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EXHIBIT 10.9
DATE OF LEASE EXECUTION: August 4th, 2005
(To be completed by Landlord)
ARTICLE I
REFERENCE DATA
1.1 SUBJECTS REFERRED TO:
Each reference in this Lease to any of the following subjects
shall be
construed to incorporate the data stated for that subject in
this Section 1.1:
LANDLORD: MCC3, LLC, a Delaware limited liability company
MANAGING AGENT: Spaulding and Slye LLC
LANDLORD'S ADDRESS: c/o Spaulding and Slye LLC
255 State Street
Boston, MA 02109
Attn: Chief Financial Officer
with a copy of all notices to:
Spaulding and Slye LLC
1717 Pennsylvania Avenue, N.W.
Washington, DC 20006
Attn: Director of Property Management
and
New Boston Fund, Inc.
60 State Street
Suite 1500 Boston, MA 02109
Attn: Jerome L. Rappaport, Jr.
LANDLORD'S REPRESENTATIVE: Sue Kravitz
TENANT: Vanda Pharmaceuticals, Inc., a Delaware Corporation
TENANT'S ADDRESS (FOR NOTICE AND BILLING):
Before Commencement Date:
Vanda Pharmaceuticals, Inc.
9620 Medical Center Drive, Suite 201
Rockville, MD 20850
Attn: Chip Clark
After Commencement Date:
Vanda Pharmaceuticals, Inc.
9605 Medical Center Drive
Rockville, MD 20850
Attn: Chip Clark
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with a copy of all notices to:
Looney, Cohen, Reagan & Aisenberg LLP
109 State Street, 2nd Floor
Boston, MA 02109
Attn: James H. Cohen, Esq.
TENANT'S REPRESENTATIVE: Chip Clark
BUILDING: The building located on the parcel of land described
in Exhibit A
hereto. References in the Lease to "Base Building" mean the
Building shell
including base Building mechanical, electrical and plumbing
systems (other
than the horizontal distribution lines, ducts or equipment);
main lobby
and elevator lobbies on the first floor, but excluding all
leased or
leasable areas within the Building. A more detailed description
of the
Building Standard Completed Shell is set forth in Part 1 of
Exhibit C
hereto.
BUILDING ADDRESS: 9605 Medical Center Drive, Rockville, MD
20850
RENTABLE FLOOR AREA OF TENANT'S SPACE: Approximately 17,002
square feet,
measured in accordance with Section 10.24 hereof.
TOTAL RENTABLE FLOOR AREA OF THE BUILDING: Approximately 115,691
square feet,
measured in accordance with Section 10.24 hereof.
TENANT'S DESIGN COMPLETION DATE: See Exhibit C - Part I
SCHEDULED TERM COMMENCEMENT DATE: January 1, 2006
TERM EXPIRATION DATE: June 30, 2016 or if the Commencement Date
occurs other
than January 1, 2006, then the Term Expiration Date shall be the
last day
of the 126th full calendar month of the Term.
APPROXIMATE TERM: Ten (10) years, six (6) months
ANNUAL RENT: $421,770.00 (triple net) for the first Lease Year
(subject to an
annual adjustment as provided in Section 4.1), computed as
follows:
<TABLE>
<S> <C>
$23.00 p.r.s.f. X 17,002 rentable square feet = $391,046.00 (the
"Base Annual Rent")
+ $ 1.81 p.r.s.f. X 17,002 rentable square feet = $ 30,773.62
(the "Additional Allowance Charge")
-----------
= $421,819.62 Annual Rent
===========
</TABLE>
ANNUAL ELECTRICAL COST: As provided in Section 4.4.
SECURITY DEPOSIT: $430,230.00
GUARANTOR: N/A
TENANT ALLOWANCE: In accordance with Section 3.5, Tenant shall
receive an
allowance for design and construction of improvements in
accordance with
Section 3.1 (a) in up to 2,578 square feet of the Premises to be
used as a
wet laboratory (the "Lab Space") not to exceed the sum of (i)
$40.00
p.r.s.f. of the Lab Space (the "Tenant Allowance"), plus (ii) at
Tenant's
option, up to an additional $70.00 p.r.s.f. of Lab Space (the
"Additional
Allowance"). Landlord shall complete improvements in the
remainder of the
Premises (the "Office Space") on a turnkey basis as provided in
Section
3.1(b). The costs incurred by Landlord in connection with the
design and
construction of improvements in the Office Space are herein
sometimes
referred to as the "Turnkey Costs." The Additional Allowance
shall be
amortized with interest thereon
2
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at twelve percent (12%) per annum over the first ten (10) Lease
Years, and
the amount amortized each Lease Year (herein referred to as
the
"Additional Allowance Charge") shall be added to Annual Rent
payable by
Tenant as herein provided. If Landlord does not provide the
entire
Additional Allowance to pay costs of completing laboratory space
as herein
provided, the amount of the Additional Allowance actually
provided by
Landlord shall be confirmed by Landlord and Tenant on the
Lease
Commencement Date Agreement and the Additional Allowance Charge
p.r.s.f.
shall be reduced to reflect the actual amount of Additional
Allowance
actually provided by Landlord, using the applicable interest
rate and
amortization period, and the Annual Rent shall be adjusted
accordingly.
Tenant shall have the option to prepay any or all of the
Additional
Allowance prior to the expiration or earlier termination of this
Lease
without penalty or additional finance charge on the amount so
prepaid.
TENANT'S SHARE: Tenant's Share shall be equal to a fraction, the
numerator of
which shall be the Rentable Floor Area of Tenant's Space (as the
same
may be increased or decreased in accordance with this Lease) and
the
denominator of which shall be the Total Rentable Floor Area of
the
Building.
PERMITTED USES: Office and laboratory use (including development
and testing,
including genetic testing, of pharmaceutical drugs, but
excluding
human or animal testing) allowable per applicable law only and
no
other use.
PUBLIC LIABILITY INSURANCE: SINGLE OCCURRENCE: $5,000,000
AGGREGATE: $10,000,000
LEASE YEAR: For all purposes of this Lease, the term "Lease
Year" shall mean any
period of twelve consecutive calendar months during the Term of
this
Lease which begins on the Commencement Date or an anniversary
thereof,
provided, however, that if the Commencement Date does not occur
on the
first day of a month, then the term "Lease Year" shall mean any
period
of twelve consecutive calendar months during the Term of this
Lease
beginning on the first day of the next calendar month following
the
Commencement Date, and the first Lease Year shall also include
the
period between the Commencement Date and the first day of
such
succeeding calendar month and provided further that the last
Lease
Year shall terminate on the Term Expiration Date or such earlier
date
on which the Lease may be terminated.
SPECIAL PROVISIONS: Provided Tenant is not in default hereunder,
one half of
each monthly installment of Base Annual Rent due for the first
twelve
(12) months of the initial Term shall be abated. The Security
Deposit,
whether in cash or in substantially the form of the letter of
credit
attached hereto as Exhibit I (the "Letter of Credit"), shall be
due
upon the execution of this Lease by Tenant.
1.2 EXHIBITS.
The exhibits and appendix listed below in this section are
incorporated in
this Lease by reference and are to be construed as part of this
Lease:
EXHIBIT A Legal Description of Lot
EXHIBIT B Part I - Plan Showing Tenant's Space
Part II - First Offer Space
EXHIBIT C Part I - Building Standard Completed Shell
Part II - Office Space Plan
Part III- Milestone Schedule
EXHIBIT D Landlord's Services
EXHIBIT E Rules and Regulations
EXHIBIT F Intentionally Omitted
EXHIBIT G Form of Estoppel Certificate
3
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EXHIBIT H Form of Lease Commencement Date Agreement
EXHIBIT I Form of Acceptable Letter of Credit
EXHIBIT J Form of Mortgagee Subordination and Nondisturbance
Agreement
EXHIBIT K Form of Ground Lessor Nondisturbance and Attornment
Agreement
APPENDIX A Method of Measurement
4
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1.3 TABLE OF CONTENTS
PAGE
----
ARTICLE I REFERENCE DATA
......................................... 1
1.1 SUBJECTS REFERRED TO: ..................................
1
1.2 EXHIBITS ...............................................
3
1.3 TABLE OF CONTENTS.......................................
5
ARTICLE II PREMISES AND TERM
...................................... 8
2.1 PREMISES ...............................................
8
2.2 TERM....................................................
8
2.3 OPTION TO EXTEND .......................................
8
2.4 RIGHT TO CANCEL ........................................
9
2.5 RIGHT OF FIRST OFFER ...................................
10
2.6 OPTION TO EXPAND .......................................
11
ARTICLE III CONSTRUCTION
........................................... 12
3.1 INITIAL CONSTRUCTION ...................................
12
3.2 PREPARATION OF PREMISES FOR OCCUPANCY ..................
14
3.3 GENERAL PROVISIONS APPLICABLE TO CONSTRUCTION ..........
16
3.4 REPRESENTATIVES ........................................
16
3.5 TENANT ALLOWANCE .......................................
16
3.6 LEASE COSTS ............................................
17
ARTICLE IV RENT
................................................... 17
4.1 RENT....................................................
17
4.2 OPERATING COSTS ........................................
18
4.3 REAL ESTATE TAXES ......................................
22
4.4 REFUNDS ................................................
24
4.5 ELECTRICITY.............................................
24
4.6 CHANGE OF FISCAL YEAR ..................................
25
4.7 PAYMENTS ...............................................
25
ARTICLE V LANDLORD'S COVENANTS
................................... 25
5.1 LANDLORD'S COVENANTS DURING THE TERM....................
25
5.1.1 Building Services ............................... 25
5.1.2 Additional Building Services .................... 26
5.1.3 Repairs ......................................... 26
5.1.4 Quiet Enjoyment ................................. 26
5.1.5 Access/Security.................................. 26
5.1.6 Intentionally Omitted ........................... 26
5.1.7 Indemnity ....................................... 26
5.1.8 Tenant's Costs .................................. 26
5.1.9 Lobby Directory.................................. 26
5.1.10 Compliance ...................................... 27
5.1.11 Insurance........................................ 27
5.2 INTERRUPTIONS ..........................................
27
5
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ARTICLE VI TENANT'S COVENANTS
......................................... 28
6.1 TENANT'S COVENANTS DURING THE TERM .........................
28
6.1.1 Tenant's Payments ..................................
28
6.1.2 Repairs and Yielding Up ............................
28
6.1.3 Occupancy and Use ..................................
29
6.1.4 Rules and Regulations ..............................
29
6.1.5 Safety Appliances and Licenses .....................
29
6.1.6 Assignment and Subletting ..........................
30
6.1.7 Indemnity ..........................................
31
6.1.8 Tenant's Insurance .................................
31
6.1.9 Tenant's Worker's Compensation Insurance ...........
32
6.1.10 Landlord's Right of Entry ..........................
32
6.1.11 Loading ............................................
33
6.1.12 Landlord's Costs ...................................
33
6.1.13 Tenant's Property ..................................
33
6.1.14 Laboror Materialmen's Liens ........................
33
6.1.15 Changes or Additions ...............................
33
6.1.16 Holdover ...........................................
34
6.1.17 Financial Statements ...............................
34
6.1.18 Compliance .........................................
34
6.1.19 Laboratories/Janitorial ............................
34
6.2 BANKRUPTCY .................................................
35
ARTICLE VII CASUALTY AND TAKING
........................................ 36
7.1 CASUALTY AND TAKING.........................................
36
7.2 TAKING .....................................................
37
7.3 RESERVATION OF AWARD .......................................
38
ARTICLE VIII RIGHTS OF MORTGAGEE
........................................ 38
8.1 PRIORITY OF LEASE ..........................................
38
8.2 RIGHTS OF MORTGAGE HOLDERS: LIMITATION OF MORTGAGEE'S
LIABILITY ..................................................
39
8.3 INTENTIONALLY OMITTED ......................................
39
8.4 NO PREPAYMENT OR MODIFICATION, ETC .........................
39
8.5 NO RELEASE OR TERMINATION ..................................
39
8.6 CONTINUING OFFER ...........................................
40
8.7 MORTGAGEE'S APPROVAL .......................................
40
ARTICLE IX DEFAULT
.................................................... 40
9.1 EVENTS OF DEFAULT ..........................................
40
9.2 TENANT'S OBLIGATIONS AFTER TERMINATION .....................
41
ARTICLE X MISCELLANEOUS
.............................................. 41
10.1 NOTICE OF LEASE
............................................ 41
10.2 INTENTIONALLY OMITTED
...................................... 42
10.3 NOTICES FROM ONE PARTY TO THE OTHER
........................ 42
10.4 BIND AND INURE
............................................. 42
10.5 NO SURRENDER
............................................... 42
10.6 NO WAIVER,
ETC.............................................. 42
10.7 NO ACCORD AND SATISFACTION
................................. 42
10.8 CUMULATIVE REMEDIES
........................................ 43
10.9 RIGHT TO CURE
.............................................. 43
6
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10.10 ESTOPPEL CERTIFICATE ...................................
