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EXHIBIT 10.17
OFFICE LEASE
REFERENCE PAGE
BUILDING: 8755 W. Higgins Road
Chicago, Illinois 60631
LANDLORD: BENEFICIARIES OF AMERICAN
NATIONAL BANK TRUST NUMBER
104601-03
LANDLORD'S ADDRESS: Suite 100, 8755 W. Higgins Road
Chicago, Illinois 60631
LEASE REFERENCE DATE: April 26, 1996
TENANT: Software Spectrum, Inc.
TENANT'S ADDRESS:
(a) As of beginning of Term: 2140 Merritt Drive
(b) Prior to beginning of Term
(if different): Garland, Texas 75041
PREMISES IDENTIFICATION: Suite Number 400 (for outline of
Premises see Exhibit A attached
to this Lease and made a part of
this Lease by this reference)
PREMISES RENTABLE AREA: approximately 16,612 sq. ft.
USE: General Office
SCHEDULED COMMENCEMENT DATE: July 1, 1996
TERMINATION DATE: June 30, 2001
TERM (or "Initial Term") OF
LEASE: 5 years and 0 months beginning on
the Commencement Date and ending
on the Termination Date (unless
sooner terminated pursuant to the
Lease)
INITIAL ANNUAL RENT (Article 3): $361,311.00
INITIAL MONTHLY INSTALLMENT OF
ANNUAL RENT (Article 3): $30,109.25
BASE YEAR (DIRECT EXPENSES): 1996
BASE YEAR (TAXES): Taxes for 1995 payable in 1996
TENANT'S PROPORTIONATE SHARE: 7.10981% (16,612 sq. ft./233,649 sq. ft.)
SECURITY DEPOSIT: $ 0
REAL ESTATE BROKERS DUE
COMMISSION: U.S. Equities Realty, Inc.
Cushman & Wakefield
The Reference Page information is incorporated into and made a part of the
Lease. In the event of any conflict between any Reference Page information and
the Lease, the Lease shall control. This Lease includes Exhibits A through C,
all of which are made a part of this Lease.
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LANDLORD: TENANT:
BENEFICIARIES OF AMERICAN SOFTWARE SPECTRUM, INC., a
NATIONAL BANK TRUST Texas corporation
NUMBER 104601-03
By: RREEF Management Company, By: /s/ THEODORE A. FREDERICKS
a California Corporation Title: Facilities Director
By: _______________________________ Dated: May 4, 1996
Title: ______________________________
Dated: ______________________________
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LEASE
By this Lease Landlord leases to Tenant and Tenant leases from Landlord
the Premises in the Building as set forth and described on the Reference Page.
The Reference Page, including all terms defined thereon, is incorporated as
part of this Lease.
1. USE AND RESTRICTIONS ON USE. The Premises are to be used solely for the
purposes stated on the Reference Page. Tenant shall not do or permit anything
to be done in or about the Premises which will in any way obstruct or interfere
with the rights of other tenants or occupants of the Building or injure, annoy,
or disturb them or allow the Premises to be used for any improper, immoral,
unlawful, or objectionable purpose. Tenant shall not do, permit or suffer in,
on, or about the Premises the sale of any alcoholic liquor as defined in the
Illinois Liquor Control Act without the written consent of Landlord first
obtained, or the commission of any waste. Tenant shall comply with all
governmental laws, ordinances and regulations applicable to Tenant's use of the
Premises and its occupancy and shall promptly comply with all governmental
orders and directions for the correction, prevention and abatement of any
violations in or upon, or in connection with, Tenant's use of the Premises, all
at Tenant's sole expense. Tenant shall not do or permit anything to be done on
or about the Premises or bring or keep anything into the Premises which will in
any way increase the rate of, invalidate or prevent the procuring of any
insurance protecting against loss or damage to the Building or any of its
contents by fire or other casualty or against liability for damage to property
or injury to persons in or about the Building or any part thereof.
2. TERM.
2.1. The Term (if and as required by the Context, "Initial Term") of
this Lease shall begin on the date ("Commencement Date") that the Premises are
substantially completed. Landlord shall tender possession of the Premises with
all the work, if any, to be performed by Landlord pursuant to Exhibit B to this
Lease substantially completed. Tenant shall deliver a punch list of items not
completed within 30 days after Landlord tenders possession of the premises and
Landlord agrees to proceed with due diligence to perform its obligations
regarding such items within 45 days of Landlord's receipt of such punch list.
Upon any extension of the Commencement Date, the Termination Date shall be
extended to the same extent so that the Term of this Lease shall continue for
the length of time indicated on the Reference Page unless sooner terminated as
provided in this Lease. Landlord and Tenant shall execute a memorandum setting
forth the actual Commencement Date and Termination Date. Landlord will use
commercially reasonable efforts to obtain a Certificate of Occupancy from the
City of Chicago if one is so required by the City of Chicago, provided,
however, if applicable governmental authorities prohibit Tenant from operating
at the Premises or cause Tenant to cease operating at the Premises because
Landlord has not obtained any required Certificate of Occupancy, Tenant's
obligation to pay rent and other sums due
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Landlord for the period that Tenant is not allowed to operate at the Premises
shall abate.
2.2. Tenant agrees that in the event of the inability of Landlord to
deliver possession of the Premises on the Scheduled Commencement Date, Landlord
shall not be liable for any damage resulting from such inability, but Tenant
shall not be liable for any rent until the time when Landlord can, after notice
to Tenant, deliver possession of the Premises to Tenant. No such failure to
give possession on the scheduled Commencement Date shall affect the other
obligations of Tenant under this Lease, except that if Landlord is unable to
deliver possession of the Premises within one hundred twenty (120) days of the
Scheduled Commencement Date (other than as a result of strikes, shortages of
materials or similar matters beyond the reasonable control of Landlord and
Tenant is notified by Landlord in writing as to such delay), Tenant shall have
the option to terminate this Lease unless said delay is as a result of: (a)
Tenant's failure to agree to plans and specifications; (b) Tenant's request for
materials, finishes or installations other than Landlord's standard except as
for such, if any, that Landlord shall have expressly agreed to furnish without
extension of time agreed by Landlord; (c) Tenant's change in any plans or
specifications; or, (d) performance or completion by a party employed by
Tenant. If said delay is the result of any of the foregoing, the Commencement
Date and the payment of rent under this Lease shall be accelerated by the
number of days of such delay.
2.3. In the event Landlord shall permit Tenant to occupy the Premises
prior to the Commencement Date, such occupancy shall be subject to all the
provisions of this Lease. Said early possession shall not advance the
Termination Date.
3. RENT.
3.1. The rate of Annual Rent and the Monthly Installments thereof to be
in effect throughout the Term of this Lease shall be as follows:
Period Annual Rent Monthly installment
------ ----------- -------------------
07/01/96 - 06/30/97 $361,311.00 $30,109.25
07/01/97 - 06/30/98 $369,617.04 $30,801.42
07/01/98 - 06/30/99 $377,922.96 $31,493.58
07/01/99 - 06/30/00 $386,229.00 $32,185.75
07/01/00 - 06/30/01 $394,535.04 $32,877.92
3.2. Tenant agrees to pay to Landlord the Annual Rent in effect from
time to time by paying the Monthly Installment of Rent then in effect on or
before the first day of each full calendar month during the Term, except that
the first month's rent shall be paid upon the execution of this Lease. The
Monthly Installment of Rent in effect at any time shall be one-twelfth of the
Annual Rent in effect at such time. Rent for any period during the Term which
is less than one full month shall be a
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prorated portion of the Monthly Installment of Rent based upon a thirty (30)
day month. Said rent shall be paid to Landlord, without deduction or offset and
without notice or demand, at the Landlord's address, as set forth on the
Reference Page, or to such other person or at such other place as Landlord may
from time to time designate in writing.
3.3. Tenant recognizes that late payment of any rent or other sum due
under this Lease will result in administrative expense to Landlord, the extent
of which additional expense is extremely difficult and economically impractical
to ascertain. Tenant therefore agrees that if rent or any other sum is not paid
within ten (10) days after coming due and payable pursuant to this Lease, such
amount shall bear interest at twelve percent (12%) per annum for the first ten
(10) days after due and when such amount remains due and unpaid for more than
ten (l0) days after said amount is due, such interest shall be supplanted by a
late charge in an amount equal to the greater of: (a) Fifty Dollars ($50.00),
or (b) a sum equal to five percent (5%) per month of the unpaid rent or other
payment. The amount of the late charge to be paid by Tenant shall be reassessed
and added to Tenant's obligation for each successive monthly period until paid.
The provisions of this Section 3.3 in no way relieve Tenant of the obligation
to pay rent or other payments on or before the date on which they are due, nor
do the terms of this Section 3.3 in any way affect Landlord's remedies pursuant
to Article 20 of this Lease in the event said rent or other payment is unpaid
after date due.
3.4. No security or guarantee which may now or hereafter be furnished
to Landlord for the payment of rent or the performance of Tenant's other
obligations under this Lease shall in any way constitute a bar to the recovery
of the Premises or defense to any action in unlawful detainer or to any other
action which Landlord may bring for a breach of any of the terms, covenants or
conditions of this Lease.
4. RENT ADJUSTMENTS.
4.1. For the purpose of this Article 4, the following terms are defined
as follows:
4.1.1. BASE YEAR (DIRECT EXPENSES): The calendar year for Base
Year (Direct Expenses) set forth on the Reference Page.
4.1.2. BASE YEAR (TAXES): The calendar year for Base Year
(Taxes) set forth on the Reference Page.
4.1.3. COMPARISON YEAR: Each calendar year falling partly or
wholly within the Term after the Base Year (Direct Expenses) or the Base Year
(Taxes), as the case may be.
4.1.4. DIRECT EXPENSES: All direct costs of operation,
maintenance, repair and management of the Building (including the amount of any
credits which Landlord may grant to particular tenants of the Building in lieu
of providing any standard services or paying any standard costs described in
this Section 4.1.2 for similar tenants), as determined in accordance with
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generally accepted accounting principles, including the following costs by way
of illustration, but not limitation: water and sewer charges; insurance
premiums of or relating to all insurance policies and endorsements deemed by
Landlord to be reasonably necessary or desirable and relating in any manner to
the protection, preservation, or operation of the Building or any part thereof
and if Landlord self insures or carries deductibles in excess of $2,000.00,
amounts equal to the savings in premiums effected thereby as reasonably
determined by Landlord; utility costs, including, but not limited to, the cost
of heat, light, power, steam, gas, and waste disposal; the cost of janitorial
services; the cost of security and alarm services; window cleaning costs; labor
costs; costs and expenses of managing the Building including management fees;
air conditioning costs; elevator maintenance fees and supplies; material costs;
equipment costs including the cost of maintenance, repair and service
agreements and rental and leasing costs; purchase costs of equipment other than
capital items; current rental and leasing costs of items which would be
amortizable capital items if purchased; tool costs; licenses, permits and
inspection fees; wages and salaries; employee benefits and payroll taxes;
accounting and legal fees; any sales, use or service taxes incurred in
connection therewith.
4.1.5. DIRECT EXPENSES shall not include depreciation or
amortization of the Building or equipment in the Building except as provided in
Section 4.7 of this Lease, loan principal payments, costs of alterations of
tenants' premises, leasing commissions, interest expenses on long-term
borrowings, advertising costs, management salaries and benefits for management
personnel above the grade of building manager and executive personnel (other
than personnel located at the Building).
4.1.6. TAXES: Real estate taxes and any other taxes, charges
and assessments which are levied with respect to the Building or the land
appurtenant to the Building, or with respect to any improvements, fixtures and
equipment or other property of Landlord, real or personal, located in the
Building and used in connection with the operation of the Building and said
land, and/or any tax which shall be levied in addition to or in lieu of real
estate, possessory interest or personal property taxes; and all fees, expenses
and costs incurred by Landlord in investigating, protesting, contesting or in
any way seeking to reduce or avoid increase in any assessments, levies or the
tax rate pertaining to any Taxes to be paid by Landlord in any Lease Year.
Taxes shall not include any corporate franchise, or estate, inheritance or net
income tax, or tax imposed upon any transfer by Landlord of its interest in
this Lease or the Building.
4.2. If in any Comparison Year, (i) Direct Expenses paid or incurred
shall exceed Direct Expenses paid or incurred in the Base Year (Direct
Expenses) and/or (ii) Taxes paid by Landlord in any Comparison Year shall
exceed the amount of such Taxes which became due and payable in the Base Year
(Taxes), regardless of the year for which such Taxes are assessed, Tenant shall
pay as additional rent for such Comparison Year Tenant's Proportionate Share of
such excess. The annual determination of Direct Expenses shall be made by
Landlord and if certified by a nationally recognized firm of public accountants
selected by Landlord shall be binding upon Landlord and Tenant. Tenant may
review the books and records supporting such determination in the
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office of Landlord, or Landlord's agent, during normal business hours, upon
giving Landlord five (5) days advance written notice within sixty (60) days
after receipt of such determination, but in no event more often than once in
any one year period. In the event that during all or any portion of any
calendar year, the Building is not fully rented and occupied Landlord may make
any appropriate adjustment in occupancy-related Direct Expenses for such year
for the purpose of avoiding distortion of the amount of such Direct Expenses to
be attributed to Tenant by reason of variation in total occupancy of the
Building, by employing sound accounting and management principles to determine
Direct Expenses that would have been paid or incurred by Landlord had the
Building been fully rented and occupied, and the amount so determined shall be
deemed to have been Direct Expenses for such Year.
4.3. Prior to the actual determination thereof for a Comparison Year,
Landlord may from time to time estimate the amount of Tenant's Proportionate
Share of Direct Expenses and/or Taxes for the Comparison Year or portion
thereof, at Landlord's option including amounts estimated to become due from
Tenant on account of Taxes pursuant to Articles 6 and/or 29 of this Lease. If
such Direct Expenses are estimated to exceed the Direct Expenses for the Base
Year (Direct Expenses), Landlord will give Tenant written notification of the
amount of such estimated excess and Tenant agrees that it will pay, by increase
of its Monthly Installments of Rent due in such Comparison Year, additional
rent in the amount of Tenant's Proportionate Share of such estimated excess. If
such Taxes are estimated to exceed the Taxes for the Base Year (Taxes),
Landlord will give Tenant written notification of the amount of such estimated
excess and Tenant agrees that it will pay, by increase of its Monthly
Installments of Rent due in such Comparison Year, additional rent at such rate
that the full estimated amount of Tenant's proportionate Share of such
estimated excess shall have been paid to Landlord when or before said payment
by Landlord is due. Any such increased rate of Monthly Installments of Rent
pursuant to this Article 4.3 shall remain in effect until further written
notification to Tenant pursuant hereto.
