826 NEWTOWN ASSOCIATES,
L.P.
BIO-IMAGING TECHNOLOGIES,
INC.
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PREMISES:
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Portion of 826 and 828
Newtown-Yardley Road,
Newtown, Pennsylvania
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DATED:
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As
of December 1, 2008
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Page
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Incorporated
Terms
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1
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Description of
Premises
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2
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Term
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3
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Annual Rent;
Additional Rent
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4
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Operating
Expenses
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4
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Real Estate
Taxes
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8
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Insurance
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10
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Utilities and
Services
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11
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Permitted
Uses
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12
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Common Areas;
Parking
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13
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No
Representations
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14
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Compliance with
Law
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14
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Care and Repair
of Premises; No Waste
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16
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Alterations,
Additions and Improvements
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Covenant
Against Liens
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Indemnification
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Landlord Not
Liable
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18
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Assignment and
Subletting
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18
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Landlord’s Access
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19
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Signs
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20
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Casualty
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Condemnation
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20
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Surrender of
Premises
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21
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Holdover
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21
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Events of
Default; Remedies
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Service Fee;
Interest
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24
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Landlord’s Right to Cure Tenant’s
Default
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24
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Notice of
Landlord’s Default
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Landlord’s Liability Limited
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24
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Subordination;
Attornment
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25
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Tenant’s
Estoppel
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-i-
TABLE OF CONTENTS
(continued)
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Page
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Quiet
Enjoyment
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Security
Deposit
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26
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Intentionally
deleted
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27
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Notices
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27
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Force
Majeure
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27
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Waivers;
Modifications
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27
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Interpretation
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27
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Applicable
Law
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27
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Authority of
Lease Signatories
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27
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Brokerage
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27
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Binding
Effect
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28
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Communications
Equipment
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28
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Flag
Pole
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29
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Right of First
Notification
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29
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Miscellaneous
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30
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Mortgagee
Consent
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31
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-ii-
RIDERS TO AGREEMENT OF
LEASE
RULES AND REGULATIONS
RIDER
iii
FOR AND IN
CONSIDERATION of the mutual covenants herein contained, as of
December 1, 2008, the parties hereto do hereby agree as
follows:
1.
Incorporated Terms . The following terms are
incorporated by reference into this Agreement:
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(a)
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NAME AND ADDRESS OF
LANDLORD :
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826
NEWTOWN ASSOCIATES, L.P.
c/o First Evergreen
55 Lane Road, Suite 430
Fairfield, New Jersey 07004
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(b)
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NAME AND ADDRESS OF
TENANT :
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BIO-IMAGING TECHNOLOGIES, INC.
826 Newtown-Yardley Road
Newtown, Pennsylvania 18940
Attention: Chief Financial Officer
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(c)
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DESCRIPTION OF PREMISES
:
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The
Premises consists of the following two parts: the space (the
“826 Space”), consisting of the entire first and second
floor of the building known as 826 Newtown-Yardley Road, Newtown,
Pennsylvania (the “826 Building”) and the space (the
“828 Space”) labeled “BioImaging Technologies,
Inc.” on the Floor Plan Rider attached hereto, in the
building known as 828 Newtown-Yardley Road, Newtown, Pennsylvania
(the “828 Building”). The 826 Space and the 828 Space
are hereinafter referred to as the “Premises”. The 826
Building and the 828 Building are hereinafter referred to as the
“Buildings”. The 826 Building and the 828 Building are
located on the property (the “Property”) designated as
Tax Lots 29-10-86, 29-10-42-1, 29-10-40-1 and 29-10-42-5, Newtown,
Pennsylvania.
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(d)
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AREA OF PREMISES AND
BUILDINGS :
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826
Space: approximately 44,076 rentable square feet
828 Space: approximately 14,605 rentable square feet
Buildings: 119,233 rentable square feet
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1
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(e)
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TERM OF LEASE
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The
Term shall be ten (10) “lease years” (as hereinafter
defined in Section 3), commencing and expiring as set forth in
Section 3.
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(f)
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PERMITTED USE:
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General office use and for any
amenities incidental thereto, which amenities shall be used only by
Tenant’s employees and Tenant’s business invitees, such
as a cafeteria and workout room, and for no other
purposes.
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(g)
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SECURITY DEPOSIT:
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None, subject to
Section 33.
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(h)
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TENANT’S SHARE:
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49.22%
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(i)
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BASE EXPENSE YEAR:
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Calendar year 2009
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(j)
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BASE TAX YEAR:
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Calendar year 2009
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(k)
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BROKER:
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Williams Real Estate of New Jersey,
LLC; commission to be paid by Landlord pursuant to a separate
agreement.
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(l)
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RIDERS TO LEASE:
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Floor Plan Rider
Annual Rent Rider
Rules and Regulations Rider
Extension Options Rider
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2.
Description of Premises . (a) Landlord hereby
leases to Tenant, and Tenant hereby hires from Landlord, the
Premises described in Section 1(c). Nothing contained herein
shall give Tenant the right to use any storage space in the
Buildings except for the storage space currently leased by Landlord
to Tenant pursuant to that certain Amendment to Office Space Lease
between Landlord and Tenant dated September 27, 2000 (the
“Storage Space Agreement”). The terms and provisions of
the Storage Space Agreement shall remain in full force and effect
for and during the Term of this Lease except that the rent for the
storage space shall increase to $9.00 per rentable square foot of
such storage space (ie., $5,850.00 per annum/$487.50 per month) for
and during the sixth (6 th )
lease year through and including the tenth (10
th ) lease year hereof. The rent for the storage
space shall remain $7.50 per rentable square foot of such storage
space (ie., $4,875.00 per
2
annum/$406.25
per month) for and during the first (1 st )
lease year through and including the fifth (5
th ) lease year hereof. In the event that Tenant
validly exercises its option(s) to extend the Term of this Lease,
the rent for such storage space for the Extension Term(s) (as
defined in the Extension Options Rider attached hereto) shall be
equal to the “Fair Market Rental Value” of such storage
space for and during each Extension Term determined as set forth in
said Extension Options Rider.