43
10.11 WAIVER OF SUBROGATION ..................................
43
10.12 INTENTIONALLY OMITTED ..................................
43
10.13 FORCE MAJEURE ..........................................
44
10.14 BROKERAGE ..............................................
44
10.15 SUBMISSION NOT AN OFFER ................................
44
10.16 REPRESENTATIONS OF LANDLORD ............................
44
10.17 NO MERGER OF TITLE .....................................
44
10.18 WAIVER OF TRIAL BY JURY ................................
45
10.19 HAZARDOUS MATERIALS ....................................
45
10.20 PARKING ................................................
47
10.21 SURVIVAL ...............................................
48
10.22 APPLICABLE LAW AND CONSTRUCTION ........................
48
10.23 CONFIDENTIALITY ........................................
48
10.24 METHOD OF MEASUREMENT ..................................
49
10.25 APPROVALS ..............................................
49
10.26 GROUND LEASE PROVISIONS ................................
49
ARTICLE XI SECURITY DEPOSIT
....................................... 50
ARTICLE XII SATELLITE DISH ANTENNA AND SUPPLEMENTAL AIR UNITS
...... 52
7
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ARTICLE II
PREMISES AND TERM
2.1 PREMISES.
Subject to and with the benefit of the provisions of this Lease
and the
Ground Lease (as hereinafter defined) relating to the parcel of
land described
in Exhibit A attached hereto and made a part hereof (the "Lot"),
Landlord hereby
leases to Tenant, and Tenant leases from Landlord, Tenant's
Space shown in
Exhibit B attached hereto and made a part hereof, on the third
(3rd) floor of
the Building on the Lot, excluding exterior faces of exterior
walls, the common
facilities areas and building service fixtures and equipment
serving exclusively
or in common other parts of the Building. Tenant's Space, with
such exclusions,
is hereinafter referred to as the "Premises."
Tenant shall have, as appurtenant to the Premises, the right to
use in
common with others entitled thereto: (a) the common facilities
included in the
Building or on the Lot to the extent and in the location from
time to time
designated by Landlord and the common facilities, if any, on the
Johns Hopkins
University Montgomery County Campus (the "Campus") of which the
Building and Lot
are a part to the extent such facilities are available for use
by tenants of the
Building, and (b) the building service fixtures and equipment
serving the
Premises.
Landlord reserves the right from time to time, without notice or
liability
to Tenant, (a) to install, repair, replace, use, maintain and
relocate for
service to the Premises and to other parts of the Building or
either, building
service fixtures and .equipment wherever located in the Building
and (b) to
alter or relocate any common facilities, provided, however, that
the same do not
materially adversely affect Tenant's use of or access to the
Premises except in
the case of temporary disruptions caused by such activities.
Landlord shall use
reasonable efforts to minimize any disruption to Tenant's
enjoyment of the
Premises from construction and repair activity within the
Building. Tenant
acknowledges that Johns Hopkins University ("JHU") will conduct
evening and
weekend classes in the Building and that to accommodate such
users, the Building
common areas will be open from 7:00 a.m. to 11:00 p.m., Monday
through Friday,
and from 8:00 a.m. to 6:00 p.m., Saturday, Sunday and Holidays
(subject to
adjustment from time to time).
2.2 TERM.
To have and to hold for a period (the "Term") commencing on the
earliest
of (a) the later of (i) the Scheduled Term Commencement Date, or
(ii) the date
on which the Premises are deemed ready for occupancy as provided
in Section 3.2,
or (b) in any event, the date on which Tenant occupies ail or
any part of the
Premises for the purpose of conducting its business operations
(whichever of
said dates is appropriate being hereafter referred to as the
"Commencement
Date"), and continuing until the Term Expiration Date, unless
sooner terminated
as provided in this Lease. Promptly following Landlord's
request, Landlord and
Tenant agree to execute a Lease Commencement Date Agreement in
the form of
Exhibit H which shall establish the Commencement Date and become
part of the
Lease.
2.3 OPTION TO EXTEND.
Tenant shall have the right to renew the Lease in its entirety
for one
consecutive additional term of five (5) years (the "Extension
Term"), upon
written notice delivered to Landlord (the "Extension Notice")
not less than 12
months nor more than 15 months prior to the Term Expiration
Date; provided that
at the time Tenant gives the Extension Notice to Landlord and at
the time of
expiration of the initial Term, (i) Tenant is not in default
hereunder beyond
expiration of any applicable grace or cure periods, and (ii)
except for a
Permitted Assignment (as defined in Section 6.1.6), Tenant has
not assigned this
Lease and is not subleasing in the aggregate more than fifty
percent (50%) of
the Premises. In no event shall any assignee (other than a
Permitted Assignee,
as defined in Section 6.1.6) or subtenant be entitled to
exercise the right to
renew set forth in this paragraph.
8
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If this right to renew is exercised by Tenant, all terms,
covenants,
conditions and provisions of the Lease (including, without
limitation, those
related to additional rent, Operating Cost Escalations, Real
Estate Tax
Escalations, Tenant's Annual Electrical Cost and, if applicable,
Tenant's Annual
Water or Gas Cost) shall apply during the Extension Term, and
the Lease shall
continue in full force and effect except that: (a) Tenant shall
occupy the
Premises in its then "as is" and "where is" condition; (b) the
provisions of
this Lease as to Tenant Allowance, Turnkey Costs, Additional
Allowance, and
rental abatement for the first Lease Year shall not apply to the
Extension
Term; (c) the Annual Rent for the Premises shall be adjusted as
hereinafter
provided; and (d) Tenant shall have no further right to renew or
extend this
Lease unless otherwise agreed to in writing by the parties.
Annual Rent for the
first year of the Extension Term will be equal to the
then-projected market rate
of rent with market concessions for space of a similar quality
and otherwise
comparable to the Premises in the Building and in the market
area as of the
expiration of the initial Term and shall thereafter escalate, in
accordance with
market terms as determined in accordance herewith provided,
however, in no event
shall Annual Rent be less than the Base Annual Rent payable by
Tenant hereunder
during the 12-month period prior to commencement of the
Extension Term, plus any
remaining unpaid portion of the Additional Allowance Charge.
If, by the date thirty (30) calendar days following timely and
valid
delivery of Tenant's Extension Notice exercising its option to
extend the Term,
Landlord and Tenant have not agreed in writing as to the Annual
Rent to be paid
by Tenant, including annual escalations thereof, or the tenant
allowance, if
any, to be paid by Landlord during the applicable Extension
Term, either
Landlord or Tenant may elect that the fair market rent,
escalations and tenant
allowance, if any, be determined in accordance with the
following procedure
(which procedure is herein referred to as the "Three-Broker
Method"). If neither
Landlord nor Tenant delivers notice to the other electing to use
the
Three-Broker Method (the "Appraisal Notice") within seven (7)
business days
following the aforesaid thirty (30) day period, then Tenant's
exercise of its
right to extend the Term shall be void and Tenant's options to
renew in
accordance herewith shall terminate and be null and void. If
either Landlord or
Tenant timely delivers the Appraisal Notice, Landlord and Tenant
shall each
appoint one commercial real estate broker, and the two so
selected shall
mutually select a third. Said real estate brokers shall each be
licensed in
Maryland, specializing in the field of commercial real estate
leases (including
those with wet labs) in the Montgomery County, Maryland area,
having no less
than ten (10) years' experience in such field, and recognized as
ethical and
reputable within their field. Landlord and Tenant agree to make
their
appointments promptly within seven (7) business days after
delivery of the
Appraisal Notice. The two brokers selected by Landlord and
Tenant shall promptly
select a third broker within seven (7) business days after they
have both been
appointed. Within ten (10) business days after the third broker
is selected,
each broker shall submit his or her determination of the
then-projected
prevailing market rent, including annual escalations thereof and
tenant
allowance and other market concessions, if any, for comparable
space in
comparable buildings within the market area. For purposes
hereof, the prevailing
market rent, escalations thereof and tenant allowance and other
concessions, if
applicable, shall be deemed to equal the mean of the two closest
rental rate,
escalation and allowance determinations. However, if either
party fails to
appoint a broker within seven (7) business days as provided
above, the one
broker who was timely appointed by the other party shall by
himself make the
determination of the prevailing market rent, escalations and
allowance, if any.
Landlord and Tenant shall each be bound by such determinations.
Landlord and
Tenant shall each pay the fees of the broker that it appointed
and shall each
pay one-half of the fees of the third broker, or the single
broker as the case
may be.
2.4 RIGHT TO CANCEL.
Notwithstanding anything to the contrary contained in this
Lease, if
Tenant is not in default beyond applicable notice and cure
periods as of the
date it delivers a Cancellation Notice (as defined below) and as
of the Early
Expiration Date (as defined below), Tenant may terminate this
Lease effective
upon the last day of the sixty-sixth (66th) calendar month of
the Term (the
"Early Expiration Date"), by delivery of a written notice (the
"Cancellation
Notice") and the applicable Termination Payment (as described
below) to Landlord
no later than the last day of the fifty-fourth (54th) calendar
month of the
Term. The Termination Payment due to Landlord should Tenant
elect to terminate
this Lease shall be the unamortized value, determined as herein
provided, of the
"Lease Transaction Costs" (as defined below). For purposes
hereof, the Lease
Transaction Costs shall mean all the Tenant Allowance, Turnkey
Costs,
9
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Additional Allowance, and all other costs incurred by Landlord
with respect to
all Leasehold Improvements to or for the Premises paid for by
Landlord
(including interest thereon, if any, at the cost to Landlord to
obtain funds to
pay for such obligations), the full amount of the Base Annual
Rent abated in
accordance with Section 1.1, and all reasonable legal fees
incurred by Landlord
in connection with the negotiation of this Lease as amended and
all brokerage
commissions incurred by Landlord in connection with this Lease
as it may be
amended, but excluding the Test Fit Allowance (as defined in
Section 3.4) paid
by Landlord for the initial space plan for the Premises. For the
purpose of
determining the Termination Payment, the Lease Transaction Costs
shall be
amortized on a straight-line basis over the initial ten (10)
Lease Years of the
Term, and the unamortized value shall be measured by Landlord as
of the Early
Expiration Date. Upon the Commencement Date, Landlord and Tenant
shall execute a
Lease Commencement Date Agreement (Exhibit H) that stipulates
the amount of
unamortized costs as stated above that will be due upon delivery
of a
Cancellation Notice.
If Tenant validly terminates this Lease as herein provided, this
Lease
shall terminate as of the Early Expiration Date as if such date
were the
original Term Expiration Date set forth in this Lease and Tenant
will vacate and
surrender the Premises on the Early Expiration Date in the
condition required by
Subsection 6.1.2.
2.5 RIGHT OF FIRST OFFER.
Subject to the conditions subsequently set forth in this Section
2.5,
Tenant shall, following the initial leasing of all of the space
in the Building
(the "Initial Lease-Up") and during the remainder of the initial
Term of this
Lease, have a right of first offer with respect to the lease of
the space
identified as the "First Offer Space" shown on Exhibit B-2
hereto and contiguous
to the Premises (herein referred to as the "First Offer Space"),
excepting any
portion thereof leased by Tenant pursuant to Section 2.6, when
such rentable
space becomes Available for Leasing (as hereinafter defined).
This right of
first offer shall be subject and subordinate to the rights
granted to any tenant
or tenants under leases in the Building entered into prior to
the Date of Lease
Execution set forth at the beginning of this Lease. As a result,
Tenant's rights
hereunder in the First Offer Space shall arise only (i) upon the
expiration of
early termination of the term of any lease of such space entered
into prior to
the Date of Lease Execution or pursuant to an option, right of
refusal, offer or
negotiation granted to a tenant under a lease executed prior to
the Date of
Lease Execution, including all permitted extensions or
expansions thereof, and
(ii) after Landlord first offers such space to other tenant(s)
of the Building
holding options to expand or rights of first refusal, offer or
negotiation as to
the First Offer Space pursuant to the terms of their respective
leases (provided
such leases were executed prior to the Date of Lease Execution)
and such
tenant(s) fail or refuse to lease the same in accordance with
their respective
leases. For purposes hereof, First Offer Space shall be
"Available for Leasing"
if such space is then or will within 12 months thereafter be
vacant and
unencumbered by any lease, option or right in favor of another
tenant or tenants
in the Building under leases executed prior the Date of Lease
Execution.
