Exhibit 10.1
5605
CenterPoint Court, Gurnee, Illinois
INDUSTRIAL BUILDING LEASE
[Build-To-Suit]
THIS
LEASE is made between CV II GURNEE LLC , a Delaware
limited liability company (“ Landlord ”), and
AKORN, INC. , a Louisiana corporation (“ Tenant
”), and has an effective date of October 23, 2007 (the
“ Effective Date ”).
ARTICLE I — LEASE TERMS
Section 1.1.
Definitions . In addition to the other terms,
which are elsewhere defined in this Lease, the following terms and
phrases, whenever used in this Lease shall have the meanings set
forth in this Section 1.1, and only such meanings, unless such
meanings are expressly contradicted, limited or expanded elsewhere
herein.
A. Base Rent Schedule
:
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Period |
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Annual Base Rent |
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Monthly Base Rent |
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Stub Period
(if applicable)
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N/A |
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Stub Period Base
Rent |
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Lease Year 1
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$ |
483,272 |
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$ |
40,272.67 |
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Lease Year 2
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$ |
494,003 |
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$ |
41,166.92 |
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Lease Year 3
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$ |
505,003 |
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$ |
42,083.58 |
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Lease Year 4
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$ |
516,277 |
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$ |
43,023.08 |
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Lease Year 5
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$ |
527,834 |
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$ |
43,986.17 |
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Lease Year 6
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$ |
539,679 |
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$ |
44,973.25 |
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Lease Year 7
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$ |
551,820 |
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$ |
45,985.00 |
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Lease Year 8
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$ |
564,265 |
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$ |
47,022.08 |
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Lease Year 9
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$ |
577,021 |
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$ |
48,085.08 |
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Lease Year 10
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$ |
590,096 |
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$ |
49,174.65 |
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B. Commencement Date
: the Substantial Completion Date.
C. Concept Plan
: the plan attached hereto as Exhibit
“A” and by this reference incorporated
herein.
D. Effective Date
: the later date this Lease is signed by Landlord and
Tenant.
E. Estimated Commencement
Date : The later of the Substantial Completion Date
or February 15, 2008.
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F. Force Majeure
: any event or circumstance which is beyond the control of
Landlord including, without limitation, any delay in securing a
building permit or in obtaining all required approvals from any
Governmental Authority, strikes, lockouts, picketing (legal or
illegal), acts of God or the public enemy, governmental
restrictions or actions, fire or other casualty, accidents,
unavailability of fuel, power, supplies or materials, unusual
adverse weather conditions, acts or omissions of any labor or
material contractor, the passage or application of any Legal
Requirements or moratorium of any Governmental Authority not now in
effect which have the effect of preventing or delaying progress on
the Initial Improvements, delay caused by Change Orders, delay
caused by the requirements of the TI Plans, and Tenant Delay.
G. Force Majeure Delay
: any interruption or delay in the progress of the Initial
Improvements which is the result of Force Majeure. Any delay which
is the result of Force Majeure shall be deemed to be a Force
Majeure Delay notwithstanding that Landlord or its contractor is
being, at the same time, concurrently delayed by events which do
not constitute Force Majeure Delay.
H. General Contractor
: Premier Design & Build Group LLC.
I. Governmental
Authority : any federal, regional, state, county or
municipal government, including, without limitation, any agency,
authority, subdivision, department or bureau thereof.
J. Guarantor :
None.
K. Initial Improvements
: collectively, the improvements contemplated in the Plans
and depicted on the Concept Plan, including the build out of the
office area.
L. Initial Monthly Rent
Adjustment Deposit : $8,017.53
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(i) |
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Initial Tax Deposit : $5,242.23
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(ii) |
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Initial Expense Deposit : $2,775.30 |
M. Landlord’s
Broker : CB Richard Ellis.
N. Landlord’s Mailing
Address :
1808 Swift
Road
Oak Brook, Illinois 60523
Attention: Mr. Sean Maher
O. Lease Year :
the twelve (12) month period commencing (i) as to the
first Lease Year, on the date which is the Commencement Date if
same is the first (1st) day of a calendar month or the first (1st)
day of the next full calendar month after the Commencement Date if
same does not occur on the first (1st) day of a calendar month, and
(ii) as to subsequent Lease Years, on the annual anniversary
date of the beginning of the first Lease Year.
P. Legal Requirements
: (i) any and all laws, codes, ordinances,
requirements, standards, plats, plans, criteria, orders,
directives, rules and regulations of any Governmental Authority
affecting the improvement, alteration, use, maintenance, operation,
occupancy, security, health, safety and environmental condition of
the Premises or any part thereof (or any occupants therein, as the
context requires) including, without limitation any Environmental
Laws (as hereinafter defined), and (ii) any and all covenants,
restrictions, conditions, easements and other agreements of record
affecting the Premises, as amended from time to time, and any
documents, rules, regulations,
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standards or
criteria set forth or referenced therein or promulgated by the
Landlord or any governing body or entity exercising jurisdiction
over the Premises, in any case, whether in force at the
Commencement Date or passed, enacted or imposed at some time in the
future, and shall include all permits, licenses, certificates,
authorizations and approvals required in connection with any of the
foregoing.
Q. Outline
Specifications : the outline specifications attached
here to as Exhibit “B” and incorporated
herein by this reference.
R. Plans : the
plans and specifications to be prepared by the Project Architect in
substantial conformity with the Concept Plan and the Outline
Specifications.