(b) The
parties acknowledge that there are multiple methods of computing
rentable area and hereby agree for the purposes of this Lease that
the rentable area of the Premises is the number of square feet set
forth in Section 1(d), and the rentable area of the Buildings
is the number of square feet set forth in
Section 1(d).
(c) Landlord
shall have no obligation to do any work in and to the Premises or
the Buildings to render them ready for Tenant’s occupancy.
Tenant has inspected the Premises and agrees to take the Premises
in “as is” condition, except as otherwise expressly
provided herein.
(d) During
the Term, Tenant may perform, at Tenant’s sole cost and
expense, certain work at the Premises (the “Refurbishment
Work”). Such Refurbishment Work shall be performed in
accordance with Section 14 of this Lease. Landlord shall
contribute a sum of up to Two Hundred Ninety Three Thousand Four
Hundred Five and 00/100 ($293,405.00) Dollars (or Five and 00/100
Dollars per rentable square foot of the Premises) to be applied to
the cost of paint and carpet (the “Landlord’s
Refurbishment Allowance”). If and to the extent that the
total aggregate cost to perform the Refurbishment Work shall exceed
the amount of Landlord’s Refurbishment Allowance, such excess
amount shall be the sole responsibility of Tenant. Landlord shall
pay Landlord’s Refurbishment Allowance to Tenant within
thirty (30) days after the completion of the Refurbishment
Work to Landlord’s reasonable satisfaction. Notwithstanding
anything to the contrary contained herein, Landlord shall not be
required to pay all or any portion of Landlord’s
Refurbishment Allowance while there is a mechanic’s or other
construction lien filed against the Property relating to any work
being performed at the Premises by Tenant, and Landlord shall have
the right to deduct from Landlord’s Refurbishment Allowance
the actual costs incurred by it, including reasonable legal fees,
in connection with the removal of any such mechanic’s or
construction lien.
(e) Landlord
and Tenant are parties to a lease with respect to the Premises
dated September, 1999, as subsequently amended by that certain
Amendment to Office Space Lease dated September 27, 2000;
First Modification of Office Space Lease dated January 11,
2002; the Letter Agreement dated June 5, 2002; the Second
Modification of Office Space Lease dated January 11, 2003; the
Third Modification of Office Space Lease dated March 11, 2004;
and the Fourth Modification of Office Space Lease dated September,
2004 (collectively, the “Prior Lease”). Upon the
Commencement Date of this Lease, the Prior Lease shall be
automatically terminated and shall be void and of no further force
or effect.
3.
Term . (a) The term of this Lease (the
“Term”) shall commence as of December 1, 2008 (the
“Commencement Date”), and shall expire at 6:00 p.m. on
the date which shall be ten (10) lease years after the Commencement
Date (the “Expiration Date”).
(b) The
first lease year shall be the period commencing on the Commencement
Date and ending or the last day of the twelfth (12
th ) full calendar month immediately following
the
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Commencement
Date. Each succeeding twelve (12) calendar month period
thereafter shall be a lease year.
4.
Annual Rent; Additional Rent . (a) Tenant shall
pay to Landlord at the address set forth in Section 1(a), or
to such other person or at such other place as the Landlord may
from time to time designate, without previous demand therefor and
without counterclaim, deduction or set-off, the annual rent
(“Annual Rent”) set forth on the Annual Rent Rider
attached hereto. Annual Rent shall be payable in monthly
installments as set forth on the Annual Rent Rider in advance on
the first day of each month during the Term of the Lease. If the
Commencement Date shall be other than the first day of a calendar
month, Tenant shall pay Landlord on the Commencement Date the
proportionate amount of Annual Rent for the balance of such month
computed by dividing the monthly Annual Rent by thirty
(30) and then multiplying the result by the number of days
beginning with and including the Commencement Date and ending with
and including the last day of the month in which the Commencement
Date occurs.
(b) All
sums other than Annual Rent payable by Tenant under this Lease
shall be deemed to be “Additional Rent” regardless of
to whom such sums may be payable. Except as otherwise provided
herein, Additional Rent shall be payable without counterclaim,
deduction or set-off. In the event of Tenant’s failure to
make timely payment of any item of Additional Rent after any
applicable notice and cure period provided for herein, Landlord
shall have available to it all rights and remedies provided by this
Lease and by law as for non-payment of Annual Rent. The term
“rent” in the Lease means Annual Rent and Additional
Rent.
5.
