LEASE BY AND BETWEEN
MERRITT-038, LLC, LANDLORD and
ACUMEDIA MANUFACTURERS, INC., TENANT
TABLE OF CONTENT
1. Payment of Rental............................... 2
2. Use............................................. 2
3. Utilities....................................... 3
4. Compliance with Laws............................ 3
5. Assignment and Subletting....................... 4
6. Loading Capacity................................ 6
7. Increase in Landlord's Insurance Rates.......... 6
8. Insurance - Indemnity........................... 6
9. Alterations..................................... 11
10. Ownership of Alterations........................ 11
11. Repairs and Maintenance......................... 12
12. Tax and Insurance Escalation.................... 15
13. Default......................................... 17
14. Damage or Destruction........................... 21
15. Possession...................................... 22
16. Exterior or Premises - Signs.................... 23
17. (Intentionally Omitted)......................... 24
18. For Rent/Sale Signs............................. 24
19. Water and other Damage.......................... 25
20. Right of Entry.................................. 25
21. Termination of Term............................. 25
22. Condemnation.................................... 26
23. Subordination................................... 27
24. Landlord's Right to Perform Tenant's Covenants.. 28
25. Attornment...................................... 28
26. Non-Waiver of Future Enforcement................ 30
27. Personal Property Taxes......................... 30
(i)
28. Recordation of Lease............................ 31
29. Notices......................................... 31
30. Waiver of Jury Trial............................ 31
31. Severability.................................... 32
32. Non-Waiver...................................... 32
33. Successors and Assigns.......................... 33
34. (Intentionally Omitted)......................... 34
35. Notices to Mortgagee............................ 34
36. Estoppel Certificate............................ 34
37. Environmental Provisions........................ 35
38. Captions........................................ 37
39. (Intentionally Omitted)......................... 37
40. Final and Entire Agreement...................... 37
41. Representatives of the Parties.................. 37
42. Additional Rent................................. 37
43. Renewal Options................................. 37
44. Termination Option.............................. 38
45. Option to Lease Contiguous Space................ 38
46. Brokerage Commissions........................... 39
(ii)
THIS LEASE, made this 16th day of April, 1998, by and between MERRITT-038,
LLC, a Maryland limited liability company, hereinafter called "Landlord" and
ACUMEDIA MANUFACTURERS, INC., a Maryland corporation, hereinafter called
"Tenant".
WITNESSETH, that in consideration of the rental hereinafter agreed upon and
the performance of all the conditions and covenants hereinafter set forth on the
part of the Tenant to be performed, the Landlord does hereby lease unto the said
Tenant, and the latter does hereby rent from the former the following premises
(hereinafter sometimes called the "premises"):
BEING THOSE PREMISES OUTLINED IN RED ON THE PLAT ATTACHED HERETO AS EXHIBIT
A, SAID PREMISES BEING LOCATED WITHIN THE BUILDING KNOWN AS 9601 PULASKI PARK
DRIVE, BALTIMORE, MARYLAND 21220; SAID PREMISES CONTAINING APPROXIMATELY TWELVE
THOUSAND SIX HUNDRED (12,600) SQUARE FEET AND BEING KNOWN AS SUITE 112-114;
for the term of five (5) years, beginning on the first day of July, 1998, and
ending on the last day of June, 2003, at and for the rental as follows:
Per Rentable
Term Annually Monthly Square Foot
---- -------- ------- ----------
Year 1 $75,600.00 $6,300.00 $6.00
Year 2 75,600.00 6,300.00 6.00
Year 3 77,490.00 6,457.50 6.15
Year 4 79,380.00 6,615.00 6.30
Year 5 81,412.93 6,784.41 6.46
All such rentals shall be payable in advance on the first day of each and every
month during the term of this Lease, without setoff or deduction whatsoever. If
the term of this Lease shall commence on a date other than the first day of a
month, the rental for the period from the date of commencement of the term to
the first day of the first full calendar month of the term shall be prorated and
shall be payable on the first day of the term; if the term of this Lease shall
end on a date other than the last day of the month of
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the term to the date the term ends shall be prorated and shall be payable on
the first day of the last month of the term.
All rentals shall be paid to Merritt Properties, LLC at 2066 Lord Baltimore
Drive, Baltimore, Maryland 21244, or at such other place or to such appointee of
the Landlord as the Landlord may from time to time designate in writing.
This lease is made subject to the following additional terms, covenants and
conditions:
1. PAYMENT OF RENTAL. Tenant covenants and agrees to pay the rental
herein reserved and each installment thereof promptly when and as due, without
setoff or deduction whatsoever. Tenant further agrees that it will not prepay
rent more than one (1) month in advance without Landlord's prior written
consent.
2. USE. Tenant covenants and agrees to use and occupy the premises solely
for the following purposes: receiving, manufacturing, storing, shipping and
selling (other than retail) products, materials and merchandise made and/or
distributed by Tenant or Tenant's affiliates, including, without limitation, the
operation of a clinical laboratory by Tenant or Tenant's affiliates. Tenant
agrees to comply with all applicable zoning and other laws and regulations, and
provide and install at its own expense any additional equipment or alterations
required to comply with all such laws and regulations as required to comply with
all such laws and regulations as required from time to time necessitated solely
as the result of Tenant's use and occupancy of the premises and/or any
alterations or installations made by Tenant thereto. Tenant will not permit,
allow or cause any public or private auction sales or sheriffs' or constables'
sales to be conducted on or from the premises. Subject to all of the provisions
of this Lease and any causes beyond Landlord's control, Tenant shall be entitled
to access to the premises and the common areas of the project twenty-four (24)
hours per day, seven (7) days per week, during the Lease term.
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3. UTILITIES.
(a) Tenant agrees to pay as additional rent for Tenant's use of water,
based upon a separate water meter for the premises, and Tenant will pay all
water charges for the premises based on such meter readings. Tenant shall also
pay its pro rata share of sewer service charges, based upon the size of the
premises in proportion to the total square footage of the building in which the
premises is located.
(b) Tenant shall pay all costs of electricity, gas, telephone and
other utilities used or consumed exclusively on or for the premises, together
with all taxes, levies or other charges on such utilities. If Tenant defaults
in payment of any such utilities, charges or taxes, Landlord may, at its option,
pay the same for and on Tenant's account, in which event Tenant shall promptly
reimburse Landlord therefor.
(c) In addition, Tenant shall pay, as additional rent, ten and
sixteen-hundredths percent (10.16%) (being the same percentage which the square
foot floor area of the premises bears to the entire leasable area of the
building) of actual out-of-pocket costs incurred by Landlord for electric usage,
for lighting the parking and other common areas, which sum shall be due within
fifteen (15) days after Landlord's demand.
4. COMPLIANCE WITH LAWS.
(a) Subject to Landlord's covenants, warranties and representations
set forth in this Lease and the Exhibits thereto, Tenant covenants and agrees
that it will, at its own expense, observe, comply with and execute all laws,
orders, rules, requirements and regulations of any and all governmental
departments, bodies, bureaus, agencies and officers, and all rules, directions,
requirements and recommendations of the local board of fire underwriters and the
fire insurance rating organizations having jurisdiction over the area in
which the premises are situated, or other bodies or agencies now or hereafter
exercising similar functions in the area in
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which the premises are situated, in any way pertaining to the premises or the
use and occupancy of the premises. In the event Tenant shall fail or neglect to
comply with any of the aforesaid laws, orders, rules, requirements or
recommendations, Landlord or its agents may, after giving Tenant written notice
of such failure and thirty (30) days to cure the same (provided that in case of
emergency, the time for cure by Tenant shall be reduced commensurate with the
emergency) enter the premises and take all such action and do all such work in
or to the premises and take all such action and do all such work in or to the
premises as may be necessary in order to cause compliance with such laws,
orders, rules, requirements or recommendations, and Tenant covenants and agrees
to reimburse Landlord promptly upon demand for the actual out-of-pocket expense
incurred by Landlord in taking such action and performing such work.
(b) Landlord covenants and agrees that, at the time Landlord delivers
possession of the premises to Tenant, the building, including the premises, will
be in compliance with all applicable governmental laws, statutes, ordinances,
codes and regulations.
5. ASSIGNMENT AND SUBLETTING.
(a) Except as hereinafter provided, Tenant covenants and agrees not to
assign this Lease, in whole or in part, nor sublet the premises, or any part or
portion thereof, nor grant any license or concession for all or any part
thereof, without the prior written consent of the Landlord in each instance
first had and obtained, which consent shall not be unreasonably withheld,
conditioned or delayed.