S. Project Architect
: Cornerstone Architects, Ltd.
T. Property Owners
Association : CenterPoint Business Park-Gurnee
Property Owner’s Association.
U. Stub Period :
if the Commencement Date falls other than on the first day of a
calendar month, the period from and including the Commencement Date
and ending and including the last day of the calendar month in
which the Commencement Day occurs.
V. Stub Period Base
Rent : an amount equal to $35,770.50 multiplied by a
fraction, the numerator of which is the number of days in the Stub
Period and the denominator of which is the number of days in the
calendar month in which the Stub Period falls.
W. Substantial
Completion : the earlier to occur of:
(i) Landlord’s receipt of a permanent, temporary or
conditional certificate of occupancy from the Village (provided
that, if such certificate is not issued solely due to the failure
to complete any work or improvements requested by Tenant which are
not a part of the Plans, such certificate shall be deemed to have
issued when the work and improvements set forth in the Plans have
been completed in all material respects); (ii) the Project
Architect states in writing that the Initial Improvements are
substantially completed in accordance with the Plans; or (iii)
Tenant’s occupancy of the Premises or any portion thereof,
provided, however, that Tenant’s occupancy of the Premises
pursuant to Section 33.1 of this Lease for the purpose of
completing Tenant’s Work (as hereinafter defined) shall not
be deemed “occupancy”. In the event there is a dispute
as to Substantial Completion, such dispute shall be resolved in
accordance with the terms of Section 4.10 hereof.
X. Substantial Completion
Date : the date on which Substantial Completion
occurs.
Y. Security Deposit
: $65,000.00
Z. Tenant’s
Broker : CB Richard Ellis
AA. Tenant Delay
: any interruption or delay in the progress of the Initial
Improvements which is the result of: (i) the failure of Tenant
to timely approve the Plans or any portion thereof;
(ii) material changes in construction requested by Tenant or
any member of the Tenant Group; (iii) the performance or
non-performance of any work at, or services with respect to, the
Premises by Tenant or any member of Tenant Group; or (iv) any
other act or omission of Tenant, any member of the Tenant Group or
any person, firm or entity claiming by, through or under any of
them.
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BB. Tenant Group
: any or all of Tenant’s agents, employees,
representatives, contractors, workmen, mechanics, suppliers,
customers, guests, licensees, invitees, sublessees, assignees and
all of their respective successors and assigns or any party
claiming by, through or under any of them.
CC. Tenant’s Mailing
Address :
Akorn, Inc.
2500 Millbrook Drive
Buffalo Grove, Illinois 60089
Attention: Neill E. Shanahan
DD. Tenant’s
Proportion : 45.91%.
EE. Term : The
period beginning on the Commencement Date and ending on the
Termination Date, unless sooner terminated by Landlord as provided
hereunder.
FF. Termination Date
: The last day of the tenth (10 th ) Lease Year,
unless sooner terminated as hereinafter provided.
GG. Use :
Warehousing and distribution of pharmaceuticals, and related
research and development laboratory and office uses.
HH. Village :
The Village of Gurnee, Illinois.
Section 1.2.
Significance of Definitions . Each reference
in this Lease to any of the Definitions contained in
Section 1.1 of this Article shall be deemed and construed to
incorporate all of the terms provided under each such
Definition.
Section 1.3.
Enumeration of Exhibits . The exhibits in this
Section and attached to this Lease are incorporated in this Lease
by this reference and are to be construed as a part of this
Lease.
Exhibit
“A”: Concept Plan
Exhibit “B”: Outline Specifications
Exhibit “C”: Land
Exhibit “D”: Form of Estoppel Certificate
Exhibit “E”: Tenant’s Building Signage
Specifications
Exhibit “F”: Permitted Hazardous Materials
Exhibit “G”: Initial Tenant Improvements
ARTICLE II — PREMISES
Section 2.1.
Lease . Landlord, for and in consideration of
the rents herein reserved and of the covenants and agreements
herein contained on the part of Tenant to be kept, observed and
performed, does by these presents, lease to Tenant, and Tenant
hereby leases from Landlord, that portion of the building commonly
known as 5605 CenterPoint Court, Gurnee, Illinois (the “
Building ”) consisting of approximately 74,008 square
feet of gross Building area (the “ Premises ”),
which Premises are located on the land legally described on
Exhibit “C” attached hereto and made a
part hereof (the “ Land ”). The Premises is
depicted in the Concept Plan attached hereto and made a part
hereof. The Land and the Building are sometimes hereinafter
collectively referred to as the “ Project .” The
lease of the Premises shall be subject to, and Tenant
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shall at
all times during the Term comply with, the covenants, conditions,
agreements, easements, encumbrances and restrictions of record, as
well as all applicable laws and ordinances (collectively, “
Restrictions ”).
ARTICLE III — TERM
Section 3.1.
Term . The Term of this Lease shall commence
on the Commencement Date and shall end on the Termination Date, or
unless sooner terminated as hereinafter provided.
ARTICLE IV — LANDLORD’S
CONSTRUCTION
Section 4.1.
Landlord’s Construction of Initial Improvements
. Subject to the terms and conditions of this
Article IV, Landlord shall, at its sole cost and expense,
cause the General Contractor to construct the Initial Improvements
to the Premises substantially in accordance with the Plans.
