Exhibit 10.1
Commercial Lease
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DATE:
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October 24,
2005
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PARTIES:
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LANDLORD:
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CHINOOK
BUSINESS PARK, L.L.C.,
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A Washington
limited liability company
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1901 North
Fourth Street
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Yakima,
Washington 98901
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TENANT:
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HOUSEVALUES,
INC.,
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A Washington
corporation
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11332 N.E.
122 nd Way
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Kirkland,
Washington 98034
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LEASED PREMISES . The Leased Premises is located at 1700
North 6 th Street, Yakima, Washington, on the
Property legally described on Exhibit A attached hereto. The Lease
is subject to all easements, restrictions, agreements of record,
mortgages and deeds of trust, and zoning and building laws;
provided, notwithstanding anything to the contrary in this Lease,
Landlord represents that (i) the Leased Premises may be used
by Tenant for the purposes authorized in this Lease;
(ii) Landlord will deliver the Leased Premises in a broom
clean condition, with all of Landlord’s personal property
being stored in the Building and all debris removed, and the Leased
Premises and Building otherwise ready for Tenant’s
improvement work; (iii) the Building structure, foundation and
roof and all Building systems are and shall be throughout the
Initial Term and any extensions thereof in good working condition;
and (iv) Landlord shall be responsible for all capital
replacements and repairs to the structure, foundation and roof, as
set forth in paragraph 6 below. The Leased Premises shall consist
of (a) approximately 2.56 acres of the Real Property described
on Exhibit A, together with all rights and appurtenances thereto,
and (b) an office/warehouse building (“the
Building”) containing an agreed upon thirty-six
thousand one hundred thirty-four (36,134) square feet of
rentable area, and (c) related primary and
supplemental parking facilities shown on the Site Plan attached as
Exhibit B, and rights attendant thereto as further defined and
outlined in this Lease. A portion of the Building comprising
approximately twelve thousand nine hundred eight-one
(12,981) square feet, is designated on Exhibit B and shall be
referred to herein as the “Reserved Area.” Tenant shall
be entitled to use the Reserved Area for any and all Permitted Uses
and to stage and install in the Reserved Area Tenant Improvements,
together with Tenant’s furniture, fixtures and equipment;
provided, however, if prior to the first anniversary of the
Commencement Date (the “First Anniversary”) any of
Tenant’s employees actually use any portion of the Reserved
Area to conduct business operations thereon then, until the First
Anniversary, the monthly Base Rent shall be increased by $0.38 per
month for each rentable square foot of the Reserved Area so used by
Tenant during such use. Use of the Reserved Area for storage shall
not be considered a business activity triggering a Base Rent
obligation. After the first anniversary of the Commencement Date,
Tenant shall be entitled to use the Reserved Area for any Permitted
Use by paying Base Rent in accordance with paragraph 2.1
below.
TENANT IMPROVEMENTS . Except as otherwise expressly set forth
in this Lease, Tenant shall be responsible, at its sole cost and
expense, for any and all alterations or improvements to the Leased
Premises installed by Tenant that are necessary to accommodate the
Tenant’s business authorized in this Lease. Any and all
alterations or improvements to the Leased Premises made by Tenant
shall be in strict accordance with the provisions of paragraph 6 of
this Lease, whether made before or after the Lease Commencement
Date. Except for parking facilities to be completed by Landlord in
accordance with paragraph 11.7 below of this Lease or alterations
or improvements necessary to satisfy Landlord’s obligations
under this Lease, Tenant, by taking occupancy of the Leased
Premises, accepts the Leased Premises in their then condition,
excluding any material latent defects known to Landlord and not
disclosed to Tenant, “AS IS” . Tenant agrees
that any equipment or building fixture items that will have some
material salvage value after they have been removed by
Tenant’s contractor as part of Tenant’s Work will
remain the property of Landlord and may be used or sold by Landlord
as long as Landlord promptly removes such items from the Leased
Premises. If Landlord does
not remove such items from the Leased Premises
promptly or fails to identify a salvageable item prior to its
removal by Tenant’s contractor, Tenant shall be entitled to
sell or otherwise dispose of such items as Tenant may determine.