4.4. When the above mentioned actual determination of Direct Expenses
is made or the actual bill or bills for the Taxes to be paid by Landlord in any
Comparison Year is issued and Landlord shall determine the amount of any actual
excess over the amount of such Taxes which became due and payable in the Base
Year (Taxes), and when Tenant is so notified in writing, then:
4.4.1. If the total additional rent Tenant actually paid
pursuant to Section 4.3 of this Lease on account of Direct Expenses for the
Comparison Year is less than Tenant's Proportionate Share of the actual excess
of the Direct Expenses, then Tenant shall pay to Landlord as additional rent in
one lump sum within thirty (30) days of receipt of Landlord's bill therefor the
difference between such total additional rent actually paid by Tenant pursuant
to said Section 4.3 of this Lease on account of Direct Expenses for the
Comparison Year and the Tenant's proportionate share of such excess; and
4.4.2. If the total additional rent Tenant actually paid
pursuant to section 4.3 of this Lease on account of Taxes for the Comparison
Year is less than Tenant's Proportionate Share of the actual excess of the
Taxes, then Tenant shall pay to Landlord as additional rent in one lump sum
within thirty (30) days of receipt of Landlord's bill therefor the difference
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between such total additional rent actually paid by Tenant pursuant to said
Section 4.3 of this Lease on account of Taxes for the Comparison Year and the
Tenant's Proportionate Share of such excess; and
4.4.3. If the total additional rent Tenant actually paid
pursuant to Section 4.3 of this Lease on account of Direct Expenses for the
Comparison Year is more than Tenant's Proportionate Share of the actual excess
of Direct Expenses as so determined, then Landlord shall credit the difference
against the then next due payments to be made by Tenant under this Article 4;
provided, however, that in no event shall the total additional rent to be paid
by Tenant on account of Direct Expenses in any Comparison Year be less than the
total additional rent on account of Direct Expenses due from Tenant in the Base
Year (Direct Expenses). Tenant shall not be entitled to a credit by reason of
actual Direct Expenses in any Comparison Year being less than Direct Expenses
in the Base Year (Direct Expenses); and
4.4.4. If the total additional rent Tenant actually paid
pursuant to Section 4.3 of this Lease on account of Taxes for the Comparison
Year is more than Tenant's Proportionate Share of the actual excess of Taxes as
so determined, then Landlord shall credit the difference against the then next
due payments to be made by Tenant under this Article 4; provided, however, that
in no event shall the total additional rent to be paid by Tenant on account of
Taxes in any Comparison Year be less than the total additional rent on account
of Taxes due from Tenant in the Base Year (Taxes). Tenant shall not be entitled
to a credit by reason of actual Taxes in any Comparison Year being less than
Taxes in the Base Year (Taxes).
4.5. If the Commencement Date is other than January 1 and is in a
Comparison Year or if the Termination Date is other than December 31, Tenant's
Proportionate Share of Direct Expenses and Taxes for the Lease Year in which
said Date occurs shall be prorated based upon a three hundred sixty-five (365)
day year.
4.6. Even though the Term has expired and Tenant has vacated the
premises, when the final determination is made of Tenant's Proportionate Share
of Direct Expenses or Taxes for the Comparison Year in which the Lease
terminated, Tenant shall pay any increase due over the estimated Direct
Expenses or Taxes paid; and conversely any overpayment, less any amounts due
Landlord under this Lease, shall be rebated to Tenant.
4.7. In addition Landlord shall be entitled to amortize and include as
an additional rental adjustment Tenant's Proportionate Share of: (i) an
allocable portion of the cost of capital improvement items which are reasonably
calculated to reduce operating expenses; (ii) the cost of fire sprinklers and
suppression systems and other life safety systems; and (iii) the cost of other
capital expenses which are required under any governmental laws, regulations or
ordinances which were not applicable to the Building at the time it was
constructed. All such costs shall be amortized over the reasonable life of such
improvements in accordance with such reasonable life and amortization schedules
as shall be determined by Landlord in accordance with generally accepted
accounting principles, with interest on the unamortized amount at one percent
(1%) in excess of the prime lending rate announced as such by The Northern
Trust Company as of February 1st of each year. Landlord represents that Mark
Smith, current property manager, has not received any
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written notice of any capital improvements required by governmental laws,
regulations or ordinances which were not applicable to the Building at the time
it was constructed.
5. SECURITY DEPOSIT. [INTENTIONALLY OMITTED]
6. ALTERATIONS.
6.1. Except for those, if any, specifically provided for in Exhibit B
to this Lease, Tenant shall not make or suffer to be made any alterations,
additions, or improvements, including, but not limited to, the attachment of
any fixtures or equipment in, on, or to the premises or any part thereof or the
making of any improvements as required by Article 7 of this Lease, without the
prior written consent of Landlord, which consent will not be unreasonably
withheld. When applying for such consent, Tenant shall, if requested by
Landlord, furnish complete plans and specifications for such alterations,
additions and improvements.
6.2. In the event Landlord consents to the making of any such
alteration, addition or improvement by Tenant, the same shall be made using
Landlord's contractor (unless Landlord agrees otherwise) at Tenant's sole cost
and expense. If Tenant shall employ any Contractor other than Landlord's
Contractor and such other Contractor or any Subcontractor of such other
Contractor shall employ any non-union labor or supplier, Tenant shall be
responsible for and hold Landlord harmless from any and all delays, damages and
extra costs suffered by Landlord as a result of any dispute with any labor
unions concerning the wage, hours, terms or conditions of the employment of any
such labor. In any event Landlord may charge Tenant a reasonable charge to
cover its overhead as it relates to such proposed work.
6.3. All alterations, additions or improvements proposed by Tenant
shall be constructed in accordance with all government laws, ordinances, rules
and regulations and Tenant shall, prior to construction, provide the additional
insurance required under Article 12 of this Lease in such case, and also all
such assurances to Landlord, including but not limited to, waivers of lien,
surety company performance bonds and personal guaranties of individuals of
substance as Landlord shall require to assure payment of the costs thereof and
to protect Landlord and the Building and appurtenant land against any loss from
any mechanic's, materialmen's or other liens.
6.4. All alterations, additions, and improvements in, on, or to the
Premises made or installed by Tenant, including carpeting, shall be and remain
the property of Tenant during the Term but excepting furniture, furnishings,
movable partitions of less than full height from floor to ceiling and other
trade fixtures, shall become a part of the realty and belong to Landlord
without compensation to Tenant upon the expiration or sooner termination of the
Term, at which time title shall pass to Landlord under this Lease as by a bill
of sale, unless Landlord elects otherwise. Upon such election by Landlord,
Tenant shall upon demand by Landlord, at Tenant's sole cost and expense,
forthwith and with all due diligence remove any such alterations, additions or
improvements which are designated by Landlord to be removed, and Tenant shall
forthwith and with all due diligence, at its sole cost and expense, repair and
restore the Premises to their original condition, reasonable wear and tear and
damage by fire or other casualty excepted.
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6.5. Tenant shall pay in addition to any sums due pursuant to Article 4
of this Lease, any increase in real estate taxes attributable to any such
alteration, addition or improvement for so long, during the Term, as such
increase is ascertainable; at Landlord's election said sums shall be paid in
the same way as sums due under said Article 4.
7. REPAIR.
7.1. Landlord shall have no obligation to alter, remodel, improve,
repair, decorate or paint the Premises, except as specified in Exhibit B if
attached to this Lease and except that Landlord shall repair and maintain the
structural portions of the Building, including the basic mechanical, plumbing,
air conditioning, heating and electrical systems installed or furnished by
Landlord. By taking possession of the Premises, Tenant accepts them as being in
good order, condition and repair and in the condition in which Landlord is
obligated to deliver them. It is hereby understood and agreed that no
representations respecting the condition of the Premises or the Building have
been made by Landlord to Tenant, except as specifically set forth in this
Lease.
7.2. Tenant shall, at all times during the Term, keep the Premises in
good condition and repair excepting damage by fire, or other casualty, and in
compliance with all applicable governmental laws, ordinances and regulations
pertaining to Tenant's use of the Premises, promptly complying with all
governmental orders and directives for the correction, prevention and abatement
of any violations or nuisances in or upon, or connected with, Tenant's use of
the Premises, all at Tenant's sole expense.
7.3. Landlord shall not be liable for any failure to make any repairs
or to perform any maintenance unless such failure shall persist for an
unreasonable time after written notice of the need of such repairs or
maintenance is given to Landlord by Tenant.
7.4. Except as provided in Article 23 of this Lease, there shall be no
abatement of rent and no liability of Landlord by reason of any injury to or
interference with Tenant's business arising from the making of any repairs,
alterations or improvements in or to any portion of the Building or the
premises or to fixtures, appurtenances and equipment in the Building. Except to
the extent, if any, prohibited by law, Tenant waives the right to make repairs
at Landlord's expense under any law, statute or ordinance now or hereafter in
effect. In any case, Tenant shall give Landlord at least thirty (30) days
notice describing in reasonable detail any repair which Tenant proposes to make
at Landlord's expense and Tenant shall not make any such repair unless Landlord
fails to commence such repair within said time or fails to continue with such
repair with reasonable diligence. In the case of emergency repairs (i.e.,
repairs necessary to prevent imminent damage or injury to human health or
safety), Landlord shall have a commercially reasonable time under the
circumstances to respond to Tenant's notice prior to the time that Tenant may
undertake such emergency repairs.
8. LIENS. Tenant shall keep the Premises, the Building and appurtenant land
and Tenant's leasehold interest in the Premises free from any liens arising out
of any services, work or
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materials performed, furnished, or contracted for by Tenant, or obligations
incurred by Tenant, including (without limitation) liens arising under the
Illinois Mechanics' Lien Act or Commercial Real Estate Broker Lien Act. In the
event that Tenant shall not, within ten (10) days following the imposition of
any such lien, either cause the same to be released of record or provide
Landlord with insurance against the same issued by a major title insurance
company or such other protection against the same as Landlord shall accept,
Landlord shall have the right to cause the same to be released by such means as
it shall deem proper, including payment of the claim giving rise to such lien.
All such sums paid by Landlord and all expenses incurred by it in connection
therewith shall be considered additional rent and shall be payable to it by
Tenant on demand with interest at the rate of three percent (3%) per annum in
excess of the prime lending rate announced as such by The Northern Trust
Company, or the highest rate permitted by law, whichever is lower.
9. ENVIRONMENTAL MATTERS. Tenant shall not, and shall not direct, suffer or
permit any of its agents, contractors, employees, licensees or invitees to at
any time handle, use, manufacture, store or dispose of in or about the Premises
or the Building any (collectively "Hazardous Materials") flammables,
explosives, radioactive materials, hazardous wastes or materials, toxic wastes
or materials, or other similar substances, petroleum products or derivatives or
any substance subject to regulation by or under any federal, state and local
laws and ordinances relating to the protection of the environment or the
keeping, use or disposition of environmentally hazardous materials, substances,
or wastes, presently in effect or hereafter adopted, all amendments to any of
them, and all rules and regulations issued pursuant to any of such laws or
ordinances (collectively "Environmental Laws"), not shall Tenant suffer or
permit any Hazardous Materials to be used in any manner not fully in compliance
with all Environmental Laws, in the Premises or the Building and appurtenant
land or the environment to become contaminated with any Hazardous Materials.
Notwithstanding the foregoing, and subject to Landlord's prior consent, Tenant
may handle, store, use or dispose of products containing small quantities of
Hazardous Materials (such as aerosol cans containing insecticides, toner for
copiers, paints, paint remover and the like) to the extent customary and
necessary for the use of the Premises for general office purposes; provided
that Tenant shall always handle, store, use, and dispose of any such Hazardous
Materials in a safe and lawful manner and never allow such Hazardous Materials
to contaminate the Premises, Building and appurtenant land or the environment.
Tenant shall hold each and all of the "Landlord Entities" harmless from and
defend them against any and all loss, claims, liability or costs (including
court costs and attorney's fees) incurred by reason of any actual or asserted
failure of Tenant to fully comply with all applicable Environmental Laws, or
the presence, handling, use or disposition in or from the Premises of any
Hazardous Materials (even though permissible under all applicable Environmental
Laws or the provisions of this Lease), or by reason of any actual or asserted
failure of Tenant to keep, observe, or perform any provision of this Article 9.
10. ASSIGNMENT AND SUBLETTING.
10.1. Tenant shall not have the right to assign or pledge this Lease or
to sublet the whole or any part of the Premises whether voluntarily, or by
operation of law, or permit the use or
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occupancy of the Premises by anyone other than Tenant, and shall not make,
suffer or permit such assignment, subleasing or occupancy without the prior
written consent of Landlord, which consent shall not be unreasonably withheld
for subleasing, and said restrictions shall be binding upon any and all
assignees of the Lease and subtenants of the Premises. In the event Tenant
desires to sublet, or permit such occupancy of, the Premises, or any portion
thereof, or assign this Lease, Tenant shall give written notice thereof to
Landlord at least sixty (60) days but no more than one hundred eighty (180)
days prior to the proposed commencement date of such subletting or assignment,
which notice shall set forth the name of the proposed subtenant or assignee,
the relevant terms of any sublease and copies of financial reports and other
relevant financial reports and other relevant financial information of the
proposed subtenant or assignee.
10.2. Notwithstanding any assignment or subletting, permitted or
otherwise, Tenant shall at all times remain directly, primarily and fully
responsible and liable for the payment of the rent specified in this Lease and
for compliance with all of its other obligations under the terms, provisions
and covenants of this Lease. Upon the occurrence of an "Event of Default" (as
defined in this Lease), if the Premises or any part of them are then assigned
or sublet, Landlord, in addition to any other remedies provided in this Lease
or provided by law, may, at its option, collect directly from such assignee or
subtenant all rents due and becoming due to Tenant under such assignment or
sublease and apply such rent against any sums due to Landlord from Tenant under
this Lease, and no such collection shall be construed to constitute a novation
or release of Tenant from the further performance of Tenant's obligations under
this Lease.
10.3. In addition to Landlord's right to approve of any subtenant or
assignee, Landlord shall have the option, in its sole discretion, in the event
of any proposed subletting or assignment, to terminate this Lease, or in the
case of a proposed subletting of less than the entire Premises, to recapture
the portion of the Premises to be sublet, as of the date the subletting or
assignment is to be effective. Notwithstanding the foregoing, Landlord shall
not exercise such rights of termination or recapture in the case of any one or
more subleases (i) that are for terms that expire no later than six (6) months
prior to the Termination Date; and (ii) that are for less than fifty percent
(50%), in the aggregate, of the area of the Premises. The option shall be
exercised, if at all, by Landlord giving Tenant written notice given by
Landlord to Tenant within sixty (60) days following Landlord's receipt of
Tenant's written notice as required above. If this Lease shall be terminated
with respect to the entire Premises pursuant to this Section, the Term of this
Lease shall end on the date stated in Tenant's notice as the effective date of
the sublease or assignment as if that date had been originally fixed in this
Lease for the expiration of the Term. If Landlord recaptures under this Section
only a portion of the Premises, the rent to be paid from time to time during
the unexpired Term shall abate proportionately based on the proportion by which
the approximate square footage of the remaining portion of the Premises shall
be less than that of the Premises as of the date immediately prior to such
recapture. Tenant shall, at Tenant's own cost and expense, discharge in full
any outstanding commission obligation on the part of Landlord with respect to
this Lease, and any commissions which may be due and owing as a result of any
proposed assignment or subletting, whether or not the Premises are recaptured
pursuant to this
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Section 10.3 and rented by Landlord to the proposed tenant or any other tenant.