Landlord agrees that all services and work performed in connection
with the Initial Improvements shall be done in a good and
workmanlike manner using only new material, and shall be performed
in material compliance with applicable Legal Requirements. Landlord
represents and warrants that, on the Commencement Date, the
Premises (excluding any Tenant’s Work, as hereinafter
defined) shall be in compliance with all applicable laws,
ordinances, codes and regulations, including fire protection and
the Americans with Disabilities Act (collectively, the “
Applicable Laws ”), as the same pertain to
warehouse/industrial buildings in general. The foregoing
representation does not apply to any Applicable Laws to the extent
the same are required due to Tenant’s specific Use or
occupancy of the Premises, as opposed to those required to
warehouse/industrial buildings in general.
Section 4.2.
Preparation and Approval of Plans . Landlord
shall, at Landlord’s expense, cause the Project Architect to
prepare the Plans. The Plans are subject to Tenant’s approval
(which shall not be unreasonably withheld or delayed), and if
Tenant does not approve same, Tenant shall advise Landlord in
reasonable detail of the reasons for such disapproval.
Tenant’s suggested revisions to the Plans shall not
contradict or exceed the requirements of the Concept Plan or the
Outline Specifications. Tenant shall comment on the Plans (or any
component thereof submitted to Tenant) and each revision thereof
within five (5) business days after receipt from Landlord. In
the event that Tenant does not disapprove of the Plans (or any
component thereof submitted to Tenant) within said five
(5) day period, the Plans (or applicable component thereof)
shall be deemed approved. Tenant may not object to any subsequent
changes as may be incorporated in the Plans necessary to obtain the
approval of the Village.
Section 4.3.
Completion of Initial Improvements . Landlord
shall diligently proceed with the construction of the Initial
Improvements upon Tenant’s approval of the Plans, approval of
the Plans by the Village, and issuance of all necessary permits for
construction. Landlord shall use good faith efforts to achieve
Substantial Completion on or before the Estimated Commencement
Date; provided, however, if construction is delayed because of any
Force Majeure Delays, then Substantial Completion shall be extended
for the additional time caused by such Force Majeure Delays without
liability on the part of Landlord.
Section 4.4.
Tenant Inspections . Landlord shall exercise
reasonable efforts to keep Tenant advised with respect to the
progress of the construction of the Initial Improvements and the
estimated date of Substantial Completion, and Landlord shall notify
Tenant in writing as soon as Substantial Completion occurs as
provided herein. During the construction of the Initial
Improvements and subject to Landlord’s reasonable scheduling
requirements, Tenant shall have the right to inspect the Premises
to monitor the progress of construction of the Initial
Improvements; provided, however, that such right may not be
exercised unless Tenant has: (i) given Landlord at least one
(1) business days’ prior written notice of the date and
time Tenant intends to exercise such inspection right;
(ii) Tenant and/or Tenant’s architect are accompanied at
all times
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during
the course of said inspection by Landlord and Landlord’s
representative or the Project Architect; and (iii) Tenant
complies with the reasonable requirements of Landlord and the
General Contractor.
Section 4.5.
Change Orders . Tenant may propose one or more
changes to the Plans to Landlord any time up to and including
thirty (30) days after Landlord commences construction of the
Initial Improvements upon Tenant’s approval of the Plans, and
subject to the approval of Landlord and the Village. As promptly as
reasonably practicable after the receipt and approval thereof,
Landlord shall provide Tenant with a “Change Order”
containing the proposed revisions to the Plans, a statement of any
Force Majeure Delay resulting from such change, and the amount of
the additional cost to complete the Initial Improvements which will
result from such change (whether hard costs or soft costs), which
costs shall be: (i) the cost of all materials, supplies,
equipment and labor used or supplied in making the proposed change,
including general conditions and any contractor’s fees (which
general conditions and contractor’s fees shall be seven
percent (7%) of such costs); (ii) any architect and engineer
fees; (iii) soft costs; and (iv) fees and expenses of
architects, engineers and other third party consultants in
connection with review or approval of changes in Plans. If Tenant
fails to approve of the Change Order in writing within ten
(10) days after delivery of the same, Tenant shall be deemed
to have abandoned its request for such Change Order, and the
Initial Improvements shall be constructed in accordance with the
then existing Plans. If Tenant approves the Change Order by signing
and returning a copy of the Change Order to Landlord within said
ten (10) day period, Landlord shall cause the Initial
Improvements to be constructed in accordance with the Change Order.
Tenant shall pay Landlord the amount of such additional costs
within ten (10) days after Landlord submits to Tenant a bill
for such additional costs as are then due and payable from time to
time. In no event shall Landlord have any obligation to commence
any work relating to a Change Order until Landlord has been paid
the cost of the estimate in full and in the event that the
additional costs are not paid within said ten (10) day period,
Tenant shall be deemed to have abandoned its request for such
Change Order. Unless requested in writing by Tenant to the
contrary, Landlord shall continue with construction of the Initial
Improvements according to the then existing Plans during the
pendency of any proposed Change Order until same is by Landlord and
Tenant as provided above. Any cessation in construction requested
in writing by Tenant shall constitute a Tenant Delay hereunder. If
Tenant requests a Change Order pursuant to this Section 4.5
and Tenant does not ultimately approve of the Change Order or pay
the cost thereof, Tenant shall promptly reimburse Landlord for any
costs and expenses resulting from such requested Change Order.