Operating Expenses . (a) Commencing on
January 1, 2010 (the “Expense Rent Commencement
Date”), Tenant shall pay as Additional Rent Tenant’s
Share referred to in Section 1(h) of the Lease of the
“expenses” (as hereinafter defined) of the Property for
any calendar year which occurs wholly or partially during the Term
of this Lease in excess of the expenses of the Property for the
calendar year referred to in Section 1(i) of this Lease (the
“Base Expense Year”) (such Additional Rent is
hereinafter called the “Expense Rent”). Tenant’s
Share reflects the ratio of the rentable area of the Premises to
the rentable area of the Buildings and may be modified from time to
time in the event of a change in the total rentable floor area of
the Premises or the total rentable floor area of the Buildings;
provided, however that the total rentable floor area of the
Premises shall not be increased unless requested or agreed to by
Tenant, and the rentable floor area of the Buildings shall not be
decreased except in connection with a casualty or condemnation as
set forth in Sections 21 and 22 hereinbelow. The term
“expenses” shall mean any and all costs incurred by
Landlord in connection with the ownership, operation, maintenance,
care and repair of the Property, including, but not limited to,
gardening and landscaping; snow removal; repairing, resurfacing or
repaving the parking areas, roads or driveways on the Property;
maintaining, repairing and replacing the roof and structural
portions of the Property; maintaining, repairing and replacing the
heating, ventilating and air conditioning system and other
mechanical systems serving the Buildings; reasonable premiums for
fire and other casualty insurance, rent insurance, liability
insurance, workers compensation insurance and other insurance with
respect to the Property; wages, medical insurance, pension payments
and other fringe benefits of all employees servicing the Property
consistent with practices in the locale of the Property; payroll
taxes; labor and materials for repairs and replacements for the
Buildings and its components and other improvements on the
Property; trash removal; all common area cleaning; service
contracts; electricity, gas, water, sewer and other utility charges
and rents other than those directly metered or
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submetered to
the Premises; licenses and permits required for the ownership and
operation of the Property; sales and use taxes payable in
connection with tangible personal property and services purchased
for the management, operation, maintenance, care and repair of the
Property; fuel oil other than fuel oil directly metered or
submetered to the Premises; painting; security; professional fees;
administrative expenses; management fees (not to exceed 4% of the
gross rent of the Property); and alterations and improvements made
by reason of governmental requirements enacted after the date
hereof.
Anything in this
Lease to the contrary notwithstanding, the term
“expenses” shall not include any expenditure for any
repair, replacement or improvement which is properly capitalized
for federal income tax purposes, unless (i) said expenditure
is made for the purpose of reducing energy or labor costs within
the Building(s) or at the Property and in such instance only to the
extent of the savings realized by the installation and operation of
the improvement (the “Reduction In Costs CapEx”), or
(ii) said expenditure is required under any governmental or
quasi-governmental law, statute, ordinance, rule, order,
requirement or regulation first enacted after the Commencement Date
hereof (including an amendment to current law first enacted after
the Commencement Date) (the “Compliance With Law
CapEx”). Such capitalized expenses shall be amortized on a
straight-line basis over the applicable recovery period as
reasonably determined by Landlord for federal income tax purposes
(using an interest rate of two percent (2%) above the prime rate as
published from time to time in The Wall Street Journal), and Tenant
shall reimburse Landlord only for the portion of such capitalized
expenses which falls within the Term hereof. The foregoing
notwithstanding, Tenant shall also pay Tenant’s Share, up to
but not more than $10,000 per annum in the aggregate, of the annual
amortization of other bona fide capital expense items expended by
Landlord in the maintenance and upkeep of the Building(s) and/or
the Property in accordance with prudent management practices
(“Additional Permitted CapEx”), based upon the
amortization of such capital expense items on a straight-line basis
over the applicable recovery period as reasonably determined by
Landlord for federal income tax purposes (using an interest rate of
two percent (2%) above the prime rate as published from time to
time in The Wall Street Journal), but Additional Permitted CapEx
shall specifically exclude, any and all expenses relating to
(i) the complete replacement of the roof of either Building,
(ii) the complete or substantial replacement of the electrical
system in either Building, (iii) the complete or substantial
replacement of the plumbing system in either Building,
(iv) the complete or substantial replacement of the parking
areas, and/or (v) replacements of or improvements to the
“Structural Elements” of either Building, all of which
excluded expenses shall be the responsibility of Landlord. The term
“Structural Elements” is defined to mean all footings,
foundations, columns and building framing, exterior envelope
systems and supports, roof support systems and decking, shear
walls, balconies, floor joists/beams and supports, floor slabs, and
load bearing walls and supports.
Notwithstanding
anything to the contrary contained herein, in the event that the
Buildings are less than ninety five (95%) percent occupied during
the Base Expense Year and/or any calendar year of the Term, the
expenses of the Property for the Base Expense Year and/or such
calendar year, as the case may be, shall be appropriately adjusted
so that the expenses of the Property shall reflect such costs as
would have been incurred if the Buildings were ninety five (95%)
percent occupied during said year.