If such assignment or subletting is permitted, Tenant shall not be
relieved from any liability whatsoever under this Lease. In the event that the
amount of the rent or other consideration to be paid to the Tenant by any
assignee or sublessee for the premises is greater than the rent required to be
paid by the Tenant to the Landlord pursuant to this Lease, Tenant shall pay to
Landlord fifty percent (50%) of any such
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excess as is received by Tenant from such assignee or sublessee after deducting
therefrom the costs and expenses incurred by Tenant in connection with any such
assignment or sublease, including, without limitation, any brokerage commission,
tenant improvement allowance and any legal fees and costs. Landlord shall have
the right, after reasonable advance written notice to Tenant, to examine
Tenant's books and records pertaining to all of such costs and expenses, as well
as all documents pertaining to the assignment or sublease. Any consent by
Landlord to an assignment or subletting of this Lease shall not constitute a
waiver of the necessity of such consent as to any subsequent assignment or
subletting. An assignment for the benefit of Tenant's creditors or otherwise by
operation of law shall not be effective to transfer or assign Tenant's interest
under this Lease unless Landlord shall have first consented thereto in writing.
(b) Notwithstanding paragraph 5(a) above, Tenant may, without the
Landlord's consent, assign this Lease, or sublease the premises in whole or in
part, to any of the following (collectively, "Permitted Transfers"): (i) any
entity which has the power to direct Tenant's management and operation, or any
entity whose management and operation are controlled by Tenant; (ii) any entity
a majority of whose stock or beneficial ownership interest is owned by Tenant;
(iii) any entity in which, or with which, Tenant, or its successors or assigns,
is merged or consolidated, in accordance with applicable statutory provisions
for merger or consolidation of entities; (iv) any entity acquiring all, or
substantially all, of Tenant's assets; (v) any successor to a successor entity
becoming such by either of the methods described in clauses (iii) or (iv)
hereof; or (vi) any other affiliate of Tenant. Tenant shall notify Landlord in
writing of any Permitted Transfer. Tenant shall remain fully liable for all of
Tenant's obligations and covenants under this Lease notwithstanding any such
Permitted Transfer unless Tenant's corporate existence is extinguished as the
result thereof. Notwithstanding the
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foregoing, if, as a result of a Permitted Transfer, Tenant's corporate existence
would be extinguished, such transfer shall only be permitted if the successor
entity has a net worth which is at least equal to Tenant's net worth prior to
such transfer, as certified to Landlord by Tenant's certified public accountant
not less than five (5) business days prior to the proposed transfer.
6. LOADING CAPACITY. Tenant covenants and agrees not to load the premises
beyond its carrying or loading capacity, which capacity Landlord represents to
be not less than one hundred seventy-five (175) pounds per square foot.
7. INCREASE IN LANDLORD'S INSURANCE RATES. Tenant will not do, or suffer
to be done, anything in or about the premises, or keep or suffer to be kept,
anything in or about the premises which will contravene or affect any policy of
insurance against loss by fire or other hazards, including, but not limited to,
public liability, now existing or which the Landlord may hereafter place
thereon, or which will prevent the Landlord from procuring such policies in
companies acceptable to Landlord at standard rates. Notwithstanding the
foregoing, Landlord represents and warrants to Tenant that, as of the date
hereof, the permitted uses of the premises by Tenant, as set forth in Section 2
hereof, do not violate any of the provisions of the immediately preceding
sentence so long as Tenant complies with all requirements of Landlord's insurer.
8. INSURANCE - LIABILITY.
(a) Tenant covenants and agrees that from and after the date of
delivery of the premises from Landlord to Tenant, Tenant will carry and
maintain, at its sole cost and expense and in the amounts specified and in the
form hereinafter provided, the following type of insurance:
(i) Public Liability and Property Damage.
Commercial General Liability Insurance covering the premises and tenant's
use thereof against claims for personal injury or death and property damage
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occurring upon, in or about the premises, such insurance to afford
protection to the limit of not less than $2,000,000 arising out of any one
occurrence, and against property damage to afford protection to the limit
of not less than $2,000,000; or such insurance may be for a combined single
limit of $2,000,000 per occurrence. The insurance coverage required under
this Section 8 (a) (i) shall, in addition, extend to any liability of
Tenant arising out of Tenant's indemnities hereinafter provided, as well as
Independent Contractors' Liability, Products/Completed Operations
Liability, Personal Injury Liability and Contractual Liability.
(ii) Tenant Improvements and Property. Insurance covering all
leasehold improvements and other improvements installed by Tenant upon the
premises, trade fixtures and personal property from time to time in, on or
upon the premises and any alterations, improvements, additions or changes
made by Tenant thereto in an amount not less than one hundred percent
(100%) of their full replacement cost from time to time during the Lease
term, providing protection against perils included within the standard form
of fire and extended coverage insurance policy issued by a company
authorized to do business in Maryland, together with insurance against
sprinkler leakage or other sprinkler damage, vandalism and malicious
mischief. Any policy proceeds from such insurance, so long as this Lease
shall remain in effect, shall be held in trust by Tenant's insurance
company first for the repair, reconstruction, restoration or replacement of
the property damaged or destroyed.
(iii) Plate Glass. Plate glass insurance covering all plate
glass in the premises. Tenant shall be and remain liable for the repair
and restoration of all such plate glass.
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(b) All polices of insurance to be provided by Tenant shall be issued
in form acceptable to Landlord by insurance companies with general policyholder
's rating of not less than A and a financial rating of AAA as rated in the most
current available "Best's" Insurance Reports, and qualified to do business in
Maryland. Each such policy shall be issued in the name of Tenant with Landlord
named as an additional insured on the liability policy only. A certificate shall
be delivered to Landlord within ten (10) days after delivery of possession of
the premises to Tenant and thereafter at least fifteen (15) days prior to the
expiration of each such policy. As often as any such policy shall expire or
terminate, renewal or additional policies shall be procured and maintained by
Tenant in like manner and to like extent. All such policies of insurance shall
contain a provision that the company writing said policy will give to Landlord
at least thirty (30) days' notice in writing in advance of any cancellations, or
lapse, or the effective date of any reduction in the amounts of insurance. In
the event Tenant shall fail to promptly furnish any insurance herein required,
Landlord may effect the same for a period not exceeding one (1) year and Tenant
shall promptly reimburse Landlord upon demand, as additional rent, the premium
so paid by Landlord. If, upon Tenant's failure, rather than purchase separate
insurance coverage, Landlord chooses to include Tenant's coverage under
Landlord's insurance policies, then Tenant shall promptly reimburse Landlord
upon demand, as additional rent, the actual increase in Landlord's premium
resulting therefrom. All such public liability, property damage and other
casualty policies shall be written as primary policies which do not contribute
to and are not in excess of coverage which Landlord may carry. All such public
liability and property damage policies shall contain a provision that Landlord
shall nevertheless be entitled to recover under said policies for any loss
occasioned to it, its servants, agents and employees by reason of the negligence
of Tenant or any other named assured. Any insurance provided for may be affected
by a policy or policies of blanket insurance, covering additional items or
8
locations; provided, however, that (i) Landlord shall be named as additional
assured thereunder as its interests may appear; (ii) the coverage afforded
Landlord will not be reduced or diminished by reason of the use of such blanket
policy of insurance; (iii) any such policy or policies (except any covering the
risks referred to in paragraph (i), shall specify therein (or Tenant shall
furnish Landlord with a written statement from the insurers under such policy
specifying) the amount of the total insurance allocated to the "Tenant
Improvements and Property" more specifically detailed in paragraph (iii), above;
and (iv) the requirements set forth herein are otherwise satisfied.
(c) Tenant shall, and does hereby, defend, indemnify and hold harmless
Landlord and any other parties in interest set forth in paragraph (b), above,
from and against any and all liabilities, fines, claims, damages and actions,
costs and expenses of any kind or nature (including attorney's fees) and of
anyone whatsoever (collectively, "Liabilities") (i) relating to or arising from
the use and occupancy of the premises; (ii) due to or arising out of any
mechanic's lien filed against the building, or any part thereof, for labor
performed or for materials furnished or claimed to be furnished to Tenant (other
than the work to be performed by Landlord pursuant to Exhibit B hereof), or
(iii) due to or arising out of any breach, violation or nonperformance of any
covenant, condition or agreement in this Lease set forth and contained on the
part of Tenant to be fulfilled, kept, observed or performed, except to the
extent such damage or injury shall be occasioned by the negligence or willful
act or omission of the Landlord, in which event, Landlord shall defend,
indemnify and hold harmless Tenant to the extent of such negligence or willful
act or omission.