If and when the First Offer Space or any portion thereof (herein
referred
to as the "Offered Space") becomes Available for Leasing in
accordance with the
preceding paragraph, prior to entering into a lease of such area
with another
person or entity, Landlord, by written notice to Tenant
("Landlord's Offer
Notice), shall first offer to lease to Tenant the Offered Space
provided that no
other tenant has a prior claim to such space as described in the
preceding
paragraph and provided further that the conditions set forth
herein are
satisfied. Upon the receipt of Landlord's Offer Notice, Tenant
shall have 10
days after receipt of Landlord's Offer Notice to advise Landlord
in writing of
Tenant's election to lease the entire Offered Space (the
'Tenant's Election
Notice"), failing which Tenant's rights as to the Offered Space
under this
Section 2.5 shall terminate and shall be null and void and
Landlord shall be
free to lease the Offered Space in its sole discretion to
another party or
parties or to otherwise encumber the same in favor of other new
or existing
tenant(s) in the Building on such terms as Landlord may
elect.
Any space taken by Tenant pursuant to this Section 2.5 shall,
except as
expressly provided in this Section 2.5, be taken by Tenant in
its "as is" and
"where is" condition and added to the Premises under the terms
of this Lease,
provided that Landlord shall have no obligation to incur Turnkey
Costs or
provide Tenant with the Tenant Allowance, Additional Allowance,
or rent
abatement for the first Lease Year
10
<PAGE>
provided under this Lease and Annual Rent for the Offered Space
shall be
determined as hereinafter provided. The Annual Rent payable by
Tenant for
Offered Space leased by Tenant in accordance with this Section
2.5 shall be
equal to the then-prevailing market rate of rent with market
concessions for
comparable space in the market area and shall escalate annually
in accordance
with market terms, provided however, that in no event shall
Annual Rent for the
Offered Space be less than the Base Annual Rent payable by
Tenant hereunder. In
the event Landlord and Tenant are unable to reach agreement upon
an amendment to
this Lease adding the Offered Space to the Premises, including
the rate of rent
for such space, within thirty (30) days following the date
Landlord received
Tenant's Election Notice, Tenant's rights under this Section 2.5
shall terminate
and shall be null and void with respect to the Offered Space
designated in that
particular Offer Notice, and Landlord shall be free to lease
such Offered Space
in its sole discretion to another party or parties or to
otherwise encumber the
same in favor of other or new tenant(s) in the Building on such
terms as
Landlord may elect.
Tenant acknowledges and agrees that Landlord shall have no
obligation to
lease First Offer Space to Tenant under this Section 2.5 unless
at the time the
Offered Space is added to the Premises no less than three years
remains of the
initial Term of the Lease.
At the time Tenant seeks to exercise any right provided to
Tenant under
this Section 2.5, (i) Tenant shall not be in default under the
terms of this
Lease beyond applicable grace or cure period, and (ii) except
for a Permitted
Assignment, Tenant may not have assigned this Lease or be
subletting in the
aggregate more than twenty five percent (25%) of the Premises.
In no event shall
any assignee (other than a Permitted Assignee) or subtenant have
the right to
exercise Tenant's right under this Section 2.5.
2.6 OPTION TO EXPAND.
Subject to the conditions subsequently set forth in this Section
2.6,
Tenant shall have an option to the lease of up to 10,000
rentable square feet of
the First Offer Space identified as the "Option Space" on
Exhibit B-2 hereto,
and contiguous to the Premises (such portion of the First Offer
Space, if any
leased by Tenant under this Section 2.6, is herein referred to
as the "Option
Space").
If Tenant elects to lease all or any portion of the Option
Space, then not
later than sixty (60) days following the Date of Lease Execution
Tenant shall
give Landlord written notice of such election (identifying the
area of Option
Space, if less than all, that Tenant has elected to lease) (the
'Tenant's Option
Election Notice"), failing which (or if Tenant does not elect to
lease all of
the Option Space in the Tenant's Option Election Notice)
Tenant's rights under
this Section 2.6 as to the entire Option Space or as to portion
thereof Tenant
has not timely elected to lease hereunder, as the case may be,
shall terminate
and shall be null and void.
Any space taken by Tenant pursuant to this Section 2.6 (the
"Taken Option
Space") shall be taken by Tenant in its "as is" and "where is"
condition and
added to the Premises under the terms of this Lease, including
without
limitation the terms of this Lease as to the rate of Annual Rent
and Tenant
Allowance per rentable square foot, provided however that
Landlord shall have no
obligation to incur any Turnkey Costs for such Space and the
Additional
Allowance, if any, shall apply only as to the Taken Option Space
improved for
use as wet laboratory, but in no event more than 30% of the
Taken Option Space.
If the Taken Option Space is less than all of the Option Space,
the portion
leased by Tenant hereunder shall be contiguous with the Premises
and
satisfactory to Landlord (in it sole but reasonable discretion)
so that the
remaining unleased portion of the Option Space is of a size,
configuration and
location on the floor that in Landlord's judgment is marketable
for the full
rental value of the Taken Option Space. In the event Tenant
timely elects to
lease any or all of the Option Space as herein provided,
Landlord and Tenant
shall execute and deliver an appropriate amendment to this Lease
prepared by
Landlord and adding the Taken Option Space to the Premises
within thirty (30)
days following the date Landlord received Tenant's Option
Election Notice. If
Tenant fails to execute any such amendment as and when herein
provided, Tenant's
rights under this Section 2.6 shall terminate and shall be null
and void.
11
<PAGE>
At the time Tenant seeks to exercise any right provided to
Tenant under
this Section 2.6, (i) Tenant shall not be in default under the
terms of this
Lease beyond applicable grace or cure period, and (ii) except
for a Permitted
Assignee, Tenant may not have assigned this Lease or be
subletting in the
aggregate more than twenty five percent (25%) of the Premises.
In no event shall
any assignee (other than a Permitted Assignee) or subtenant have
the right to
exercise Tenant's right under this Section 2.6.
ARTICLE III
CONSTRUCTION
3.1 INITIAL CONSTRUCTION.
Tenant acknowledges that Tenant has had an opportunity to
inspect the
Premises. Except as expressly herein provided as to the
completion of Leasehold
Improvements, the Premises shall be delivered to Tenant "as is"
and "where is"
with all faults and without representation, warranty or guaranty
of any kind by
Landlord to Tenant.
(a) Lab Space. Tenant shall provide to Landlord for approval on
or before
Tenant's Design Completion Date, complete sets of drawings and
specifications
for construction of leasehold improvements in the Lab Space
(such complete sets,
once approved by Landlord, are referred to herein as the "Lab
Space Complete
Plans") all of which shall be prepared at Tenant's expense by an
architect
selected by Tenant and approved by Landlord (herein referred to
as Tenant's
Architect") and Landlord's engineer, including but not limited
to:
a. Furniture and Equipment Layout Plans
b. Dimensioned Partition Plans
c. Dimensioned Electrical and Telephone Outlet Plans
d. Reflected Ceiling Plans
e. Door and Hardware Schedules
f. Room Finish Schedules including wall, carpet and floor tile
colors
g. Electrical, mechanical and structural engineering plans
h. All necessary construction details and specifications.
Tenant shall deliver such complete construction drawings and
specifications to Landlord at Landlord's Address and Landlord
shall have 5
business days (or 10 business days if the contemplated
improvements will affect
the structure of the Building or mechanical, electrical or
plumbing systems)
from the date it receives the same to review such drawings and
specifications
and notify Tenant as to whether they are approved by Landlord,
it being
understood that any such approvals are for the limited purposes
set forth in
Section 10.25 of the Lease. If Tenant's drawings and
specifications are not
approved by Landlord, Landlord shall inform Tenant of the reason
and Tenant
shall have the opportunity to submit revised plans (the "Revised
Plans") and the
Landlord shall have 5 business days from the date it receives
the Revised Plans
to review the same and notify the Tenant as to whether the
Revised Plans are
approved by Landlord.
Landlord and Tenant shall initial the Lab Space Complete Plans
after the
same have been submitted by Tenant and approved by Landlord.
Tenant shall not
amend or supplement the Lab Space Complete Plans, including by
change order,
without Landlord's approval.
12
<PAGE>
All of Tenant's construction, installation of furnishings, and
later
changes or additions for the Lab Space shall be coordinated with
any other work
being performed by Landlord in such manner as to maintain
harmonious labor
relations and not to damage the Building or Lot or interfere
with construction
of the Building or related improvements or Building operations.
All work
described in the Lab Space Complete Plans (the "Lab Space
Leasehold
Improvements") shall be performed by Spaulding and Slye
Construction Company,
Limited Partnership (the "Landlord's Contractor").
The subcontractors for building the Lab Space Leasehold
Improvements shall
be selected according to the following process. Landlord's
Contractor shall (i)
solicit bids from at least three subcontractors for each trade,
if applicable,
and at the time of submission of final bid and pricing drawings
pursuant to
Milestone #5 set forth in Part III of Exhibit C hereto, Tenant
may designate the
name of at least one qualified subcontractor to be included in
Landlord's
Contractor's list; (ii) allow Tenant to review the results of
bids received for
the Lab Space Leasehold Improvements prior to awarding
subcontracts for the
work, provided, that any delay occasioned by Tenant's review
shall be deemed a
Tenant Delay (as hereinafter defined); and (iii) select the
lowest qualified bid
timely received in accordance with the foregoing process,
provided that in no
event shall Landlord's Contractor be required to accept any bid
which Landlord's
Contractor believes to be in error, or any bid from a
subcontractor to which
Landlord's Contractor may have reasonable objection. If Tenant
elects that a
trade not go through the three-bid process described above,
Landlord's
Contractor will obtain prices from a subcontractor in such trade
and present the
same to Tenant. The Tenant shall then have the right to approve
such
subcontractor and its prices or reject such subcontractor in
which case the
Landlord's Contractor will choose a subcontractor pursuant to
the three bid
process described above, and any delay occasioned by Tenant's
rejection of any
subcontractor shall be deemed a Tenant Delay (as hereinafter
defined).
The Landlord's Contractor shall perform the Lab Space
Leasehold
Improvements for a guaranteed cost (including a 5% contractor's
fee and the
Landlord's Contractor's general conditions costs) established in
accordance with
procedure set forth above. Landlord shall not charge Tenant any
fee for
construction management. Landlord's Contractor shall obtain all
necessary
building permits for constructing the Lab Space Leasehold
Improvements and the
initial certificate of occupancy for the Lab Space.
Landlord, in its sole discretion, may elect by written notice to
Tenant at
the time it approves the Lab Space Complete Plans, not to
approve any proposed
construction, alterations or additions requiring unusual expense
to readapt the
Lab Space to normal laboratory use on lease termination or
increasing the cost
of construction, insurance or taxes on the Building or of
Landlord's services
called for by Section 5.1 unless Tenant first gives assurances
acceptable to
Landlord that such readaptation will be made prior to such
termination without
expense to Landlord and makes provisions acceptable to Landlord
for payment of
such increased cost. Landlord will also disapprove any
alterations or additions
requested by Tenant which will delay completion of the Premises
or the Building.
All changes and additions shall be part of the Building except
such items as by
writing at the time of approval the parties agree either shall
be removed by
Tenant on termination of this Lease or shall be removed at
Tenant's cost or left
at Tenant's election.
Tenant shall also pay to Landlord as additional rent the
Tenant
Improvement Reimbursement to Landlord (also herein referred to
as "TIR") for the
Lab Space. Tenant Improvement Reimbursement to Landlord for the
Lab Space shall
be the amount equal to the excess of (a) all costs incurred by
Landlord on
account of the Lab Space Leasehold Improvements including in the
costs so
incurred any fees and charges of Tenant's Architect or
Landlord's engineer paid
by Landlord and the cost and fees charged to Landlord by
Landlord's Contractor
over (b) the Tenant Allowance for the Lab Space set forth in
Section 1.1 hereof
and, if applicable, the Additional Allowance. Tenant shall pay
to Landlord the
TIR for the Lab Space parri passu with the disbursement by
Landlord of the
Tenant Allowance and, if applicable, Additional Allowance for
the Lab Space, and
the remainder upon substantial completion of Lab Space Leasehold
Improvements,
in each case, on submission by Landlord to Tenant of a statement
therefor. In
addition to paying TIR as provided above, Tenant shall pay an
amount equal to
all costs incurred by Landlord as a result of any change orders
signed by Tenant
and Landlord affecting the Lab Space Complete Plans, including
the costs and
fees charged to Landlord by Landlord's Contractor with
respect
13
<PAGE>
to such change orders. Amounts due and payable on account of
such change orders
shall be included in the statements relating to TIR provided for
above, and
Tenant shall pay therefor in accordance with each such statement
within thirty
(30) days, and in all events by the Commencement Date.