10.4. All lease renewal option rights or space option rights, special
privileges and extra services granted to Tenant by this Lease, or addendum or
amendment to this Lease or letter of agreement shall be personal to the
original Tenant named in this Lease and shall endure only so long as said
Tenant continues to be the Tenant under this Lease and remains in possession of
the Premises. Consent by Landlord to any assignment or subletting shall not
include Consent to the assignment or transferring of any of said options, right,
privileges or services and all of them shall terminate entirely upon such
assignment or as to the space subleased in the case of a sublease. Unless
expressly agreed in writing by Landlord to the contrary, every sublease of any
of the Premises and the rights of the sublessee under the sublease shall be
subordinate to this Lease and the rights of Landlord under this Lease and shall
not survive termination of this Lease or of Tenant's rights to possession under
this Lease, and each sublease shall so provide.
10.5. In the event that Tenant sells, sublets, assigns or transfers this
Lease, Tenant shall pay to Landlord as additional rent an amount equal to fifty
percent (50%) of any Increased Rent (as defined below) when and as such
Increased Rent is received by Tenant. As used in this Section, "Increased Rent"
shall mean the excess of (i) all rent and other consideration which Tenant is
entitled to receive by reason of any sale, sublease, assignment or other
transfer of this Lease, over (ii) the rent otherwise payable by Tenant under
this Lease at such time. For purposes of the foregoing, any consideration
received by Tenant in form other than cash shall be valued at its fair market
value as determined by Landlord in good faith.
10.6. Notwithstanding any other provision hereof, Tenant shall have no
right to make (and Landlord shall have the absolute right to refuse consent to)
any assignment of this Lease or sublease of any portion of the Premises if at
the time of either Tenant's notice of the proposed assignment or sublease or
the proposed commencement date thereof, there shall exist any uncured default
of Tenant or matter which will become a default of Tenant with passage of time
unless cured; or if the proposed assignee or sublessee is an entity: (a) with
which Landlord is already in negotiation as evidenced by the issuance of a
written proposal; (b) is already an occupant of the Building unless Landlord is
unable to provide the amount of space required by such occupant; (c) is a
governmental agency; (d) is incompatible with the character of occupancy of the
Building; or (e) would subject the Premises to a use which would: (i) involve
increased personnel or wear upon the Building; (ii) violate any exclusive right
granted to another tenant of the Building; or, (iii) require any addition to or
modification of the Premises or the Building in order to comply with building
code or other governmental requirements. Tenant expressly agrees that Landlord
shall have the absolute right to refuse consent to any such assignment or
sublease and that for the purposes of any statutory or other requirement of
reasonableness on the part of Landlord such refusal shall be reasonable.
10.7. Tenant will pay to Landlord on demand a sum equal to all of
Landlord's reasonable costs, including attorney's fees, incurred in
investigating and considering any proposed or purported assignment or pledge of
this Lease or sublease of any
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of the Premises, regardless of whether Landlord shall consent to, refuse
consent, or determine that Landlord's consent is not required for, such
assignment, pledge or sublease. Any purported sale, assignment, mortgage,
transfer of this Lease or subletting which does not comply with the provisions
of this Article 10 shall be void.
10.8. If Tenant is a corporation, partnership or trust, any transfer or
transfers of or change or changes within any twelve month period in the number
of the outstanding voting shares of the Corporation, the general partnership
interests in the partnership or the identity of the persons or entities
controlling the activities of such partnership or trust resulting in the
persons or entities owning or controlling a majority of such shares,
partnership interests or activities of such partnership or trust at the
beginning of such period no longer having such ownership or control shall be
regarded as equivalent to an assignment of this Lease to the persons or
entities acquiring such ownership or control and shall be subject to all the
provisions of this Article 10 to the same extent and for all intents and
purposes as though such an assignment. Notwithstanding the foregoing, if Tenant
is a publicly traded company, the foregoing shall not apply. In any event, the
merger or consolidation of Tenant with another entity shall require the written
consent of Landlord (which consent shall not be unreasonably withheld or
delayed), unless (a) Tenant is the surviving entity, and (b) the successor
entity assumes all obligations of Tenant under this Lease, and has a net worth
equal to or greater than Tenant's net worth immediately prior to such merger or
consolidation.
11. INDEMNIFICATION. None of the Landlord Entities shall be liable and
Tenant hereby waives all claims against them for any damage to any property or
any injury to any person in or about the Premises or the Building by or from
any cause whatsoever (including without limiting the foregoing, rain or water
leakage of any character from the roof, windows, walls, basement, pipes,
plumbing works or appliances, the Building not being in good condition or
repair, gas, fire, oil, electricity or theft), except to the extent caused by
or arising from any actual or asserted negligent or willful act or willful
omission of Landlord or its agents, employees or contractors. Tenant shall
protect, indemnify and hold the Landlord Entities harmless from and against any
and all loss, claims, liability or costs (including court costs and attorney's
fees) incurred by reason of (a) any damage to any property (including but not
limited to property of any Landlord Entity) or any injury (including but not
limited to death) to any person occurring in, on or about the Premises or the
Building to the extent that such injury or damage shall be caused by or arise
from any actual or alleged act, neglect, fault, or omission by or of Tenant,
its agents, servants, employees, invitees, or visitors to meet any standards
imposed by any duty with respect to the injury or damage; (b) the conduct or
management of any work or thing whatsoever done by the Tenant in or about the
Premises or from transactions of the Tenant concerning the Premises; (c)
Tenant's failure to comply with any and all governmental laws, ordinances and
regulations applicable to Tenant's use of the Premises or its occupancy; or (d)
any breach or default on the part of Tenant in the performance of any covenant
or agreement on the part of the Tenant to be performed pursuant to this Lease.
The provisions of this Article shall survive the termination of this Lease with
respect to any claims or liability occurring prior to such termination.
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12. INSURANCE.
12.1. Tenant shall keep in force throughout the Term a commercial
general liability insurance policy or policies to protect the Landlord Entities
against any liability to the public or to any invitee of Tenant or a Landlord
Entity incidental to the use of or resulting from any accident occurring in or
upon the Premises with a comprehensive single limit of not less than
$2,000,000.00 per occurrence and not less than $5,000,000.00 in the aggregate
or such larger amount as Landlord may prudently require from time to time, and
insurance protecting against liability under Worker's Compensation Laws with
limits at least as required by statute. Tenant shall also keep in force
throughout the Term All Risk or Special Form coverage protecting Tenant against
loss of or damage to Tenant's alterations, additions, improvements, carpeting,
floor coverings, panelings, decorations, fixtures and other business personal
property situated in or about the Premises to the full replacement value of the
property so insured, and Business Interruption Insurance with limit of
liability representing loss of at least approximately six months of income.
12.2. Each of the aforesaid policies shall (a) be provided at Tenant's
expense; (b) name the Landlord Entities as additional insureds; (c) be issued
by an insurance company with a minimum Best's rating of "A:VII" during the
Term; and (d) provide that said insurance shall not be canceled unless thirty
(30) days prior written notice shall have been given to Landlord; and said
policy or policies or certificates thereof shall be delivered to Landlord by
Tenant upon the Commencement Date and at least thirty (30) days prior to each
renewal of said insurance.
12.3. Whenever Tenant shall undertake any alterations, additions or
improvements in, to or about the Premises ("Work") the aforesaid insurance
protection must extend to and include injuries to persons and damage to
property arising in connection with such Work, without limitation including
statutory limits required by applicable Worker's Compensation Laws and $500,000
per occurrence for Employer's Liability, and such other insurance as Landlord
shall require; and the policies of or certificates evidencing such insurance
must be delivered to Landlord prior to the commencement of any such Work.
13. WAIVER OF SUBROGATION. So long as their respective insurers so permit,
Tenant and Landlord hereby mutually waive their respective rights of recovery
against each other for any loss insured by fire, extended coverage, All Risks
or other insurance now or hereafter existing for the benefit of the respective
party but only to the extent of the net insurance proceeds payable under such
policies. Each party shall obtain any special endorsements required by their
insurer to evidence compliance with the aforementioned waiver.
14. SERVICES AND UTILITIES.
14.1. Provided Tenant shall not be in default under this Lease, and
subject to the other provisions of this Lease, Landlord agrees to furnish to
the Premises between the hours of 8:00 a.m. and 6:00 p.m. on generally
recognized business days and between 8:00 a.m. and 1:00 p.m. on Saturdays (but
exclusive in any event of Sundays and legal holidays), the following services
and utilities subject to the rules and regulations of the Building prescribed
from time to time, all of which shall be
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comparable in quality and quantity to that provided in first-class office
buildings in the general area of the Building: (a) water suitable for normal
office use of the Premises; (b) heat and air conditioning required in
Landlord's judgment for the use and occupation of the Premises; (c) janitorial
service; (d) elevator service by nonattended automatic elevators; (e) such
window washing as may from time to time in Landlord's judgment be reasonably
required; and, (f) equipment to bring to Tenant's meter, electricity for
lighting, convenience outlets and other normal office use. To the extent that
Tenant is not billed directly by a public utility, Tenant shall pay, upon
demand, as additional rent, for all electricity used by Tenant in the Premises.
The charge shall be at the rates charged for such services by the local public
utility. Tenant shall pay for all electric light bulbs, tubes and ballasts.
Tenant agrees at all times to cooperate fully with Landlord and to abide by all
the regulations and requirements which Landlord may prescribe for the proper
functioning and protection of said systems. Landlord shall not be liable for,
and Tenant shall not be entitled to, any abatement or reduction of rental by
reason of Landlord's failure to furnish any of the foregoing, unless such
failure shall persist for an unreasonable time after written notice of such
failure is given to Landlord by Tenant and provided further that Landlord shall
not be liable to Tenant when such failure is caused by accident, breakage,
repairs, labor disputes of any character, energy usage restrictions or by any
other cause, similar or dissimilar, beyond the reasonable control of Landlord.
Landlord shall use reasonable efforts to remedy any interruption in the
furnishing of services and utilities; provided, however, if as a result of
interruption in utilities to the Building for greater than 150 days Tenant is
unable to occupy and operate the Premises, Tenant may terminate this Lease at
any time prior to the restoration of such service upon written notice to
Landlord. Notwithstanding the above, Landlord shall be entitled, without
compensation to Tenant or any abatement of rent, to cooperate voluntarily in a
reasonable manner with the efforts of national, state or local governmental
bodies or suppliers of utilities in reducing consumption of energy or other
resources.
14.2. Should Tenant require any additional work or service, as described
above, including services furnished outside ordinary business hours specified
above, Landlord may, on terms to be agreed, upon reasonable advance notice by
Tenant, furnish such additional service and Tenant agrees to pay Landlord such
charges as may be agreed upon, including any tax imposed thereon, but in no
event at a charge less than Landlord's actual cost plus overhead for such
additional service and, where appropriate, a reasonable allowance for
depreciation of any systems being used to provide such service.
14.3. Wherever heat-generating machines or equipment are used by Tenant
in the Premises which affect the temperature otherwise maintained by the air
conditioning system, Landlord reserves the right to install supplementary air
conditioning units in or for the benefit of the Premises and the cost thereof,
including the cost of installation and the cost of operations and maintenance,
shall be paid by Tenant to Landlord upon demand as such additional rent.
14.4. Tenant will not, without the written consent of Landlord, use any
apparatus or device in the Premises, including but not limited to, electronic
data processing machines and machines using current in excess of 200 watts or
110 volts, which
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will in any way increase the amount of electricity or water usually furnished
or supplied for use of the Premises for normal office use, nor connect with
electric current, except through existing electrical outlets in the Premises,
or water pipes, any apparatus or device for the purposes of using electrical
current or water. It Tenant shall require water or electric current in excess
of that usually furnished or supplied for use of the Premises as normal office
use, Tenant shall procure the prior written consent of Landlord for the use
thereof, which Landlord may refuse, and if Landlord does consent, Landlord may
cause a water meter or electric current meter to be installed so as to measure
the amount of such excess water and electric current. The cost of any such
meters shall be paid for by Tenant. Tenant agrees to pay as additional rent to
Landlord promptly upon demand therefor, the cost of all such excess water and
electric current consumed (as shown by said meters, if any, or, if none, as
reasonably estimated by Landlord) at the rates charged for such services by the
local public utility or agency, as the case may be, furnishing the same, plus
any additional expense incurred in keeping account of the water and electric
current so consumed.
14.5. As provided in this Lease, Tenant shall be entitled to the use of
wiring ("Communications Wiring") from the vault of Illinois Bell Telephone
Company or its successor ("IBT") at or near the entrance to the Building to
Tenant's telephone panel at or near the entrance to the Premises, sufficient
for normal general office use of the Premises. Tenant shall not install any
additional Communications Wiring without the prior written consent of Landlord,
which Landlord may refuse; nor shall Tenant remove any Communications Wiring
without such consent. Tenant shall be responsible for, and indemnify and hold
Landlord harmless from and against, all injuries and damages to persons or
property and all expenses, claims and liabilities resulting from the
installation, use, maintenance, repair or replacement of Communications Wiring
("Wiring Work") by Tenant or anyone employed by Tenant. If and so long as an
arrangement ("Provider Arrangement") shall be in effect between Landlord and
IBT or other qualified concern to provide any Wiring Work on an exclusive basis
Tenant shall obtain such Wiring Work as Tenant shall require from such provider
through or as directed by Landlord and shall pay all the costs thereof billed
directly to Tenant by such provider. If and so long as no Provider Arrangement
shall be in effect, Tenant shall arrange for, through Landlord if required by
Landlord, and pay directly for, all such Wiring Work as Tenant shall require
from such provider as Tenant shall select subject to the prior authorization of
Landlord, which Landlord may refuse for any reason, including (without
limitation) that Landlord is not satisfied as to the expertise or reliability
of the provider or the liability insurance protection to be given.
14.6. In addition to the parking spaces provided to Tenant on a
non-exclusive basis in the seven-story parking deck adjacent to the Building,
Tenant shall be entitled to eight (8) reserved parking spaces in said parking
deck at a location to be determined by Landlord. Tenant shall not be charged
additional rent for these parking spaces.