(d) Landlord shall maintain insurance through individual or blanket
policies insuring the premises against fire and extended coverage (including
"all risk" coverage) for not less than ninety percent (90%) of the replacement
cost of the building of which the premises is a part, with deductibles in the
form and endorsements of such
9
coverage as selected by Landlord, together with rental abatement insurance
against loss of rent in an amount equal to the amount of rent for a period of at
least twelve (12) months commencing on the date of loss. Landlord shall also
carry Commercial General Liability Insurance in the same amounts and forms as
that required of Tenant under paragraph 8 (a) hereof. Landlord may also carry
such other insurance as Landlord may deem prudent or advisable. The insurance
required to be carried by Landlord hereunder may be carried instead by
Landlord's general contractor during the period of construction of the building.
(e) Landlord shall, and does hereby, indemnify, defend and hold
harmless Tenant and Tenant's officers, directors, employees and agents
(collectively, "Tenant Parties") from and against all Liabilities (as defend in
paragraph 8 (c) above) relating to, or arising from, (i) the use and occupancy
of any part of the project of which the premises is a part by Landlord or
Landlord's agents or employees, and (ii) the breach, violation or nonperformance
of any covenant, condition or agreement in this Lease set forth and contained on
the part of Landlord to be fulfilled, kept, observed or performed, as the case
may be.
(f) Notwithstanding any other provision in this Lease to the contrary,
Landlord and Tenant each waive any right to recover against the other for claims
for damages to Tenant's personal property or the premises/building, as
applicable, whether or not covered by insurance, regardless of the cause or
origin, including, without limitation, the negligence of either Landlord or
Tenant. This provision is intended to waive fully, and for the benefit of
Tenant and Landlord, any rights and/or claims which might give rise to a right
of subrogation in favor of any insurance carrier. The coverage obtained by
Landlord and Tenant, respectively, pursuant to this Lease shall include, without
limitation, a waiver of subrogation endorsement attached to the certificate of
insurance. Notwithstanding any of the foregoing provisions of this paragraph,
if either
10
party cannot procure such waiver of subrogation endorsement without substantial
increased premium cost, the provisions of this paragraph shall no longer be
applicable unless the other party agrees to pay such increased premium cost.
9. ALTERATIONS. Tenant shall not make any alterations to the premises, or
any part thereof, without prior written consent of Landlord in each instance
first had and obtained. If Tenant shall desire to make such alterations, plans
for the same shall first be submitted to and approved by Landlord, such approval
not to be unreasonably withheld, conditioned or delayed, and all work and
installations shall be performed by Tenant at its own expense in accordance with
approved plans. Tenant agrees that all such work shall be done in a good and
workmanlike manner, that the structural integrity of the building shall not be
impaired, and that no liens shall attach to the premises by reason thereof.
Tenant agrees to obtain, at Tenant's expense, all permits required for such
alterations. Notwithstanding the foregoing, Tenant shall be entitled to make
non-structural interior alterations to the premises without Landlord's consent
if (i) Landlord's mortgage or deed of trust permits such alterations to be made
without the consent of the mortgagee or holder of the deed of trust, (ii) such
alterations do not cost in excess of Twenty-five Thousand Dollars ($25,000.00)
per occurrence, and (iii) do not affect the mechanical systems within the
building or impair the structural integrity thereof. Tenant shall, however,
submit plans and specifications to Landlord for all such alterations, whether or
not the same are subject to Landlord's approval.
10. OWNERSHIP OF ALTERATIONS. Unless Landlord shall elect in writing that
all or part of any alteration made by Tenant to the premises (including any
alteration consented to by Landlord pursuant to Section 9 hereof) excluding,
however, Landlord's work and installations in accordance with Exhibit B hereto,
which Tenant shall have no obligation to remove, shall remain on the premises
after the termination of this Lease (which election shall be made by Landlord,
if at all, at the time Tenant seeks Landlord's
11
consent), the premises shall be restored by Tenant before the expiration of this
Lease, at Tenant's sole expense to the condition that existed as of the date
Tenant took possession of the premises, reasonable wear and tear and/or damage
from casualty or condemnation excepted. Upon such written election by Landlord,
any such alterations, improvements, betterments or mechanical equipment,
including but not limited to, heating and air conditioning systems, excluding,
however, Tenant's trade fixtures, equipment, furniture and other personal
property, shall become the property of Landlord as soon as they are affixed to
the premises, and all right, title and interest thereof of Tenant shall
immediately cease, unless otherwise agreed to in writing by Landlord. Tenant
shall promptly pay any franchise, minor privilege or other tax or assessment
resulting directly or indirectly from any alterations or improvements made by
Tenant to the premises. Tenant shall repair promptly, at its own expense, any
damage to the premises caused by bringing into the premises any property for
Tenant's use, or by the installation or removal of such property, regardless of
fault or by whom such damage shall be caused, except to the extent that such
damage was caused by Landlord, its agents, contractors or employees.
11. REPAIRS AND MAINTENANCE.
(a) Except for the work to be performed by Landlord in accordance with
Exhibit B hereto ("Landlord's work"), the premises hereby leased are leased to
Tenant "as is". Except for Landlord's Work and as otherwise set forth in this
Section 11, Landlord shall be under no liability, nor have any obligation to do
any work or make any repairs in or to the premises, and any work which may be
necessary to outfit the premises for Tenant's occupancy or for the operation of
Tenant's business therein is the sole responsibility of Tenant and shall be
performed by Tenant at its own cost and expense. Tenant acknowledges that it
has fully inspected the premises prior to the execution of this Lease, and
Tenant further acknowledges that Landlord has made no
12
warranties or representations with respect to the condition or state of repairs
of the premises, except for warranties provided by Landlord in Exhibit B.
(b) Tenant will, during the term of this Lease, keep the premises
(including windows, doors, plumbing, heating and electrical facilities and
installations exclusively serving the premises) in good order and repair and
will make all necessary repairs thereof at its own expense. Landlord will,
during the term of this Lease, keep, maintain and make all necessary repairs
(except painting) to the exterior masonry walls and roof of the premises, the
roof membrane, flashings and downspouts, all load-bearing walls (including load-
bearing demising walls), all utility systems not serving the premises
exclusively and all common areas of the project, at Landlord's sole cost and
expense, after being notified in writing by Tenant of the need for such repairs,
and shall have a reasonable time in which to complete such repairs. Tenant
agrees to carry a maintenance and/or service agreement or policy on the HVAC
system in the demised premises. This agreement or policy shall be carried
throughout the term of this Lease and any renewals or extensions thereof.
Tenant shall provide Landlord with a copy of such policy or a certificate
evidencing such coverage. In the event that the repairs required to be made by
Landlord are necessitated as a result of negligence or misuse by Tenant, its
agents, servants, employees, licensees or guests, or by any contractor engaged
by or on behalf of Tenant, such repairs shall be made by and be paid for by
Tenant. Tenant agrees to pay, as additional rent, Tenant's pro rata share of
snow and ice removal expense, based upon the size of the premises in proportion
to the total square footage of the building in which the premises are located.
Tenant will, at the expiration of the term or at the sooner termination thereof
by forfeiture or otherwise, deliver up the premises in the same good order and
condition as they were at the beginning of the tenancy, reasonable wear and tear
and damage from casualty or condemnation excepted. Tenant further agrees that
it will maintain the premises at its
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own expense in a clean, orderly and sanitary condition, free of insects,
rodents, vermin, and other pests; and that it will not permit undue accumulation
of garbage, trash, rubbish or other refuse, but will remove the same at its own
expense and will keep such refuse in proper containers within the interior of
the premises until called for to be removed other than one (1) exterior trash
container which Tenant may maintain in a location mutually acceptable to
Landlord and Tenant. Tenant further agrees that it will not install any
additional electrical wiring, other than minor circuitry/wiring for Tenant's
equipment used at the premises, or plumbing unless it has first obtained
Landlord's written consent thereto, and, if such consent is given, Tenant will
install the same at its own cost and expense, and Tenant shall obtain, at
Tenant's expense, all permits required for such installation.
(c) In the event Tenant shall not proceed promptly and diligently to
make any repairs or perform any obligation imposed upon it by subparagraphs (a)
and (b) hereof within thirty (30) days after receiving written notice from
Landlord to make such repairs or perform such obligation (provided that in the
event of an emergency, the time for cure by Tenant shall be reduced commensurate
with the emergency), then and in such event, Landlord may, at its option, enter
the premises and do and perform the things specified in said notice, without
liability on the part of Landlord for any loss or damage resulting from any such
action by Landlord, and Tenant agrees to pay promptly upon demand any actual
out-of-pocket cost or expense incurred by Landlord in taking such action.