Landlord and Tenant agree to work cooperatively with each other and
with Tenant’s contractor to identify, in advance of any
actual Tenant Work if possible any equipment of fixtures that might
have material salvage value to Landlord. Tenant shall have no
obligation to store, maintain, preserve or account for any such
equipment of fixture items.
AGREEMENT : LANDLORD HEREBY LEASES TO TENANT AND TENANT
DOES HEREBY AGREE TO LEASE FROM LANDLORD THE ABOVE-DESCRIBED LEASED
PREMISES UPON THE FOLLOWING TERMS AND CONDITIONS:
1. TERM .
1.1 Initial
Term . The Lease term shall for a period of five
(5) years , commencing on the later of:
(i) October 22, 2005 or (ii) the date on which this
Lease is signed and delivered by Landlord and Tenant (the
“Commencement Date”) and shall terminate on the day
prior to the fifth anniversary of the Commencement Date, at 5:00
p.m. (PST). If Tenant occupies the Premises prior to the
Commencement Date, Tenant’s occupancy of the Premises shall
be subject to all of the provisions of this Lease. Early occupancy
of the Premises shall not advance the expiration date of this
Lease. Notwithstanding the foregoing, if by the Commencement Date
Landlord does not deliver exclusive possession of the Leased
Premises to Tenant as represented, then the Commencement Date shall
be delayed until it is so delivered; provided, however, if Landlord
fails to deliver exclusive possession of the Leased Premises to
Tenant as represented by December 14, 2005, then Tenant shall
have the right to terminate this Lease, unless the reason for
Landlord’s failure is solely attributable to a Tenant breach
of this Lease.
1.2 Option Term
. Unless Tenant is then in material default under this Lease,
Tenant shall have the option to extend the Initial Term of this
Lease for one (1) additional five (5)-year
period on the same terms and conditions as set forth in
this Lease except as to rent, by giving Landlord written notice of
exercise of this option at least six (6) months
before the end of the Initial Term. Rent for the Option Term shall
be ninety-five percent (95%) of the then Fair
Market Rental (as defined below) of the Leased Premises to be
mutually agreed to not less that ninety
(90) days prior to the commencement date of the Option
Term. Fair Market Rental shall mean then-current market rents for
similarly-situated, similar quality buildings in the Yakima, WA
area taking into consideration, without limitation, leasing
concessions, landlord allowances and transaction costs then being
offered to tenants for new lease transactions. If the parties are
unable to agree on the Fair Market Value, then the parties will
submit the determination of Fair Market Rental to binding and final
appraisal in accordance with the appraisal procedures set forth in
this paragraph. If the parties are unable to reach an agreement on
the Fair Market Rental within thirty (30) days
after Tenant gives Landlord written notice of its exercise of its
option to extend, the parties shall negotiate in good faith and
select one (1) , qualified independent appraiser
licensed in the state of Washington and familiar with the sale and
rental of commercial real property in the area, which includes the
Leased Premises. The parties shall each pay one-half
( 1 / 2 ) of the cost of such an appraisal.
The Fair Market Rental determined by the appraiser (consistent with
the limitations set forth in this paragraph) shall be used as the
basis for the rent for the Option Term, unless Landlord or Tenant
gives the other party written notice within fifteen
(15) days from its receipt that the appraisal is not
acceptable. The party objecting to the appraisal shall then obtain
a second independent appraisal at such party’s sole cost and
expense within thirty (30) days of such
rejection. In such an event, the Fair Market Rental of the Leased
Premises shall be the average of the initial appraisal and the
second appraisal obtained by the party objecting to the initial
appraisal. The appraisal process set forth above must completed no
later than thirty (30) days prior to the
expiration of the Initial Lease Term.