(b) Office Space. Landlord will provide design development plans
and
complete sets of construction drawings and specifications and
engineering
drawings prepared by Landlord's architect or engineer at
Landlord's expense
(such construction drawings and engineering drawings are
referred to herein as
the "Construction Plans") to build out the Office Space
according to the
approved space plan and other documents identified in Exhibit C
- Part II
attached hereto. Landlord will submit the design development
plans and the
Construction Plans for the Office Space to Tenant, it being
understood that
Landlord will not agree to any changes to the design development
plans or the
Construction Plans that will increase the cost or delay the
completion of the
improvements described therein (the "Office Space Leasehold
Improvements").
Notwithstanding the foregoing, Landlord may approve changes to
the design
development plans or the Construction Plans that may increase
the cost of the
Office Space Leasehold Improvements provided Tenant pays in
advance all costs
associated with such changes in accordance with this Section 3.1
(b) and
executes a written change order signed by Tenant's
Representative agreeing that
any such delay will be deemed a Tenant Delay. Landlord and
Tenant shall initial
the Construction Plans for the Office Space after the same have
been completed
by Landlord and delivered to Tenant. The completed Construction
Plans so
initialed by Landlord and Tenant shall be deemed the "Office
Space Complete
Plans." All work described in the Office Space Complete Plans
shall be performed
by Landlord's Contractor.
Landlord will not approve any construction, alterations or
additions'
requiring unusual expense to readapt the Office Space to normal
office use on
lease termination or increasing the cost of construction,
insurance or taxes on
the Building or of Landlord's services called for by Section 5.1
unless Tenant
first gives assurances acceptable to Landlord that such
readaptation will be
made prior to such termination without expense to Landlord and
makes provisions
acceptable to Landlord for payment of such increased cost.
Landlord will also
disapprove any alterations or additions requested by Tenant
which will delay
completion of the Premises or the Building. All changes and
additions shall be
part of the Building except such items as by writing at the time
of approval the
parties agree either shall be removed by Tenant on termination
of this Lease or
shall be removed at Tenant's costs or left at Tenant's
election.
Tenant shall pay to Landlord as additional rent the Tenant
improvement
Reimbursement to Landlord for the Office Space. Tenant
Improvement Reimbursement
to Landlord for the Office Space shall be the amount equal to
all costs incurred
by Landlord on account of changes to the Office Space Complete
Plans requested
by Tenant or resulting from act, omission, delay or default by
Tenant ("Tenant
Delay") including in the costs so incurred the cost to Landlord
of Landlord's
Contractor's overhead and profit equal to twenty percent (20%)
of costs of work.
Tenant shall pay to Landlord the TIR for the Office Space parri
passu, with the
expenditure of funds by Landlord to pay costs payable by
Landlord for design
and construction of the Office Space Leasehold Improvements and
the remainder
upon substantial completion of the Office Space Leasehold
Improvements, in each
case upon submission by Landlord to Tenant of a statement
therefor. In addition
to paying TIR as provided above, Tenant shall pay an amount
equal to all costs
incurred by Landlord as a result of any change orders signed by
Tenant and
Landlord affecting the Office Space Complete Plans, including
the costs and fees
charged to Landlord by Landlord's Contractor with respect to
such change orders.
Amounts due and payable on account of such change orders shall
be included in
the statements relating to TIR provided for above, and Tenant
shall pay therefor
in accordance with each such statement within thirty (30) days,
and in all
events by the Commencement Date.
3.2 PREPARATION OF PREMISES FOR OCCUPANCY.
Landlord agrees to use reasonable efforts to substantially
complete the
Lab Space Leasehold Improvements and Office Space Leasehold
Improvements
(collectively the "Leasehold Improvements") by the Scheduled
Term Commencement
Date, which date shall, however, be extended for a period equal
to that of any
delays incurred by Landlord due to Force Majeure (as defined in
Section 10.13)
or Tenant Delay. The Premises shall be deemed ready for
occupancy on the date on
which (i) the Leasehold
14
<PAGE>
Improvements, to be constructed by Landlord's Contractor
(collectively
"Landlord's Work"), are substantially complete as certified in
writing to Tenant
by Landlord's architect with the exception of minor items which
can be fully
completed within sixty (60) days without material interference
with Tenant and
other items which because of the season or weather or the nature
of the item are
not practicable to do at the time, provided that none of said
items is necessary
to make the Premises tenantable for the Permitted Uses; and (ii)
a temporary
certificate of occupancy is issued for the Premises; provided
further, however,
that if Landlord is unable to obtain a temporary certificate of
occupancy for
the Premises or any part thereof or complete construction of
Landlord's Work due
to long lead items (as hereinafter defined) included in the Lab
Space Complete
Plans or the Office Space Complete Plans (collectively, the
"Complete Plans") or
any act or omission of Tenant or its agents, employees,
contractors, invitees or
licensees or due to delay in Tenant's compliance with the
provisions of Section
3.1 of this Lease or the Milestones set forth in Part III of
Exhibit C hereof
(herein sometimes referred to as "Tenant Delays"), then the
Premises shall be
deemed ready for occupancy no later than the date the Landlord's
Work would have
been substantially completed and a temporary certificate of
occupancy would have
been available but for such Tenant Delays. For purposes hereof,
"long lead item"
shall mean any item(s) of work included in the Complete Plans,
or in any change
order requested by Tenant, that cannot be completed in
accordance with the
Landlord's construction schedule (without overtime or
acceleration of the work),
provided that Landlord's Contractor advises Tenant that the item
is a long lead
item before commencement of construction.
Tenant shall select a specialties contractor ("Tenant's
Contractor") to
install telephone, computer and data processing cables, and
wiring on the
Premises at Tenant's direction and expense. All such work shall
be coordinated
with work being performed by or for Landlord on the Premises and
the Building.
Tenant covenants to pay for all work performed by Tenant or
Tenant's Contractor,
and Tenant shall apply for all permits and licenses required in
connection with
such work and shall pay all fees due in connection therewith.
Tenant shall
provide to Landlord the originals of all such permits and
licenses. All such
improvements, whether or not paid for by Landlord, and any other
improvements
which are affixed to the Premises shall be and remain the
property of Landlord.
During the performance of any work, Tenant must provide Landlord
evidence that
Tenant or its contractor has in place (i) a policy insuring
against "all risks
of physical loss" on a builder's risk non-reporting form, having
replacement
cost and agreed amount endorsements, and (ii) commercial general
liability with
underlying coverage totaling not less than Ten Million Dollars
($10,000,000),
each such policy to name Landlord and Landlord's lenders as an
additional
insured (and as loss payee on policies other than public
liability insurance)
and to be in a form reasonably acceptable to Landlord). Such
contractor also
must provide evidence that it has in place workmen's
compensation insurance in
amounts and in form statutorily required. Without in any manner
limiting
Landlord's rights and Tenant's obligations under any other
indemnity set forth
in this Lease, Tenant shall defend, with counsel reasonably
acceptable to
Landlord, save harmless and indemnify Landlord from (a) claims
or demands of
Tenant's Contractor or anyone claiming by, through or under
Tenant's Contractor,
and (b) liability for injury, loss, accident, or damage to any
person or
property, including, without limitation, bodily injury and/or
death, and from
any claims, actions, proceedings and expenses and costs in
connection therewith
(including, without limitation, reasonable counsel fees) arising
from the acts
or omissions of Tenant, its agents, employees, contractor or
subcontractors, in
performance of any construction, remodeling or redecoration.
Landlord shall permit Tenant access for installing tele/data
equipment and
systems furnishings in the Premises prior to the Term if it can
be done without
material interference with completion of the Building or
remaining portions of
the Leasehold Improvements.
In the event of Tenant's failure to comply with the provisions
of this
Article III or the Milestones set forth in Part III of Exhibit C
hereof or to
submit information or to deliver final bidding and pricing
documents or the
Complete Plans approved by Landlord as herein required and by
the date set forth
in the Milestones set forth in Part III of Exhibit C hereto and
if Tenant does
not cure such failure within thirty (30) days of written notice
thereof from
Landlord, Landlord may, at Landlord's option, exercisable by
notice to Tenant,
terminate this Lease on the date specified in said notice to
Tenant, and upon
such termination Landlord shall have all the rights provided in
Article IX of
this Lease in the event of Tenant's default.
15
<PAGE>
If for any reason, other than Force Majeure or Tenant Delay,
Landlord
fails to achieve Landlord's Milestone set forth in item 9 of
Part III of Exhibit
C hereto, Tenant may, as its sole and exclusive remedy at law or
in equity, have
the remedy if any, provided to Tenant in item 9 of Part III of
Exhibit C hereto.
3.3 GENERAL PROVISIONS APPLICABLE TO CONSTRUCTION.
All construction work required or permitted by this Lease, shall
be done
in a good and workmanlike manner and in compliance with all
applicable laws and
all lawful ordinances, regulations, orders, permits and
approvals of
governmental authority and insurers of the Building. Either
party may inspect
the work of the other at reasonable times and promptly shall
give notice of
observed defects. Landlord's obligations under Section 3.1 shall
be deemed to
have been performed when Tenant commences to occupy any portion
of the Premises
for the Permitted Uses except for (i) items relating to the
Leasehold
Improvements which are incomplete or do not conform with the
requirements of
Section 3.1 and as to which Tenant shall in either case have
given written
notice to Landlord prior to such commencement, and (ii) latent
defects relating
to the Leasehold Improvements not readily observable prior to
the Commencement
Date, but as to which Tenant makes a claim in writing within one
(1) year
following the date of substantial completion of such work by
Landlord's
Contractor. If Tenant shall not have commenced to occupy the
Premises for the
Permitted Uses within 30 days after they are deemed ready for
occupancy as
provided in Section 3.2, a certificate of completion by a
licensed architect or
registered engineer shall be conclusive evidence that Landlord
has performed all
such obligations except for items stated in such certificate to
be incomplete or
not in conformity with such requirements.
3.4 REPRESENTATIVES.
Each party authorizes the other to rely in connection with
their
respective rights and obligations under this Article III upon
approval and other
actions on the party's behalf by Landlord's Representative in
the case of
Landlord or Tenant's Representative in the case of Tenant or by
any person
designated in substitution or addition by notice to the party
relying.
3.5 TENANT ALLOWANCE.
Provided Tenant is not in default hereunder (beyond the giving
of notice
and expiration of any grace or cure period provided hereunder),
Landlord shall
provide the Tenant Allowance and, if applicable, the Additional
Allowance in the
amount specified in Section 1.1 to be applied not later than
December 31, 2006,
against the costs incurred by Tenant for initial space planning
by Tenant's
Architect, the cost of preparation and administration of the Lab
Space Complete
Plans and the cost incurred by Landlord in construction of the
Lab Space
Leasehold Improvements (including, without limitation,
architects' and
engineers' fees, sprinklers, fire alarms, smoke detectors, exit
lights, cabling
and costs of compliance with all applicable laws such as,
without limitation,
the Americans with Disabilities Act), the cost of obtaining all
permits,
licenses and fees related to Landlord's construction of the Lab
Space Leasehold
Improvements in accordance with this Article III and as
otherwise provided in
this Section.
If all costs to be incurred by Tenant on account of Leasehold
Improvements
(including Landlord's Contractor's fee) will exceed the Tenant
Allowance and, if
applicable, the Additional Allowance, Landlord may require as a
condition
precedent to the first disbursement of the Tenant Allowance,
evidence reasonably
satisfactory to Landlord that Tenant has set aside funds
sufficient to pay such
excess and may disburse the Tenant Allowance and Additional
Allowance parri
passu with the disbursement of such funds by Tenant.
No portion of the Tenant Allowance shall be used to reimburse
Landlord for
the $0.11 per rentable square foot Landlord agreed to pay for
Tenant's initial
test fit for the Premises (the "Test Fit Allowance").
16
<PAGE>
3.6 LEASE COSTS.
If Tenant (i) defaults under the Lease prior to Commencement
Date and
fails to cure such default after any applicable notice and cure
periods, (ii)
fails to occupy the Premises for the conduct of its business
within sixty (60)
days after the Commencement Date, or (iii) fails to pay any
Annual Rent or
Additional Rent due upon Commencement Date, if applicable, or
upon the date that
the first monthly installment of Annual Rent and Additional Rent
are not abated
pursuant to Article I hereto, then in any such event, in
addition to and not in
lieu of any other rights and remedies Landlord may have pursuant
to this Lease
or at law or in equity, Tenant shall forthwith repay to Landlord
upon demand,
the Tenant Allowance, the Turnkey Costs and Additional
Allowance, plus any other
costs incurred by Landlord associated with the design and
construction of the
Leasehold Improvements including, but not limited to, design
costs, engineering
costs and the cost of construction, together with interest
thereon at the
Default Rate from the date of delivery of the Premises by
Landlord in accordance
with this Lease until such amount is paid by Tenant (the
"Pre-Term Costs").