(d) If (i) Landlord fails to commence the on-site physical performance
of any item of repair or maintenance required to be performed by Landlord under
this Lease, fails to correct any defect or deficiency that is subject to any
warranty of Landlord under this lease, or fails to restore any utilities serving
the premises that are interrupted as a result of the willful act or negligence
of Landlord or its agents,
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employees or contractors, (ii) such failure exceeds thirty (30) days after
written notice from Tenant to Landlord setting forth the need for same (provided
that in the event of an emergency, the time for Landlord's performance in
accordance with clause (i) shall be reduced commensurate with the emergency),
and (iii) the need for such repair or maintenance materially affects Tenant's
use or enjoyment of the premises or access to or parking for the premises, then
Tenant may (as its non-exclusive remedy), but shall not be obligated to, perform
such item of repair or maintenance, in which event Landlord shall reimburse
Tenant for Tenant's actual out-of-pocket costs and expenses within thirty (30)
days following receipt by Landlord of an itemized list of such costs and
expenses, together with copies of paid bills or receipts.
12. TAX AND INSURANCE ESCALATION.
(a) The premises hereby leased comprise approximately ten and sixteen-
hundredths percent (10.16%) of the total land and building within which the
premises is located.
(b) Tenant covenants and agrees to pay Landlord, as additional rent,
ten and sixteen-hundredths percent (10.16%) of any increase in real estate taxes
assessed against the land and/or building in excess of the taxes for the
1998/1999 fiscal year (provided that if the building is not assessed as a
"completed improvement" during the 1998/1999 fiscal year, then the base year for
purposes of such computation shall be the first fiscal year in which such
assessment is made), whether as a result of an increase in the tax rate, or the
levy, assessment or imposition of any tax on real estate as such not now levied,
assessed or imposed, which payment shall be due and payable within thirty (30)
days after Landlord's written demand. The foregoing shall apply to increases in
real estate taxes assessed against the land or building(s) generally, and not
resulting from improvements placed thereon by Tenant. In the event of any
increases in real estate taxes resulting from improvements, alterations or
additions
15
made by Tenant, Tenant shall pay the entire amount of said increase. If this
Lease shall be in effect for less than a full fiscal year, Tenant shall pay a
pro rata share of taxes, based upon the number of months that this Lease is in
effect. "Taxes" as used herein shall include, but not by way of limitation, all
paving taxes, special paving taxes, Metropolitan District charges, and any and
all other benefits or assessments which may be levied on the premises or the
land or building(s) in which the same are situate, but shall not include any
income tax on the income or rent payable hereunder. "Taxes" shall also include
all reasonable expenses incurred by Landlord (including attorney's fees and
costs) in contesting any increase in, or applying for any reduction of, a tax
assessment, if, and only to the extent, such contest results in a reduction of
the assessed value of the project. In addition to any other limitations
contained in this Lease, Tenant's proportionate share of taxes levied or
assessed against the premises and/or the project shall exclude (i) any federal,
state or local documentary transfer taxes or stamps or similar taxes relating to
the sale, transfer or other change in ownership in ownership of the premises or
the property, or any portion thereof or interest therein, and (ii) any late or
delinquency fees, penalties or costs associated with the late payment taxes.
(c) Tenant also covenants and agrees to pay Landlord, as additional
rent, ten and sixteen-hundredths percent (10.16%) of any increase in insurance
premiums (as hereinafter defined) in excess of the annualized premiums for the
most recent policy period in which the premium includes a charge for the
completed building, which payment shall be due and payable within thirty (30)
days after Landlord's written demand. As used herein, "insurance premiums"
means the total premium cost of all insurance carried by Landlord with respect
to the building within which the premises is located, together with adjacent
parking area used exclusively for the said building, including, but not limited
to, all Real Property and Rental Value perils insured against
16
under an "All Risk" insuring agreement, primary General Liability insurance and
Umbrella and/or Excess Liability insurance.
13. DEFAULT.
(a) Any of the following events shall constitute a default by Tenant:
(i) If the rent (basic or additional) shall be in arrears, in
whole or in part, for ten (10) days after written default notice from
Landlord to Tenant (provided that Landlord shall be required to only give
two (2) such written default notices during any calendar year within the
Lease term); or
(ii) If Tenant shall have failed to perform any other term,
condition, or covenant of this Lease on its part to be performed for a
period of thirty (30) days after written notice of such failure from
Landlord; provided, however, that if any such failure cannot reasonably be
cured within such thirty (30) day period, Tenant shall not be deemed in
default hereunder so long as Tenant commences to cure such failure within
such thirty (30) day period and continues diligently thereafter until the
failure is fully cured; or
(iii)If Tenant is adjudicated as bankrupt or insolvent by any
court of competent jurisdiction, or if any such court enters an order,
judgment or decree finally approving any petition against Tenant seeking
reorganization, liquidation, dissolution or similar relief, or if a
receiver, trustee, liquidator or conservator is appointed for all or
substantially all of Tenant's assets and such appointment is not vacated
within sixty (60) days after the appointment, or if Tenant seeks or
consents to any of the relief hereinabove enumerated in this subparagraph
(iii) or files a voluntary petition in bankruptcy or insolvency or makes an
assignment of all or substantially all of its assets for the benefit of
creditors or admits in writing of its inability to pay its debts generally
as they come due or files Articles of Dissolution, or similar writing
indicating its intention
17
to wind up or liquidate its business, with the appropriate authority of the
place of its incorporation; or
(iv) If Tenant's leasehold interest under this Lease is sold under
execution, attachment or decree of court to satisfy any debt of Tenant, or
if any lien (including a mechanic's lien) is filed against Tenant's
leasehold interest and is not discharged or bonded over within ten (10)
business days after Tenant's actual knowledge thereof.
(b) In the event of default as defined in paragraph (a) hereof,
Landlord, in addition to any and all legal and equitable remedies it may have,
shall have the following remedies:
(i) To distrain for any rent or additional rent in default;
provided such right of distraint shall be subordinate to the rights of any
lender of Tenant having a security interest in Tenant's property as set
forth in paragraph (d) of this Section 13.
(ii) At any time after default, without notice, to declare this
Lease terminated and enter the premises with legal process; and in such
event Landlord shall have the benefit of all provisions of law now or
hereafter in force respecting the speedy recovery of possession form
Tenant's holding over or proceedings in forcible entry and detainer, and
Tenant waives any and all provisions for notice under such laws.
Notwithstanding such re-entry and/or termination, Tenant shall
immediately be liable to Landlord for the sum of the following: (a) all rent an
additonal rent then in arrears, without apportionment to the termination date,
including Tenant's contribution to taxes under paragraph 12 for the year of
termination, whether such termination is before or after July 1st of such year;
(b) all other liabilities of Tenant and damages sustained by Landlord as a
result of Tenant's default, including, but not limited
18
to, the reasonable costsof reletting the premises and any broker's commissions
payable as a result thereof; (c) all of Landlord's costs and expenses (including
reasonable counsel fees) in connection with such default and recovery of
possession; (d) the difference between the rent reserved under this Lease for
the balance of the term and the fair rental value of the premises for the
balance of the term to be determined as of the date of re-entry, if the rent
reserved under this Lease for the balance of the term exceeds the fair rental
value of the premises for the balance of the term as of such date; or at
Landlord's option in lieu thereof, Tenant shall pay the amount of the rent and
additional rent reserved under this Lease at the times herein stipulated for
payment of rent and additional rent for the balance of the term, less any amount
received by Landlord during such period from others to whom the premises may be
rented on such terms and conditions and at such rentals as Landlord, in its sole
discretion, shall deem proper; and (e) any other damages recoverable by law. In
the event Landlord brings any action against Tenant to enforce compliance by
Tenant with any covenant or condition of this Lease, including the covenant to
pay rent, and it is judicially determined that Tenant has defaulted in
performing or complying with any such covenant or condition, then and in such
event, Tenant shall pay to Landlord all costs and expenses incurred by Landlord
in bringing and prosecuting such action against Tenant, including reasonable
attorney's fees.
(c) In the event Tenant fails to pay Landlord any rental payment or
other charge due hereunder within five (5) days from the date on which any such
payment was due, Landlord may, at its option, charge Tenant a late charge equal
to ten percent (10%) of the rental payment or other such charge, which late
charge shall be collectible as additional rent and shall be payable by Tenant to
Landlord within ten (10) days after written notice from Landlord to Tenant
assessing the same; provided tha tno late charge shall be due on the first
delinquent installment of base rent during each
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Lease year so long as tenant pays to Landlord such delinquent installment of
base rent within five (5) days after written notice from Landlord that such base
rent amount is past due. After such first delinquent notice during any Lease
year, Landlord may assess a late charge without prior notice to Tenant if any
rental installment is not paid within five (5) days from the due date. In
addition, any such rental payment or other charge which is delinquent for ten
(10) days or more, shall bear interest from the date on which same was due at
the prime rate of interest then being charged by NationsBank to its most favored
commercial customers.