Landlord may make changes to the Plans without Tenant’s
consent, provided that: (i) such changes (a) will not
create any additional monetary obligation for Tenant under this
Lease, (b) are in material conformity with the Plans (as may
have been previously revised by permissible Tenant and/or Landlord
changes thereto), and (c) will not decrease the quality of any
component of the Initial Improvements; or (ii) such changes
are required by any applicable Legal Requirements and Landlord
notifies Tenant of the nature of the change.
Section 4.6.
Punchlist . Before Tenant takes occupancy of
the Premises, Landlord, the Project Architect and Tenant shall
conduct an inspection of the Premises, and work in good faith to
jointly prepare a punchlist (hereinafter referred to as the “
Punchlist ”). Except as otherwise expressly provided
in this Lease, any items not on the Punchlist shall be deemed
accepted by Tenant. Tenant shall provide reasonable access to
Landlord, its employees, agents and contractors for purposes of the
repair and correction of any Punchlist items. Landlord shall
complete all Punchlist items as soon as is reasonably practicable,
subject to extension due to any Force Majeure Delays. Landlord
shall use good faith efforts to complete all Punchlist items within
thirty (30) days after the date of such Punchlist, subject to
extension due to any Force Majeure Delays; provided, however, in
the absence of Force Majeure Delays, with respect to any Punchlist
items that are not reasonably capable of being completed within
said thirty (30)-day period, Landlord shall be deemed in compliance
with this Section 4.6 as long as Landlord commences the
correction of the applicable Punchlist items within said thirty
(30)-day period and thereafter diligently prosecutes such items to
completion..
Section 4.7.
Representatives . Landlord designates Edward
R. Harrington as its representative for all purposes of this
Article IV. Tenant designates Neill Shanahan, Vice President,
Human Resources, its
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representative for all purposes of this Article IV. Wherever
the terms of this Article IV require any notice to be given to
or by a party, or any determination or action to be made or taken
by a party, the representative of each party shall act for and on
behalf of such party, and the other party shall be entitled to rely
thereon. Either party may designate one or more substitute
representatives for all or a specified portion of the provisions of
this Article IV, subject to notice to the other party of the
identity of such substitute representative.
Section 4.8.
Warranties . Landlord represents that it shall
obtain and use reasonable efforts to enforce on behalf of Tenant
(i) a warranty against defective materials and workmanship
with respect to the Initial Improvements from the General
Contractor for a period of one (1) year from Substantial
Completion of the Initial Improvements; and (ii) a warranty
against defects in the roof from the roof manufacturer for such
portion of the existing fifteen (15) year roof warranty that
falls within the Term of this Lease (the existing fifteen
(15) year roof warranty term began approximately May 1,
2007). Tenant shall notify Landlord in writing of any defective
condition occurring with respect to the Initial Improvements
promptly following Tenant’s discovery thereof and Landlord
shall request that the party issuing the warranty perform any
remedial work required to be performed under such warranty.
Section 4.9.
Allowances . The Base Rent has been calculated
based on the inclusion of an allowance in the aggregate amount of
$322,222.00 (collectively, the “ Landlord’s
Allowance ”), to be applied toward the following:
A. $182,222.00 (the “
Generator Allowance ”)for work associated with the
installation of a back-up generator and screening at the Premises
(the “ Generator Installation ”);
B. $65,000.00 (the “ Project
Manager Allowance ”)for the fees of any project manager
used by Tenant in connection with the construction of the Premises
(“ Tenant’s Project Manager ”);
C. $17,500.00 (the “
Temperature Mapping Allowance ”)for work associated
with warehouse temperature mapping (the “ Temperature
Mapping ”);
D. $42,500.00 (the “
Commissioning Allowance ”) for commissioning of the
lab and warehouse (the “ Commissioning ”);
and
E. $15,000.00 (the “ Cooler
Allowance ”) for cooler hookups (the “ Cooler
Hookups ”).
Landlord shall notify Tenant in the
event the cost of any of the above-referenced items exceeds the
applicable allowance for such item by more than ten percent (10%).
If the aggregate costs for the Generator Installation,
Tenant’s Project Manager, the Temperature Mapping, the
Commissioning and the Cooler Hookups exceed the amount of the
Landlord’s Allowance, the Tenant shall, within fifteen
(15) days after receipt of the General Contractor’s
statement of such actual costs, pay such excess to Landlord.
Section 4.10.
Substantial Completion Determination . In that Tenant
notifies Landlord, within ten (10) days after receipt of
notice from Landlord that Substantial Completion has occurred, that
Tenant disagrees with Landlord’s determination of Substantial
Completion, and if the parties cannot agree upon Substantial
Completion within ten (10) days thereafter, then such dispute
shall be determined by arbitration as hereinafter provided.
Landlord and Tenant will each select an arbitrator who shall be
disinterested and shall be a person that has been actively engaged
in the development or leasing of property comparable to the
Premises in the Gurnee, Illinois area for a period not less than
seven (7) years immediately preceding his or her appointment.
Landlord and Tenant shall each simultaneously submit to the
arbitrators all relevant data used by each such party in arriving
at its determination of Substantial Completion or the lack thereof.
