGEE. Guarantor acknowledges that Landlord may
conditionally assign its rights hereunder to the holder of the First Mortgage
and agrees that this Guaranty shall inure to the benefit of the holder of the
First Mortgage to the extent provided in such assignment.
[Balance of page left blank intentionally.]
IN WITNESS WHEREOF, Guarantor has duly executed this Guaranty as of the
day and year first above written.
INFOCROSSING, INC.,
a Delaware corporation
By: _____________________________
Name:
Title:
[Corporate Seal]