(d) Landlord hereby agrees to subordinate Landlord's right of
distraint with respect to the personal property (trade fixtures, equipment and
merchandise) of Tenant from time to time located within the premises ("Tenant's
Property") to a contractual lien or other security interest given by Tenant to a
lender ("Tenant's Lender") whose loan is secured by such lien or security
interest in Tenant's Property. Landlord agrees to permit Tenant's Lender to go
upon the premises at such times and under such conditions as shall be reasonably
designated by Landlord for the purpose of removing Tenant's Property after the
effective date of any termination of this Lease or any repossession of the
premises by Landlord, provided such removal does not waive or defeat Landlord's
right of distraint (which shall at all times be subordinate to the prior rights
of Tenant's Lender) provided Tenant's Lender agrees in writing to repair any
damage to the premises caused by the removal of Tenant's Property and to
indemnify, protect, defend (with counsel reasonably acceptable to Landlord) and
hold harmless Landlord from and against any and all claims, actions, losses,
costs and fees (including reasonable attorney's fees) and liabilities resulting
from or in connection with the entry onto the premises by Tenant's Lender or its
agents. Landlord further agrees to execute and deliver such instruments
reasonably requested by Tenant's Lender, and in form and
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content reasonably satisfactory to Landlord, from time to time to evidence or
effect the aforesaid subordination and agreements of Landlord.
14. DAMAGE OR DESTRUCTION.
(a) If, during the Lease term, the premises hereby leased are damaged
by fire or other casualty, but not to the extent that Tenant is prevented from
carrying on business in the premises, Landlord shall promptly cause such damage
to be repaired; if such damage renders a substantial portion of the premises
untenantable, the rent reserved hereunder shall be reduced during the period of
its untenantability proportionately to the amount by which the area so rendered
untenantable bears to the entire area leased hereunder, and such reduction shall
be apportioned from the date of the casualty to the date when the leased
premises are rendered fully tenantable. Notwithstanding the foregoing, in the
event such fire or other casualty damages or destroys any of Tenant's leasehold
improvements (other than Landlord's Work), alterations, betterments, fixtures or
equipment, Tenant shall cause the same to be repaired or restored at Tenant's
sole cost and expense and Landlord shall have no liability for the restoration
or repair thereof except for Landlord's work.
(b) If , during the Lease term, a substantial portion of the building
in which the premises is situated (including all, or a portion of, the premises
itself) are rendered wholly untenantable as the result of fire, the elements,
unavoidable accident or other casualty (collectively, "Casualty"), Landlord
shall have the option either to restore the premises to their condition
immediately prior to the casualty or to terminate this Lease, such option shall
be exercised by Landlord by written notice to Tenant within thirty (30) days
after the Casualty. In the event of such termination, the rent reserved
hereunder shall be adjusted as of the date of the Casualty. If Landlord elects
to restore the premises, such restoration shall be completed as promptly as
reasonably possible
21
and the rent reserved hereunder shall abate until the premises are again
rendered tenantable.
(c) Notwithstanding the foregoing provisions of this Section 14, if
(i) following a Casualty, Tenant requests notice from Landlord as to the
probable time for completion of the repair or restoration of the premises,
Landlord notifies Tenant in writing (which notice shall be given within thirty
(30) days following Tenant's request) that Landlord in good faith estimates that
the repair or restoration will not be substantially completed within one hundred
twenty (120) days from the date of the Casualty, or (ii) the Casualty occurs
during the final year of the Lease term, then and in such event, Tenant shall
have the right to terminate this Lease, provided Tenant gives Landlord written
termination notice after the expiration of such one hundred twenty (120) day
period, (but prior to substantial repair or restoration of the premises), or
within fifteen (15) days after a Casualty occurring in the last year of its
term, whichever is applicable, in which event the rent and other charges
payable hereunder shall be adjusted as of the date of the Casualty.
15. POSSESSION.
(a) In case possession of the premises, in whole or in part, cannot be
given to Tenant on or before the commencement of the term of this Lease,
landord agrees to abate the rent until possession is given to Tenant with
Landlord's Work substantially completed in accordance with Exhibit B hereto, and
Tenant agrees to accept such abatement as liquidated damages (and the additional
damages that may become due under paragraph 15(c) below) for the failure to
obtain possession on the commencement date herein specified. The parties hereto
covenant and agree that if the term of this Lease commences on a date other than
the date herein specified, they will, upon the request of either of them,
execute an agreement setting for the the new commencement and termination dates
of the Lease term. Under no circumstances
22
shall Landlord be under any liability for failure to deliver possession of the
premises to Tenant on the date herein specified, except as expressly provided in
paragraph 15(c) below.
(b) Notwithstanding anything to the contrary contained in this Lease,
Tenant shall have the right to enter the premises at least thirty (30) days
prior to the Lease commencement date to install phone systems, furniture,
fixtures and equipment, etc. (collectively, the "Early Entry Activities") and
such early entry for such purposes shall not trigger the commencement date.
Tenant agrees (i) any such early entry by Tenant shall be at Tenant's sole risk,
(ii) Tenant shall not substantially interfere with Landlord or Landlord's
contractors completing work within the premises, and (iii) Tenant shall comply
with and be bound by all provisions of this Lease during the period of such
early entry, except for payment of rent which shall begin to accrue as of the
Lease commencement date.
(c) In the event Landlord's Work has not been substantially completed
in accordance with Exhibit B hereto by August 1, 1998, Tenant shall be entitled
to an abatement of rent equal to two (2) days abatement for each day of delay
beyond August 1, 1998, until the date of substantial completion of Landlord's
Work. Further, notwithstanding anything to the contrary contained herein, if
possession of the premises is not tendered to Tenant will all of Landlord's Work
substantially completed in accordance with Exhibit B hereto on or before October
1, 1998, Tenant shall be entitled to terminate this Lease by delivering written
termination notice to Landlord so long as such notice is delivered to Landlord
prior to Landlord's substantial completion of Landlord's Work.
16. EXTERIOR OF PREMISES - SIGNS.
(a) Tenant covenants and agrees that it will not place or permit any
sign, billboard, marquee, lights, awning, poles, placard, advertising matter, or
other
23
thing of any kind, in or about the exterior of the premises or the building in
which the premises are situate, nor paint or make any change in, to or on the
exterior of said premises to change the uniform architecture, paint or
appearance of the building, without in each such instance obtaining the prior
written consent of Landlord, which consent shall not be unreasonably withheld,
conditioned or delayed. In the event such consent is given, Tenant agrees to pay
any minor privilege or other tax that may be chargeable by any governmental
authority arising as a result of any such installation immediately when due.
Tenant shall obtain, at Tenant's expense, all permits required for such
installation. Tenant further agrees to maintain any sign, billboard, marquee,
awning, decoration, placard, or advertising matter or other thing of any kind as
may be approved by Landlord in good condition and repair at all times.
(b) Tenant further covenants and agrees not to pile or place anything
on the sidewalk, parking lot or other exterior portion of the premises or
building or in the front, rear or sides of the building, nor block the sidewalk,
parking lot or other exterior portion of the premises or building, nor do
anything that directly or indirectly will materially interfere with any of the
rights of ingress or eqress or of light from any other tenant, nor do anything
which will, in any way, change the uniform and general design of any property of
Landlord in which the premises are situate.
17. (Intentionally Omitted)
18. FOR RENT/SALE SIGNS. Landlord shall have the right to place a "For
Rent" sign on any portion of said premises for six (6) months prior to
termination of this Lease and to place a "For Sale" sign thereon at any time.
During such six-month period, Landlord may show the premises and all parts
thereof to prospective tenants between the hours of 9:00 a.m. and 5:00 p.m. on
any day, except Sunday or any day on which Tenant shall not be open for
business, provided that if Tenant has closed for business
24
prior to the Lease termination date, then Landlord shall have the right to show
the premises at any time after Tenant's closing for business.