15. HOLDING OVER. Tenant shall pay Landlord for each day Tenant retains
possession of the Premises or part of them after termination of this Lease by
lapse of time or otherwise at the rate ("Holdover Rate") which shall be 150% of
the greater of: (a) the amount of the Annual Rent for the last period prior to
the date
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of such termination plus all Rent Adjustments under Article 4; and, (b) the
then market rental value of the Premises as determined by Landlord assuming a
new lease of the Premises of the then usual duration and other terms, in either
case prorated on a daily basis, and also pay all damages sustained by Landlord
by reason of such retention, and shall indemnify and hold Landlord harmless
from any loss or liability resulting from such holding over and/or failure to
surrender the Premises when and in the condition required by Sections 6.4. and
27.2. of this Lease. If Landlord gives notice to Tenant of Landlord's election
to that effect, such holding over shall constitute renewal of this Lease for a
period from month to month or one year, whichever shall be specified in such
notice, in either case at the Holdover Rate, but if the Landlord does not so
elect, no such renewal shall result notwithstanding acceptance by Landlord of
rent after such termination; and instead, a tenancy at sufferance at the
Holdover Rate shall be deemed to have been created. In any event, no provision
of this Article 15 shall be deemed to waive Landlord's right of reentry or any
other right under this Lease or at law.
16. SUBORDINATION. Without the necessity of any additional document being
executed by Tenant for the purpose of effecting a subordination, this Lease
shall be subject and subordinate at all times to ground or underlying leases
and to the lien of any mortgages or deeds of trust now or hereafter placed on,
against or affecting the Building, Landlord's interest or estate in the
Building, or any ground or underlying lease; provided, however, that if the
lessor, mortgagee, trustee, or holder of any such mortgage or deed of trust
elects to have Tenant's interest in this Lease be superior to any such
instrument, then, by notice to Tenant, this Lease shall be deemed superior,
whether this Lease was executed before or after said instrument.
Notwithstanding the foregoing, Tenant covenants and agrees to execute and
deliver upon demand such further instruments evidencing such subordination or
superiority of this Lease as may be required by Landlord. Landlord shall use
reasonable efforts to provide Tenant with a non-disturbance agreement in form
and content reasonably acceptable to Tenant in the event this Lease is
subordinated to any mortgage hereafter placed on the Building.
17. RULES AND REGULATIONS. Tenant shall faithfully observe and comply with
all the rules and regulations as set forth in Exhibit C to this Lease and all
reasonable modifications of and additions to them from time to time put into
effect by Landlord. Landlord shall not be responsible to Tenant for the
non-performance by any other tenant or occupant of the Building of any such
rules and regulations.
18. REENTRY BY LANDLORD; PERFORMANCE OF TENANT'S OBLIGATIONS.
18.1. Landlord reserves and shall at all times have the right to
re-enter the Premises to inspect the same, to supply janitor service and any
other service to be provided by Landlord to Tenant under this Lease, and, upon
not less than 24 hours advance notice, to show said premises to prospective
purchasers, mortgagees or tenants, and at all times without notice to alter,
improve or repair the Premises and any portion of the Building including,
without limitation, the improvements and other items described in Section 4.7
and Article 7 of this Lease, without abatement of rent, and may for that
purpose erect, use and maintain scaffolding, pipes, conduits and other
necessary structures and open any wall, ceiling or floor in and through the
Building and premises where reasonably required by the character
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of the work to be performed, provided entrance to the Premises shall not be
blocked thereby, and further provided that the business of Tenant shall not be
interfered with unreasonably, Landlord hereby agreeing to use commercially
reasonable efforts to minimize any such interference with Tenant's business and
inconvenience to Tenant, its employees and visitors.
18.2. Landlord may, at Landlord's option, enter into and upon the
Premises with, or if Tenant shall have vacated the Premises without, five (5)
days notice, if Landlord determines in its sole discretion that Tenant is not
acting within a commercially reasonable time to maintain, repair or replace
anything for which Tenant is responsible under this Lease and correct the same,
without being deemed in any manner guilty of trespass, eviction or forcible
entry and detainer and without incurring any liability for any damage or
interruption of Tenant's business resulting therefrom. If Tenant shall have
vacated the Premises, Landlord may at Landlord's option re-enter the Premises
at any time during the last six months of the then current Term of this Lease
and make any and all such changes, alterations, revisions, additions and tenant
and other improvements in or about the Premises as Landlord shall elect, all
without any abatement of any of the rent otherwise to be paid by Tenant under
this Lease.
18.3. Landlord shall have the right at any time to change the
arrangement and/or locations of entrances, or passageways, doors and doorways,
and corridors, elevators, stairs, toilets or other public parts of the Building
(provided no such changes interfere with or diminish Tenant's access to the
Premises or the toilet or elevator facilities serving the Premises) and to
change the name, number or designation by which the Building is commonly known.
In the event that Landlord damages any portion of any wall or wall covering,
ceiling, or floor or floor covering within the Premises, Landlord shall repair
or replace the damaged portion to match the original as nearly as commercially
reasonable but shall not be required to repair or replace more than the portion
actually damaged.
18.4. Tenant hereby waives any claim for damages for any injury or
inconvenience to or interference with Tenant's business, any loss of occupancy
or quiet enjoyment of the Premises, and any other loss occasioned by any action
of Landlord authorized by this Article 18. Tenant agrees to reimburse Landlord,
on demand, as additional rent, for any expenses which Landlord may incur in
thus effecting compliance with Tenant's obligations under this Lease.
18.5. For each of the aforesaid purposes, Landlord shall at all times
have and retain a key with which to unlock all of the doors in the Premises,
excluding Tenant's vaults and safes or special security areas (designated in
advance), and Landlord shall have the right to use any and all means which
Landlord may deem proper to open said doors in an emergency to obtain entry to
any portion of the Premises. As to any portion to which access can not be had
by means of a key or keys in Landlord's possession, Landlord is authorized to
gain access by such means as Landlord shall elect and the cost of repairing any
damage occurring in doing so shall be borne by Tenant and paid to Landlord as
additional rent upon demand. Landlord acknowledges and agrees that certain
areas of the Premises designated by Tenant shall be computer rooms and computer
servers and, although Tenant shall provide Landlord with a key to such areas,
Landlord shall not be providing any janitorial services to such areas and,
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therefore, shall not enter such areas unless otherwise authorized to do so
under this Lease. In any event, Landlord shall use reasonable efforts to notify
Tenant prior to entering such areas.
19. DEFAULT.
19.1. Except as otherwise provided in Article 21 of this Lease, the
following events shall be deemed to be Events of Default under this Lease:
19.1.1. Tenant shall fail to pay when due any sum of money
becoming due to be paid to Landlord under this Lease, whether such sum be any
installment of the Rent reserved by this Lease, any other amount treated as
additional rent under this Lease, or any other payment or reimbursement to
Landlord required by this Lease, whether or not treated as additional rent
under this Lease, and such failure shall continue for a period of five days
after written notice that such payment was not made when due, but if any such
notice shall be given, for the twelve month period commencing with the date of
such notice, the failure to pay within five days after due any additional sum
of money becoming due to be paid to Landlord under this Lease during such
period shall be an Event of Default, without notice.
19.1.2. Tenant shall fail to comply with any term, provision
or covenant of this Lease which is not provided for in another Section of this
Article and shall not cure such failure within twenty (20) days (forthwith, if
the failure involves a hazardous condition) after written notice of such
failure to Tenant, provided, however, that if such failure requires additional
time to complete a cure thereof and such failure does not result in an
emergency situation or a hazardous condition at the Premises, at Landlord's
option Tenant may have an additional ten (10) days to complete a cure of such
failure so long as Tenant is diligently pursuing such cure to its completion.
19.1.3. Tenant shall abandon or vacate any substantial portion
of the Premises.
19.1.4. Tenant shall fail to vacate the Premises immediately
upon termination of this Lease, by lapse of time or otherwise, or upon
termination of Tenant's right to possession only.
19.1.5. The leasehold interest of Tenant shall be levied upon
under execution or be attached by process of law or Tenant shall fail to
contest diligently the validity of any lien or claimed lien and give sufficient
security to Landlord to insure payment thereof or shall fail to satisfy any
judgment rendered on such claim or lien and have the same released, and such
default shall continue for ten (10) days after written notice thereof to
Tenant.
19.1.6. Tenant shall become insolvent, admit in writing its
inability to pay its debts generally as they become due, file a petition in
bankruptcy or a petition to take advantage of any insolvency statute, make an
assignment for the benefit of creditors, make a transfer in fraud of creditors,
apply for or consent to the appointment of a receiver of itself or of the whole
or any substantial part of its property, or file a petition or answer seeking
reorganization or arrangement under the federal bankruptcy laws, as now in
effect or hereafter
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amended, or any other applicable law or statute of the United States or any
state thereof.
19.1.7. A court of competent jurisdiction shall enter an order,
judgment or decree adjudicating Tenant bankrupt, or appointing a receiver of
Tenant, or of the whole or any substantial part of its property, without the
consent of Tenant, or approving a petition filed against Tenant seeking
reorganization or arrangement of Tenant under the bankruptcy laws of the United
States, as now in effect or hereafter amended, or any state thereof, and such
order, judgment or decree shall not be vacated or set aside or stayed within
sixty (60) days from the date of entry thereof.
20. REMEDIES.
20.1. Except as otherwise provided in Article 21 of this Lease, upon
the occurrence of any of the Events of Default described or referred to in
Article 19 of this Lease, Landlord shall have the option to pursue any one or
more of the following remedies without any notice or demand whatsoever,
concurrently or consecutively and not alternatively:
20.1.1. Landlord may, at its election, terminate this Lease
or terminate Tenant's right to possession only, without terminating the Lease.
20.1.2. Upon any termination of this Lease, whether by lapse
of time or otherwise, or upon any termination of Tenant's right to possession
without termination of the Lease, Tenant shall surrender possession and vacate
the Premises immediately, and deliver possession thereof to Landlord, and
Tenant hereby grants to Landlord full and free license to enter into and upon
the Premises in such event with or without process of law and to repossess
Landlord of the Premises as of Landlord's former estate and to expel or remove
Tenant and any others who may be occupying or be within the Premises and to
remove Tenant's signs and other evidence of tenancy and all other property of
Tenant therefrom without being deemed in any manner guilty of trespass,
eviction or forcible entry or detainer, and without incurring any liability for
any damage resulting therefrom, Tenant waiving any right to claim damages for
such re-entry and expulsion, and without relinquishing Landlord's right to rent
or any other right given to Landlord under this Lease or by operation of law.
20.1.3. Upon any termination of this Lease, whether by lapse
of time or otherwise, Landlord shall be entitled to recover as damages, all
past due rent, including any amounts treated as additional rent under this
Lease, and other sums due and payable by Tenant on the date of termination,
plus as liquidated damages and not as a penalty, an amount equal to either, as
Landlord shall elect: (i) the total amount of Annual Rent and additional rent
which was due to be paid under this Lease for the then most recent Lease Year
or such shorter time as equals the then otherwise unexpired term of this Lease;
or (ii) the sum of: (a) an amount equal to the then present value of the rent
reserved in this Lease for the residue of the stated Term of this Lease
including any amounts treated as additional rent under this Lease and all other
sums provided in this Lease to be paid by Tenant, minus the fair rental value
of the Premises for such residue (which the parties agree shall not exceed
eighty percent (80%) of the then present value of the rent reserved for such
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residue); (b) the value of the time and expense necessary to obtain a
replacement tenant or tenants, and the estimated expenses described in Section
20.1.4 of this Lease relating to recovery of the Premises, preparation for
reletting and for reletting itself; and (c) the cost of performing any other
covenants which would have otherwise been performed by Tenant.
20.1.4. Upon any termination of Tenant's right to possession only
without termination of the Lease:
20.1.4.1. Neither such termination of Tenant's right to
possession nor Landlord's taking and holding possession thereof as provided in
Section 20.1.2 of this Lease shall terminate the Lease or release Tenant, in
whole or in part, from any obligation, including Tenant's obligation to pay the
rent, including any amounts treated as additional rent, under this Lease for
the full Term, and if Landlord so elects Tenant shall pay forthwith to Landlord
the sum equal to the entire amount of the rent, including any amounts treated
as additional rent under this Lease, for the residue of the Term plus any other
sums provided in this Lease to be paid by Tenant for the remainder of the Term.
20.1.4.2. Landlord may, but need not, relet the Premises or any
part thereof for such rent and upon such terms as Landlord, in its sole
discretion, shall determine (including the right to relet the premises for a
greater or lesser term than that remaining under this Lease, the right to relet
the Premises as a part of a larger area, and the right to change the character
or use made of the Premises). In connection with or in preparation for any
reletting, Landlord may, but shall not be required to, make repairs,
alterations and additions in or to the Premises and redecorate the same to the
extent Landlord deems necessary or desirable, and Tenant shall, upon demand,
pay the cost thereof, together with Landlord's expenses of reletting,
including, without limitation, any broker's commission incurred by Landlord. If
Landlord decides to relet the Premises or a duty to relet is imposed upon
Landlord by law, Landlord and Tenant agree that nevertheless Landlord shall at
most be required to use only the same efforts Landlord then uses to lease
premises in the Building generally and that in any case that Landlord shall not
be required to give any preference or priority to the showing or leasing of the
Premises over any other space that Landlord may be leasing or have available
and may place a suitable prospective tenant in any such other space regardless
of when such other space becomes available. Landlord shall not be required to
observe any instruction given by Tenant about any reletting or accept any
tenant offered by Tenant unless such offered tenant has a credit-worthiness
acceptable to Landlord and leases the entire Premises upon terms and conditions
including a rate of rent (after giving effect to all expenditures by Landlord
for tenant improvements, broker's commissions and other leasing costs) all no
less favorable to Landlord than as called for in this Lease, nor shall Landlord
be required to make or permit any assignment or sublease for more than the
current term or which Landlord would not be required to permit under the
provisions of Article 10 of this Lease.
20.1.4.3. Until such time as Landlord shall elect to terminate
the Lease and shall thereupon be entitled to recover the amounts specified in
such case in Section 20.1.3 of this Lease, Tenant shall pay to Landlord upon
demand the full amount of all rent, including any amounts treated as additional
rent
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under this Lease and other sums reserved in this Lease for the remaining Term,
together with the costs of repairs, alterations, additions, redecorating and
Landlord's expenses of reletting and the collection of the rent accruing
therefrom (including attorney's fees and broker's commissions), as the same
shall then be due or become due from time to time, less only such consideration
as Landlord may have received from any reletting of the Premises; and Tenant
agrees that Landlord may file suits from time to time to recover any sums
falling due under this Article 20 as they become due. Any proceeds of
reletting by Landlord in excess of the amount then owed by Tenant to Landlord
from time to time shall be credited against Tenant's future obligations under
this Lease but shall not otherwise be refunded to Tenant or inure to Tenant's
benefit.
20.2. If, on account of any breach or default by Tenant in Tenant's
obligations under the terms and conditions of this Lease, it shall become
necessary or appropriate for Landlord to employ or consult with an attorney
concerning or to enforce or defend any of Landlord's rights or remedies arising
under this Lease, Tenant agrees to pay all Landlord's reasonable attorney's
fees so incurred. Tenant expressly waives any right to: (a) trial by jury; and
(b) service of any notice required by any present or future law or ordinance
applicable to landlords or tenants but not required by the terms of this Lease.