(b) Notwithstanding
any provision contained in this Lease to the contrary, the term
“expenses” shall not include interest, points, fees or
principal payments on mortgage debt or
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ground rents
incurred by Landlord as owner of the Property; capital expenses or
improvements (except to the extent expressly permitted under
Section 5(a), above), leasing commissions; accountants,
consultants or attorneys fees, costs and disbursements and other
expenses incurred in connection with leasing space (including any
leasing office and concessions to such new tenants), lease
negotiations or disputes with tenants, prospective tenants or third
parties or associated with the enforcement of any leases or the
defense of Landlord’s title to the Buildings or the Property;
costs of construction of the Buildings and related facilities;
costs of any items or services sold or provided to tenants
(including Tenant) for which Landlord is to be reimbursed by such
tenants (whether or not actually reimbursed) or which are not
generally provided to all tenants of the Buildings; fees and higher
interest charges caused by Landlord’s refinancing the
Property; costs incurred due to a violation by Landlord or any
tenant of the terms and conditions of any lease; overhead and
profit increment paid to subsidiaries or affiliates of Landlord, or
to any party as a result of a non competitive selection process,
for management or other services on or to the Buildings or for
supplies or other materials, to the extent that the costs of such
services, supplies or materials exceed the costs that would have
been paid had the services, supplies or materials been provided by
unaffiliated parties on a competitive basis; all items and services
for which Tenant reimburses Landlord or pays third persons, or
which Landlord provides selectively to one or more tenants or
occupants of the Buildings (other than Tenant) without
reimbursement (it being agreed that until Landlord and Tenant
otherwise agree, Tenant shall provide janitorial services to the
entire 826 Building and the remainder of the Premises at
Tenant’s cost and expense and the cost of providing
janitorial services to other tenants in the Buildings shall be
excluded from Tenant’s Share of “expenses”);
commissions, advertising, space planning, art and promotional
expenditures; charitable and political contributions; financing
costs and amortization of funds borrowed by Landlord, whether
secured or unsecured; depreciation of the Buildings; completing,
fixturing, improving, renovating, painting, redecorating or other
work, which Landlord pays for or performs for other tenants within
their premises, and costs of correcting defects in such work;
salaries, wages, benefits and other compensation paid to officers
and employees of Landlord who are not assigned in whole or in part
to the operation, management, maintenance of repair of the
Property; general organizational, administrative and overhead costs
relating to creating or maintaining Landlord’s existence,
either as a corporation, partnership, or other entity, including
general corporate, legal and accounting expenses and all general
corporate overhead and general administrative expenses not related
to the operation of Buildings or the Property; costs incurred by
Landlord due to the violation by Landlord, its employees, agents or
contractors or any tenant of the terms and conditions of any lease
of space in the Property or any law, order or regulation of
governmental authority; costs incurred in the sale of the Buildings
or Property; net income taxes of Landlord or the owner of any
interest in the Property, real estate (except as provided in
Section 6 below), ad valorem, franchise, transfer, capital
stock, gift, estate or inheritance taxes or any federal, state or
local documentary taxes imposed against the Property or any portion
thereof or interest therein; any expenses otherwise includable
within Operating Expenses to the extent actually reimbursed by
persons other than tenants of the Property under leases for space
in the Property; salaries and benefits and other compensation to
executives, officers or partners of Landlord above the grade of
building manager or to any other person above the grade of building
manager; Landlord’s costs of electricity and other services
sold or provided to tenants in the Building (including Tenant) for
which Landlord is entitled to be reimbursed by such tenants as a
separate additional charge or rental over and above the base rent
or expenses payable under the lease with such tenant; costs
incurred in connection with environmental clean-up, response action
or
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remediation on,
in or under or about the Buildings or Property, except to the
extent caused or contributed to by Tenant in which case Tenant
shall be solely responsible for its share of the cost thereof; any
increase in insurance premiums to the extent that such increase is
caused or attributable to the use, occupancy or act of another
tenant; the cost of consummating any ground lease; the cost of
installing, operating and maintaining any commercial concessions
operated by Landlord in the Buildings or of installing, operating
and maintaining any specialty services such as a Building cafeteria
or dining facility, or an athletic, luncheon or recreational club,
or any theater or garage; the cost of providing any bookkeeping and
accounting services customarily provided by a managing agent and
the cost of which is included in management fees, except as
otherwise provided in this Lease; expenses allocable directly and
solely to the retail space in the Buildings, if any; the cost of
Tenant’s Share of any deductible amount under
Landlord’s insurance policies to the extent that
Tenant’s Share exceeds deductibles which are customary for
similar properties in the area of the Property; cost of any
separate electrical meter Landlord may provide to any of the other
tenants in the Buildings or Property; the cost of repairs or other
work to the extent Landlord is actually reimbursed by insurance or
condemnation proceeds; reserves for bad debts and rent loss
reserves and reserves for future repairs and replacements; repair
costs resulting from the negligence or willful misconduct of
Landlord.
(c) Commencing
on the Expense Rent Commencement Date, Tenant shall pay its Expense
Rent in monthly installments on the first day of each month on an
estimated basis as determined by Landlord (which estimate shall not
exceed the amount of the actual expenses for the prior year by ten
(10%) percent). Landlord may adjust such estimate at any time and
from time to time based upon Landlord’s experience and
anticipation of costs. After the end of each calendar year during
the Term, Landlord shall deliver to Tenant a statement (the
“End of Year Expense Rent Statement”) setting forth the
actual expenses of the Property for such calendar year, the amount
paid by Tenant as Expense Rent on account thereof, Tenant’s
Share of such expenses, and the amount due to or from Tenant. If
Tenant has paid less than the actual amount due, Tenant shall pay
the difference to Landlord within thirty (30) days after
Landlord’s request therefor. Any amount paid by Tenant which
exceeds the amount due shall be credited to the next succeeding
payments due as Expense Rent hereunder, unless the Term has then
expired in which event such excess amount shall be refunded to
Tenant. If the Expense Rent Commencement Date is other than the
first day of a calendar year, or the Expiration Date is prior to
the last day of a calendar year, the Expense Rent shall be
apportioned so that Tenant shall pay only such portion of the
expenses of the Property attributable to the period of such
calendar year occurring after the Expense Rent Commencement Date or
prior to the Expiration Date, as the case may be.
(d) Notwithstanding
anything to the contrary contained herein, in the event that any
tenant of the Buildings or the Property is separately billed for
any item of expenses for which Tenant is responsible hereunder, the
amount billed to such tenant shall not be included in the term
expenses and the rentable floor area of such tenant’s leased
premises shall be excluded for the purposes of determining
Tenant’s Share of that specific expense.