1.3 Early Termination
Right . Notwithstanding the Initial Term set forth in
paragraph 1.1 above, and provided Tenant is not in material default
under this Lease Tenant shall have the right to terminate this
Lease at any time after the third anniversary of the Lease
Commencement Date). Tenant may exercise its limited right to
terminate this Lease by providing Landlord written notice within
six (6) months prior to the effective date of
termination (which shall be no less than six
(6) months after the date of notice of termination).
If Tenant exercises its termination right, Landlord shall have the
right to install “For Lease” signs three
(3) months prior to the anticipated termination date
and may show the Leased Premises to prospective tenants consistent
with the terms and conditions of this Lease, by providing Tenant
with reasonable advance
notice of such showings and provided
such access does not cause any material disruption to Tenant.
Tenant shall continue to be liable for all Rent and Additional Rent
up to and including the effective date of termination. As
additional consideration to the Landlord for the lease termination
rights set forth in this paragraph, in the event Tenant exercises
its early termination right, Tenant shall pay to Landlord a lease
termination fee equal to the unamortized balance of the commission
paid to Tenant’s broker (amortized over the Initial
Five (5)-Year Term). The early termination fee shall
be paid one-half ( 1 / 2 ) with Tenant’s initial notice
of termination and the remaining one-half (
1
/
2
)
on the effective date of
the termination set forth in the notice. Attached hereto as Exhibit
C is an amortization schedule reflecting the early termination fee
for each month of the Lease Term.
2. RENT .
2.1 Base Rent
. Tenant shall pay Landlord monthly rent for the Initial Term
of this Lease as set forth below, payable in advance in equal
monthly installments on or before the first day of each calendar
month during the term of this Lease.
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Lease Months
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Total
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Months 1-3*
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$
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0.00
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Months 4-12**
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$
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13,627.30 /month
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Months 13-60
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$
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18,560.80/ month
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*Note : During months 1-3, Tenant shall pay its share
of operating expenses (utilities, taxes, insurance premiums, etc.)
monthly, in advance in accordance with the terms and provisions of
this Lease. Tenant shall be entitled to the equivalent of no Base
Rent for three (3) full months. Therefore, if the Commencement
Date is not the first day of a calendar month, the Base Rent for
the 4 th month of the Term will be
appropriately pro rated.
**Note : Subject to adjustment during said months in
the event business activities are conducted in the Reserved Area
prior to the first anniversary of the Commencement Date, as
provided in the paragraph entitled “Leased Premises”
above.
Upon signing this Lease, Tenant shall pay and
deliver to Landlord the fourth (4
th
) month’s
Base Rent in the amount
of Thirteen Thousand Six Hundred Twenty-seven and 30/100
Dollars ($13,627.30) , which shall be applied to the rent
amounts first coming due under the Lease. If this Lease commences
on a day other than the first day of a calendar month, for that
partial month, the monthly Base Rent shall be prorated based on the
actual number of days in a calendar month.
2.2 Interest and Late
Charges . All rent and other payments not paid
when due shall bear interest from the date due until fully paid at
the rate of twelve percent (12%) per annum , but
not in any event at a rate greater than the maximum rate of
interest permitted by law. In addition, Tenant acknowledges that
late payment of any rent or other payment required by this Lease
from Tenant to Landlord will result in collection costs to
Landlord, the extent of which additional cost is extremely
difficult and economically impractical to ascertain. Tenant
therefore agrees that if it fails to make any rent or other payment
required by this Lease to Landlord within ten
(10) days of the date when it is due, Landlord may
impose a late charge of five cents (5¢) per
dollar , per month, of the overdue payment or One
Hundred Dollars and No/100 ($100.00) per month , whichever
is greater, to reimburse Landlord for the costs of collecting the
overdue payment; provided, however, Landlord agrees to give Tenant
at least one business day to cure a failure to pay an amount due
before charging such a late fee unless Tenant has failed to pay an
amount owed under this Lease when due on two or more prior
occasions in the last twelve months. Tenant shall pay the late
charge upon demand by Landlord. Tenant agrees that the late charge
is a reasonable estimate of the costs to Landlord of collecting the
overdue payment. Landlord may levy and collect the late charge in
addition to all
other remedies available for
Tenant’s default, and collection of a late charge shall not
waive the breach caused by the late payment.