The arbitrators shall be directed as promptly as possible to reach
a determination as to Substantial Completion. If the two
arbitrators so appointed fail to agree upon a determination as to
Substantial Completion, the two
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arbitrators shall appoint a third arbitrator, using the criteria
described above, to decide upon Substantial Completion. If no
determination is made prior to the Commencement Date (based on the
Substantial Completion Date per Landlord’s determination of
Substantial Completion), then Landlord’s determination shall
be used until the arbitration is completed. If the determination
later agreed upon by the arbitrators is later than the Substantial
Completion Date determined by Landlord, then the Commencement Date
shall be deemed to be such later date, the parties shall execute an
agreement stating that the Commencement Date is the date determined
by the arbitrators as the date of Substantial Completion, and
Landlord shall apply any Rent Adjustment Deposits paid by Tenant
for the periods prior to such date to the Rent Adjustment Deposits
first due after such date. The arbitrators’ decision shall be
binding on Landlord and Tenant. Landlord and Tenant, respectively,
shall pay the fees and out-of-pocket expenses of any individual
appointed as arbitrator hereunder by Landlord and Tenant,
respectively, and Landlord and Tenant shall each pay one-half (1/2)
of the fees and out-of-pocket expenses of any third arbitrator
appointed pursuant to this Section 4.10.
Section 4.11.
Termination Option . Provided that Tenant shall have
signed off on the final Plans no later than November 1, 2007,
then if Substantial Completion (which, for purposes of this
Section 4.11 shall not include the installation of the
generator at the Premises) has not occurred by June 1, 2008
(the “ Outside Delivery Date ”), Tenant shall
have the option (“ Termination Option ”) to
terminate the Lease without penalty effective as of the Outside
Delivery Date upon the following terms and provisions:
(a) Tenant gives Landlord
written notice (“ Termination Notice ”) of
Tenant’s exercise of the Termination Option, provided,
however, the Termination Notice shall not be effective unless
received by Landlord within ten (10) days after the Outside
Delivery Date.
(b) There is no uncured Event of
Default in existence under the Lease on the date Tenant delivers
the Termination Notice.
(c) The Termination Option
herein granted shall automatically terminate upon the failure of
Tenant to timely or properly exercise the Termination Option.
(d) In the event the Tenant sign
off on the Final Plans occurs after November 1, 2007, then the
Outside Delivery Date shall be extended by two (2) days for
each day after November 1, 2007 on which Tenant signs off on
the final Plans.
ARTICLE V — RENT
Section 5.1. Base
Rent . Tenant agrees to pay to Landlord, monthly in
advance, without offset or deduction, base rent for the Term
(“ Base Rent ”) in the amount of the Monthly
Base Rent set forth in the Base Rent Schedule commencing on the
Commencement Date and continuing on the first day of each month
thereafter for the balance of the Term of this Lease. In addition
thereto, Tenant shall pay all such other amounts as are herein
described as “ Additional Rent ” in the manner
and at the time specified in this Lease. The term “
Rent ” when used in this Lease shall include all Base
Rent payable under this Section 5.1, as well as the charges
herein described as Additional Rent. All Rent payable hereunder
shall be payable to Landlord at LOCKBOX 2023 Paysphere Circle,
Chicago, IL 60674 , or as Landlord may otherwise from time to
time designate in writing.
Notwithstanding the foregoing, but
provided there is then no continuing Event of Default under the
Lease, a portion of the monthly Base Rent, in the amount of
$35,770.50, shall abate for the first four (4) full calendar
months of the Lease Term (the “ Abatement Period
”). If the Commencement Date does not fall on the first day
of a calendar month, then Tenant shall pay the Stub Period Base
Rent during any such partial
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month
and the Abatement Period shall begin on the first day of the first
full calendar month following the Commencement Date. After the
expiration (or earlier termination) of the Abatement Period, Tenant
shall commence to pay full monthly Base Rent throughout the
remainder of the Term when due, and without notice or demand
therefor, as provided herein. During the Abatement Period, Tenant
shall be responsible for the payment of the remainder of the
monthly Base Rent, in the amount of $4,502.17, plus all monthly
Rent Adjustment Deposits and all costs, expenses and other amounts
payable hereunder and all other amounts incurred or in connection
with Tenant’s use and occupancy of the Premises. In the event
Tenant breaches or defaults in the performance of any its covenants
or obligations under this Lease and such breach or default
continues beyond the expiration of any applicable notice and cure
period, all abated monthly Base Rent shall thereupon become
immediately due and payable (without limiting Landlord’s
other rights and remedies hereunder, at law and in equity), and if
such breach or default shall occur during the Abatement Period and
such breach or default continues beyond the expiration of any
applicable notice and cure period, the Abatement Period shall
automatically be deemed terminated as of such breach or
default.
Section 5.2. Base
Rent Adjustment . In addition to the Base Rent
payable by Tenant hereunder, Tenant shall pay to Landlord, as
Additional Rent, the Rent Adjustment described in this
Section 5.2 without set off or deduction. Until such time as
Tenant receives the first Adjustment Statement provided for in
clause (C) of this Section 5.2, Tenant shall, commencing
on the Commencement Date and on the first day of each and every
month thereafter, make the Initial Monthly Rent Adjustment Deposit
specified in Article I hereof.
A. For the purposes of this
Lease:
(1) The term “ Calendar
Year ” shall mean each calendar year or a portion thereof
during the Term.
(2) The term “ Expenses
” shall mean and include all expenses paid or incurred by
Landlord for managing, owning, maintaining, operating, insuring,
replacing and repairing the Premises and all appurtenances and
personal property used in conjunction therewith, including, but not
limited to a management fee in an amount equal to two percent (2%)
of Rent, whether the management services are performed by Landlord,
an affiliate of Landlord, or by a third party.