19. WATER AND OTHER DAMAGE. Landlord shall not be liable for, and
Landlord is hereby released and relieved from, all claims and demands of any
kind by reason of or resulting from damage or injury to person or property of
Tenant or any other party, directly or indirectly caused by (a) dampness, water,
rain or snow, in any part of the premises or in any part of any other property
of Landlord or of others, and/or (b) falling plaster, steam, gas, electricity,
or any leak or break in any part of the premises or from any pipes, appliances
or plumbing or from sewers or the street or subsurface or from any other place
or any part of any other property of Landlord or of others or in the pipes of
the plumbing or heating facilities thereof, except to the extent caused by the
negligence or willful misconduct of Landlord or Landlord's employees, agents or
contractors.
20. RIGHT OF ENTRY. Landlord and its agents, servants, employees,
including any builder or contractor employed by Landlord, shall have the right,
license and permission, at any and all reasonable times, but upon twenty-four
(24) hours' prior notice to Tenant (except in case of emergency when no such
prior notice shall be required), to enter and inspect the premises or any part
thereof, and at the option of Landlord, to make such reasonable repairs and/or
changes in the premises as Landlord may deem necessary or proper and/or to
enforce and carry out any provision of this Lease, provided that any such entry
by Landlord or its agents or contractors shall be accomplished in such a manner
as to not unreasonably interfere with Tenant's use or enjoyment of or access to
the premises.
21. TERMINATION OF TERM. It is agreed that the term of this Lease shall
expire and terminate at the end of the original term hereof (or at the
expiration of the last renewal term, if this Lease contains a renewal option and
the same is properly
25
exercised), without the necessity of any notice by or to any of the parties
hereto, unless otherwise provided herein. If Tenant shall occupy the premises
after such expiration or termination, it is understood that Tenant shall hold
the premises as a Tenant from month-to-month, subject to all the other terms and
conditions of this Lease, at an amount equal to one hundred fifty percent (150%)
times the highest monthly rental installment reserved in this Lease. Landlord
shall, upon such expiration or termination of this Lease, be entitled to the
benefit of all public general or local laws relating to the speedy recovery of
possession of lands and tenements held over by tenants that may be now in force
or may hereafter be enacted.
22. CONDEMNATION.
(a) If, during the term of this Lease, all or a substantial part of
the premises shall be taken by or under power of eminent domain, this Lease
shall terminate as of, and the rent (basic and additional) shall be apportioned
to and abate from and after, the date of taking. Tenant shall have no right to
participate in any award or damages for such taking and hereby assigns all of
its right, title and interest therein to Landlord, except as provided in
paragraph 22(d) hereof. For the purposes of this paragraph, "a substantial part
of the premises" shall mean such part that the remainder thereof is rendered
inadequate for Tenant's business and that such remainder cannot practicably be
repaired and improved so as to be rendered adequate to permit Tenant to carry on
its business with substantially the same efficiency as before the taking.
(b) If, during the Lease term, less than a substantial part of the
premises (as hereinabove defined) is taken by or under power of eminent domain,
this Lease shall remain in full force and effect according to its terms; and
Tenant shall not have the right to participate in any award or damages for such
taking and Tenant hereby assigns all of its right, title and interest in and to
the award to Landlord, except as provided in paragraph 22(d) below. In such
event Landlord shall, at its expense,
26
promptly make such repairs and improvements as shall be necessary to make the
remainder of the premises adequate to permit Tenant to carry on its business to
substantially the same extent and with substantially the same efficiency as
before the taking; provided that in no event shall Landlord be required to
expend an amount in excess of the award received by Landlord for such taking.
If, as a result of such taking, any part of the premises is rendered permanently
unusable, the basic annual rent reserved hereunder shall be reduced in such
amount as may be fair and reasonable, which amount shall not exceed the
proportion which the area so taken or made unusable bears to the total area
which was usable by Tenant prior to the taking. If the taking does not render
any part of the premises unusable, there shall be no abatement of rent.
(c) For purposes of this section, "taking" shall include a negotiated
sale or Lease and transfer of possession to a condemning authority under bona
fide threat of condemnation for public use, and Landlord alone shall have the
right to negotiate with the condemning authority and conduct and settle all
litigation connected with the condemnation. As hereinabove used, the words
"award or damages" shall, in the event of such sale or settlement, include the
purchase or settlement price.
(d) Nothing herein shall be deemed to prevent Tenant from claiming and
receiving from the condemning authority, if legally payable, compensation for
the taking of Tenant's own tangible property and such amount as may be payable
by statute or ordinance toward Tenant's damages for Tenant's loss of business,
removal and relocation expenses.
23. SUBORDINATION. Tenant covenants and agrees that all of Tenant's
rights hereunder are and shall be subject and subordinate to the lien of any
first mortgage hereafter placed on the leased premises or any part thereof,
except the Tenant's property or trade fixtures, and to any and all renewals,
modifications, consolidations,
27
replacements, extensions or substitutions of any first mortgage, provided Tenant
receives a "Non-Disturbance Agreement" as defined in paragraph 25(b) hereof.
Such subordination shall be automatic, without the execution of any further
subordination agreement by Tenant. If, however, a written subordination
agreement, consistent with this provision, is required by a mortgage, Tenant
agrees to execute, acknowledge and deliver the same subject to receipt by Tenant
of such Non-Disturbance Agreement, and in the event of failure so to do,
Landlord may, in addition to any other remedies for breach of covenant
hereunder, execute, acknowledge and deliver the same as the agent or
attorney-in-fact of Tenant, and Tenant hereby irrevocably constitutes Landlord
its attorney-in-fact for such purpose.
24. LANDLORD'S RIGHT TO PERFORM TENANT'S COVENANTS. If Tenant shall fail
to perform any covenant or duty required of it by this Lease or by law following
any applicable cure period set forth in this Lease, Landlord shall have the
right (but not the obligation) to perform the same, and if necessary to enter
the premises for such purposes without notice. The reasonable cost thereof to
Landlord shall be deemed to be additional rent hereunder payable by Tenant, and
Landlord shall have the same rights and remedies with respect to such additional
rent as Landlord has with respect to the rental reserved hereunder.
25. ATTORNMENT.
(a) If Landlord assigns this Lease or the rents hereunder to a
creditor as security for a debt, Tenant shall, after notice of such assignment
and upon demand by Landlord or the assignee, pay all sums thereafter becoming
due landlord hereunder both to Landlord and such assignee. Tenant shall also,
upon receipt of such notice, have all policies of insurance required hereunder
endorsed so as to protect the assignee's interest as it may appear and shall
deliver such policies, or certificates thereof, to the assignee.
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(b) If, at any time during the term of this Lease, the Landlord of the
leased premises shall be the holder of a leasehold estate covering premises
which include the leased premises, and if such leasehold shall terminate or be
terminated for any reason, or if, at any time during the term of Lease a
mortgage to which this Lease is subordinate shall be foreclosed, Tenant agrees
at the election and upon demand of any owner of the premises which include the
leased premises, or of any mortgage in possession thereof, or of any holder of a
leasehold thereafter affecting premises which include the leased premises, or of
any purchaser at foreclosure, to attorn, from time to time, to any such owner,
mortgagee, holder or purchaser upon the terms and conditions set forth herein
for the remainder of the term demised in this Lease. Provided, however, that
Tenant shall not be obligated to attorn unless, if Tenant shall so request in
writing, such holder, owner, mortgagee or purchaser shall execute and deliver to
Tenant an instrument (the "Non-Disturbance Agreement") wherein said holder,
owner, mortgagee or purchaser agrees that so long as Tenant performs all the
terms, covenants and conditions of this Lease, on Tenant's part to be performed,
Tenant's possession under the provisions of this Lease shall not be disturbed by
such holder, owner, mortgagee or purchaser.
(c) The foregoing provisions shall inure to the benefit of any such
owner, mortgagee, holder or purchaser and shall apply notwithstanding that this
Lease may terminate upon the termination of any such leasehold estate or upon
such foreclosure, and shall be self-operative upon any such demand, without
requiring any further instrument to give effect to such provisions. Tenant,
however, upon demand of any such owner, mortgagee, holder and purchaser, agrees
to execute, from time to time an instrument in confirmation of the foregoing
provisions, satisfactory to any such owner, mortgagee, holder or purchaser, in
which Tenant shall acknowledge such
29
attornment and set forth herein and shall apply for the remainder of the term
originally demised in this Lease.