ARTICLE IV
RENT
4.1 RENT.
Commencing on the Commencement Date and continuing for the
remainder of
the Term, Tenant agrees to pay rent to Landlord, without any
offset or reduction
whatever (except as otherwise expressly set forth in this
Lease), in an amount
equal to 1/12th of the Annual Rent in equal installments in
advance on the first
day of each calendar month included in the Term; and for any
portion of a
calendar month at the beginning or end of the Term, at the
proportionate rate
payable for such portion, in advance, provided that the first
installment of
Annual Rent shall be due and payable pursuant to the Special
Provisions set
forth in Article I hereof. Notwithstanding the foregoing,
provided that Tenant
is not in default hereunder, one-half (1/2) of each monthly
installment of Base
Annual Rent payable by Tenant for the first twelve (12) months
of the initial
Term shall be abated as provided in accordance with the Special
Provisions of
Section 1.1 hereof.
As used herein, "Annual Rent" shall mean the sum set forth in
Section 1.1.
On the first day of the Second Lease Year and on the first day
of each
subsequent Lease Year or portion thereof during the initial
Term, the amount of
Annual Rent shall be increased as follows (as adjusted based
upon the actual
amount of the Additional Allowance as provided in Section
1.1):
17
<PAGE>
<TABLE>
<CAPTION>
BASE
ANNUAL RENTABLE ADDITIONAL
LEASE RENT X SQUARE = BASE ANNUAL + ALLOWANCE =
YEAR P.R.S.F. FEET RENT CHARGE ANNUAL RENT
<S> <C> <C> <C> <C> <C>
<C> <C> <C> <C>
Second $23.69 X 17,002 = $402,777.38 + $30,773.62 =
$433,551.00
Third $24.40 X 17,002 = $414,848.80 + $30,773.62 =
$445,622.42
Fourth $25.13 X 17,002 = $427,260.26 + $30,773.62 =
$458,033.88
Fifth $25.89 X 17,002 = $440,181.78 + $30,773.62 =
$470,955.40
Sixth $26.66 X 17,002 = $453,273.32 + $30,773.62 =
$484,046.94
Seventh $27.46 X 17,002 = $466,874.92 + $30,773.62 =
$497,648.54
Eighth $28.29 X 17,002 = $480,986.58 + $30,773.62 =
$511,760.20
Ninth $29.14 X 17,002 = $495,438.28 + $30,773.62 =
$526,211.90
Tenth $30.01 X 17,002 = $510,230.02 + $30,773.62 =
$541,003.64
Eleventh $30.91 X 17,002 = $525,531.82 + $ -0- = $525,531.82
</TABLE>
The term "additional rent" shall mean Tenant's Share of
Operating Costs
(as defined below), Tenant's Share of Real Estate Taxes (as
defined below),
Tenant's Annual Electrical Cost (as defined below), Tenant
Improvement
Reimbursement to Landlord (whether for the Office Space or the
Lab Space), and
all other costs, charges and impositions, in addition to Annual
Rent, payable by
Tenant in accordance with the terms of this Lease.
4.2 OPERATING COSTS.
Commencing on the Commencement Date and continuing for the
remainder of
the Term, Tenant shall pay to Landlord, as additional rent,
Tenant's Share of
Operating Costs (as defined below) in monthly installments on
the first day of
each month during the Term and as otherwise provided in this
Section 4.2. Within
one-hundred eighty (180) days after the end of each fiscal year
ending during
the Term and within one hundred twenty (120) days after Lease
termination,
Landlord shall render a statement ("Landlord's Operating Cost
Statement") in
reasonable detail and according to usual accounting practices,
certified by
Landlord, and showing for the preceding fiscal year or fraction
thereof, as the
case may be, Landlord's operating costs ("Operating Costs")
which shall:
(a) EXCLUDE, notwithstanding any other, provisions in this
Section 4.2 to
the contrary, the following:
(i) Ground rent or other rental payments made under any ground
lease
or underlying lease or payments of principal, interest, late
charges, penalties
or other charges made on account of any loan;
(ii) Costs of improvements or replacements to the Building
which
under generally accepted accounting principles are capitalized
except as
expressly included in Operating Costs under part (b) of this
Section 4.2
("Capital Improvements");
(iii) Costs of leasing commissions, legal, space planning,
construction and other expenses incurred in procuring tenants
for the Building;
(iv) Costs of painting, redecorating or other work performed
solely
for the benefit of another tenant, prospective tenant or
occupant;
18
<PAGE>
(v) Salaries, wages, or other compensation paid to officers
or
executives of Landlord or its property manager at the level of
senior vice
president and above;
(vi) Salaries, wages, or other compensation or benefits paid
to
employees of Landlord or its property manager who are not
assigned to the
operation, management, maintenance, or repair of the Building or
Campus; and in
the case of any offsite or other employees who are not assigned
full time to the
operation, management, maintenance or repair of the Building or
Campus, Landlord
shall reasonably allocate the compensation paid for the wages,
salary, or other
compensation or benefits paid to such employees among the
properties to which
such employees are assigned and Operating Costs shall exclude
the portion of
such compensation not reasonably allocated to the Building or
Campus;
(vii) Any fines or penalties incurred due to the violation
by
Landlord of any governmental rule or authority;
(viii) Any costs for which Landlord actually receives
reimbursement
from insurance, condemnation awards, or any other source,
including other
tenants of the Building if charged to such tenants specially and
not as an
Operating Cost, Real Estate Tax or Electrical Cost;
(ix) Costs in excess of the deductible on applicable
insurance
policies for repairs, restoration, replacements or other work
occasioned by (a)
fire, windstorm or other casualty which Landlord is hereunder
required to insure
against (whether such destruction be total or partial) and (b)
the exercise by
governmental authorities of the right of eminent domain;
(x) Attorneys' fees and expenses and costs of litigation in
connection with disputes with tenants, other occupants or
prospective tenants,
or with consultants, management agents, leasing agents,
purchasers or mortgagees
of the Building; and costs incurred by Landlord due to
Landlord's violation of
the terms of this Lease which would not have been incurred by
Landlord but for
such violation;
(xi) Costs incurred in connection with the original construction
of
the Building or other improvements constructed with the
Building;
(xii) Costs relating to another tenant's or occupant's space
which
(A) were incurred in rendering any service or benefit to such
tenant that
Landlord was not required to provide, or were for a service in
excess of the
service that the Landlord was required to provide to Tenant
hereunder or (B)
were otherwise in excess of the Building standard services then
being provided
by Landlord to all tenants or other occupants in the Building,
whether or not
such other tenant or occupant is actually charged therefor by
Landlord;
(xiii) Costs incurred in connection with the acquisition of the
Lot
or sale, financing, refinancing, mortgaging, selling or change
of ownership of
the Building and/or the Lot, including, but not limited to,
attorneys' fees,
title insurance premiums, and recording costs;
(xiv) Fines, interest, penalties, legal fees or costs of
litigation
incurred due to the late payments of loan payments, taxes and
utility bills;
(xv) Landlord's or its property manager's general home
office
overhead expenses;
(xvi) Costs incurred for any items to the extent covered by
a
manufacturer's, materialman's, vendor's or contractor's
warranty;
(xvii) Non-cash items, such as deductions for depreciation
and
amortization of the Building and the Building equipment (except
as expressly
included in Operating Costs under part (b) of this Section 4.2);
interest on
capital invested; bad debt losses; rent losses and reserves for
such losses;
19
<PAGE>
(xviii) Costs incurred in connection with the operation of any
lobby
shop or cafeteria owned, operated or subsidized by Landlord
(except the
non-capital costs of any cafeteria expressly included in
Operating Costs under
part (b) of this Section 4.2);
(xix) Costs incurred by Landlord which are associated with
the
operation of the business of the legal entity which constitutes
Landlord as the
same is separate and apart from the costs of the operation of
the Building,
including legal entity formation and maintenance charges;
(xx) All amounts which would otherwise be included in
Operating
Costs which are paid to any affiliate or subsidiary of Landlord
to the extent
the cost of such goods or services exceed the market rate for
similar services
under arms length contracts in the Washington, D.C. metropolitan
area;
(xxi) Rentals and other related expenses incurred in leasing
elevators or other equipment ordinarily considered to be of
a capital nature;
(xxii) Contingency or replacement reserves;
(xxii) Costs incurred in the remediation or removal of
Hazardous
Materials (as defined in Section 10.18) released on or from
the Building or Lot in violation of Environmental Laws (as
defined in Section 10.18) provided, however, any such costs
arising from Tenant's use of the Premises shall be charged
directly to Tenant;
(xxiii) Marketing and advertising expenses;
(xxiv) Utility costs for which any tenant directly contracts
and
pays the supplier thereof; and;
(xxv) Costs of acquiring or renting works of art displayed in
the
Common Area.
(b) BUT INCLUDE, without limitation: costs of maintenance and
repair of
any cafeteria or fitness room generally available to tenants of
the Building;
expenses of any proceedings for abatement of Real Estate Taxes
and assessments
with respect to any fiscal year or fraction of a fiscal year;
premiums for
insurance; fees payable to third parties for audits of Operating
Costs, provided
that such costs are not incurred due to Landlord's overcharging
tenants for
Operating Costs; reasonable legal fees and costs payable.in
seeking a reduction
of Real Estate Taxes and in connection with Building service
contracts;
compensation and all fringe benefits, worker's compensation
insurance premiums
and payroll taxes paid by Landlord to, for or with respect to
all persons
engaged in the operating, maintaining or cleaning of the
Building and Lot; all
utility charges other than electricity not billed directly to
tenants by
Landlord or the utility; payments to Landlord's property manager
and other
independent contractors (including, without limitation,
affiliates of Landlord,
if applicable) under service contracts for cleaning, operating,
managing,
maintaining, repairing or testing the Building and Lot; payments
made to
consultants retained to advise Landlord regarding compliance by
tenants of the
Building with applicable Laws (as defined in Section 6.1;18);
rent paid by the
managing agent or imputed cost equal to the loss of market rent
by Landlord for
making available to the managing agent space for an office in
the Building (not
exceeding 1,000 rentable square feet) on the ground floor or
above; and all
other costs and expenses incurred in connection with owning,
administering,
cleaning, operating, managing, maintaining and repairing the
Building and Lot,
or either, and the Building's pro-rata share of all such costs
and expenses
applicable to owning, administering, cleaning, operating,
managing, maintaining
and repairing common areas on the Campus, including, without
limitation, common
area rent and other charges applicable to the Shady Grove Life
Sciences Center.
If Landlord installs or constructs a new or replacement capital
item for the
purpose of reducing Operating Costs or complying with
requirements of law, the
cost thereof as reasonably amortized by Landlord in accordance
with generally
accepted accounting principles, with interest at Landlord's cost
of funds plus
one percent (1%) per annum (the "Prime Rate"), on the
unamortized amount, shall
be included in Landlord's Operating Costs.
20
<PAGE>
"Tenant's Share of Operating Costs" shall be equal to the
product of (a)
Operating Costs as indicated in Landlord's Operating Cost
Statement, multiplied
by (b) "Tenant's Share."
Landlord's Operating Cost Statement shall also show the average
number of
square feet of the Building which were occupied for the
preceding fiscal year or
fraction thereof. If less than ninety-five percent (95%) of the
Net Rentable
Area of the Building is occupied during any full or fractional
year of the Term
(including the Base Year), the actual Operating Costs for those
costs that vary
with occupancy (such as, without limitation, cleaning and
janitorial) shall be
adjusted for such year to an amount which Landlord estimates
would have been
incurred in Landlord's reasonable judgment had ninety-five (95%)
of the Net
Rentable Area of the Building been occupied, provided, however,
that Operating
Costs as so adjusted shall not exceed the actual costs Landlord
would have
incurred had the Building been ninety-five percent (95%)
occupied.
In case of special services which are provided to Tenant but are
not
rendered to all areas on a comparable basis, the proportion
allocable to the
Premises shall be the same proportion which the Rentable Floor
Area of Tenant's
Space (as the same may be increased or decreased in accordance
with this Lease)
bears to the total rentable floor area to which such service is
so rendered
(such latter area to be determined in the same manner as the
Total Rentable
Floor Area of the Building).
Notwithstanding any other provision of this Section 4.2, if the
Term
expires or is terminated as of a date other than the last day of
a fiscal year,
then for such fraction of a fiscal year at the end of the Term,
Tenant's last
payment to Landlord under this Section 4.2 shall be prorated and
made on the
basis of Landlord's reasonable best estimate of the items
otherwise includable
in Landlord's Operating Cost Statement which shall be delivered
to Tenant within
one-hundred twenty (120) days following expiration or
termination of the Term,
and shall be made on or before the date 10 days after Landlord
delivers such
estimate to Tenant.