20.3. Pursuit of any of the foregoing remedies shall not preclude
pursuit of any of the other remedies provided in this Lease or any other
remedies provided by law (all such remedies being cumulative), nor shall
pursuit of any remedy provided in this Lease constitute a forfeiture or waiver
of any rent due to Landlord under this Lease or of any damages accruing to
Landlord by reason of the violation of any of the terms, provisions and
covenants contained in this Lease.
20.4. No act or thing done by Landlord or its agents during the Term
shall be deemed a termination of this Lease or an acceptance of the surrender
of the Premises, and no agreement to terminate this Lease or accept a surrender
of said Premises shall be valid, unless in writing signed by Landlord. No
waiver by Landlord of any violation or breach of any of the terms, provisions
and covenants contained in this Lease shall be deemed or construed to
constitute a waiver of any other violation or breach of any of the terms,
provisions and covenants contained in this Lease. Landlord's acceptance of the
payment of rental or other payments after the occurrence of an Event of Default
shall not be construed as a waiver of such Default, unless Landlord so notifies
Tenant in writing. Forbearance by Landlord in enforcing one or more of the
remedies provided in this Lease upon an Event of Default shall not be deemed or
construed to constitute a waiver of such Default or of Landlord's right to
enforce any such remedies with respect to such Default or any subsequent
Default.
21. TENANT'S BANKRUPTCY OR INSOLVENCY.
21.1. If at any time and for so long as Tenant shall be subjected to
the provisions of the United States Bankruptcy Code or other law of the United
States or any state thereof for the protection of debtors as in effect at such
time (each a "Debtor's Law,"):
21.1.1. To the extent that the provisions of such Debtor's Law
shall prohibit the declaring of an event described
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in Article 19 of this Lease to be a default under this Lease, or the
enforcement of any right or remedy provided to Landlord in said Article 20,
such event shall not be a default and such right or remedy shall not be
enforced.
21.1.2. Except to the extent expressly provided by such Debtor's
Law, Tenant, Tenant as debtor-in-possession, and any trustee or receiver of
Tenant's assets (each a "Tenant's Representative") shall have no greater right
to remain in possession of all or any part of the Premises than would be
accorded to Tenant if such Debtor's Law were not applicable; if such Debtor's
Law requires or permits the imposition upon or payment by Tenant's
Representative of charges for the use or possession thereof, such charges shall
in no event be less that the Rent and Additional Rent which are or would be
payable absent of such Debtor's Law pursuant to Articles 3 and 4 of this Lease
with respect to such portion of the Premises for the period of such possession
or use thereof by Tenant's Representative.
21.1.3. Tenant's Representative shall have no greater right to assume
or assign this Lease or any interest in this Lease, or to sublease any of the
Premises than accorded to Tenant in Article 10 of this Lease, except to the
extent Landlord shall be required to permit such assumption, assignment or
sublease by the provisions of such Debtor's Law. Without limitation of the
generality of the foregoing, any right of any Tenant's Representative to assume
or assign this Lease or to sublease any of the Premises shall be subject to the
conditions that:
21.1.3.1. Such Debtor's Law shall provide to Tenant's
Representative a right of assumption of this Lease which Tenant's
Representative shall have timely exercised and Tenant's Representative shall
have fully cured any default of Tenant under this Lease.
21.1.3.2. Tenant's Representative or the proposed assignee, as
the case shall be, shall have deposited with Landlord as security for the
timely payment of Rent an amount equal to the larger of: (a) three months' Rent
and other monetary charges accruing under this Lease; and (b) any sum specified
in Article 5; and shall have provided Landlord with adequate other assurance of
the future performance of the obligations of the Tenant under this Lease.
Without limitation, such assurances shall include, at least, in the case of
assumption of this Lease, demonstration to the satisfaction of the Landlord
that Tenant's Representative has and will continue to have sufficient
unencumbered assets after the payment of all secured obligations and
administrative expenses to assure Landlord that Tenant's Representative will
have sufficient funds to fulfill the obligations of Tenant under this Lease;
and, in the case of assignment, submission of current financial statements of
the proposed assignee, audited by an independent certified public accountant
reasonably acceptable to Landlord and showing a net worth and working capital
in amounts determined by Landlord to be sufficient to assure the future
performance by such assignee of all of the Tenant's obligations under this
Lease.
21.1.3.3. The assumption or any contemplated assignment of this
Lease or subleasing any part of the Premises, as shall be the case, will not
breach any provision in any other lease, mortgage, financing agreement or other
agreement by which Landlord is bound.
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21.1.3.4. Landlord shall have, or would have had absent the
Debtor's Law, no right under Article 10 of this Lease to refuse consent to the
proposed assignment or sublease by reason of the identity or nature of the
proposed assignee or sublessee or the proposed use of the Premises concerned.
22. QUIET ENJOYMENT. Landlord represents and warrants that it has full right
and authority to enter into this Lease and that Tenant, while paying the rental
and performing its other covenants and agreements contained in this Lease,
shall peaceably and quietly have, hold and enjoy the Premises for the Term
without hindrance or molestation from Landlord subject to the terms and
provisions of this Lease. Landlord shall not be liable for any interference or
disturbance by other tenants or third persons, nor shall Tenant be released
from any of the obligations of this Lease because of such interference or
disturbance.
23. DAMAGE BY FIRE, ETC.
23.1. In the event the Premises or the Building are damaged by fire or
other cause and in Landlord's reasonable estimation such damage can be
materially restored within ninety (90) days, Landlord shall forthwith repair
the same and this Lease shall remain in full force and effect, except that if
such damage is not the result of any negligence or willful misconduct of Tenant
or its agents, employees, or invitees, then Tenant shall be entitled to a
proportionate abatement in rent from the date of such damage. Such abatement of
rent shall be made pro rata in accordance with the extent to which the damage
and the making of such repairs shall interfere with the use and occupancy by
Tenant of the Premises from time to time. Within thirty (30) days from the date
of such damage, Landlord shall notify Tenant, in writing, Landlord's reasonable
estimation of the length of time within which material restoration can be made,
and Landlord's determination shall be binding on Tenant. For purposes of this
Lease, the Building or Premises shall be deemed "materially restored" if they
are in such condition as would not prevent or materially interfere with
Tenant's use of the Premises for the purpose for which it was being used
immediately before such damage.
23.2. If such repairs cannot, in Landlord's reasonable estimation, be
made within ninety (90) days, Landlord and Tenant shall each have the option of
giving the other, at any time within sixty (60) days after such damage, notice
terminating this Lease as of the date of such damage. In the event of the
giving of such notice, this Lease shall expire and all interest of the Tenant
in the Premises shall terminate as of the date of such damage as if such date
had been originally fixed in this Lease for the expiration of the Term. In the
event that neither Landlord nor Tenant exercise the above set forth option to
terminate this Lease in the event of partial destruction, then Landlord shall
repair or restore such damage, this Lease continuing in full force and effect,
and the rent becoming due which this Lease shall be proportionately abated as
provided in Section 23.1 of this Lease. Landlord shall not be required to
repair or replace any damage or boss by or from fire or other cause to any
panelings, decorations, partitions, additions, railings, ceilings, floor
coverings, office fixtures or any other property or improvements installed on
the Premises or belonging to Tenant. Any insurance which may be carried by
Landlord or Tenant against loss or damage to the Building or Premises shall be
for the sole
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benefit of the party carrying such insurance and under its sole control.
23.3. In the event that Landlord should fail to complete such repairs
and material restoration within sixty (60) days after the date estimated by
Landlord therefor as extended by this Section 23.3, Tenant may at its option
and as its sole remedy terminate this Lease by delivering written notice to
Landlord, within fifteen (15) days after the expiration of said period of time,
whereupon the Lease shall end on the date of such notice or such later date
fixed in such notice as if the date of such notice was the date originally
fixed in this Lease for the expiration of the Term; provided, however, that if
construction is delayed because of changes, deletions or additions in
construction requested by Tenant, strikes, lockouts, casualties, Acts of God,
war, material or labor shortages, government regulation or control or other
causes beyond the reasonable control of Landlord, the period for restoration,
repair or rebuilding shall be extended for the amount of time Landlord is so
delayed. Notwithstanding anything to the contrary contained in this Article:
(a) Landlord shall not have any obligation whatsoever to repair, reconstruct,
or restore the Premises when the damages resulting from any casualty covered by
the provisions of this Article 23 occur during the last twelve (12) months of
the Term or any extension thereof, but if Landlord determines not to repair
such damages Landlord shall notify Tenant and if such damages shall render any
material portion of the Premises untenantable Tenant shall have the right to
terminate this Lease by notice to Landlord within fifteen (15) days after
receipt of Landlord's notice; and (b) in the event the holder of any
indebtedness secured by a mortgage or deed of trust covering the Premises or
Building requires that any insurance proceeds be applied to such indebtedness,
then Landlord shall have the right to terminate this Lease by delivering
written notice of termination to Tenant within fifteen (15) days after such
requirement is made by any such holder, whereupon this Lease shall end on the
date of such damage as if the date of such damage were the date originally
fixed in this Lease for the expiration of the Term.
23.4. In the event of any damage or destruction to the Building or
Premises by any peril covered by the provisions of this Article 23, it shall be
Tenant's responsibility to properly secure the Premises and upon notice from
Landlord to remove forthwith, at its sole cost and expense, such portion of all
of the property belonging to Tenant or its licensees from such portion or all
of the Building or Premises as Landlord shall request and Tenant hereby
indemnifies, protects, defends and holds Landlord harmless from any loss,
liability, costs and expenses, including attorneys' fees, arising out of any
claim of damage or injury as a result of any actual or alleged failure of
Tenant to properly secure the Premises prior to such removal and/or such
removal.
24. EMINENT DOMAIN. If all or any substantial part of the Premises shall be
taken or appropriated by any public or quasi-public authority under the power
of eminent domain, or conveyance in lieu of such conveyance, either party to
this Lease shall have the right, at its option, of giving the other, at any
time within thirty (30) days after such taking, notice terminating this Lease,
except that Tenant may only terminate this Lease by reason of taking or
appropriation as above provided, if such taking or appropriation shall be so
substantial as to materially interfere
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with Tenant's use and occupancy of the Premises. If neither party to this Lease
shall so elect to terminate this Lease, the rental thereafter to be paid shall
be adjusted on a pro rata basis. In addition to the rights of Landlord above,
if any substantial part of the Building shall be taken or appropriated by any
public or quasi-public authority under the power of eminent domain or
conveyance in lieu thereof, and regardless of whether the Premises or any part
thereof are so taken or appropriated, Landlord shall have the right, at its
sole option, to terminate this Lease. Landlord shall be entitled to any and all
income, rent, award, or any interest whatsoever in or upon any such sum, which
may be paid or made in connection with any such public or quasi-public use or
purpose, and Tenant hereby assigns to Landlord any interest it may have in or
claim to all or any part of such sums, other than any separate award which may
be made with respect to Tenant's trade fixtures and moving expenses; Tenant
shall make no claim for the value of any unexpired Term.
25. SALE BY LANDLORD. In event of a sale or conveyance by Landlord of the
Building, the same shall operate to release Landlord from any future liability
upon any of the covenants or conditions, expressed or implied, contained in
this Lease in favor of Tenant, and in such event Tenant agrees to look solely
to the responsibility of the successor in interest of Landlord in and to this
Lease. Except as set forth in this Article 25, this Lease shall not be affected
by any such sale and Tenant agrees to attorn to the purchaser or assignee. If
any security has been given by Tenant to secure the faithful performance of any
of the covenants of this Lease, Landlord may transfer or deliver said security,
as such, to Landlord's successor in interest and thereupon Landlord shall be
discharged from any further liability with regard to said security.
26. ESTOPPEL CERTIFICATES. Within ten (l0) business days following any
written request which Landlord may make from time to time, Tenant shall execute
and deliver to Landlord or mortgagee or prospective mortgagee a sworn statement
certifying: (a) the date of commencement of this Lease; (b) the fact that this
Lease is unmodified and in full force and effect (or, if there have been
modifications to this Lease, that this lease is in full force and effect, as
modified, and stating the date and nature of such modifications); (c) the date
to which the rent and other sums payable under this Lease have been paid; (d)
the fact that there are no current defaults under this Lease by either Landlord
or Tenant except as specified in Tenant's statement; and (e) such other matters
as may be requested by Landlord. Landlord and Tenant intend that any statement
delivered pursuant to this Article 26 may be relied upon by any mortgagee,
beneficiary or purchaser and Tenant shall be liable for all loss, cost or
expense resulting from the failure of any sale or funding of any loan caused by
any material misstatement contained in such estoppel certificate. Tenant
irrevocably agrees that if Tenant fails to execute and deliver such certificate
within such ten (10) business day period Landlord or Landlord's beneficiary or
agent may execute and deliver such certificate on Tenant's behalf, and that
such certificate shall be fully binding on Tenant if Tenant fails to execute
and deliver a contrary certificate within five (5) days after receipt by Tenant
of a copy of the certificate so executed on behalf of Tenant.
27. SURRENDER OF PREMISES.
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27.1. Tenant shall, at least thirty (30) days before the last day of
the Term, arrange to meet Landlord for a joint inspection of the Premises. In
the event of Tenant's failure to arrange such joint inspection to be held
prior to vacating the Premises, Landlord's inspection at or after Tenant's
vacating the Premises shall be conclusively deemed correct for purposes of
determining Tenant's responsibility for repairs and restoration.
27.2 At the end of the Term or any renewal of the Term or other sooner
termination of this Lease, Tenant will peaceably deliver up to Landlord
possession of the Premises, together with all improvements or additions upon or
belonging to the same, by whomsoever made, in the same conditions received or
first installed, broom clean and free of all debris, excepting only ordinary
wear and tear and damage by fire or other casualty. Tenant may, and at
Landlord's request shall, at Tenant's sole cost, remove upon termination of
this Lease, any and all furniture, furnishings, movable partitions of less than
full height from floor to ceiling, trade fixtures and other property installed
by Tenant, title to which shall not be in or pass automatically to Landlord
upon such termination, repairing all damage caused by such removal. Property
not so removed shall unless requested to be removed be deemed abandoned by the
Tenant and title to the same shall thereupon pass to Landlord under this Lease
as by a bill of sale. All other alterations, additions and improvements in, on
or to the Premises shall be dealt with and disposed of as provided in Article 6
hereof.
27.3. All obligations of Tenant under this Lease not fully performed as
of the expiration or earlier termination of the Term shall survive the
expiration or earlier termination of the Term. Upon the expiration or earlier
termination of the Term, Tenant shall pay to Landlord the amount, as estimated
by Landlord, necessary to repair and restore the Premises as provided in this
Lease and/or to discharge Tenant's obligation for unpaid amounts due or to
become due to Landlord. All such amounts shall be used and held by Landlord for
payment of such obligations of Tenant, with Tenant being liable for any
additional costs upon demand by Landlord, or with any excess to be returned to
Tenant after all such obligations have been determined and satisfied. Any
otherwise unused Security Deposit shall be credited against the amount payable
by Tenant under this Lease.