(e) Tenant
shall have the right, at its cost and expense, to audit the Expense
Rent for the immediately preceding calendar year only provided that
(i) Tenant shall notify Landlord of its election to audit the
Expense Rent within ninety (90) days following Tenant’s
receipt of the End of Year Expense Rent Statement, (ii) such
audit shall be conducted at the office where Landlord maintains its
records and only after Tenant gives Landlord at least thirty
(30) days’ prior written
7
notice,(iii)
Tenant shall deliver to Landlord a copy of the results of such
audit within one hundred twenty (120) days following
Tenant’s receipt of the End of Year Expense Rent Statement;
(iv) no assignee shall conduct an audit for any period during
which such assignee was not in possession of the Premises;
(v) Tenant shall keep the results of such audit strictly
confidential and shall not disclose the same to any other party
except on an as needed basis in the event of a dispute regarding
the Expense Rent; (vi) no subtenant shall have any right to
conduct an audit; (vii) no audit shall be conducted at any
time that Tenant is in default of any of the terms of this Lease
beyond the expiration of any applicable notice and grace period
provided for herein; and (viii) such audit shall only be
conducted by a certified public accountant not compensated on a
contingent fee basis. Tenant may not remove any of Landlord’s
expense records or other documents from the office where Landlord
maintains the same. In the event that Tenant’s audit alleges
that an error was made by Landlord, Landlord shall have ninety
(90) days following receipt of the results of such audit to
obtain an audit from an accountant of Landlord’s choice, at
Landlord’s cost and expense, or Landlord shall be deemed to
have accepted the results of Tenant’s audit. In the event
that Landlord’s and Tenant’s accountants shall be
unable to reconcile the results, both accountants shall mutually
agree upon a third accountant whose determination shall be
conclusive. The cost of any such third accountant shall be shared
equally between Landlord and Tenant. If it is determined that
Tenant has paid less than the actual amount due, Tenant shall pay
the difference to Landlord within thirty (30) days after the
date of such determination. If it is determined that Tenant has
paid any amount in excess of the amount due, such excess amount
shall be refunded to Tenant within thirty (30) days after the
date of such determination. If it is determined that the expenses
used to calculate the Expense Rent in any year during the Term
hereof exceeded the actual expenses properly chargeable to Tenant
in accordance with this Lease for said year by more than ten (10%)
percent, then Landlord shall promptly reimburse Tenant for the
actual, documented cost of the audit.
(f) To
the extent that any cost or expense is appropriately included in
expenses pursuant hereto, it shall only be included in expenses
once, notwithstanding that such cost or expense may fall under more
than one category or be referenced in more than one Section of this
Lease.
6.
Real Estate Taxes . (a) Commencing on
January 1, 2010 (the “Tax Rent Commencement
Date”), Tenant shall pay as Additional Rent Tenant’s
Share referred to in Section 1(h) of the Lease of all real estate
taxes assessed against the Property for any tax fiscal year which
occurs wholly or partially during the Term of this Lease in excess
of the real estate taxes assessed against the Property for the tax
fiscal year referred to in Section 1(j) (the “Base Tax
Year”) (such Additional Rent is hereinafter called the
“Tax Rent”). The term “real estate taxes”
shall mean (i) any tax or assessment levied, assessed or
imposed at any time by any governmental authority on or against the
Property or any part thereof; (ii) any assessment for public
betterments or improvements levied, assessed or imposed upon or
against the Property; (iii) any reasonable legal fees and
other costs incurred by Landlord in connection with evaluating
and/or contesting the assessed valuation of the Property for real
estate tax purposes; and (iv) any tax levied, assessed or
imposed at any time upon or against the receipt of income or rents
or any other tax upon Landlord as a substitute or supplement in
whole or in part for a real estate tax or assessment. The term
“real estate taxes” shall not include income taxes,
estate taxes, inheritance taxes, franchise taxes, transfer taxes,
capital stock taxes or any fines or penalties for the late payment
of real estate taxes.
8
(b) Commencing
on the Tax Rent Commencement Date, Tenant shall pay its Tax Rent in
monthly installments on the first day of each month on an estimated
basis as determined by Landlord (which estimate shall not exceed
the actual amount of real estate taxes for the prior year by ten
(10%) percent.) Landlord may adjust such estimate at any time and
from time to time based upon Landlord’s anticipation of the
real estate taxes which may be assessed against the Property. At
any time after the real estate taxes for any tax fiscal year shall
be fixed by the appropriate governmental authorities, Landlord
shall deliver to Tenant a statement (the “End of Year Tax
Rent Statement”) setting forth the actual real estate taxes
assessed against the Property for such tax fiscal year, the amount
paid by Tenant as Tax Rent on account thereof, Tenant’s Share
of such real estate taxes, and the amount due to or from Tenant. If
Tenant has paid less than the actual amount due, Tenant shall pay
the difference to Landlord within thirty (30) days after
Landlord’s request therefor. Any amount paid by Tenant which
exceeds the actual amount due shall be credited to the next
succeeding payments due as Tax Rent hereunder, unless the Term has
then expired in which event such excess amount shall be refunded to
Tenant. Real estate taxes for any tax fiscal year beginning before
the Tax Rent Commencement Date or terminating after the Expiration
Date shall be apportioned so that Tenant shall pay only such
portion of the increase in real estate taxes as shall be
attributable to the period of such tax fiscal year occurring after
the Tax Rent Commencement Date or prior to the Expiration Date, as
the case may be.
(c) Upon
receipt of Landlord’s prior approval, which approval shall
not be unreasonably withheld, conditioned or delayed, Tenant may
contest or appeal, at Tenant’s sole cost and expense, the
amount or validity, in whole or in part, of any real estate taxes
assessed against the Buildings or the Property, by appropriate
proceedings diligently conducted by Tenant in good faith. Tenant
shall provide to Landlord for its reasonable review and approval
prior to filing any applications, affidavits and like supporting
documentation required in connection with such effort. Landlord
shall reasonably cooperate with Tenant subject to and in accordance
with the conditions set forth in this paragraph. Tenant may take
any such contest in its own name or, if it cannot contest in its
own name, in the name of the Landlord. Tenant shall be responsible
for any increase in any real estate taxes that is levied against
the Property to the extent said increase is due to Tenant’s
contest or appeal.