26. NON-WAIVER OF FUTURE ENFORCEMENT. The receipt of rent by Landlord,
with knowledge of any breach of this Lease by Tenant or of any default on the
part of Tenant in the observance or performance of any of the conditions or
covenants of this Lease, shall not be deemed to be a waiver of any provisions of
this Lease. No failure on the part of Landlord or of the Tenant to enforce any
covenant or provision herein contained nor any waiver of any right hereunder by
Landlord or Tenant, shall discharge or invalidate such covenant or provision or
affect the right of Landlord or Tenant to enforce the same in the event of any
subsequent default. The receipt by Landlord of any rent or any sum of money or
any other consideration hereunder paid by Tenant after the termination, in any
manner, of the term herein demised, or after the giving by Landlord of any
notice hereunder to effect such termination, shall not reinstate, continue or
extend the term herein demised, or destroy, or in any manner impair the efficacy
of any such notice of termination as may have been given hereunder by Landlord
to Tenant prior to the receipt of any such sum of money or other consideration,
unless so agreed to in writing and signed by Landlord. Neither acceptance of
the keys nor any other act or thing done by Landlord or any agent or employee
during the term herein demised shall be deemed to be an acceptance of a
surrender of said premises, excepting only an agreement in writing signed by
Landlord accepting or agreeing to accept such surrender.
27. PERSONAL PROPERTY TAXES. Tenant shall be responsible for and shall
pay any taxes or assessments levied or assessed during the term of this Lease
against any leasehold interest of Tenant or personal property or trade fixtures
of Tenant of any kind, owned by Tenant or placed in, upon or about the premises
by Tenant.
30
28. RECORDATION OF LEASE. Neither Tenant nor Landlord will record this
Lease or a memorandum of the Lease.
29. NOTICES. Any notice required by this Lease shall be sent by certified
mail to Landlord at: 2066 Lord Baltimore Drive, Baltimore, Maryland 21244. Any
notice required by this Lease shall be sent by certified mail to Tenant at:
Acumedia Manufacturers, Inc.
9601 Pulaski Park Drive
Baltimore, Maryland 21220
With a copy to:
IDEXX Laboratories,Inc.
One IDEXX Drive
Westbrook, Maine 04092
Attention: Facilities Manager and General Counsel
Either party may, at any time, or from time to time, designate in writing a
substitute address for that above set forth, and thereafter to all notices to
such party shall be sent by certified mail to such substitute address.
30. WAIVER OF JURY TRIAL. TO THE EXTENT PERMITTED BY LAW, THE LANDLORD AND
THE TENANT WAIVE ALL RIGHTS TO A TRIAL BY JURY IN ANY ACTION, COUNTERCLAIM, OR
PROCEEDING BASED UPON, OR RELATED TO, THE SUBJECT MATTER OF THIS LEASE. THIS
WAIVER APPLIES TO ALL CLAIMS AGAINST ALL PARTIES TO SUCH ACTIONS AND
PROCEEDINGS, INCLUDING PARTIES WHO ARE NOT PARTIES TO THIS LEASE. THIS WAIVER IS
KNOWINGLY, INTENTIONALLY, AND VOLUNTARILY MADE BY THE TENANT AND THE Tenant
ACKNOWLEDGES THAT NEITHER THE LANDLORD, NOR ANY PERSON ACTING ON BEHALF OF THE
LANDLORD, HAS MADE ANY REPRESENTATIONS OF FACT TO INDUCE THIS WAIVER OF TRIAL BY
JURY OR IN ANY WAY TO MODIFY OR NULLIFY ITS EFFECT. THE TENANT FURTHER
ACKNOWLEDGES THAT IT HAS BEEN REPRESENTED (OR HAS HAD THE
31
OPPORTUNITY TO BE REPRESENTED) IN THE SIGNING OF THIS LEASE AND IN THE MAKING OF
THIS WAIVER BY INDEPENDENT COUNSEL, SELECTED OF ITS OWN FREE WILL, IN THAT IT
HAS HAD THE OPPORTUNITY TO DISCUSS THIS WAIVER WITH COUNSEL. THE TENANT FURTHER
ACKNOWLEDGES THAT IT HAS READ AND UNDERSTANDS THE MEANING AND RAMIFICATIONS OF
THIS WAIVER PROVISION AND AS EVIDENCE OF THIS FACT SIGNS ITS INITIALS.
------------------------
(initials of party signing for Tenant)
31. SEVERABILITY.
(a) It is agreed that, for the purpose of any suit brought or based on
this Lease, this Lease shall be construed to be a divisible contract, to the end
that successive actions may be maintained thereon as successive periodic sums
shall mature or be due hereunder, and it is further agreed that failure to
include in any suit or action any sum or sums then matured or due shall not be a
bar to the maintenance of any suit or action for the recovery of said sum or
sums so omitted; and Tenant agrees that it will not, in any suit or suits
brought or arising under this Lease for a matured sum for which judgment has not
previously been obtained or entered, plead, rely on or interpose the defenses of
res adjudicata, former recovery, extinguishment, merger, election of remedies or
other similar defense as a default to said suit or suits.
(b) If any terms, clause or provision of this Lease is declared
invalid by a court of competent jurisdiction, the validity of the remainder of
this Lease shall not be affected thereby but shall remain in full force and
effect.
32. NON-WAIVER. It is understood and agreed that nothing herein shall be
construed to be a waiver of any of the terms, covenants or conditions herein
contained, unless the same shall be in writing, signed by the party to be
charged with such waiver and no waiver of the breach of any covenant herein
shall be construed as a waiver of
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such covenant or any subsequent breach thereof. No mention in this Lease of any
specific right or remedy shall preclude Landlord or Tenant from exercising any
other right or from having any other remedy or from maintaining any action to
which it may be otherwise entitled either at law or in equity.
33. SUCCESSORS AND ASSIGNS.
(a) Except as herein provided, this Lease and the covenants and
conditions herein contained shall inure to the benefit of an be binding upon
Tenant, its successors and assigns, and shall inure to the benefit of Tenant and
only Permitted Transferees of Tenant or assignees of Tenant to whom an
assignment by Tenant has been consented to in writing by Landlord.
(b) In the event Landlord's interest under this Lease is transferred
or assigned and written notice thereof is given to Tenant, the Landlord herein
named (or any subsequent assignee or transferee of the Landlord's interest under
this Lease who gives such notice to Tenant) shall automatically be relieved and
released from and after the date of such transfer or conveyance from all
liability hereunder arising or accruing after such transfer or conveyance.
Further, Tenant specifically agrees to look solely to Landlord's interest in the
building, the land upon which the building is located and the proceeds and
income derived therefrom, for the recovery of any judgment from Landlord, it
being agreed that Landlord shall never be personally liable for any such
judgment. The provision contained in the foregoing sentence is not intended to,
and shall not, limit any right that Tenant might otherwise have to obtain
injunctive relief against Landlord or Landlord's successors in interest or any
other action not involving the personal liability of Landlord to respond in
monetary damages from assets other than Landlord's interest in the building, the
land upon which the building is located and the proceeds and income derived
therefrom, or any suit or action in connection with
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enforcement or collection of amounts which may become owing or payable under or
on account of insurance maintained by Landlord.
34. (Intentionally Omitted)
35. NOTICES TO MORTGAGEE. Tenant agrees that a copy of any notice of
default from Tenant to Landlord shall also be sent to the holder of any mortgage
or deed of trust on the premises; provided Tenant has been given written notice
of the fact that such mortgage or deed of trust has been made; and Tenant shall
allow said mortgage or holder of the deed of trust a reasonable time, not to
exceed an additional thirty (30) days from the time Landlord is otherwise
obligated to cure such default, to cure, or cause to be cured, any such default.
If such default cannot reasonably be cured within the time specified herein,
then such additional time as may be necessary shall be allowed, provided the
curing of such default is commenced and diligently pursued (including, but not
limited to, commencement of foreclosure proceedings if necessary to effect such
cure) in which event this Lease shall not be terminated while such remedies are
being thus diligently pursued.
36. ESTOPPEL CERTIFICATE. Tenant shall, at any time and from time to time
during the term of this Lease or any renewal thereof, upon request of Landlord,
execute, acknowledge, and deliver to Landlord or its designee, a statement in
writing, certifying that this Lease is unmodified and in full force and effect
if such is the fact (or if there have been any modifications thereof, that the
same is in full force as modified and stating the modifications), the dates to
which the rents and other charges have been paid in advance, if any, and any
defaults or claimed defaults by Landlord. Any such statement delivered pursuant
to this paragraph may be relied upon by any prospective purchaser of the estate
of Landlord or by the mortgagee or any assignee of any mortgagee or the trustee
or beneficiary of any deed of trust constituting a lien on the premises or upon
property in which the premises are situate.
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37. ENVIRONMENTAL PROVISIONS.