Tenant shall pay, as additional rent, on the first day of each
month of
such fiscal year and each ensuing fiscal year thereafter,
"Estimated Monthly
Payments" equal to 1/12th of Tenant's Share of the estimated
Operating Costs for
the respective fiscal year, with an appropriate additional
payment or credit to
be made after Landlord's Operating Cost Statement is delivered
to Tenant. If the
amount paid by Tenant for Tenant's Share of estimated Operating
Costs is less
than Tenant's Share of the actual Operating Costs, Tenant agrees
to pay, as
additional rent, to Landlord the amount of the differential. If
the amount paid
by Tenant for Tenant's Share of estimated Operating Costs is
more than Tenant's
Share of the actual Operating Costs, then Landlord shall credit
such excess
against Tenant's subsequent monthly payments for Tenant's Share
of Operating
Costs, as appropriate, until such excess is exhausted (or refund
such excess to
Tenant if at the end of the Term). Landlord may adjust such
Estimated Monthly
Payment from time to time and at any time during a fiscal year
(but not more
often than twice per fiscal year), and Tenant shall pay, as
additional rent, on
the first day of each month following receipt of Landlord's
notice thereof, the
adjusted Estimated Monthly Payment. Each of Landlord's Operating
Cost Statements
given by Landlord pursuant to the Lease shall be conclusive and
binding upon
Tenant unless, within ninety (90) days after the receipt of the
statement,
Tenant notifies Landlord that it wishes to audit Landlord's
Operating Costs for
the preceding year. If Tenant gives such notice timely
requesting the right to
review or audit Landlord's books and records pertaining to
Operating Costs for
the preceding year, Landlord shall make available to Tenant for
inspection or
auditing during normal business hours not more than six (6)
months following
delivery to Tenant of the Operating Cost Statement to which such
review related,
at the offices of Landlord's managing agent where such records
are kept, the
books and records with respect to Landlord's Operating Costs for
the fiscal year
in question. If such books and records are not kept in the
Washington, D.C.
Greater Metropolitan Area, Landlord shall upon Tenant's written
request, not
more often than once per year, make copies of such books and
records available
to Tenant for inspection or audit as herein provided at an
office of Landlord or
Landlord's managing agent in the Washington, D.C. Greater
Metropolitan Area.
Pending the resolution of any such dispute as to Landlord's
Operating Cost
Statement, Tenant shall pay the adjustments, including any
underpayment of
Tenant's Share of Operating Costs, as specified in accordance
with Landlord's
Operating Cost Statement, without prejudice to Tenant's
position, as herein
provided. If the dispute shall be resolved in Tenant's favor,
Landlord shall
credit or pay to Tenant (as hereinabove provided) the amount of
Tenant's
overpayment. In
21
<PAGE>
addition, if there has been an overcharge to Tenant of Operating
Costs in excess
of five percent (5%) of Tenant's Share of the Operating Costs in
such year,
Landlord shall reimburse Tenant for its reasonable costs
incurred in connection
with Tenant's review of Landlord's books and records of
Operating Costs.
If Landlord fails to furnish Tenant any statement of Landlord's
estimate
of Tenant's Share of Operating Costs for any fiscal year or if
Landlord shall
furnish such estimate for any fiscal year subsequent to the
commencement
thereof, then until the first day of the month following the
month in which such
estimate is furnished to Tenant, Tenant shall pay to Landlord on
the first day
of each month an amount equal to the monthly sum payable by
Tenant to Landlord
under this Section 4.2 .in respect of the last month of the
preceding fiscal
year.
4.3 REAL ESTATE TAXES.
Commencing on the Commencement Date and continuing for the
remainder of
the Term, Tenant shall pay to Landlord, as additional rent,
Tenant's Share of
Real Estate Taxes (as defined below), if any, in monthly
installments on the
first day of each month during the Term and as otherwise
provided in this
Section 4.3. Within one-hundred eighty (180) days after the end
of each Fiscal
Year ending during the Term and after Lease termination,
Landlord shall render a
statement ("Landlord's Real Estate Tax Statement") certified by
Landlord, and
showing for the preceding fiscal year or fraction thereof, as
the case may be,
Real Estate Taxes for the Building and Lot, accompanied by
copies of the tax
bills relating thereto.
Tenant's Share of Real Estate Taxes" shall be equal to the
product of (a)
the Real Estate Taxes as indicated in Landlord's Real Estate Tax
Statement,
multiplied by (b) Tenant's Share.
The term "Real Estate Taxes" as used above shall mean all taxes
of every
kind and nature assessed by any governmental authority on the
Lot, the Building
and improvements, or both, or on any easement benefiting the
same, on the income
derived from the Building, or on the rents payable by tenants of
the Building
which the Landlord shall become obligated to pay because of or
in connection
with the ownership, leasing and operation of the Lot, the
Building and
improvements, or both; installments and interest on assessments
for public
betterments or public improvements; special assessments, fees,
charges, levies,
penalties, service payments, excises, assessments, charges, and
costs for
transit, transit encouragement, traffic reduction programs, or
any other
purpose; impositions or taxes of every kind or nature whatsoever
assessed or
levied or imposed by any governmental entity, governmental
authority or any
improvement or assessment district of any kind having the direct
or indirect
power to tax, whether or not consented to or joined in by
Landlord, against the
Building or Lot or any legal or equitable interest of Landlord
therein, whether
now or hereafter imposed, and whether or not customary in the
contemplation of
the parties on the date of this Lease; subject to the following:
there shall be
excluded from Real Estate Taxes all federal state or local taxes
based upon the
net income of Landlord, excess profits taxes, excise taxes,
franchise taxes, and
estate, succession, inheritance and transfer taxes, provided,
however, that if
at any time during the Term the present system of ad valorem
taxation of real
property shall be changed so that in lieu of the whole or any
part of the ad
valorem tax on real property, there shall be assessed on
Landlord a capital levy
or other tax on the rents received with respect to the Lot,
Building and
improvements, or both, or a federal, state, county, municipal,
or other local
income, franchise, excise, sales, profit or similar tax,
assessment, levy or
charge (distinct from any now in effect) measured by or based,
in whole or in
part, upon any such rents, then any and all of such taxes,
assessments, levies
or charges, to the extent so measured or based, shall be deemed
to be included
within the term "Real Estate Taxes." Tenant acknowledges that in
the event that
Real Estate Taxes are reduced because nonprofit entities occupy
the Building,
the share of Real Estate Taxes paid by such tenants shall be
structured so that
the tax-exempt tenant(s) for which such reduction is given
receives(s) the full
benefit of the property tax exemption.
Notwithstanding any other provision of this Section 4.3, if the
Term
expires or is terminated as of a date other than the last day of
a fiscal year,
then for such fraction of a fiscal year at the end of the Term,
Tenant's last
payment to Landlord under this Section 4.3 shall be prorated and
made on the
basis of Landlord's reasonable best estimate of the items
otherwise includable
in Landlord's Real Estate Tax
22
<PAGE>
Statement which shall be delivered to Tenant within one-hundred
twenty (120)
days after the Term expires or is terminated and shall be made
on or before 10
days after Landlord delivers such estimate to Tenant. Within
thirty (30) days
following the date Real Estate Taxes are finally determined for
the period for
which Tenant made estimated payments, Tenant or Landlord, as the
case may be,
shall pay to the other the balance of any underpayment or
overpayment,
respectively, of Tenant's Share of Real Estate Taxes. This
paragraph shall
survive the expiration or earlier termination of this Lease.
Tenant shall pay, as additional rent, on the first day of each
month of
such fiscal year and each ensuing fiscal year thereafter,
Estimated Monthly Real
Estate Taxes equal to 1/12th of Tenant's Share of the estimated
Real Estate
Taxes for the respective fiscal year, with an appropriate
additional payment or
credit to be made after Landlord's Real Estate Tax Statement is
delivered to
Tenant. If the amount paid by Tenant for Tenant's Share of
estimated Real Estate
Taxes is less than Tenant's Share of the actual Real Estate
Taxes, Tenant agrees
to pay, as additional rent, to Landlord the amount of the
differential. If the
amount paid by Tenant for Tenant's Share of estimated Real
Estate Taxes is more
than Tenant's Share of the actual Real Estate Tax, then Landlord
shall credit
such excess against Tenant's subsequent monthly payments for
Tenant's Share of
Real Estate Taxes, as appropriate, until such excess is
exhausted (or refund
such excess to Tenant if at the end of the Term). Landlord may
adjust such
Estimated Monthly Real Estate Tax Payment from time to time and
at any time
during a fiscal year (but not more often than twice per fiscal
year), and Tenant
shall pay, as additional rent, on the first day of each month
following receipt
of Landlord's notice thereof, the adjusted Estimated Monthly
Real Estate Tax
Payment. Each of Landlord's Real Estate Tax Statements given by
Landlord
pursuant to the Lease shall be conclusive and binding upon
Tenant unless, within
ninety (90) days after the receipt of such statement, Tenant
notifies Landlord
that it wishes to audit Landlord's books and records pertaining
to Landlord's
Real Estate Taxes for the preceding year. If Tenant gives such
notice timely
requesting the right to review or audit Landlord's books and
records pertaining
to Landlord's Real Estate Taxes, Landlord shall make available
to Tenant for
inspection or auditing during normal business hours, at the
offices of
Landlord's managing agent where such records are kept, the books
and records
with respect to Landlord's Real Estate Taxes for the fiscal year
in question. If
such books and records are not kept in the Washington, D.C.
Greater Metropolitan
Area, Landlord shall upon Tenant's written request, not more
often than once per
year, make copies of such books and records available to Tenant
for inspection
or audit as herein provided at an office of Landlord or
Landlord's managing
agent in the Washington, D.C. Greater Metropolitan Area. Pending
the resolution
of any such dispute as to Landlord's Real Estate Tax Statement,
Tenant shall pay
the adjustments, including any underpayment of Tenant's Share of
Real Estate
Taxes, as specified in accordance with Landlord's Real Estate
Tax Statement,
without prejudice to Tenant's position, as herein provided. If
the dispute shall
be resolved in Tenant's favor, Landlord shall credit or pay to
Tenant (as
hereinabove provided) the amount of Tenant's overpayment. In
addition, if there
has been an overcharge to Tenant of Real Estate Taxes in excess
of five percent
(5%) of Tenant's Share of Landlord's Real Estate Taxes in such
year, Landlord
shall reimburse Tenant for its reasonable costs incurred in
connection with
Tenant's review of Landlord's books and records of Real Estate
Taxes.
In the event that the method currently used for the computation
of the
assessed market value of the Building and/or the Lot is
discontinued or revised
by the State of Maryland, the determination of the increase in
Real Estate Taxes
under this Section 4.3 shall thereafter be determined by
Landlord according to a
formula and procedure which, in Landlord's reasonable judgment,
most nearly
approximates the method of determination hereinabove set forth.
In the event
that any business, rent or other taxes which are now or
hereafter levied upon
Tenant's use or occupancy of the Premises, on Tenant's leasehold
improvements,
on Tenant's business at the Premises or on Landlord by virtue of
Tenant's
occupancy of the Premises, are enacted, changed or altered so
that any of such
taxes are levied against Landlord or in the event that the mode
of collection of
such taxes is changed so that Landlord is responsible for
collection or payment
of such taxes, any and all such taxes shall be deemed to be a
part of the Real
Estate Taxes and Tenant shall pay to Landlord the full amount of
all of such
taxes or if they relate to all tenants in the Building, then
Tenant's Share
thereof.
If Landlord fails to furnish Tenant any statement of Landlord's
estimate
of Tenant's Share of Real Estate Taxes for any fiscal year or if
Landlord shall
furnish such estimate for any fiscal year subsequent to the
commencement hereof,
then until the first day of the month following the month in
which such
23
<PAGE>
estimate is furnished to Tenant, Tenant shall pay to Landlord on
the first day
of each month an amount equal to the monthly sum payable by
Tenant to Landlord
under this Section 4.3 in respect of the last month of the
preceding fiscal
year.
4.4 REFUNDS.
Tenant shall be entitled to its pro rata share of any refund of
Real
Estate Taxes received by Landlord, net of reasonable costs
incurred by Landlord
in obtaining such refund not to exceed Real Estate Taxes paid by
Tenant with
respect to the tax year to which such refund relates (it being
understood that
the Real Estate Taxes paid by Tenant for any tax year may fall
into two separate
fiscal years so long as the tax year is not the same as the
fiscal year).