28. NOTICES. Any notice or document required or permitted to be delivered
under this Lease shall be addressed to the intended recipient, shall be
transmitted personally, by fully prepaid registered or certified United States
Mail return receipt requested, or by reputable independent contract delivery
service furnishing a written record of attempted or actual delivery,
and shall be deemed to be delivered when tendered for delivery to the addressee
at its address set forth opposite its signature on the Reference Page, or at
such other address as it has then last specified by written notice delivered in
accordance with this Article 28, or if to Tenant at either its aforesaid
address or its last known registered office or home of a general partner or
individual owner, whether or not actually accepted or received by the
addressee.
29. TAXES PAYABLE BY TENANT. In addition to rent and other charges to be
paid by Tenant under this Lease, Tenant shall reimburse to Landlord, upon
demand, any and all taxes payable by Landlord (other than net income taxes)
whether or not now
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customary or within the contemplation of the parties to this Lease: (a) upon,
allocable to, or measured by or on the gross or net rent payable under this
Lease, including without limitation any gross income tax or excise tax levied
by the State, any political subdivision thereof, or the Federal Government with
respect to the receipt of such rent; (b) upon or with respect to the
possession, leasing, operation, management, maintenance, alteration, repair,
use or occupancy of the Premises or any portion thereof, including any sales,
use or service tax imposed as a result thereof; (c) upon or measured by the
Tenant's gross receipts or payroll or the value of Tenant's equipment,
furniture, fixtures and other personal property of Tenant or leasehold
improvements, alterations or additions located in the Premises; or (d) upon
this transaction or any document to which Tenant is a party creating or
transferring any interest of Tenant in this Lease or the Premises. At
Landlord's election said sums shall be reimbursed to Landlord in the same way
as sums due under Article 4 of this Lease. In addition to the foregoing, Tenant
agrees to pay, before delinquency, any and all taxes levied or assessed against
Tenant and which become payable during the term hereof upon Tenant's equipment,
furniture, fixtures and other personal property of Tenant located in the
Premises.
30. INTENTIONALLY DELETED.
31. RELOCATION OF TENANT. Landlord, at its sole expense, on at least one
hundred twenty (120) days prior written notice, may require Tenant to move from
the Premises to other space of comparable size (which space shall not be in
more than one location) and decor at the same rent as then being paid by Tenant
in order to permit Landlord to consolidate the space leased to Tenant with
other adjoining space leased or to be leased to another tenant. In the event of
any such relocation, Landlord shall use commercially reasonable efforts to
minimize disruption to Tenant's operations, Landlord will pay all expenses of
preparing and decorating the new premises so that they will be substantially
similar to the Premises from which Tenant is moving, Landlord will deliver the
relocated premises to Tenant ready for occupancy, and Landlord will also pay
the expense of moving Tenant's furniture and equipment to the relocated
premises. In such event this Lease and each and all of the terms and covenants
and conditions hereof shall remain in full force and effect and thereupon be
deemed applicable to such new space except that a revised Reference Page and a
revised Exhibit A shall become part of this Lease and shall reflect the
location of the new premises.
32. REMOVAL OF TENANT'S PROPERTY. Any and all property which may be removed
from the Premises by Landlord pursuant to the authority of this Lease or of
law, to which Tenant is or may be entitled, may be handled, removed and/or
stored, as the case may be, by or at the direction of Landlord but at the risk,
cost and expense Of Tenant, and Landlord shall in no event be responsible for
the value, preservation or safekeeping thereof. Tenant shall pay to Landlord,
upon demand, any and all expenses incurred in such removal and all storage
charges against such property so long as the same shall be in Landlord's
possession or under Landlord's control. Any such property of Tenant not retaken
by Tenant from storage within thirty (30) days after removal from the Premises
shall, at Landlord's option, be deemed conveyed by Tenant to Landlord under
this Lease as by a bill of sale without further payment or credit by Landlord
to Tenant.
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33. DEFINED TERMS AND HEADINGS. The Article headings shown in this Lease are
for convenience of reference and shall in no way define, increase, limit or
describe the scope or intent of any provision of this Lease. Any
indemnification or insurance of Landlord shall apply to and inure to the
benefit of all the following "Landlord Entities", being Landlord, Landlord's
investment manager, and the trustees, boards of directors, officers, general
partners, beneficiaries, stockholders, employees and agents of each of them.
Any option granted to Landlord shall also include or be exercisable by
Landlord's trustee, beneficiary, agents and employees, as the case may be. In
any case where this Lease is signed by more than one person, the obligations
under this Lease shall be joint and several. The terms "Tenant" and "Landlord"
or any pronoun used in place thereof shall indicate and include the masculine
or feminine, the singular or plural number, individuals, firms or corporations,
and their and each of their respective successors, executors, administrators
and permitted assigns; according to the context hereof. The term "rentable
area" shall mean the rentable area of the Premises or the Building as
calculated by the Landlord on the basis of the plans and specifications of the
Building including a proportionate share of any common areas. Tenant hereby
accepts and agrees to be bound by the figures for the rentable space footage of
the Premises and Tenant's Proportionate Share shown on the Reference Page.
34. TENANT'S AUTHORITY. If Tenant signs as a corporation each of the persons
executing this Lease on behalf of Tenant represents and warrants that Tenant
has been and is qualified to do business in the State of Illinois, that the
corporation has full right and authority to enter into this Lease, and that all
persons signing on behalf of the corporation were authorized to do so by
appropriate corporate actions. If Tenant signs as a partnership, trust or other
legal entity, each of the persons executing this Lease on behalf of Tenant
represents and warrants that Tenant has complied with all applicable laws,
rules and governmental regulations relative to its right to do business in the
State of Illinois and that such entity on behalf of the Tenant was authorized
to do so by any and all appropriate partnership, trust or other actions. Tenant
agrees to furnish promptly upon request a corporate resolution, proof of due
authorization by partners, or other appropriate documentation evidencing the
due authorization of Tenant to enter into this Lease.
35. ENFORCEABILITY. If for any reason whatsoever any of the provisions of
this Lease shall be unenforceable or ineffective, all of the other provisions
shall be and remain in full force and effect.
36. COMMISSIONS. Each of the parties: (a) represents and warrants to the
other that it has not dealt with any broker or finder in connection with this
Lease, except as described on the Reference Page; and, (b) indemnifies and
holds the other harmless from any and all losses, liability, costs or expenses
(including attorneys' fees) incurred as a result of any alleged breach of the
foregoing warranty by it.
37. TIME AND APPLICABLE LAW. Time is of the essence of this Lease and all of
its provisions. This Lease shall in all respects be governed by the laws of the
State of Illinois.
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38. SUCCESSORS AND ASSIGNS. Subject to the provisions of Article 10, the
terms, covenants and conditions contained in this Lease shall be binding upon
and inure to the benefit of the heirs, successors, executors, administrators
and assigns of the parties to this Lease.
39. ENTIRE AGREEMENT. This Lease, together with its exhibits, contains all
agreements of the parties to this Lease and supersedes any previous
negotiations. There have been no representations made by the Landlord or
understandings made between the parties other than those set forth in this
Lease and its exhibits. This Lease may not be modified except by a written
instrument duly executed by the parties to this Lease.
40. EXAMINATION NOT OPTION. Submission of this Lease shall not be deemed to
be a reservation of the Premises. Landlord shall not be bound by this Lease
until it has received a copy of this Lease duly executed by Tenant and has
delivered to Tenant a copy of this Lease duly executed by Landlord, and until
such delivery Landlord reserves the right to exhibit and lease the Premises to
other prospective tenants. Notwithstanding anything contained in this Lease to
the contrary, Landlord may withhold delivery of possession of the Premises from
Tenant until such time as Tenant has paid to Landlord any security deposit
required by Article 5 of this Lease, the first month's rent as set forth in
Article 3 of this Lease and any sum owed pursuant to this Lease.
41. RECORDATION. Tenant shall not record or register this Lease or a short
form memorandum hereof without the prior written consent of Landlord, and then
shall pay all charges and taxes incident such recording or registration.
42. LIMITATION OF LANDLORD'S LIABILITY. Redress for any claim against
Landlord under this Lease shall be limited to and enforceable only against and
to the extent of Landlord's interest in the property of which the Premises are
a part. The obligations of Landlord under this Lease are not intended to and
shall not be personally binding on, nor shall any resort be had to the private
properties of, any of its trustees or board of directors and officers, as the
case may be, its investment manager, the general partners thereof, or any
beneficiaries, stockholders, employees, or agents of Landlord or the investment
manager.
43. RENEWAL OPTION.
43.1. Tenant shall, provided the Lease is in full force and effect and
Tenant is not in default under any of the other terms and conditions of the
Lease at the time of notification or commencement, have one (1) option to renew
this Lease for a term of five (5) years for the portion of the Premises being
leased by Tenant as of the date the renewal term is to commence, on the same
terms and conditions set forth in the Lease, except as modified by the terms,
covenants and conditions as set forth below.
43.2. If Tenant elects to exercise said option, then Tenant shall
provide Landlord with written notice no earlier than the date which is twelve
(12) months prior to the expiration of the then current term of the Lease, but
no later than the date which is six (6) months prior to the expiration of the
current term of the Lease, and the Annual Rent and Monthly Installment in
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effect at the expiration of the then current term of the Lease shall be
increased, commencing on the first day of the new renewal term, to reflect the
current fair market rental for comparable space in other similar buildings in
the same rental market as of the date the renewal term is to commence. If
Tenant fails to provide such notice, Tenant shall have no further or additional
right to extend or renew the term of the Lease. The notice shall be given in
the manner provided in the Lease for the giving of notices to Landlord.
43.3. Landlord shall advise Tenant of the Annual Rent and Monthly
Installment no later than thirty (30) days after receipt of Tenant's written
request therefor. Said notification of the new Annual Rent may include a
provision for its escalation to provide for a change in fair market rental
between the time of notification and the commencement of the renewal term. If
Tenant and Landlord are unable to agree on a mutually acceptable rental rate
not later than sixty (60) days prior to the expiration of the then current
term, then Landlord and Tenant shall each appoint a qualified MAI appraiser
doing business in the area, in turn those two independent MAI appraisers shall
appoint a third MAI appraiser and the majority shall decide upon the fair
market rental for the Premises as of the expiration of the then current term.
Landlord and Tenant shall equally share in the expense of this appraisal except
that in the event the Annual Rent and Monthly Installment is found to be within
ten percent (10%) of the original rate quoted by Landlord, then Tenant shall
bear the full cost of all the appraisal process. In no event shall the Annual
Rent and Monthly Installment be subject to determination or modification by any
person, entity, court or authority other than as set forth expressly herein.
43.4. This option is not transferable; the parties hereto acknowledge
and agree that they intend that the aforesaid option to renew this Lease shall
be "personal" to Tenant as set forth above and that in no event will any
assignee or sublessee have any rights to exercise the aforesaid option to
renew.
44. RIGHT OF FIRST REFUSAL. Provided Tenant is not then in default under the
terms, covenants and conditions of the Lease, and subject to the rights of
other tenants, Tenant shall have the right to lease approximately 6,000 square
feet of contiguous space on the fourth floor of the Building as shown on
Exhibit D (the "Expansion Premises") at such time as Landlord receives an offer
from a third party to lease the Expansion Premises which Landlord is prepared
to accept (the "Offer"). In such a case, Landlord shall give written notice to
Tenant of the Offer, in all its particulars and Tenant shall have a period of
five (5) business days in.which to exercise Tenant's right to lease the
Expansion Premises, failing which Landlord may lease the Expansion Premises to
the third party on the basis of the Offer. If Tenant does not exercise its
option, this right shall continue and be effective at any time during the Term
that Landlord receives an Offer, except in the event that the Offer is from the
tenant then occupying the Expansion Premises, in which case Tenant shall have
no right hereunder. If Tenant exercises its option to include the Expansion
Premises hereunder, effective on the delivery date specified in the Offer, the
Expansion Space shall automatically be included in the Premises and be subject
to all the terms and conditions of the Lease, except as set forth in the Offer
and as follows:
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a. Tenant's Proportionate Share shall be recalculated, using the
total square footage of the Premises, as increased by the
Expansion Premises.
b. Except as set forth in the Offer, the Expansion Premises shall be
leased on an "as is" basis and Landlord shall have no obligation
to improve the Expansion Premises or grant Tenant any improvement
allowance thereon.
c. If requested by Landlord, Tenant shall, prior to the beginning of
the term for the Expansion Premises, execute a written memorandum
confirming the inclusion of the Expansion Premises and the Annual
Rent for the Expansion Premises.
45.1 SATELLITE DISH. Landlord hereby grants to Tenant for the Term of the
Lease a license (the "License") to: (a) maintain and operate one (1) parabolic
dish antenna (the "Antenna") not to exceed five (5) feet in diameter on the
roof of the Building in a location directed by Landlord; and (b) use, in common
with others, those certain common utility conduits and shafts within the
Building designated by Landlord (the locations for the Antenna and the common
utility shafts and conduits being herein collectively called the "Equipment
Space Area"), for the purpose of installing, operating, and maintaining the
microwave antenna and transmission and receiving equipment (the "Equipment"),
and for connecting the Equipment to the Premises by means of coaxial or other
wire or cable through said common utility shafts and conduits.
45.2. Tenant's use of the space required for the Antenna itself shall be
exclusive, but Tenant's use of the remainder of the Equipment Space Area shall
be nonexclusive. Landlord shall at all times have access to such Equipment
Space Area for the purpose of operating, maintaining, repairing, or improving
the Building. Landlord reserves the right to grant licenses and leases to other
tenants in the Building or others throughout the Term to use the non-exclusive
portions of the Equipment Space Area, the Building or the roof of the Building
for the operation of radio, microwave, satellite and telecommunications
equipment, so long as such use does not unreasonably interfere with Tenant's
installation or use of the Equipment.
45.3. Tenant shall pay to Landlord, as additional rent, on a monthly
basis, the actual costs incurred by Landlord in furnishing electric power for
the operation of the Equipment. All amounts due under this Section 45.3 shall
constitute additional rent for all purposes of the Lease.
45.4. Tenant shall pay to Landlord the amount of all identifiable
additional taxes and other governmental impositions, (including but not limited
to all permit fees) if any, which shall be required to be paid by Landlord in
any calendar year partly or wholly within the Term by reason of the
installation, maintenance, use or operation of the Equipment.
45.5. Tenant shall, all at Tenant's sole cost, expense and risk, install
the Equipment in a good and workmanlike manner, and in compliance with all
building, electric, communications and safety codes, ordinances, standards,
regulations and requirements of all governmental bodies having jurisdiction in
the matter, including, without limitation, the Federal Government, the Federal
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Communications Commission (the "FCC") or any successor agency having
jurisdiction over radio or telecommunications, the State of Illinois, the City
of Chicago, and the County of Cook. The Equipment shall be connected to
Landlord's power supply in strict compliance with all applicable building,
electrical, fire and safety codes.