(d) Tenant
shall have the right, at its cost and expense, to audit the Tax
Rent for the immediately preceding calendar year only provided that
(i) Tenant shall notify Landlord of its election to audit the
Tax Rent within ninety (90) days following Tenant’s
receipt of the End of Year Tax Rent Statement, (ii) such audit
shall be conducted at the office where Landlord maintains its
records and only after Tenant gives Landlord at least thirty
(30) days’ prior written notice,(iii) Tenant shall
deliver to Landlord a copy of the results of such audit within one
hundred twenty (120) days following Tenant’s receipt of
the End of Year Tax Rent Statement; (iv) no assignee shall
conduct an audit for any period during which such assignee was not
in possession of the Premises; (v) Tenant shall keep the
results of such audit strictly confidential and shall not disclose
the same to any other party except on an as needed basis in the
event of a dispute regarding the Tax Rent; (vi) no subtenant
shall have any right to conduct an audit; (vii) no audit shall
be conducted at any time that Tenant is in default of any of the
terms of this Lease beyond the expiration of any applicable notice
and grace period provided for herein; and (viii) such audit
shall only be conducted by a certified public accountant not
compensated on a contingent fee basis. Tenant may not remove any of
Landlord’s expense records or other documents from the office
where Landlord maintains the same. In the event that Tenant’s
audit alleges that an error was made by Landlord, Landlord
shall
9
have ninety
(90) days following receipt of the results of such audit to
obtain an audit from an account of Landlord’s choice, at
Landlord’s cost and expense, or Landlord shall be deemed to
have accepted the results of Tenant’s audit. In the event
that Landlord’s and Tenant’s accountants shall be
unable to reconcile the results, both accountants shall mutually
agree upon a third accountant whose determination shall be
conclusive. The cost of any such third accountant shall be shared
equally between Landlord and Tenant. If it is determined that
Tenant has paid less than the actual amount due, Tenant shall pay
the difference to Landlord within thirty (30) days after the
date of such determination. If it is determined that Tenant has
paid any amount in excess of the amount due, such excess amount
shall be refunded to Tenant within thirty (30) days after the
date of such determination. If it is determined that the real
estate taxes used to calculate the Tax Rent in any year during the
Term hereof exceeded the actual real estate taxes properly
chargeable to Tenant in accordance with this Lease for said year by
more than ten (10%) percent, then Landlord shall promptly reimburse
Tenant for the actual, documented cost of the audit.
7.
Insurance . (a) Tenant shall provide, at its own
expense, and keep in force during the Term:
(1) General
Liability Insurance, including contractual liability coverage,
insuring against and saving harmless Landlord, any mortgagee now or
hereafter encumbering the Property (“Landlord’s
Mortgagee”) and Tenant against any liability which arises
from any occurrence on or about the Premises, or which arises from
any liability, claims or costs indicated in Section 16 against
which Tenant is required to indemnify Landlord. The coverage limits
of said general liability insurance policy shall be at least
$3,000,000.00 in combined single limit with respect to personal
injury, death or property damage arising out of any one occurrence.
Such coverage may be combined as primary general liability and
excess (umbrella) liability. Such amount shall be subject to
periodic increase as reasonably required by Landlord.
(2) Fire
and casualty insurance with broad form extended coverage,
including, but not limited to, coverage for vandalism and malicious
mischief, in the amount of the full replacement cost, from time to
time, of Tenant’s trade fixtures, equipment, inventory and
other contents of the Premises.
(3) Business
interruption insurance in an amount at least sufficient to pay
Tenant’s obligations as to payment of Annual Rent and
Additional Rent under this Lease.
(4) Workers’
Compensation insurance in accordance with the laws of the state in
which the Premises are located.
(5) Such
other insurance as Landlord may from time to time reasonably
require which is consistent with insurance carried by other similar
properties in the area of the Property.
(b) All
such policies shall be issued by insurance companies of recognized
responsibility, satisfactory to Landlord and duly licensed and
authorized to transact business in the state in which the Premises
are located. Tenant agrees to deliver to Landlord, prior to the
commencement of the Term, and thereafter not later than thirty
(30) days after request by Landlord, a copy of each such
insurance policy or, if requested by Landlord, a certificate of
insurance as to
10
any such policy
of insurance, together with proof of the payment of the initial or
renewal premiums therefor. Such insurance shall be non-cancelable
without thirty (30) days’ prior written notice to
Landlord and Landlord’s Mortgagee and any loss shall be
payable notwithstanding any act or negligence of Tenant or Landlord
or any agent or employee thereof.
(c) Landlord
and Tenant each hereby releases the other from any and all
liability in the event of damage to or destruction of the Premises
or the contents thereof whether or not caused by the negligence or
other act, omission to act or fault of Tenant or Landlord or their
respective agents, servants or employees to the extent that such
liability is covered by any insurance required to be carried by
either party hereunder or any other insurance actually carried by
either party. It is the intent of Landlord and Tenant that the
releasing party shall look to its own insurance policies for
compensation in the event of any damage to or destruction of the
Premises or the contents thereof. In the event that the insurance
required to be maintained or actually maintained by the releasing
party does not cover such damage or destruction, and if the other
party’s insurance does cover such damage or destruction, the
releasing party shall be entitled to seek compensation from the
other party’s insurance policy for such damage or
destruction. All insurance policies carried by Landlord and Tenant
covering the Premises, or the contents thereof, or in any manner
relating thereto, shall expressly provide that the foregoing
release shall not affect or reduce the coverage or the
insurer’s obligations thereunder and shall also expressly
waive any right of subrogation on the part of the insurer against
the other party.