4.5 ELECTRICITY.
Commencing on the Commencement Date and continuing for the
remainder of
the Term, Tenant shall pay, as additional rent in addition to
Tenant's Share of
Operating Costs and Tenant's Share of Real Estate Taxes during
the Term,
Tenant's Annual Electrical Cost in accordance with this Section
4.5. Tenant's
Annual Electrical Cost shall mean the cost to Landlord for
Tenant's use of
electrical energy in the Premises as shown on the Meter (as
hereinafter
defined). Landlord shall cause electricity for lighting and
operation of
Tenant's equipment, facilities and fixtures in the Premises to
be metered by a
separate utility meter or check meter (the "Meter"). If the
Meter is a separate
meter directly from the utility, the Tenant's Annual Electrical
Cost shall be
equal to the amount billed to Landlord on such meter. If the
Meter is a check
meter measuring Tenant's consumption of electricity but not
separately billed by
the utility, Tenant's Annual Electrical Cost shall mean the
Landlord's "average
cost per kilowatt hour" (as hereinafter defined) of electrical
energy used on
the Premises as shown on the Meter.
For every fiscal year or portion thereof beginning on the
Commencement
Date and during the Term hereof, as the same may be extended,
Tenant shall pay,
as additional rent, Tenant's Annual Electrical Cost in monthly
installments on
the first day of each month during the Term and as otherwise
provided in this
Section 4.5. As soon as practicable after the end of each fiscal
year during the
Term, and after Lease termination, Landlord shall render a
statement (the
"Landlord's Electrical Statement") in reasonable detail and
according to usual
accounting practices certified by Landlord and showing for the
preceding
calendar year or fraction thereof Tenant's Annual Electrical
Cost.
Tenant shall pay, as additional rent, on the first day of each
month of
such fiscal year and each ensuing fiscal year thereafter,
Estimated Monthly
Electricity Cost Payments equal to 1/12th of Landlord's estimate
of Tenant's
Annual Electrical Cost for the respective fiscal year, with an
appropriate
additional payment or credit to be made after Landlord's
Electrical Statement is
delivered to Tenant. If the amount paid by Tenant for estimated
Annual
Electrical Cost is less than the actual Annual Electrical Cost,
Tenant agrees to
pay, as additional rent, to Landlord the amount of the
differential. If the
amount paid by Tenant for estimated Annual Electrical Cost is
more than the
actual Annual Electrical Cost, then Landlord, shall credit such
excess against
Tenant's subsequent monthly payments for Tenant's Annual
Electrical Cost, as
appropriate, until such excess is exhausted (or refund such
excess to Tenant if
at the end of the Term. Landlord may adjust such Estimated
Monthly Electrical
Cost Payment from time to time and at any time during a fiscal
year (but not
more often than twice per fiscal year), and Tenant shall pay, as
additional
rent, on the first day of each month following receipt of
Landlord's notice
thereof, the adjusted Estimated Monthly Electrical Cost
Payment.
If Landlord fails to furnish Tenant any statement of Landlord's
estimate
of Tenant's Annual Electrical Cost for any fiscal year or if
Landlord shall
furnish such estimate for any fiscal year subsequent to the
commencement hereof,
then until the first day of the month following the month in
which such estimate
is furnished to Tenant, Tenant shall pay to Landlord on the
first day of each
month an amount equal to the monthly sum payable by Tenant to
Landlord under
this Section 4.5 in respect of the last month of the preceding
fiscal year.
24
<PAGE>
Tenant shall have the right from time to time during the Term to
read the
Building electricity meter and the Meter serving the Premises.
Each Landlord's
Electrical Statement delivered to Tenant hereunder shall be
conclusive and
binding upon Tenant unless, within ninety (90) days after
receipt of the
statement, Tenant notifies Landlord that it wishes to audit
Landlord's books and
records with respect to Annual Electrical Cost for the.preceding
fiscal year. If
Tenant gives such notice timely requesting the right to audit
Landlord's books
and records, Tenant shall have the right, at a reasonable time
and upon
reasonable notice, to examine Landlord's books and records
respecting the
Building which relate to the determination and computation of
Tenant's Annual
Electrical Cost for the fiscal year in question. If such books
and records are
not kept in the Washington, D.C. Greater Metropolitan Area,
Landlord shall upon
Tenant's written request, not more often than once per year,
make copies of such
books and records available to Tenant for inspection or audit as
herein provided
at an office of Landlord or Landlord's managing agent in the
Washington, D.C.
Greater Metropolitan Area.
For the purpose of this Lease, Landlord's "average cost per
kilowatt hour"
for any year (or applicable portion thereof at the beginning or
end of the term)
shall mean the cost calculated by dividing the sum of the costs
charged Landlord
by the public utility for electricity consumed in the Building
in the applicable
period by the sum of the number of kilowatt hours used by the
Building during
such period as measured by the Building master meter.
4.6 CHANGE OF FISCAL YEAR.
Landlord shall have the right from time to time to change the
periods of
accounting under Sections 4.2, 4.3 and 4.5 to any annual period
other than a
calendar year, and upon any such change all items referred to in
Sections 4.2,
4.3 and 4.5 shall be appropriately apportioned. In all
Landlord's Statements
(including Operating Cost Statements or Real Estate Tax
Statements or Landlord's
Electrical Statement) rendered under Section 4.2, 4.3 or 4.5,
amounts for
periods partially within and partially without the accounting
periods shall be
appropriately apportioned, and any items which are not
determinable at the time
of a Landlord's Statement shall be included therein on the basis
of Landlord's
estimate, and with respect thereto Landlord shall render
promptly after
determination a supplemental Landlord's Statement, and
appropriate adjustment
shall be made according thereto. All Landlord's Statements shall
be prepared on
an accrual basis of accounting.
4.7 PAYMENTS.
All payments of Annual Rent and additional rent shall be made to
Managing
Agent, or to such other person or place as Landlord may from
time to time
designate. If any installment of Annual Rent or additional rent
or on account of
TIR is not paid within five (5) days following the due date
thereof, at
Landlord's election, (a) it shall bear interest at a rate equal
to the average
prime commercial rate from time to time established by the three
largest
national banks in Washington, D.C. plus 3% per annum (the
"Default Rate") from
such due date, which interest shall be immediately due and
payable as further
additional rent, and (b) Tenant shall also pay, as additional
rent, a late fee
equal to five percent (5%) of the late installment.
ARTICLE V
LANDLORD'S COVENANTS
5.1 LANDLORD'S COVENANTS DURING THE TERM.
Landlord covenants during the Term:
5.1.1 Building Services. Landlord shall furnish, through
Landlord's
employees or independent contractors, the services listed in
Exhibit
D.
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5.1.2 Additional Building Services. Landlord shall furnish,
through
Landlord's employees or independent contractors, reasonable
additional Building operation services upon reasonable
advance
request of Tenant at equitable rates from time to time
established
by Landlord to be paid by Tenant.
5.1.3 Repairs. Except as otherwise provided in Article VII,
Landlord shall
make such repairs to the Building's roof, exterior walls,
floor
slabs, mechanical (including HVAC), electrical, plumbing and
fire/life safety systems serving the Building in general and
the
Premises (except for supplemental systems installed by and
exclusively serving Tenant), other structural components and
common
facilities of the Building as may be necessary to keep them in
good
working condition.
5.1.4 Quiet Enjoyment. Landlord covenants that Landlord has the
right to
make this Lease and that Tenant on paying the rent and
performing
its obligations hereunder shall peacefully and quietly have,
hold
and enjoy the Premises throughout the Term without any manner
of
hindrance or molestation from Landlord or anyone claiming
under
Landlord, subject however to all the terms and provisions
hereof.
5.1.5 Access/Security. Tenant shall have access to the Premises
24 hours
per day, 7 days of the week; subject, however, to a key card
access
system in the Building at the main entry to the Building and at
the
secondary Building door (the Tenant shall receive 4 key cards
for
each 1,000 rentable square feet of floor area in the Premises at
no
cost), provided that the Building main entry door and
secondary
entry door may remain unlocked 7 a.m, to 11 p.m. Monday
through
Friday and 8 a.m. to 6 p.m. on Saturday); provided further,
however,
that no representation or warranty is made by Landlord as to
the
adequacy, completeness or integrity of said access control
system
and failure of such access control system shall not modify or
affect
the limitations on Landlord's liability under this Lease.
5.1.6 Intentionally Omitted.
5.1.7 Indemnity. Landlord shall indemnify, defend, protect and
save
harmless Tenant, any trustee, stockholder, officer, director
or
employee of Tenant ("Indemnified Tenant Parties"), to the
extent
permitted by law, from and against any and all liabilities,
losses,
damages, costs, expenses (including reasonable attorneys' fees
and
expenses), causes of action, suits, claims, demands or judgments
of
any nature arising from injury to or death of any person or
damage
to or loss of property on the Premises caused by the negligence
or
willful misconduct of Landlord or its agents or employees,
except to
the extent caused by the negligence or willful misconduct of
Tenant
or its agents, employees, contractors, licensees or
sublessees.
Tenant shall give Landlord prompt and timely notice of any
claim
made or suit against it or any other party of which it has
knowledge, relating to any matter which in any way may result
in
indemnification pursuant to this Section 5.1.7. Subject to the
prior
rights, if any, of insurers, Landlord shall be entitled to
control
the defense and compromise of an such claim or suit to the
extent of
any actual or potential claim for indemnification made or
reserved
by Tenant (as well as any claim made against Landlord or any
of
those for whom it is legally responsible).
5.1.8 Tenant's Costs. Landlord shall pay all costs including,
without
limitation, reasonable attorneys' fees incurred by Tenant in
connection with the successful enforcement by Tenant of any
obligations of Landlord or remedies of Tenant under this
Lease.
5.1.9 Lobby Directory. Landlord shall install, at Landlord's
expense,
Tenant's name on the Building directory in the Building
lobby.
Building standard suite signage (at the entrance to the
Premises)
shall be provided at Landlord's expense, but any changes to
the
signage may only be made in accordance with the terms of this
Lease
and such changes shall be at the expense of the Tenant. In the
event
that Landlord maintains a monument sign upon the Lot with the
names
of Building tenants, Landlord shall also install, at
Tenant's
expense, Tenant's name in Building standard signage on such
monument
sign.
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<PAGE>
5.1.10 Compliance. Landlord shall be responsible for the
Building's
overall compliance with the Americans with Disabilities Act as
it
relates to the common areas of the Building (including,
without
limitation, core area bathrooms) except to the extent that
any
improvement or renovation is required due to Tenant's special
use of
the Premises (other than general office or laboratory use). As
used
in this Section, the Americans with Disabilities Act shall
mean
the Americans with Disabilities Act of 1991,42 U.S.C.
Sections
12.101, et seq. and all regulations applicable thereto
promulgated
as of the date hereof (collectively, "ADA"). Following the
Commencement Date, Tenant shall have the responsibility to
comply
with the requirements of the ADA in the Premises.
5.1.11 Insurance. Landlord shall procure and maintain throughout
the Term
of this Lease a policy or policies of insurance, at its sole
cost
and expense (but subject to Section 4.2), causing the Building
and
any other improvements on the Lot to be insured in the amounts
(with
full replacement cost endorsement) and coverages required under
the
Ground Lease, a policy of commercial general liability
insurance
satisfying the terms of the Ground Lease, and such other
insurance
or higher limits as may be required under the Ground Lease or by
the
holder of any mortgage on the Building. Any insurance provided
for
in this Section 5.1.11 may be maintained by means of a policy
or
policies of blanket insurance, covering additional items or
locations or insureds, provided, however, that the coverage
afforded
Landlord and any such other parties in interest will not be
reduced
or diminished by reason of the use of such blanket policy of
insurance.
5.2 INTERRUPTIONS.
Landlord shall not be liable to Tenant for any compensation or
reduction
of rent by reason of inconvenience or annoyance or for loss of
business arising
from power losses or shortages or from the necessity of
Landlord's entering the
Premises for any of the purposes in this Lease authorized, or
for repairing the
Premises or any portion of the Building or Lot, or for
interruption or
termination (by reason of any cause reasonably beyond Landlord's
control,
including without limitation, loss of any applicable license or
governmental
approval), of the services provided by Landlord pursuant to
Section 5.1. In case
Landlord is prevented or delayed from making any repairs,
alterations or
improvements, or furnishing any service or performing any other
covenant or duty
to be performed on Landlord's part, by reason of any cause
reasonably beyond
Landlord's control, Landlord shall not be liable to Tenant
therefor, nor, except
as expressly otherwise provided in Article VII, shall Tenant be
entitled to any
abatement or reduction of rent by reason thereof, nor shall the
same give rise
to a claim in Tenant's favor that such failure constitutes
actual or
constructive, total or partial, eviction from the Premises.