2.3 Place of
Payment . All rent payments required by this Lease
shall be made directly to Landlord by delivering each monthly
payment to Landlord or Landlord’s agent personally or by
mailing the payment to Landlord at the address set forth in this
Lease or to such other address as Landlord may, from time to time,
designate in writing.
2.4 Net Lease
Provision . All payments required to be paid by
Tenant under this Lease, other than Base Rent, will constitute
Additional Rent. This is intended to be a “triple net”
Lease, meaning that, unless otherwise expressly set forth, Tenant
shall pay, except as limited herein, all expenses reasonably
incurred by Landlord relating to the reasonable repair, maintenance
and operation of the Leased Premises (except with respect to any
expenses that are Landlord obligations as described in this Lease)
after commencement of the Lease term, and all rent ( including
Base and Additional Rent ) shall be received by Landlord
without set-off, offset, abatement, or deduction of any kind,
except as otherwise expressly provided herein. Notwithstanding
anything herein to the contrary, Tenant shall not be obligated to
pay for any of the following: (i) legal fees, brokerage
commissions, advertising costs, or other related expenses incurred
by Landlord in connection with the leasing of space in the
Building; (ii) repairs, alterations, additions, improvements
or replacements made to rectify or correct any defect in the
original design, materials or workmanship of the Building or common
areas (but not including repairs, alterations, improvements or
replacements made as a result of ordinary wear and tear);
(iii) damage and repairs attributable to fire or other
casualty; (iv) damage and repairs necessitated by the
negligence or willful misconduct of Landlord, Landlord’s
employees, contractors or agents; (v) executive salaries or
salaries of service personnel to the extent that such personnel
perform services not solely in connection with the management,
operation, repair or maintenance of the Building;
(vi) Landlord’s general overhead expenses not related to
the Building; (vii) legal fees, accountants’ fees and
other expenses incurred in connection with Landlord’s title
to or interest in the Building, Leased Premises or any part
thereof; (viii) costs (including permit, license and
inspection fees) incurred in renovating or otherwise improving,
decorating or painting or altering space for tenants or other
occupants of vacant space (excluding common areas) in the Building;
(ix) costs incurred due to a violation by Landlord or any
other tenant of the Building of the terms and conditions of a
lease; (x) cost of any service provided to Tenant for which
Landlord is reimbursed; (xi) any other expense which, under
GAAP applicable to real estate operations, would not be considered
a reasonable maintenance and operating expense; (xii) cost and
expenses which would be capitalized under GAAP; and
(xiii) costs incurred for a hazardous waste clean-up unless
caused by Tenant. In no event shall Landlord charge any property
management fees or charges or collect in excess of 100% of
operating expenses and shall not recover any item of cost more than
once. Tenant shall have the right to audit Landlord’s books
and records pertaining to any prior operating expenses.
3. BUSINESS PURPOSE AND
USE .
3.1 Permitted
Use . Tenant may use the Leased Premises only for
general office, light manufacturing (excluding recreational vehicle
manufacturing) or retail uses, including (without limitation)
operating a contact or call center business and activities
reasonably related thereto, including (without limitation)
recruiting and training, and for no other purpose without the
written consent of Landlord, which consent shall not be
unreasonably withheld, conditioned or delayed. Tenant shall be
permitted to use the Leased Premises at any and all times of each
day, month and year of the Term, unless prohibited from doing so by
applicable law.
3.2 Compliance with
Laws . In connection with its use, Tenant shall
comply, at its expense, with all applicable laws, regulations and
requirements of any public authority, including those regarding
maintenance, operation and use of the Leased Premises and any
appliances on the Leased Premises ( including signs ).