Notwithstanding the foregoing,
Expenses shall not include the costs of the following:
(a) repairs, replacements and general maintenance paid or
payable by proceeds of insurance or other third parties;
(b) interest, principal, amortization or other payments on
loans to Landlord; (c) real estate brokerage and/or leasing
commissions and marketing expenses; (d) renovations,
alterations, improvements, installations and/or decorations to the
space of other tenants or occupants of the Building or any vacant
space available for lease to tenants in the Building ; (e) real
estate taxes; (f) transfer, gains, franchise, gift,
corporation, profit and income taxes imposed upon Landlord;
(g) costs incurred with respect to a sale or transfer of all
or any portion of the Building or any interest therein, or in any
person of whatever tier owning an interest therein;
(h) financing and refinancing costs; (i) the cost of
electricity furnished to any space leased or available for lease to
tenants in the Building; (j) lease takeover costs incurred by
Landlord in connection with leases in the Building; (k) any
cost for which Landlord receives compensation or reimbursement
through proceeds of insurance; (l) expenses incurred in
connection with services or other benefits of a type that are not
provided to Tenant (or are provided at separate or additional
charge) but which are provided to another tenant or occupant of the
Building; (m) advertising and promotional expenditures;
(n) legal fees, expenses and disbursements (including, without
limitation, those incurred in connection with leasing, sales,
financings or refinancings or disputes with current or prospective
tenants); (o) amounts otherwise includable in Expenses
(including any increased
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insurance
costs) but reimbursed to Landlord directly by Tenant or other
tenants of the Building; (p) to the extent any costs
includable in Expenses are incurred with respect to both the
Building and other properties (including, without limitation,
salaries, fringe benefits and other compensation of
Landlord’s personnel who provide services to both the
Building and other properties), there shall be excluded from
Expenses a fair and reasonable percentage thereof which is properly
allocable to such other properties as determined by Landlord;
(q) the cost of any judgment, settlement or arbitration award
resulting from any liability of Landlord (other than a liability
for amounts otherwise includable in Expenses hereunder) and all
expenses incurred in connection therewith; (r) any interest,
fine, penalty or other late charges payable by Landlord, unless and
only to the extent that such late charge or amount results from
Tenant’s failure to pay to Landlord in a timely fashion any
amounts required under this Lease; (s) costs incurred by
Landlord which result from Landlord’s breach of a lease or
Landlord’s tortious or negligent conduct; (t) the cost
of repairs, replacements or restorations by reason of fire or other
casualty or condemnation; (u) costs and expenses incurred by
Landlord in connection with any obligation of Landlord to indemnify
any Building tenant (including Tenant) pursuant to its lease or
otherwise; and (v) except as otherwise provided in
Section 8.1 or in Section 8.2, the cost of any Capital
Item (as hereinafter defined).
(3) The term “ Rent
Adjustments ” shall mean all amounts owed by Tenant as
Additional Rent on account of Expenses or Taxes, or both.
(4) The term “ Rent
Adjustment Deposit ” shall mean an amount equal to
Landlord’s estimate of Rent Adjustments due for any Calendar
Year made from time to time during the Term.
(5) The term “ Taxes
” shall mean real estate taxes, assessments, sewer rents,
rates and charges, transit taxes, taxes based upon the receipt of
rent, and any other federal, state or local governmental charge,
general, special, ordinary or extraordinary, which accrue during
the Term and are levied or assessed or become a lien against the
Premises or any portion thereof in any Calendar Year during the
Term and any tax in substitution of any of the foregoing. Taxes
also include Landlord’s reasonable costs and expenses
(including reasonable attorney’s fees) in contesting or
attempting to reduce any taxes.
B. Tenant shall pay to the Landlord
as Additional Rent Tenant’s Proportion of Expenses and Taxes
attributable to each Calendar Year of the Term. The amount of Taxes
attributable to a Calendar Year shall be the amount assessed for
any such Calendar Year, even though the assessment for such Taxes
may be payable in a different Calendar Year.
C. As soon as reasonably feasible
after the expiration of each Calendar Year, Landlord will furnish
Tenant a statement (“ Adjustment Statement ”)
showing the following:
(1) Expenses and Taxes for the
Calendar Year last ended and the amount of Expenses and Taxes
payable by Tenant for such Calendar Year;
(2) The amount of Rent Adjustments
due Landlord for the Calendar Year last ended, less credits for
Rent Adjustment Deposits paid, if any; and
(3) The Rent Adjustment Deposit due
in the current Calendar Year.
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D. Within thirty (30) days after
Tenant’s receipt of each Adjustment Statement, Tenant shall
pay to Landlord:
(1) The amount of Rent Adjustment
shown on said statement to be due Landlord for the Calendar Year
last ended; plus
(2) The amount, which when added to
the Rent Adjustment Deposit theretofore paid in the current
Calendar Year, would provide that Landlord has then received such
portion of the Rent Adjustment Deposit as would have theretofore
been paid to Landlord had Tenant paid one twelfth of the Rent
Adjustment Deposit, for the current Calendar Year, to Landlord
monthly on the first day of each month of such Calendar Year.