(a) Tenant and its successors and assigns shall use and occupy the
leased premises at all times during the term hereof, under and in compliance
with the laws of the State of Maryland and in compliance with all applicable
Environmental Legal Requirements. "Environmental Legal Requirements" shall mean
any applicable law relating to public health, safety or the environment,
including, without limitation, relating to releases, discharges or omissions to
air, water, land or groundwater, to the withdrawal or use of groundwater, to the
use and handling of polychlorinated biphenyls ("PCB's") or asbestos, or asbestos
containing products, to the disposal, treatment, storage or management of solid
or other hazardous or harmful wastes or to exposure to toxic, hazardous or other
harmful materials (collectively "Hazardous Substances") to the handling,
transportation, discharge or release of gaseous or liquid substance and any
regulation or final order or directive issues pursuant to such statue or
ordinance, in each case applicable to the premises, the building or its
operation, construction or modification, including without limitation the
following: the Clean Air Act, the Federal Water Pollution Control Act ("FWPCA"),
the Safe Drinking Water Act, the Toxic Substances Control Act, the Comprehensive
Environmental Response Compensation and Liability Act, as amended by the Solid
and Hazardous Waste Amendments of 1984 ("RCRA"), the Occupational Safety and
Health Act, the Emergency Planning and Community Right-to-Know Act of 1986, the
Solid Waste Disposal Act, and any state statutes addressing similar matters, and
any state statute providing for financial responsibility for clean-up or other
actions with respect to the release or threatened release of any of the above-
referenced substances.
(b) Tenant hereby indemnifies and saves Landlord harmless from all
liabilities and claims arising from the use, storage or placement of any
Hazardous Substances upon the premises or elsewhere within the building or
property of Landlord
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(only if and to the extent brought or placed thereon by Tenant, its agents,
employees, contractors or invitees); and Tenant shall (i) within fifteen (15)
days after written notice thereof, take or cause to be taken, at its sole
expense, such actions as may be necessary to comply with all Environmental Legal
Requirements and (ii) within fifteen (15) days after written demand therefor,
reimburse Landlord for any amounts expended by Landlord to comply with any
Environmental Legal Requirements with respect to the premises or with respect to
any other portions of Landlord's building or property as the result of, and only
if and to the extent of, the placement or storage of Hazardous Substances by
Tenant, its agents, employees, contractors or invitees, or in connection with
any judicial or administrative investigation or proceeding relating thereto,
including, without limitation, reasonable attorney's fees, fines or other
penalty payments.
(c) Tenant hereby grants Landlord, and Landlord's agents and employees
(including, but not limited to, any engineers or other parties engaged in the
testing of Hazardous Substances) the right to enter upon the premises for the
purpose of determining whether Tenant, its agents, employees, contractors or
invitees, has violated any of the provisions of this Section.
(d) Landlord represents and warrants, to the best of Landlord's
knowledge, that Landlord has not received any written notice of any violation of
any Environmental Legal Requirements with respect to the premises or project,
nor is Landlord aware of any existing violation of any Environmental Legal
Requirements with respect to the premises or the project. Further, to the best
of Landlord's knowledge, no Hazardous Substances are located in, on, under or
about the premises or the project. Landlord hereby indemnifies Tenant against,
and agrees to hold Tenant harmless from, any and all loss, cost or expense that
Tenant may incur (including reasonable attorney's fees) as a result of the
presence or existence of Hazardous Substances in, on, under or
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about the premises and/or the project that do not result from the acts or
omissions of Tenant, or Tenant's agents, employees or contractors.
38. CAPTIONS. The captions of the various sections of this Lease are for
convenience only and are not a part of this Lease. Such captions shall not be
construed to define or limit any of the provisions of this Lease.
39. (Intentionally Omitted)
40. FINAL AND ENTIRE AGREEMENT. This Lease contains the final and entire
agreement between the parties hereto, and neither they nor their agents shall be
bound by any terms, conditions or representations not herein written.
41. REPRESENTATIVES OF THE PARTIES. The name of Tenant's representative
to be contacted in event of emergency: Richard Daigle. The name of Landlord's
representative to be contacted in event of emergency: Stephen W. Shaw.
42. ADDITIONAL RENT. All sums of money required to be paid by Tenant to
Landlord pursuant to the terms of this Lease, unless otherwise specified herein,
shall be considered additional rent and shall be collectible by Landlord as
additional rent, in accordance with the terms of this Lease. Nothing herein
contained shall be deemed to suspend or delay the payment of any amount of money
or charge at the time the same becomes due and payable hereunder or to limit any
other remedy of Landlord.
43. RENEWAL OPTIONS. If Tenant is not then in default under this Lease or
any of the provisions hereof, Tenant may extend the term of this Lease for two
(2) additional successive periods of three (3) years each, by notifying Landlord
in writing of its intention to do so at least one hundred eighty (180) days
prior to the expiration of the then current term. Each such renewal term shall
be under the same terms and conditions as are herein set forth except that the
annual base rental for each year of each such renewal term shall be the greater
of (i) a sum equal to one hundred two and one-half percent (102.5%) times the
annual base rental for the preceding Lease year or
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(ii) the then "prevailing market rental" as defined in Section 45 hereof. All
said rental shall be payable, in advance, in equal monthly installments on the
first day of each month during said renewal term or terms, without setoff or
deduction. There shall be no additional right to renew or extend the Lease term
except as provided herein.
44. TERMINATION OPTION. Tenant is hereby granted a one (1) time option to
terminate this Lease at the end of the third year of the original Lease term,
provided Tenant gives Landlord one hundred eighty (180) days prior written
notice of its intent to terminate, together with a termination fee equal to
Forty-Five Thousand Two Hundred Two Dollars Fifty Cents ($45,202.50) plus the
"unamortized value" of the Landlord funded improvements above the base building
cost. Such "unamortized value" shall be equal to the total cost of the Landlord
funded improvements (above the base building cost), amortized at twelve percent
(12%) per annum from the commencement of the Lease term.
45. OPTION TO LEASE CONTIGUOUS SPACE.
(a) Landlord hereby grants Tenant the right of first offer (the
"Option") to Lease space contiguous to the premises ("Contiguous Space") under
the following terms and conditions: If Tenant advises Landlord in writing that
Tenant desires to Lease Contiguous Space, then when and as such Contiguous Space
becomes available, Landlord shall, prior to leasing any such Contiguous Space to
another tenant, give Tenant written notice ("Landlord's Notice") specifying the
Contiguous Space which Landlord contemplates leasing and offering to lease such
Contiguous Space to Tenant for the unexpired term of this Lease (including any
renewal option term) at a rental which shall be equal to the then "prevailing
market rental" of the leased premises, as hereinafter defined, and otherwise
under the same terms and conditions as are set forth in this Lease. As used
herein, the "prevailing market rental" shall be the same square foot rental
which Landlord or its affiliates is then offering to Lease similar space in
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similar buildings within the Baltimore Metropolitan Area. Tenant shall have ten
(10) business days from the date of Landlord's Notice to elect whether or not to
exercise the Option. If Tenant elects to exercise the Option, Tenant shall give
Landlord written notice exercising the Option within such ten (10) business day
period, and the parties shall promptly enter into an amendment or addendum to
this Lease with respect tot he Contiguous Space. If Tenant does not exercise
the Option within such ten (10) business day period following the Notice, Tenant
shall no longer have any option with respect to the Contiguous Space, and
Landlord shall be free to lease the Contiguous Space to a third party, which
leasing shall be on such terms and conditions as Landlord and the third party
may agree.
(b) The Option shall remain in effect only if, at the time of
Landlord's Notice, there remain at least three (3) years of the unexpired Lease
term, including any renewal term exercised by Tenant.
46. BROKERAGE COMMISSIONS. Tenant represents and warrants to Landlord
that the only broker or brokerage firm it has dealt or negotiated with in
connection with this Lease is Grubb & Ellis of Metropolitan Washington, D.C.
(the "Broker"). In the event Tenant takes possession of the premises and
commences payment of rent, Landlord agrees to pay the Broker a commission in
accordance with a separate agreement between Landlord and the Broker. Tenant
agrees to indemnify and hold Landlord harmless from any claims or liability,
including reasonable attorneys' fees, in connection with a claim by any person
for a real estate broker's commission, finder's fee or other compensation (other
than to Broker) based upon any statement, representation or agreement of Tenant,
and Landlord agrees to indemnify and hold Tenant harmless from any such claim or
liability, including reasonable attorneys' fees, based upon any statement,
representation or agreement of Landlord.
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AS WITNESS the hands and seals of the parties hereto the date and year
first above written.
WITNESS: MERRITT-038, LLC
By: (SEAL)
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LANDLORD
ACUMEDIA MANUFACTURERS, INC.
By: (SEAL)
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TENANT
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