Without limiting the generality of the foregoing, after the
Commencement Date of this Lease, Tenant, at its sole cost and
expense, shall be responsible for complying with all applicable
governmental rules and regulations required by Tenant’s
specific use of the Leased Premises or changes in applicable laws,
including, but not limited to, repairs or alterations to the
interior, exterior or structure of the Leased Premises necessitated
by changes in applicable building codes, handicapped access laws or
similar regulations. Notwithstanding the foregoing, Landlord
represents that it has not received any notice stating or is
otherwise aware of any condition making the Leased Premises not
currently in compliance with all
applicable laws. This
Section 3.2 shall not limit Landlord’s obligation to
comply with any applicable laws related to the Building provided
the non-compliance was not caused by Tenant.
3.3 Supervision
. Tenant shall keep the Leased Premises clean and orderly.
Tenant will supervise its employees and cause Tenant’s
agents, independent contractors, employees, customers, suppliers
and invitees to conduct their activities in such a manner as to
comply with the requirements of this Lease and the rules and
regulations described herein.
3.4 Storage,
Trash . Tenant shall not store anything outside
the Building except in strict compliance with requirements of the
applicable governmental authority. Tenant shall dispose of its
trash in a manner reasonably acceptable to Landlord, at
Tenant’s expense, which shall include an obligation to
provide cleaning and waste removal services a minimum of every
other day that Tenant is open for normal business
activities.
4. UTILITIES AND TAXES
.
4.1 Utilities
Generally . The Building is already currently
served by electrical power, water and gas. Landlord shall not take
any action to prevent Tenant from using the HVAC system serving the
Leased Premises 24 hours per day, 7 days per week, 52 weeks per
year. If electrical power, water and gas are not available to the
Leased Premises as of the Lease Commencement Date as a result of
Landlord’s acts or omissions, Tenant shall have the right
(after notice to Landlord and opportunity to cure, not to exceed
three (3) business days ), in addition to any
other right or remedy available to Tenant, to take whatever action
Tenant may consider necessary or appropriate to obtain such
services and to deduct the reasonable cost of obtaining such
services thereof from the rent or other obligations owed under this
Lease.
4.2 Payment
. Tenant shall pay directly to the appropriate supplier all
charges for utilities and services supplied to the Leased Premises
and billed to Tenant, including, without limitation, hook-up and
service charges for electricity, gas, telephone, water, sewer,
wastewater discharge and garbage collection and janitorial
services. If utility consumption is not separately metered to the
Leased Premises, Tenant shall pay Landlord for all utilities
consumed on the Leased Premises or any portion thereof at a rate
which as nearly as possible represents the cost to Landlord of
providing such utilities to Tenant. Payment shall be made within
ten (10) days after Tenant receives the relevant
billings from Landlord, or within the time permitted for payment by
the utility company where Tenant is directly billed. Landlord
represents that the Leased Premises are already connected to and
are ready to receive electrical, water, telephone and sewer
services. Tenant may make its own arrangements for janitorial and
trash removal services. Landlord shall cooperate in permitting
Tenant to make arrangements to have all utility services that are
supplied to the Leased Premises billed directly to
Tenant.
4.3 Interruption of
Service . Landlord shall not be liable for any
failure or interruption of utilities or services to the Leased
Premises, unless caused by the negligence of Landlord or its
agents. If Landlord fails to cooperate with Tenant and the service
provider in restoring any interruption of utilities or services, to
the extent Landlord’s cooperation is needed or may be of
assistance in restoring such utilities or services and are
requested by Tenant, Tenant shall have the right, in addition to
any other right or remedy available to Tenant, to take whatever
action Tenant may consider necessary or appropriate to restore such
utilities or services, and to deduct the reasonable cost thereof
from the rent or other obligation owed under this Lease.
4.4 Taxes and
Assessments .