Landlord reserves the right to stop any service or utility
system when
necessary by reason of accident or emergency or until necessary
repairs have
been completed. Except in case of emergency repairs, Landlord
will give Tenant
reasonable advance notice of any contemplated stoppage and will
use reasonable
efforts to avoid unnecessary inconvenience to Tenant by reason
thereof.
Landlord also reserves the right to institute such policies,
programs and
measures as may be necessary, required or expedient for the
conservation or
preservation of energy or energy services or as may be necessary
or required to
comply with applicable codes, rules, regulations or
standards.
Notwithstanding the foregoing provisions of this Section 5.2 and
any other
provision of this Lease to the contrary, in the event that any
interruption of
service(s) results from a cause arising on the Building or Lot
not reasonably
beyond Landlord's control or results from any negligent or
willful act or
omission of Landlord or its agents or their employees and as a
result of such
interruption the Premises or material portion thereof is made
untenantable for
the conduct of Tenant's business for a period of five (5)
consecutive business
days and during such period Tenant does not use or occupy the
affected space,
the Annual Rent and the additional rent payable by Tenant
hereunder for the
portion of the Premises which is so untenantable and unused by
Tenant shall
abate for the period commencing on the day after such fifth
(5th) consecutive
business day and ending on the day upon which the interrupted
service(s) is(are)
restored.
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<PAGE>
ARTICLE VI
TENANT'S COVENANTS
6.1 TENANT'S COVENANTS DURING THE TERM.
Tenant covenants:
6.1.1 Tenant's Payments. Tenant shall pay when due (a) all
Annual Rent and
additional rent, (b) all taxes which may be imposed on
Tenant's
personal property in the Premises (including, without
limitation,
Tenant's fixtures and equipment) regardless to whomever
assessed, (c)
all charges by public utilities for telephone and other
utility
services (including service inspections therefor) rendered to
the
Premises not otherwise required hereunder to be furnished by
Landlord
without charge and not consumed in connection with any
services
required to be furnished by Landlord without charge, and (d)
as
additional rent, all charges to Landlord for services
rendered
pursuant to Section 5.1.2 hereof.
6.1.2 Repairs and Yielding Up. Except as otherwise provided in
Article VII,
Section 5.1.3 and Section 10.11, Tenant shall keep the Premises
in
good order, repair and condition, reasonable wear and tear
and
casualty damage required hereunder to be covered by
Landlord's
insurance and damage due to condemnation only excepted; and at
the
expiration or termination of this Lease peaceably to yield up
the
Premises and all changes and additions therein in such order,
repair
and condition and free of any and all Hazardous Materials
(as
hereinafter defined), first removing all goods and effects of
Tenant
and any items, the removal of which is required by agreement
or
specified herein to be removed at Tenant's election and which
Tenant
elects to remove, and repairing all damage caused by such
removal and,
if required hereunder, restoring the Premises as and to the
extent
required and leaving them clean and neat. Notwithstanding
the
foregoing, Tenant shall not be obligated to remove any of the
initial
alterations in the Premises performed by or for Tenant before
the
Commencement Date except to the extent that Landlord's approval
of
such alterations was expressly conditioned, in writing, upon
Tenant's
agreement to remove the same at the end of the Term, and
provided
further that Tenant shall be obligated to remove Tenant's
cabling from
the Building risers. At least three (3) months prior to the
surrender
of the Premises, Tenant shall deliver to Landlord a
narrative
description of the actions proposed (or required by any
governmental
authority) to be taken by Tenant in order to surrender the
Premises
(including any installations permitted by Landlord to remain in
the
Premises) at the expiration or earlier termination of the Term,
free
from any residual impact from the use, storage, generation,
release or
disposal of Hazardous Materials ("Tenant HazMat Operations")
and
otherwise released for unrestricted use and occupancy (the
"Surrender
Plan"). Such Surrender Plan shall be accompanied by a current
listing
of (i) all Hazardous Materials licenses and permits held by or
on
behalf of Tenant with respect to the Premises, and (ii) all
Hazardous
Materials used, stored, handled, treated, generated, released
or
disposed of from the Premises, and shall be subject to the
review and
approval of Landlord's environmental consultant. In connection
with
the review and approval of the Surrender Plan, upon the request
of
Landlord, Tenant shall deliver to Landlord or its consultant
such
additional information concerning Tenant HazMat Operations as
Landlord
shall reasonably request. On or before such surrender, Tenant
shall
deliver to Landlord evidence that the approved Surrender Plan
shall
have been satisfactorily completed and Landlord shall have the
right,
at Landlord's expense except as set forth below, to cause
Landlord's
environmental consultant to inspect the Premises and perform
such
additional procedures as may be deemed reasonably necessary to
confirm
that the Premises are, as of the effective date of such
surrender or
early termination of the Lease, free from any residual impact
from
Tenant HazMat Operations. Landlord shall have the unrestricted
right
to deliver such Surrender Plan and any report by Landlord's
environmental consultant with respect to the surrender of the
Premises
to third parties. If Tenant shall fail to prepare or submit
a
Surrender Plan approved by Landlord in its reasonable
discretion, or
if Tenant shall fail to complete the approved
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<PAGE>
Surrender Plan, or if such Surrender Plan, whether or not
approved by
Landlord, shall fail to adequately address any residual effect
of
Tenant HazMat Operations in, or about the Premises, Landlord
shall
have the right to take such actions as Landlord may deem
reasonable or
appropriate to assure that the Premises and the Project are
surrendered free from any residual impact from Tenant HazMat
Operations, the cost of which actions shall be reimbursed by
Tenant as
Additional Rent, without regard to the limitation set forth
above in
this Section 6.1.2.
6.1.3 Occupancy and Use. Tenant shall use and occupy the
Premises only for
the Permitted Uses; Tenant shall not use or permit the Premises
or any
portion thereof to be used for any Prohibited Use (as
hereinafter
defined) or by any Prohibited Person (as defined in Section 14.4
of
the Ground Lease as set forth in Section 10.26 hereof). Tenant
shall
not injure or deface the Premises, Building, or Lot or permit
animal,
laboratory or other odors, noises or emissions to emanate from
the
Premises; and shall not permit in the Premises any use thereof
which
is improper, offensive, contrary to law or ordinances, or liable
to
create a nuisance or to invalidate or increase the premiums for
any
insurance on the Building or its contents or liable to
render
necessary any alteration or addition to the Building. For
purposes
hereof: (a) "Prohibited Use" shall mean (i) the manufacture or
sale of
consumer products (such as, without limitation, alcoholic
beverages,
tobacco products, or weapons but not including drugs sold over
the
counter or by medical prescription) recognized as hazardous to
human
health by federal or Maryland state governmental authorities,
(ii) the
publication, manufacture, sale, distribution, promotion or
purveyance
of pornographic material, or (iii) gambling; (b) a
"Controlled
Affiliate" of any person shall mean any person controlling,
controlled
by or under common control with such person; and (c) for
purposes of
the definition of "Controlled Affiliate" the term
"controlled"
(including the terms, "controlled," "controlling," "controlled
by,"
and "under common control" with) means the possession, direct
or
indirect, of the power to: (y) vote ten percent (10%) or more of
the
outstanding voting securities of, or other ownership interests
in,
such person if the person is a company whose stock or other
ownership
interests are publicly traded and, if not, to vote more than
fifty
percent (50%) of the outstanding voting securities of, or
other
ownership interests in, such person, or (z) otherwise direct
the
management policies of such person by contract or otherwise. As
used
herein, a "person" shall mean any individual, partnership,
corporation, limited liability company, unincorporated
association,
trust, estate, or other legal entity. Notwithstanding the
foregoing,
no federal, state, or local governmental entity, agency or
authority
(other than a college or university) shall be a "Prohibited
Person"
for the purposes of this Lease.
6.1.4 Rules and Regulations. Tenant shall comply with the Rules
and
Regulations set forth in Exhibit E and all other reasonable
Rules and
Regulations hereafter made by Landlord (not inconsistent with
the
terms of this Lease), of which Tenant has been given notice, for
the
care and use of the Building and Lot and their facilities
and
approaches. Landlord shall take commercially reasonable steps
to
enforce said Rules and Regulations, it being understood however
that
Landlord shall not be liable to Tenant for the failure of
other
tenants of the Building to conform to such Rules and
Regulations, and
provided further, however, that Landlord shall not apply the
Rules and
Regulations more strictly against Tenant than against other
tenants in
the Building similarly situated.
6.1.5 Safety Appliances and Licenses. Tenant shall keep the
Premises
equipped with all safety appliances required by law or ordinance
or
any other regulation of any public authority because of any
particular
use (including laboratory use) made by Tenant and shall procure
all
licenses and permits so required because of such use and, if
requested
by Landlord, Tenant shall do any work so required because of
such
particular use (including laboratory use), it being understood
that
the foregoing provisions shall not be construed to broaden in
any way
Tenant's Permitted Uses.
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<PAGE>
6.1.6 Assignment and Subletting. Tenant shall not without the
prior written
consent of Landlord assign this Lease, make any sublease, or
permit
occupancy of the Premises or any part thereof by anyone other
than
Tenant, voluntarily or by operation of law. As additional rent,
Tenant
shall reimburse Landlord promptly for reasonable legal and
other
expenses incurred by Landlord in connection with any request by
Tenant
for consent to assignment or subletting (not to exceed $1,000 in
the
aggregate in connection with each such request). No assignment
or
subletting shall affect the continuing primary liability of
Tenant
(which, following assignment, shall be joint and several with
the
assignee). No consent to any of the foregoing in a specific
instance
shall operate as a waiver in any subsequent instance.
Landlord's
consent to any proposed assignment or subletting is required
both as
to the terms and conditions thereof, and as to the
creditworthiness of
the proposed assignee or subtenant and the consistency of the
proposed
assignee's or subtenant's business with other uses and tenants
in the
Building. Landlord's consent to assignment or subletting by
Tenant
shall not be unreasonably withheld or delayed, provided that
Tenant is
not then in default under this Lease (beyond any applicable
grace or
cure period). In the event that any assignee (other than a
Permitted
Assignee) or subtenant pays to Tenant any amounts which
(after
deducting therefrom costs to Tenant of reasonable legal
fees,
brokerage fees, improvements, allowances or rent concessions
made by
Tenant in connection with such sublease or assignment and
further
deducting any Additional Allowance Charges prepaid by Tenant)
exceed
the Annual Rent and additional rent then payable hereunder, or
pro
rata portion thereof on a square footage basis for any portion
of the
Premises, Tenant shall promptly pay fifty percent (50%) of said
excess
to Landlord as and when received by Tenant. If Tenant
requests
Landlord's consent to assign this Lease (other than an
assignment to a
Permitted Assignee) or sublet (other than a sublease to a
Permitted
Assignee) more than fifty percent (50%) of the Premises for
substantially all of the remainder of the Term, Landlord shall
have
the option, exercisable by written notice to Tenant given within
20
days after receipt of such request, to terminate this Lease
(a)
entirely in the case of an assignment or (b) with respect to
the
portion of the Premises desired to be sublet, as the case may
be, as
of a date specified in such notice which shall be not less than
30 or
more than 60 days after the date of such notice.
If, at any time during the Term of this Lease, Tenant is: (i)
a
corporation or a trust (whether or not having shares of
beneficial
interest) and there shall occur any direct or indirect change in
the
identity of the persons or entities owning or controlling more
than
fifty percent (50%) of the voting rights or shares of stock or
other
ownership interests in Tenant or in the trustees or other
persons
exercising like functions and managing the affairs of Tenant; or
(ii)
a partnership or association or otherwise not a natural person
(and is
not a corporation or a trust), and there shall occur any direct
or
indirect change in the identity of any of the persons who then
are
members of such partnership or association or who comprise
Tenant,
Tenant shall so notify Landlord and Landlord may terminate this
Lease
by notice to Tenant given within 90 days thereafter if, in
Landlord's
reasonable judgment, the credit of Tenant is thereby
impaired.
If Tenant shall at any time or times during the term of this
Lease
desire to assign this Lease or sublet all or a portion of
the
Premises, Tenant shall give written notice thereof to Landlord,
which
notice shall be accompanied by: (a) a conformed or photostatic
copy of
the proposed assignment or sublease, the effective or
commencement
date of which shall be at least thirty (30) days after the
giving of
such notice; (b) a statement setting forth in reasonable detail
the
identity of the proposed assignee or subtenant, the nature of
its
business and its proposed use of the Premises; (c) current
financial
information with respect to the proposed assignee or
subtenant,
including, without limitation, its most recent financial report
and
any contract of sale if Tenant is selling its bus
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