45.6. Prior to commencing installation of the Equipment, Tenant shall
first deliver to Landlord Tenant's plans and specifications for the
installation of the Equipment for review and approval by Landlord's personnel
and/or consultants, and also shall obtain, and deliver to Landlord copies of,
all permits, licenses and consents required for the installation and operation
of the Equipment. Tenant shall not commence installation of the Equipment until
Landlord has approved said plans, specifications, permits, licenses and
consents. Landlord shall have the right (but shall not be required) to directly
supervise all phases of the installation. In addition, Tenant shall notify
Landlord upon completion of the installation of the Equipment, Landlord shall
have ten (10) days after receipt of such notification in which to inspect the
installation, and Tenant shall not commence operation of the Equipment until
Landlord has approved the installation.
45.7 All of the Equipment shall be and remain the property of Tenant
throughout the Term, and shall be continuously maintained by Tenant in safe,
structurally sound, clean and sightly condition. Prior to the expiration or
termination of the Term, Tenant shall remove the Equipment (including all
installation and anchoring hardware) and surrender the Equipment Space Area in
substantially the same condition as existing prior to the installation of the
Equipment except for such normal wear and tear as would occur absent the
Equipment. Tenant shall be liable for, and shall reimburse Landlord on demand
for, the cost of repairing all damage done to the Equipment Space Area or the
Building by such removal, including filling and sealing any holes or cavities
left by the removal of installation or anchoring hardware. Any Equipment not so
removed by Tenant may be removed by Landlord and Landlord's cost of doing so
shall be paid to Landlord by Tenant on demand, or at Landlord's option any or
all of such Equipment as was not so removed shall become Landlord's property as
though conveyed by bill of sale.
45.8. Neither the granting of the License hereby or Landlord's review
and approval of the plans and specifications for the installation of the
Equipment and/or supervision and inspection of the installation of the
Equipment shall be construed in any way as a representation by Landlord that
either the installation or the operation of the Equipment is permissible under
applicable laws, ordinances and regulations or as approval by Landlord of the
adequacy or safety of the installation of the Equipment or as a waiver of any
of landlord's rights hereunder. Notwithstanding such approval, consent,
supervision or inspection on the part of Landlord, Tenant shall be responsible
for any damage to the Building or existing structures on the Building, for any
and all interference with the maintenance of the Building or of any system
currently serving the Building caused by Tenant's installation of the
Equipment, and for any damages or injury arising out of such installation
except to the extent caused by or arising from the negligent or willful act of
Landlord or its agents, employees or contractors (to which extent Landlord
agrees to indemnify and hold Tenant harmless). Landlord's cost of repairing any
damage to the Building for which Tenant is responsible as aforesaid which is
not paid by Tenant
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within ten (10) days after Tenant's receipt of Landlord's written notice
concerning such cost shall be due from Tenant on demand.
45.9. Tenant shall operate the Equipment in strict compliance with all
applicable statutes, codes, rules, regulations, standards, and requirements of
all federal, state, and local governmental boards, authorities, and agencies,
including, without limitation, the FCC. The installation, operation, and
maintenance of the Equipment shall at all times strictly comply with all such
technical standards as shall be required by Landlord in good faith as well as
all Landlord's reasonable rules and regulations now or hereafter promulgated.
The operation of the Equipment shall not interfere with the maintenance or
operation of the Building, or any system now or hereafter serving the Building,
or the operation of any existing radio, microwave, satellite or
telecommunications equipment operating in, on or from the Building. In the
event that operation of the Equipment would violate any of the terms or
conditions of this paragraph, Tenant shall either cure such violation or
suspend operation of the Equipment within forty-eight (48) hours after notice
from Landlord of such violation, and shall not resume operation of the
Equipment until such operation is in strict compliance with all of the
requirements of this paragraph. In the event Tenant refuses to either cure such
violation or suspend operation of the Equipment when so notified by Landlord,
or in the event of an emergency, Landlord shall have the right to either cure
such violation or suspend the supply of electric power to the Equipment, and
Landlord shall have no liability to Tenant, and Tenant shall have no right to
an abatement or offset by reason of such suspension.
45.10. So long as there does not exist any uncured Event of Default
under this Lease, the License shall not be cancelled by Landlord or its
successors or assigns. The License granted hereunder may be terminated prior to
the scheduled Termination Date of this Lease (a) at the option of Tenant in the
event the Equipment is or becomes unusable by Tenant by reason of either
inability to obtain or retain all required FCC or other governmental permits
for operation of the Equipment or erection by a third party of an obstruction
(other than temporary) blocking the transmission of signal between the
Equipment and the connecting transmission-receptor installation, this option to
be exercised by not less than thirty (30) days prior written notice from
Tenant; and (b) by Tenant by notice given to the Landlord within 30 days after
the expiration of the period for restoration if the Equipment or the Equipment
Space Area shall be damaged by fire or other casualty to such an extent that
the Equipment is rendered unusable and cannot be restored to usability within
30 days.
46. TENANT IMPROVEMENTS. Landlord shall cause the design and
construction of improvements in the Premises pursuant to the work Letter
attached hereto as Exhibit B, which improvements shall not include any of
Tenants personal property, furniture, equipment or other items of a similar
nature personal to Tenant.
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LANDLORD: TENANT:
BENEFICIARIES OF AMERICAN SOFTWARE SPECTRUM, INC., a
NATIONAL BANK TRUST NUMBER Texas corporation
104601-03
By: RREEF Management Company, By: /s/ THEODORE A. FREDERICH
a California corporation ------------------------------
Title: Facilities Director
Dated: May 4, 1996
By:________________________________
Title: ____________________________
Dated: ____________________________
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EXHIBIT A
attached to and made a part of Lease bearing the
Lease Reference Date of March 26, 1996 between
BENEFICIARIES OF AMERICAN NATIONAL BANK TRUST NUMBER 104601-03,
as Landlord and Software Spectrum, Inc., as Tenant
PREMISES
Exhibit A is intended only to show the general layout of the Premises as of the
beginning of the Term of this Lease. It does not in any way supersede any of
Landlord's rights set forth in Section 18.3 of the Lease with respect to
arrangements and/or locations of public parts of the Building and changes in
such arrangements and/or locations. It is not to be scaled; any measurements or
distances shown should be taken as approximate.
16,612 square feet
(Approximate Configuration)
Suite 400
Chicago, Illinois 60606
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EXHIBIT B
attached to and made a part of Lease bearing the
Lease Reference Date of March 26, 1996 between
BENEFICIARIES OF AMERICAN NATIONAL BANK TRUST NUMBER 104601-03,
as Landlord and SOFTWARE SPECTRUM, INC., as Tenant
WORK LETTER
The undersigned, Landlord and Tenant, respectively, are executing
simultaneously with this Work Letter a written Lease covering premises (the
"Premises") as described in the Lease and hereby attach this Work Letter to
said Lease as Exhibit B thereto. Any defined term used in this Exhibit B which
is not defined herein shall have the meaning provided for such term in the
Lease.
In consideration of the mutual covenants contained herein and in the Lease,
Landlord and Tenant agree as follows:
I. Landlord Work and Plans
A. Landlord agrees to do the Work ("Landlord Work") as shown
on the space plans and specifications prepared by K.
Peterson Associates (the "Architect") dated March 6, 1996
and Addendum One (1) dated March 15, 1996 (the "Space
Plans") and as specified on the Budget Quotation (the
"Quote") prepared by Edison Construction Company dated
March 19, 1996 (as supplemented by March 20, 1996 facsimile
transmittal sheet), copies of which are attached to this
Work Letter as Schedule B-l, excluding any Tenant
furnishings, fixtures, equipment, communications and data
cabling, and electrical/data connections to Tenant's
furniture panels and systems.
B. Any subsequent modifications, revisions or changes to the
Space Plans or to the Quote are expressly subject to
Landlord's prior written approval.
II. Improvements
A. Landlord shall pay for all costs and expenses incurred in
connection with the installation and construction of the
improvements specified in the Space Plans and the Quote. If
Tenant later requests changes, or if unforeseen
circumstances beyond Landlord's control result in changes
to the scope of the work contemplated in the Space Plans or
in the Quote, Tenant will pay the net increase in cost of
the improvements as a result of such changes as more fully
described below.
III. Tenant's Extra Work
If Tenant requests Landlord to do any work in connection with the
premises other than the Landlord Work, or Tenant requests any
modifications or changes to the Landlord Work after approval of
the Space Plans and budget therefor, and Landlord, in its sole
discretion, approves of such other work in writing (such other
work is hereinafter referred to as "Tenant's Extra Work"), the
following terms, conditions, agreements, and procedures shall be
applicable:
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A. Tenant shall, at its sole cost and expense, cause the
Architect to prepare and submit to Landlord, on or before
the date construction commences (the "Plans Due Date"), all
necessary drawings, plans, and specifications covering the
proposed Tenant's Extra Work (such drawings, plans and
specifications are hereinafter referred to as "Tenant's
Extra Work Plans").
B. Landlord agrees to cause the Tenant's Extra Work to be
constructed, provided that Tenant's Extra Work Plans are
acceptable to Landlord and approved in writing by Landlord,
that the timing of Tenant's Extra Work must be coordinated
with the scheduling of Landlord's Work, and that Tenant has
complied with all applicable provisions, terms and
conditions of this Work Letter.
C. All such Tenant's Extra Work shall be done at Tenant's sole
cost and expense. Prior to commencing any of Tenant's Extra
Work, Landlord shall submit to Tenant for Tenant's approval
a written estimate of the cost of Tenant's Extra Work
(hereinafter called ("Estimate"). If Tenant fails to
approve any Estimate in writing within five (5) business
days of its submission to Tenant, the Estimate shall be
deemed disapproved and Landlord shall not be obligated to
proceed with Tenant's Extra Work but Landlord may complete
the construction of the Landlord Work. If Tenant approves
the Estimate, Landlord may require Tenant to deposit the
amount of the Estimate with Landlord within five (5)
business days after Landlord's written request therefor.
Such deposit shall be held as security for the payment of,
and shall be credited, without interest, against the sums
payable by Tenant under this Work Letter.
D. If Tenant shall request any modifications, revisions or
changes to the Tenant's Extra Work at any time and from
time to time, it shall follow the same procedure herein
prescribed for the initiation, approval and commencement of
the Tenant's Extra Work in each such case.
E. Tenant agrees to pay to Landlord the following sums for
Tenant's Extra Work:
1. All costs and expenses pertaining to Tenant's Extra
Work, subcontractors and general and other
conditions, costs and expenses, and
2. An overhead charge of ten percent (10%) of the total
of all such costs under Paragraph III. E. 1. hereof.
Tenant shall pay to Landlord within fifteen (15) business
days after being billed therefor, at any time and from time
to time, the amount of such costs, expenses and charges for
Tenant's Extra Work set forth in such billings, which
amounts shall be treated as additional rent under the
Lease.
IV. Completion of the Work, Tenant's Acts or Omissions, and Defaults
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A. Landlord shall commence construction of the Landlord Work
and shall tender to Tenant the Premises substantially
completed on or prior to the scheduled commencement Date of
the Lease, subject only to ordinary punch list items.
Tenant shall deliver a list of such punch list items, if
any, within thirty (30) days of Tenant's occupancy of the
premises and Landlord shall complete such punch list within
forty-five (45) days of reaching written agreement on such
punch list items with Tenant. Landlord's obligation to
tender the Premises substantially completed on the
Scheduled Commencement Date is subject to acts and events
beyond Landlord's control, including but not limited to
acts of God, strike and other occurrences of "force
majeure." During construction of the Landlord Work,
Landlord shall use its best efforts to apprise Tenant of
the construction schedule for the Landlord Work. In the
event that the Premises are not in fact substantially
completed according to such schedule, Landlord shall have a
reasonable time after such date in which to take such
corrective action as Landlord deems necessary and shall
notify Tenant as soon as it deems such corrective action,
if any, has been completed so that the Premises are ready
for occupancy.
B. Notwithstanding anything in the Lease to the contrary, if
Tenant is not in default hereunder or under the Lease,
Tenant's obligation to pay rent under the Lease shall not
commence until Landlord shall have substantially completed
the Landlord work; provided, however, that if Landlord
shall be delayed in substantially completing the Premises
as a result of any act or omission by Tenant, its agents,
employees, representatives or contractors, or any one or
more of them including, without limitation, the following;
1. Tenant's failure to approve any Estimate within five
(5) business days of its submission to Tenant; or
2. Tenants failure to furnish to Landlord Tenants Extra
Work Plans by the required date; or
3. Tenant's failure to pay amounts or deposit any
Estimate required hereunder within the period set
forth herein; or
4. Tenant's request for any materials, finishes, or
installations other than as specified in the Space
Plans or in the Quote; or
5. Tenant's request that Landlord delay or not construct
the Landlord work or Tenant's Extra Work in all or
part of the Premises; or
6. Tenant's delay in supplying Landlord or Architect
with any requested information; or
7. Tenant's changes at any time or from time to time in
any one or more of the following: Landlord Work,
Tenant's Extra Work, the Space Plans, the Quote or
Tenant's Extra Work
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Plans, regardless of Landlord's approval of any such
changes; or
8. The performance or completion by Tenant, or any
person or entity employed by Tenant, of any work on
or about the Premises including, without limitation,
any disharmony or interference caused by such
performance or completion as further described in
Paragraph V. A. hereof; or
9. Any other act or omission by Tenant or any of its
agents, employees, representatives or contractors;
then, in any such event, the commencement of the term of
the Lease and the payment of rent thereunder shall not be
affected or deferred on account of such delay
notwithstanding that the Landlord Work and/or the Tenant's
Extra Work may not be substantially completed. The cost of
any changes and/or additions made to the Landlord Work,
Tenant's Extra Work, the Space Plans, the Quote, or
Tenant's Extra Work Plans at the request of Tenant after
Landlord and Tenant have agreed on the Space Plans or
Tenant's Extra Work Plans, including but not limited to the
actual cost of such changes or additions, the cost of any
revisions to the Space Plans or Tenant's Extra Work Plans,
and the cost of any delays in construction resulting from
any Tenant requested changes, all as determined by Landlord
in its reasonable discretion, whether or not such changes
are finally agreed to, together with ten percent (10%) of
such costs for Landlord's overhead, shall be paid by Tenant
upon Landlord's presentation of a bill therefor or as
herein required, and such amount shall be treated as
additional rent under the Lease.