4.4.1 Taxes and Other
Payments . In addition to Base Rent, Tenant shall pay
as additional rent its share of all real property taxes and
assessments of any public authority levied or assessed against the
Leased Premises after the Commencement Date. Landlord or Tenant
shall have the right to contest, in Landlord’s name, all such
taxes; provided, however, Tenant shall pay for the cost of
reasonably contesting any such taxes. Real property taxes and
assessments shall include all real property taxes and assessments
of any public authority assessed against the Leased Premises and
improvements located thereon, and rent tax, gross receipts tax, tax
on Landlord’s interest under this Lease, or any tax in lieu
of the foregoing, whether or not such tax is now in effect
(excluding any Tenant tax based on Landlord’s net
income).
Tenant’s “share”
of taxes and assessments shall be a percentage thereof equal to the
percentage which the net rentable area of the building leased by
Tenant bears to the total net rentable area of the building located
on the Leased Premises; provided, however, taxes or assessments on
any improvements solely used by Tenant and separately assessed by
the applicable taxing authority, and all utilities and operating
expenses associated with improvements solely used by Tenant, shall
be paid in full by Tenant. Tax payments for any partial assessment
period shall be prorated between Landlord and Tenant and paid in
advance. Tenant’s share of all other real property, taxes and
assessments shall be paid to Landlord no less than ten
(10) days prior to their date due to the applicable
taxing authority. If not separately billed or charged to Tenant,
Landlord shall promptly provide Tenant with copies of all
assessment notices, the tax statements or other sufficient
documentation of the amount and due date of all such taxes, which
shall then be timely paid by Tenant. If Tenant fails to timely pay
any real property taxes, charges or assessments, Landlord may pay
such amounts and the cost thereof, together with interest at the
rate of twelve percent (12%) per annum , shall
be immediately due and payable from Tenant to Landlord. Tenant
shall pay such amounts to Landlord with the monthly rental payment
next falling due.
4.4.2 Personal Property
Taxes . Tenant shall also pay, before delinquency, any
and all taxes levied or assessed on or as a result of
Tenant’s leasehold improvements, equipment, furniture,
fixtures and any other personal property located on the Leased
Premises. In the event any or all of Tenant’s leasehold
improvements, equipment, furniture, fixtures, and other personal
property shall be assessed and taxed with the real property, Tenant
shall pay to Landlord its share of such taxes within ten
(10) days after delivery to Tenant from Landlord of
the taxing authorities’ statement in writing setting forth
the amount of such taxes applicable to Tenant’s
property.
5. INSURANCE AND INDEMNITY
PROVISIONS :
5.1 Liability
Insurance . Tenant, at its expense, shall obtain and
keep in force during the entire term of this Lease a broad form
policy of commercial general liability insurance. Such policy or
policies shall provide for liability coverage with minimum combined
single limits for bodily injury and property damage per occurrence
in amounts not less than Two Million Dollars
($2,000,000) . The limits of liability insurance required
by this paragraph shall not, however, limit the liability of Tenant
hereunder. The Tenant’s liability insurance required by this
paragraph shall be made on an “occurrence” basis and
not on a “claims made” basis. The liability insurance
referred to in this paragraph 5.1 may be provided under (i) an
individual policy covering the Leased Premises, or (ii) a
blanket policy or policies that include other liabilities,
properties and locations of Tenant; so long as the amount and
coverage of insurance required to be carried under this
Section 5 is not diminished, or (iii) a combination of
the foregoing insurance programs. To the extent any deductible is
permitted or allowed as part of any insurance policy carried by
Tenant in compliance with this Section 5, Tenant shall be
deemed to be covering the amount of such deductible under an
informal plan of self-insurance; provided, however, that in no
event shall any deductible exceed Five Thousand Dollars
($5,000) .
5.2 Property Insurance of
Tenant . Tenant, at its expense, shall maintain in
effect (a) a property insurance policy using the “Causes
of Loss - Special Form” on furnishings, trade fixtures,
inventory and equipment located on the Leased Premises, for their
full replacement value and (b) similar insurance on all plate
glass on the Leased Premises for its replacement cost. The
applicable proceeds of such insurance, so long as this Lease
remains in effect, shall be used to repair or replace the leasehold
improvements, fixtures, equipment and plate glass so
insured.