Commencing on the first day of the
first month after Tenant’s receipt of each Adjustment
Statement, and on the first day of each month thereafter until
Tenant receives a more current Adjustment Statement, Tenant shall
pay to Landlord one twelfth of the Rent Adjustment Deposit shown on
said statement. Landlord shall not issue more than one Adjustment
Statement during any Calendar Year. During the last complete
Calendar Year, Landlord may include in the Rent Adjustment Deposit
its estimate of the Rent Adjustment which may not be finally
determined until after the expiration of the Term. The
Tenant’s obligation to pay the Rent Adjustment shall survive
the Term.
E. Tenant’s payment of the Rent
Adjustment Deposit for each Calendar Year shall be credited against
the Rent Adjustments for such Calendar Year. All Rent Adjustment
Deposits may be co mingled, and no interest shall be paid to Tenant
thereon.
F. Tenant at its cost may examine and
audit the books and records of Landlord pertaining to the Expenses,
for the purposes of verifying that such costs and expenses were
paid, the amounts thereof and the accuracy of Landlord’s
accounting and billing for such matters subject to execution of a
confidentiality agreement acceptable to Landlord, and provided that
if Tenant utilizes an independent accountant to perform such review
it shall be one of national standing which is reasonably acceptable
to Landlord, is not compensated on a contingency basis and is also
subject to such confidentiality agreement. If Tenant fails to
object to Landlord’s Adjustment Statement within ninety
(90) days after receipt of the same, Tenant shall be deemed to
have approved such Adjustment Statement and shall have no further
right to object to or contest such Adjustment Statement. Any
overpayment or underpayment of such costs and expenses correctly
shown by such audit shall be promptly reconciled by a payment equal
to the amount thereof by Landlord to Tenant, or by Tenant to
Landlord, as the case may be. If the results of such audit
correctly show that the amount billed by Landlord to Tenant has
been overpaid by four percent (4%) or more, Landlord shall
reimburse Tenant for the reasonable cost of such audit in addition
to the amount overpaid. Not more than one such audit shall be
conducted for each Calendar Year during the term hereof.
Section 5.3.
Interest Charge and Late Charge . Tenant
acknowledges that its late payment of any Rent will cause Landlord
to incur certain costs and expenses not contemplated under this
Lease, the exact amount of which is extremely difficult or
impractical to fix. Therefore, if any payment of Rent, or any
portion thereof, is not received by Landlord within five
(5) days after written notice that the same was not paid
when due, Tenant shall immediately pay to Landlord a late charge
equal to three percent (3%) of the unpaid amount (“ Late
Charge" ). Notwithstanding the foregoing, however, if any
payment of Rent, or any portion thereof, is late more than two
(2) times in any twelve (12) month period, then no
written notice of non-receipt shall be required and the Late Charge
shall become immediately due and payable if the same is not paid
within five (5) days after the date when due. In the event
that any overdue payment of Rent is not paid within one month of
the due date thereof, an additional Late Charge equal to three
percent of the unpaid
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amount
may be charged by Landlord, and Landlord may charge an additional
three percent of the unpaid amount so over due for each additional
month, or fraction thereof, during which any such payment remains
past due. Landlord and Tenant agree that the Late Charge represents
a reasonable estimate of costs and expenses incurred by Landlord
from, and is fair compensation to Landlord for, its loss suffered
by such non payment by Tenant.
Any amount due from Tenant to
Landlord under this Lease, other than the payment of Rent, not paid
when due shall bear interest from the date when the same is payable
under the terms of this Lease until the same shall be paid at an
annual rate of interest equal to eighteen percent per annum (the
“ Delinquency Rate ”).
ARTICLE VI — UTILITIES
Section 6.1.
Utilities . Tenant shall pay, directly to the
appropriate supplier, all costs of natural gas, electricity, heat,
light, power, sewer service, telephone, water, refuse disposal and
other utilities and services supplied to the Premises. If at any
time, any services or utilities are jointly metered, Landlord shall
make a reasonable determination of Tenant’s share thereof and
Tenant shall pay its share, as Additional Rent hereunder, within
fifteen (15) days after receipt of an invoice from
Landlord.
The current utility service providers
(each such company shall hereinafter be referred to as a “
Current Service Provider ”) are utility companies
selected by Landlord to provide service for the Premises.
Notwithstanding the foregoing, if permitted by law, Landlord shall
have the right at any time and from time to time during the Term to
either contract for service from a different company or companies
providing service (each such company shall hereinafter be referred
to as an “ Alternate Service Provider ” provided
that such Alternate Service Provider provides equal or better
service at a comparable cost and the change does not result in an
interruption of service) or continue to contract for service from
the Current Service Provider.
Tenant shall cooperate with Landlord,
the Current Service Provider and any Alternate Service Provider at
all times and, as reasonably necessary, shall allow Landlord,
Current Service Provider and any Alternate Service Provider
reasonable access to the Premises’ electric lines, feeders,
risers, wiring, and any other machinery within the Premises.
Landlord shall in no way be liable or
responsible for any loss, damage, or expense that Tenant may
sustain or incur by reason of any change, failure, interference,
disruption, defect, unavailability or unsuitability in the supply
or character of the energy furnished to the Premises, and no such
change, failure, interference disruption, defect, unavailability,
or unsuitability shall relieve Tenant from any of its obligations
under the Lease. Notwithstanding the foregoing, in the event such
failure, interference, disruption, defect, unavailability or
unsuitability: (i) is directly caused by the negligence or willful
misconduct of Landlord or Landlord’s agents, employees or
contractors, (ii) causes the Premises to be untenantable, and
(iii) causes Tenant to be unable to conduct its business at
the Premises for three (3) consecutive business days, the Base
Rent and Additional Rent shall abate from the date of the
untenantability until the earlier of the date Premises are again
tenantable or the date Tenant begins conducting its business from
the Premises.