C. If Tenant shall fail to comply with any term, provision or
agreement hereunder or if Landlord and Tenant fail to reach
agreement on Tenant's Extra Work Plans within fifteen (15)
days after the submission thereof to Landlord, and if any
such matter is not remedied or resolved to Landlord's
satisfaction fifteen (15) days following written notice to
Tenant, then, in addition to any other remedies granted
Landlord under the Lease in the case of default by Tenant
and any remedies provided for elsewhere in this Work Letter
or available at law or equity, Landlord may elect, upon
notice to Tenant, to: (l) discontinue all work hereunder,
and Tenant's obligation to pay rent shall commence of the
Commencement Date set forth in the Lease, without any
abatement on account of any delay in connection with any
work relating to the Premises, (2) complete the
construction of the Landlord Work pursuant to the Space
Plans as approved by Landlord and Tenant or complete any
work which Landlord and Tenant have agreed to in writing,
tendering possession to Tenant upon substantial completion
thereof, the date of such tender being deemed to be the
Commencement Date under the Lease, and charge Tenant for
the additIonal costs of completing the electrical,
plumbing, office partitions and other
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work, the plans and specifications for which have not been
agreed to by Landlord and Tenant, which amount shall be
paid by Tenant to Landlord as additional rent prior to any
such work commencing, or (3) cancel the Lease, effective
fifteen (15) days after Tenant receives notice thereof,
without incurring any liability on account thereof and the
term granted under the Lease is expressly limited
accordingly. If Landlord cancels the Lease pursuant to the
terms hereof or as a result of Tenant's default under the
Lease, such cancellation shall not affect Tenant's
liability for any sums payable under this Work Letter.
V. Tenant's Access to the Premises
A. After receipt of written notice from Tenant requesting
access to the Premises, Landlord shall permit Tenant and
Tenant's agents or contractors to enter the Premises during
the two (2) week period prior to the Commencement Date
specified in the Lease in order that Tenant may do other
approved work or alterations as may be required by Tenant
to make the premises ready for Tenant's use and occupancy.
Permission by Landlord for such prior entry shall be under
a license and shall be subject to the condition that Tenant
and Tenant's agents, contractors, workmen, mechanics,
suppliers, and invitees shall work in harmony and not
interfere with Landlord and its agents and contractors in
doing their work in the Building or with other tenants and
occupants of the Building. If at any time such entry shall
cause or threaten to cause such disharmony or interference,
Landlord, in its sole discretion, shall have the right to
withdraw and cancel such license upon twenty-four (24)
hours written notice to Tenant (or immediately in case of
emergency or condition causing or likely to cause harm to
person or property) and any further prior entry shall be
prohibited. Tenant agrees that any entry into and any
occupation of the Premises shall be deemed to be under all
of the terms, covenants, conditions and provisions of the
Lease, except as to the covenant to pay rent, and further
agrees that to the extent permitted by Law, Landlord and
its principals, employees and agents shall not be liable in
any way for any injury or death to any person or persons,
loss or damage to any of Tenant's work and installations
made in the Premises, or loss or damage to property placed
therein, the same being at Tenant's sole risk. Tenant
agrees to protect, defend, indemnify, and save harmless
Landlord and its principals, employees and agents from all
liabilities, costs, damages, fees and expenses (including
reasonable attorneys' fees and expenses) arising out of or
connected with the activities of Tenant or its agents,
contractors, workmen, mechanics, suppliers and invitees in
or about the Premises or the Building.
B. In addition to any other conditions or limitations on such
license to enter the Premises prior to the said Occupancy
Date, Tenant expressly agrees that none of its agents,
contractors, workmen, mechanics, suppliers, or invitees
shall enter the Pre-
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mises prior to the date they are tendered by Landlord
unless and until each of them shall furnish such assurances
to Landlord, including but not limited to, insurance
coverages, waivers of lien, surety company performance
bonds and personal guaranties of individuals of substance,
as Landlord shall require to protect Landlord against any
loss, casualty, liability, liens or claims.
VI. Miscellaneous
A. Tenant expressly assumes the responsibility and obligation
of supplying Landlord and Architect with all information
concerning Tenant's requirements with respect to the
Landlord Work and Tenant's Extra Work as and when requested
by any of them.
B. The Landlord Work and Tenant's Extra Work, if any, shall be
done by the contractors and subcontractors designated by
Landlord, in accordance with the terms, conditions and
provisions herein contained.
C. Except as set forth in Paragraph I. A. hereof, Landlord has
no other agreement with Tenant and has no obligation to do
any work with respect to the Premises. Any other work in
the Premises which may be permitted by Landlord pursuant to
the terms and conditions of the Lease shall be done at
Tenant's sole cost and expense and in accordance with the
terms and provisions herein set forth pertaining to
Tenant's Extra Work and such additional requirements as
Landlord deems necessary or desirable.
D. All rights and remedies of Landlord herein created or
otherwise existing at law or equity are cumulative, and the
exercise of one or more such rights or remedies shall not
be deemed to exclude or waive the right to the exercise of
any other rights or remedies. All such rights and remedies
may be exercised and enforced concurrently and whenever and
as often as deemed desirable.
E. Time is of the essence under this Work Letter.
F. Any person signing this Work Letter on behalf of the Tenant
represents and warrants that he/she has the express
authority of the Tenant to do so. Any person signing this
Work Letter on behalf of Landlord represents and warrants
that he/she has the express authority of Landlord to do so.
G. The terms and provisions of the Lease are hereby
incorporated herein by reference and made a part hereof,
but none of the terms or provisions contained herein shall
be interpreted to modify or amend the Lease, except as
provided in Paragraph IV hereof. This Work Letter shall not
be deemed applicable to any additional office space added
to the original Premises at any time or from time to time,
whether by any options under the Lease or otherwise, or to
any portion of the original Premises or any additions
thereto in the event of a renewal or extension of the
original term of the
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Lease, whether by any options under the Lease or otherwise.
H. This Work Letter shall be binding upon and inure to the
benefit of the parties hereto and their respective heirs,
executors, legal representatives, successors and assigns.
I. This Work Letter shall in all respects be governed by the
laws of Illinois.
LANDLORD: TENANT:
BENEFICIARIES OF AMERICAN SOFTWARE SPECTRUM, INC.,
NATIONAL BANK TRUST a Texas corporation
NUMBER 104601-03
By: RREEF Management Company,
a California corporation By: /s/ THEODORE A. FREDERICH
___________________________________
Title: Facilities Director
By:________________________________
Dated: May 4, 1996
Title:_____________________________
Dated: ______________________, 1996
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SCHEDULE B-1
Budget Quotation Prepared by Edison Construction Company
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EXHIBIT C
attached to and made a part of Lease bearing the
Lease Reference Date of March 26, 1996
BENEFICIARIES OF AMERICAN NATIONAL BANK TRUST NUMBER 104601-03,
as Landlord and SOFTWARE SPECTRUM, INC., as Tenant
RULES AND REGULATIONS
1. No sign, placard, picture, advertisement, name or notice shall be
installed or displayed on any part of the outside or inside of the Building
without the prior written consent of the Landlord. Landlord shall have the
right to remove, at Tenant's expense and without notice, any sign installed or
displayed in violation of this rule. All approved signs or lettering on doors
and walls shall be printed, painted, affixed or inscribed at the expense of
Tenant by a person or vendor chosen by Landlord. In addition, Landlord reserves
the right to change from time to time the format of the signs or lettering and
to require previously approved signs or lettering to be appropriately altered.
2. If Landlord objects in writing to any curtains, blinds, shades or
screens attached to or hung in or used in connection with any window or door of
the Premises, Tenant shall immediately discontinue such use. No awning shall be
permitted on any part of the Premises. Tenant shall not place anything or allow
anything to be placed against or near any glass partitions or doors or windows
which may appear unsightly, in the opinion of Landlord, from outside the
Premises.
3. Tenant shall not obstruct any sidewalks, halls, passages, exits,
entrances, elevators, escalators or stairways of the Building. The halls,
passages, exits, entrances, shopping malls, elevators, escalators and stairways
are not for the general public, and Landlord shall in all cases retain the
right to control and prevent access to the Building of all persons whose
presence in the judgment of Landlord would be prejudicial to the safety,
character, reputation and interests of the Building and its tenants provided
that nothing contained in this rule shall be construed to prevent such access
to persons with whom any tenant normally deals in the ordinary course of its
business, unless such persons are engaged in illegal activities. No tenant and
no employee or invitee of any tenant shall go upon the roof of the Building.
4. The directory of the Building will be provided exclusively for the
display of the name and location of tenants only and Landlord reserves the
right to exclude any other names therefrom.
5. All cleaning and janitorial services for the Building and the Premises
shall be provided exclusively through Landlord. Tenant shall not cause any
unnecessary labor by carelessness or indifference to the good order and
cleanliness of the Premises. Landlord shall not in any way be responsible to
any Tenant for any loss of property on the Premises, however occurring, or for
any damage to any Tenant's property by the janitor or any other employee or any
other person.
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6. Landlord will furnish Tenant free of charge with two keys to each door
in the Premises. Landlord may make a reasonable charge for any additional keys,
and Tenant shall not make or have made additional keys, and Tenant shall not
alter any lock or install a new or additional lock or bolt on any door of its
Premises. Tenant, upon the termination of its tenancy, shall deliver to
Landlord the keys of all doors which have been furnished to Tenant, and in the
event of loss of any keys so furnished, shall pay Landlord therefor.
7. If Tenant requires telegraphic, telephonic, burglar alarm or similar
services, it shall first obtain, and comply with, Landlord's instructions in
their installation.
8. No equipment, materials, furniture, packages, supplies, merchandise or
other property will be received in the Building or carried in the elevators
except between such hours and in such elevators as may be designated by
Landlord.
9. Tenant shall not place a load upon any floor which exceeds the load per
square foot which such floor was designed to carry and which is allowed by law.
Landlord shall have the right to prescribe the weight, size and position to all
equipment, materials, furniture or other property brought into the Building.
Heavy objects shall, stand on such platforms as determined by Landlord to be
necessary to properly distribute the weight. Business machines and mechanical
equipment belonging to Tenant which cause noise or vibration that may be
transmitted to the structure of the Building or to any space in the Building to
such a degree as to be objectionable to Landlord or to any tenants shall be
placed and maintained by Tenant, at Tenant's expense, on vibration eliminators
or other devices sufficient to eliminate noise or vibration. The persons
employed to move such equipment in or out of the Building must be acceptable to
Landlord. Landlord will not be responsible for loss of, or damage to, any such
equipment or other property from any cause, and all damage done to the Building
by maintaining or moving such equipment or other property shall be repaired at
the expense of Tenant.
10. Tenant shall not use any method of heating or air conditioning other
than that supplied by Landlord. Tenant shall not waste electricity, water or
air conditioning. Tenant shall keep corridor doors closed.
11. Landlord reserves the right to exclude from the Building between the
hours of 6 p.m. and 7 a.m. the following day, or such other hours as may be
established from time to time by Landlord, and on Sundays and legal holidays
any person unless that person is known to the person or employee in charge of
the Building and has a pass or is properly identified. Tenant shall be
responsible for all persons for whom it requests passes and shall be liable to
Landlord for all acts of such persons. Landlord shall not be liable for damages
for any error with regard to the admission to or exclusion from the Building of
any person.
12. Tenant shall close and lock the doors of its Premises and entirely shut
off all water faucets or other water apparatus and electricity, gas or air
outlets before Tenant and its employees leave the Premises. Tenant shall be
responsible for any damage or injuries sustained by other tenants or occupants
of the Building or by Landlord for noncompliance with this rule.
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13. The toilet rooms, toilet, urinals, wash bowls and other apparatus shall
not be used for any purpose other than that for which they were constructed, no
foreign substance of any kind whatsoever shall be thrown into any of them, and
the expense of any breakage, stoppage or damage resulting from the violation of
this rule shall be borne by the Tenant who, or whose employees or invitees,
shall have caused it.
14. Except as expressly permitted under this Lease, Tenant shall not install
any radio or television antenna, loudspeaker or other device on the roof or
exterior walls of the Building. Tenant shall not interfere with radio or
television broadcasting or reception from or in the Building or elsewhere.
15. Except as approved by Landlord, Tenant shall not mark, drive nails,
screw or drill into the partitions, woodwork or plaster or in any way deface
the Premises. Tenant shall not cut or bore holes for wires. Tenant shall not
affix any floor covering to the floor of the Premises in any manner except as
approved by Landlord. Tenant shall repair any damage resulting from
noncompliance with this rule.
16. Tenant shall not install, maintain or operate upon the Premises any
vending machine, except those for employee use approved in writing by Landlord.
17. Tenant shall store all its trash and garbage within its Premises. Tenant
shall not place in any trash box or receptacle any material which cannot be
disposed of in the ordinary and customary manner of trash and garbage disposal.
All garbage and refuse disposal shall be made in accordance with directions
issued from time to time by Landlord.
18. No cooking shall be done or permitted by any Tenant on the Premises,
except by the Tenant on Underwriters' Laboratory approved equipment for brewing
coffee, tea, hot chocolate and similar beverages shall be permitted provided
that such equipment and use is in accordance with all applicable federal, state
and city laws, codes, ordinances, rules and regulations and further provided
that microwave ovens shall be permitted if Underwriter's Laboratory approved
and if powered by a separate circuit installed by Tenant at its sole cost and
expense and approved by Landlord.
19. Tenant shall not use in any space or in the public halls of the Building
any hand trucks except those equipped with the rubber tires and side guards or
such other material-handling equipment as Landlord may approve. Tenant shall
not bring any other vehicles of any kind into the Building.
20. Tenant shall hot use the name of the Building in connection with or in
promoting or advertising the business of Tenant except as Tenant's address.
21. The requirements of Tenant will be attended to only upon appropriate
application to the office of the Building by an authorized individual.
Employees of Landlord shall not perform any work or do anything outside of
their regular duties unless under special instruction form Landlord, and no
employee of Landlord will admit any person (Tenant or otherwise) to any office
without specific instructions from Landlord.
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22. Landlord may waive any one or more of these Rules and Regulations for
the benefit of any particular tenant or tenants, but no such waiver by Landlord
shall be construed as a waiver of such Rules and Regulations in favor of any
other tenant or tenants, nor prevent Landlord from thereafter enforcing any
such Rules and Regulations against any or all of the tenants of the Building.
23. These Rules and Regulations are in addition to, and shall not be
construed to in any way modify or amend, in whole or in part, the terms,
covenants, agreements and conditions of any lease of premises in the Building.
24. Landlord reserves the right to make such other and reasonable rules and
regulations as in its judgment may from time to time be needed for safety and
security, for care and cleanliness of the Building and for the preservation of
good order in and about the Building. Tenant agrees to abide by all such rules
and regulations in this Exhibit C stated and any additional rules and
regulations which are adopted.
25. Tenant shall be responsible for the observance of all of the foregoing
rules by Tenant's employees, agents, clients, customers, invitees and guests.
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EXHIBIT D
attached to and made a part of Lease bearing the
Lease Reference Date of March 26, 1996 between
BENEFICIARIES OF AMERICAN NATIONAL BANK TRUST NUMBER 104601-03,
as Landlord and SOFTWARE SPECTRUM, INC., as Tenant
EXPANSION PREMISES
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