(d) Tenant
shall comply with the requirements of any insurance policy carried
by Landlord or Tenant covering the Property or the Premises, all
requirements of the issuer of any such policy, and the applicable
regulations and requirements of the National Board of Fire
Underwriters, any applicable local board of fire underwriters, and
any other body exercising a similar function. If the premiums for
any insurance policy maintained by Landlord applicable to the
Property exceed the rate that would have been applicable for the
permitted use of Tenant as a result of the failure by Tenant to
comply with such requirements, or as a result of or in connection
with the use to which the Premises are put by Tenant, Tenant shall
reimburse Landlord for such excess within thirty (30) days after
Landlord’s request therefor.
8.
Utilities and Services . (a) Subject to the
provisions of Section 8(b) below, Landlord shall furnish the
Premises with electricity, heating and air conditioning for the
normal use and occupancy of the Premises as general offices only
during “Work Hours”. “Work Hours” shall
mean the period from 8:00 a.m. to 6:00 p.m. on Monday through
Friday, excluding “Building Holidays”. Building
Holidays are defined as New Year’s Day, Martin Luther King
Day, President’s Day, Memorial Day, the Monday preceding or
Friday following Independence Day if Independence Day falls on a
Tuesday or Thursday respectively, Independence Day, Labor Day,
Columbus Day, Veteran’s Day, Thanksgiving and the day
following, Christmas Eve day, Christmas, and New Year’s Eve
day. Tenant may have access to and use the Premises other than
during Work Hours, 24 hours per day, 7 days per week, provided
Tenant complies with Landlord’s reasonable security
procedures with respect to such access and use.
(b) Tenant
agrees to pay as Additional Rent all charges for electricity,
light, heat or other utility used by Tenant at the Premises in
accordance with separate submeters which are currently installed at
the Premises. Tenant shall pay Landlord for the consumption of such
utilities based upon its submetered usage within ten (10) days
after receipt of an invoice therefor, at the
11
General
Services (GS) electric rate of the utility company providing
the electricity to the Premises, with no profit to Landlord. Any
non-payment or late payment of such utility bills shall be deemed a
default under the terms of this Lease. All charges for the repair
of any submeters servicing the Premises shall be payable by Tenant
as Additional Rent and shall be paid when the same shall become
due. A separate electric meter or meters directly with the utility
company may be installed by Landlord, at Tenant’s cost and
expense, only if installing such separate direct meter or meters to
measure Tenant’s electric consumption in the Premises is
possible. If such direct meters are installed, Tenant shall arrange
with the public utility companies servicing the Property for the
provision of electricity and shall pay all charges therefor
directly to the utility company. Thereafter, Landlord shall have no
obligation to furnish electricity to the Premises served by such
electric meter(s).
(c) Within
the Common Areas (as hereinafter defined in Section 10),
Landlord shall furnish reasonably: (i) adequate electricity,
(ii) hot and cold water, (iii) lavatory supplies, (iv)
automatically operated elevator service, (v) normal and
customary cleaning services (on a five-day a week basis) after
business hours (for the 828 Building only), (vi) heat and air
conditioning in season, (vii) landscaping, (viii) parking
lot maintenance, (ix) common area maintenance and (x) snow and
ice removal. Tenant shall be responsible for Tenant’s Share
of the cost of such services in accordance with Section 5
hereof. Tenant shall provide, at Tenant’s cost and expense,
daily janitorial service to the 826 Building and the remainder of
the Premises.
(d) Landlord
shall not be liable for any damages to Tenant resulting from the
quality, quantity, failure, unavailability or disruption of any
services beyond the reasonable control of Landlord and except as
hereinafter provided, the same shall not constitute a termination
of this Lease or an actual or constructive eviction or entitle
Tenant to an abatement of rent. Landlord shall not be responsible
for providing any services not specifically provided for in this
Lease. Landlord reserves the right to suspend any of the services
agreed to be supplied by Landlord hereunder when necessary by
reason of accident or for repairs, alterations, replacements or
improvements necessary or desirable in the judgment of Landlord for
as long as shall be required by reason thereof, and Landlord shall
not be liable to Tenant and Tenant shall not be entitled to any
abatement or reduction of rent by reason thereof, provided that
Landlord shall use commercially reasonable efforts to minimize the
length of such suspension and provided that Landlord will use
commercially reasonably efforts to minimize any disruption of or
interference with Tenant’s possession. Notwithstanding
anything herein to the contrary, if by reason of the failure or
interruption in any building service or utility within
Landlord’s reasonable control, the Premises are rendered
untenantable in whole or in part for a period of seven
(7) consecutive days or longer, and the failure or
interruption shall not be the result of Tenant’s fault or
neglect, then Tenant may terminate this Lease upon ten
(10) days’ prior written notice to Landlord, which
notice may be sent at any time subsequent to the aforesaid seven
(7) consecutive day period and prior to the restoration of the
interrupted services.
9.
Permitted Uses . Tenant may use the Premises only for
the uses set forth in Section 1(f) above. Notwithstanding the
foregoing, Tenant shall not use or permit the Premises to be used
for any unlawful purpose or in violation of any certificate of
occupancy covering the Property or which may constitute a public or
private nuisance or make voidable any insurance in force relating
to the Property or which may interfere with the use and occupancy
of the Buildings by other tenants; provided, however, Tenant may
continue the use subject to contesting any alleged
violation
12
or charge,
provided that such contest and/or continued use shall not result in
any liens, fines or penalties against the Property. Tenant shall
indemnify and hold harmless Landlord and Landlord’s managing
agent from and against all liability, claims or costs, including
reasonable legal fees, arising from Tenant’s contest of such
use.