5.3 Property Insurance of
Landlord . Landlord shall maintain in effect property
insurance covering the Leased Premises (except those items
specified in paragraph 5.2), but not the contents thereof, using
the “Causes of Loss - Special Form” covering loss or
damage to the Leased Premises in an amount equal to the full
replacement value thereof. Such insurance shall include at a
minimum those coverages described in Exhibit F attached hereto.
Tenant shall reimburse Landlord for its prorata share of the cost
of such insurance as an operating expense calculated in the same
manner as Tenant’s share of real estate taxes set forth in
paragraph 4.4.1 above.
5.4 Insurance
Policies . All Tenant’s insurance policies shall
name Landlord as an additional insured and shall be with companies
and with loss-payee clauses reasonably satisfactory to
Landlord. Copies of all policies or
certificates evidencing such insurance shall be delivered to
Landlord by Tenant prior to Tenant’s occupancy of the Leased
Premises. All policies shall bear endorsements requiring
thirty (30) days’ written notice to
Landlord prior to any change or cancellation.
5.5 Waiver of
Subrogation . Tenant and Landlord each waive any and
all rights of recovery against the other, or against the employees,
agents and representatives of the other, for loss of or damage to
such waiving party, property, or property of others under its
control, where such loss or damage is insured against under any
third party insurance policy in force at the time of such loss or
damage. Landlord and Tenant shall, upon obtaining the policies of
insurance required hereunder, give notice to the insurance carriers
that the foregoing mutual waiver of subrogation is contained in
this Lease. The foregoing waiver shall not apply if it would have
the effect, but only to the extent of such effect, of invalidating
any insurance coverage of Landlord or Tenant.
5.6 Indemnity of Tenant and
Landlord . Tenant shall defend, indemnify and hold
Landlord harmless from any and all costs, claims or liability
arising from any third party claim pertaining to:
(1) Tenant’s use of the Leased Premises; (2) the
conduct of Tenant’s business or anything else done or
permitted by Tenant to be done in or about the Leased Premises;
(3) any breach or default in the performance of Tenant’s
obligations under this Lease; (4) any misrepresentation or
breach of warranty by Tenant under this Lease; or (5) other
acts or omissions of Tenant. Tenant shall defend Landlord against
any such costs, claims or liability at Tenant’s expense with
counsel reasonably acceptable to Landlord or, at Landlord’s
election, Tenant shall reimburse Landlord for any reasonable legal
fees or costs reasonably incurred by Landlord in connection with
any such claim. Tenant shall not however be obligated to indemnify
Landlord to the extent any such claim or loss is caused by the
concurrent negligence of Landlord or its agents or employees. As
used in this paragraph, the term “Tenant” shall include
Tenant’s officers, employees, agents, contractors and
invitees, if applicable. Landlord shall defend, indemnify and hold
Tenant harmless from any and all costs or liability arising from
any third party claim pertaining to (1) Landlord’s use
of the Leased Premises; (2) the conduct of Landlord’s
business or anything else done by Landlord in or about the Leased
Premises; (3) any breach or default in the performance of
Landlord’s obligations under this Lease; (4) any
misrepresentation or breach of warranty by Landlord under this
Lease; or (5) other acts or omissions of Landlord. Landlord
shall defend Tenant against any such costs, claims or liability at
Landlord’s expense with counsel reasonably acceptable to
Tenant or, at Tenant’s election, Landlord shall reimburse
Tenant for any reasonable legal fees or costs reasonably incurred
by Tenant in connection with any such claim. Landlord shall not
however be obligated to indemnify Tenant to the extent any such
claim or loss is caused by the concurrent negligence of Tenant or
its agents or employees.
6. MAINTENANCE, REPAIRS AND
ALTERATIONS .
6.1 Landlord’s
Obligations . Except for damage caused by any
negligent or intentional act or omission of Tenant or
Tenant’s agents, employees or invitees, Landlord, at
Landlord’s expense shall keep in good order, condition, and
repair the capital and structural components of the Leased Premises
defined as the foundation, footings, concrete slabs, concrete pier,
structural steel, roof deck and skin, exterior walls (excluding
painting), facade, and the existing plumbing and sewer lines in or
serving the Building (excluding any new plumbing or sewer lines
installed by Tenant) and the underground utilities (from the real
property boundary line to the point they enter the Building located
on the Premises), and capital improvements to the parking lot
(e.g., repaving or replacement of light fixtures or drainage
systems). Landlord shall not be required to maintain in the Leased
Premises the interior surface of exterior walls, floors, interior
windows, doors, or interior plate glass. Landlord shall have no
obligation to make repairs under this paragraph 6.1 until a
reasonable time after receipt of written notice of the need for
such repairs or the need for such repairs otherwise comes to the
attention of Landlord, but shall make all repairs promptly
following receipt of any such notice or after becoming aware of the
need for such repairs. The definition of capital components shall
be based on Generally Accepted Accounting Principels
(GAAP).
6.2 Tenant’s
Obligations . Tenant, at Tenant’s expense, shall
keep in good order, condition, and repair the Leased Premises and
every part or portion thereof not required to be repaired and
maintained by Landlord. Other than with regard to those components
to be maintained and repaired by Landlord, Tenant shall be
responsible to maintain and keep in a good working state of repair
the Leased Premises, including without limitation, to the extent
not the responsibility of Landlord, the maintenance,
replacement and repair of any
windows, plate glass, signs, doors, window casings, glazing,
heating, ventilating, air conditioning systems, and plumbing,
electrical wiring and conduits serving the Leased Premises and
general maintenance and upkeep on all parking and landscaped areas
(including general maintenance and irrigation, ice and snow
removal, and parking lot striping or cleaning). Tenant shall be
responsible for providing (or contracting for) customary building
services including routine maintenance of mechanical, electrical,
sprinkler and HVAC systems for the Premises and interior cleaning
at Tenant’s sole expense. Landlord shall deliver the Leased
Premises to Tenant with the heating, ventilating, and air
conditioning systems, plumbing and electrical conduits, circuit
breakers, panel boxes, meters and water heaters in good working
order and condition. Tenant shall promptly repair any damage to any
elements to be maintained and repaired by Tenant from damages
caused by any burglary or attempted burglary. Tenant shall keep the
glass on all windows and doors clean and presentable, replace
immediately all broken glass in the Building; make any necessary
repairs to, or replacements of, all doors and door closure
apparatus and mechanisms; keep all plumbing clean and in a good
state of repair, including pipes, drains, toilets, basins, water
heaters and those portions of the heating system within the walls
of the Premises, and keep all utilities, including the circuit
breakers, panel boxes and meters in a good state of repair.
Additionally, it shall be the Tenant’s responsibility to
maintain and repair any and all improvements installed by Tenant to
the extent they are not damaged by Landlord’s failure to
repair or maintain the Building as described in this Lease. Nothing
herein shall obligate Tenant to repair or maintain the Leased
Premises with regard to any condition caused by (i) ordinary
wear and tear; (ii) a casualty or condemnation; or
(iii) any act or omission of Landlord or any failure by
Landlord to comply with this Lease.
6.3 Surrender of Leased
Premises . On the last day of the term of this
Lease, or on any sooner termination, Tenant shall surrender the
Leased Premises to Landlord in good condition, ordinary wear and
tear excepted. Other than ordinary wear and tear, Tenant shall
repair any damage to the Leased Premises occasioned by
Tenant’s use thereof or by the removal of Tenant’s
trade fixtures, furnishings, and equipment, which repair shall
include the patching and filling of holes and repair of any
structural damage.
6.4 (a)
Landlord’s Rights if Tenant Fails To Perform
Tenant’s Obligations . If Tenant fails to
perform any of its repair or maintenance obligations under this
Lease within twenty (20) days after written notice from
Tenant, or sooner if an emergency exists or the failure renders the
Leased Premises a danger to persons or property, then in addition
to any other right or remed