10.
Common Areas; Parking . (a) Tenant shall have
the non-exclusive right, in common with others, to use any common
entrances, lobbies, drives, elevators, stairs, and similar access
and serviceways in and adjacent to the Buildings (hereinbefore and
hereinafter sometimes referred to as “Common Areas”),
subject to such reasonable rules and regulations as the Landlord
may adopt.
(b) Tenant
and its employees and invitees shall have the right, in common with
Landlord and other tenants of the Property and their employees and
invitees, to use the parking areas provided by Landlord on the
Property for the parking of passenger automobiles. Without limiting
the foregoing, Landlord represents to Tenant that there currently
is sufficient parking at the Property to provide Tenant with a
minimum of four (4) parking spaces at the Property per 1,000
square feet of rentable area contained within the Premises (the
“Parking Ratio”). Landlord agrees that Landlord will
not reduce the Parking Ratio unless within ten (10) days of
such reduction, substitute parking is made available to Tenant on
the Property. Tenant agrees that use of the parking areas by
Tenant, its employees, customers or invitees shall not exceed the
Parking Ratio. Tenant’s parking shall be limited to vehicles
no larger than standard sized automobiles or light pickup vehicles.
Landlord and Tenant shall mutually agree on the location of fifteen
(15) parking spaces which shall serve as reserved spaces for
use by Tenant and Tenant’s visitors and which shall be
counted in the Parking Ratio. The use of such reserved parking
spaces is personal to the Tenant named herein and shall not be
available to any assignee or subtenant of Landlord (other than an
assignee or subtenant pursuant to a “Permitted Assignment or
Sublease” (as hereinafter defined in Section 18(a)
hereinbelow)), but Tenant’s Parking Ratio shall in no event
be reduced, and in the event of any assignment or sublease hereof
(other than a Permitted Assignment or Sublease) which results in a
loss of reserved parking spaces, the number of unreserved parking
spaces shall be increased accordingly so that Tenant’s
Parking Ratio shall not be diminished. Tenant shall not cause large
trucks or other large vehicles to be parked within the parking
areas, except that temporary parking of larger delivery vehicles
may be permitted in the area designated therefor by Landlord.
Vehicles shall be parked only in striped parking spaces and not in
driveways, access roads, loading areas or other locations not
specifically designated for parking. Landlord shall have the right
to assign parking spaces for the exclusive use of other tenants of
the Property and/or Landlord and their employees and invitees, and
Tenant and its employees and invitees shall not park their vehicles
in parking spaces allocated to others by Landlord. Landlord shall
not be required to keep parking spaces clear of unauthorized
vehicles or to otherwise supervise the use of the parking areas.
Landlord shall not be responsible for any damage to or theft of any
vehicles in the parking areas. Landlord may issue parking permits,
install a gate system or impose any other system as Landlord deems
necessary for the use of the parking areas; provided, however, that
upon notice from Tenant regarding suspected unauthorized use of the
parking areas, Landlord shall use reasonable efforts to cause
unauthorized vehicles to be removed. Landlord reserves the right
from time to time to make any alterations or repairs that it deems
necessary to the parking areas, roads or driveways, and to
temporarily revoke or temporarily modify the parking rights granted
to Tenant for such repairs or maintenance for as short a time
period as reasonably practicable, without any abatement or
reduction of rent by reason thereof; provided, however, that
Landlord shall give
13
Tenant as much
advance notice as is reasonably practical under the circumstances
(in no event less than seven (7) days, except in the instance
of a bona fide emergency) in anticipation of repairs or
improvements to the parking areas, and all such projects (if any)
shall be undertaken in a manner designed to be as least disruptive
to Tenant as is reasonably practical under the circumstances.
Landlord may require Tenant to furnish it with the automobile
license numbers assigned to vehicles of Tenant and its employees
and invitees and to notify Landlord of any changes thereof.
Landlord may limit parking in the front yard of the Property to
visitors.
11. No
Representations . Tenant acknowledges that Landlord has not
made any representation with respect to any matter or thing
affecting or related to the Premises, other than expressly provided
herein.
12.
Compliance with Law . (a) As of the Commencement
Date, Landlord represents to the best of its knowledge that the
Property is in compliance with all laws, orders and regulations of
any governmental authority and that Landlord has obtained all
required certificates of occupancy applicable to the Premises. If
the Property is not in compliance with such laws, orders and
regulations as of the Commencement Date, Landlord, at its sole cost
and expense, shall be responsible for bringing the Property into
compliance with all such laws, orders and regulations unless Tenant
is obligated to comply with all such laws, orders and regulations
under the terms of the Prior Lease, or unless Tenant has caused the
Property not to be in compliance with such laws, orders and
regulations.
(b) From
and after the Commencement Date, Tenant shall take all necessary
action to conform to and comply with all laws, orders and
regulations of any governmental authority or Landlord’s or
Tenant’s insurers, or any Landlord’s Mortgagee, now or
hereafter applicable to the Premises or Tenant’s use or
occupancy, including the Americans with Disability Act of 1990 (as
amended) and the Federal Occupational Safety and Health Act of 1970
(as amended), except that Tenant shall not be required to perform
any structural repairs or alterations to the Premises unless such
structural repairs or alterations are required (i) as a result
of Tenant’s particular ma
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