ARTICLE VII — USE
Section 7.1.
Use . The Premises shall be used for the Use
only, and for no other purpose.
Section 7.2.
Prohibited Uses . Tenant shall not permit the
Premises, or any portion thereof, to be used in such manner which
impairs Landlord’s right, title or interest in the Premises
or any portion thereof, or in such manner which gives rise to a
claim or claims of adverse possession or of a dedication of the
Premises,
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or any
portion thereof, for public use. Tenant shall not use or occupy the
Premises or permit the Premises to be used or occupied
(i) contrary to any Restriction or any statute, rule, order,
ordinance, requirement, regulation or restrictive covenant
applicable thereto, and shall at all times comply with same,
(ii) in any manner which would violate any certificate of
occupancy, (iii) in any manner which would render the
insurance void or the insurance risk more hazardous, (iv) in
any manner which would cause structural injury to the Building,
(v) in any manner which would cause the value or usefulness of
the Premises or any part thereof to diminish or (vi) in a
manner which would constitute a public or private nuisance or
waste. Tenant agrees that it will, promptly upon discovery of any
such use, immediately notify Landlord and take all necessary steps
to compel the discontinuance of such use.
ARTICLE VIII — MAINTENANCE, REPAIR AND REPLACEMENTS OF
PREMISES
Section 8.1.
Tenant’s Obligations . Except as set
forth in Section 8.2 below, Tenant assumes full and sole
responsibility for condition, operation, repair, alteration,
improvement, replacement, maintenance and management of the
Premises. Tenant agrees, at Tenant’s sole cost and expense,
to take good care of the Premises and keep same and all parts
thereof, together with any and all alterations and additions
thereto, in good order, condition and repair, suffering no waste or
injury. Tenant shall, at its sole cost and expense, promptly
perform all maintenance and make all necessary repairs and
replacements, ordinary as well as extraordinary, foreseen as well
as unforeseen, in and to any equipment now or hereafter located in
the Premises, including, without limitation, water, sewer, gas,
HVAC and electricity connections, pipes, mains and all other
fixtures, machinery, apparatus, equipment, overhead cranes and
appurtenances now or hereafter belonging to, connected with or used
in conjunction with the Premises. All such repairs and replacements
shall be of first class quality and sufficient for the proper
maintenance and operation of the Premises. Tenant shall keep and
maintain the Premises safe, secure and clean, specifically
including, but not by way of limitation, removal of waste and
refuse matter. Tenant shall not permit anything to be done upon the
Premises (and shall perform all maintenance and repairs thereto so
as not) to invalidate, in whole or in part, or prevent the
procurement of any insurance policies which may, at any time, be
required under the provisions of this Lease. Tenant shall not
obstruct or permit the obstruction of any parking area, adjoining
street or sidewalk. Landlord shall assign to Tenant the warranty
for the rooftop HVAC units serving the Premises. Tenant shall use
commercially reasonable efforts to perform all required
maintenance, repairs and replacements under this Section 8.1
as soon as possible.
Tenant at its own cost and expense
also shall promptly comply with any and all governmental
requirement to or affecting the Premises or any part thereof,
irrespective of the nature of the work required to be done,
extraordinary as well as ordinary, whether or not the same involve
or require any structural changes or additions in or to the
Building and irrespective of whether or not such changes or
additions be required on account of any particular use to which the
Premises or any part thereof are being put.
In the event that, in the reasonable
judgment of both Landlord and Tenant, Tenant is required to make
any repair or replacement pursuant to this Section 8.1 which
would be considered a capital repair or replacement under generally
accepted accounting principles (each, a “ Capital Item
”) and which is not caused by the negligence of Tenant or any
member of the Tenant Group or Tenant’s failure to maintain or
repair such item as required hereby, then Tenant shall only be
responsible for the cost of any such Capital Item, amortized at
8.5% over the manufacturer’s estimated useful life of such
Capital Item, as reasonably determined by Landlord in accordance
with generally accepted accounting principles, for that portion of
the Term remaining at the time such Capital Item is repaired or
replaced, and Landlord shall pay the balance of such cost.
Section 8.2.
Landlord’s Obligations . Subject to the
provisions of Articles X and XIII hereof, Landlord shall, at its
sole cost and expense, and without reimbursement by Tenant, except
for any
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maintenance, repair and replacement cause by the act or omission of
Tenant or any member of the Tenant Group, maintain, repair and
replace, as necessary, the roof and structural portions (including
the structural integrity of the exterior walls) of the Building in
which the Premises is located (the “ Structural Items
”). Landlord shall also maintain, repair and replace, as
necessary, the common areas of the Building, the landscaping,
parking lot, sidewalks and appurtenances thereto, including, as
necessary, snow and ice removal and all costs incurred by Landlord
in connection therewith shall be deemed Expenses. In the event that
Landlord is required to make any repair or replacement pursuant to
this Section 8.2 which would be considered a Capital Item
(other than Structural Items, which shall be at Landlord’s
sole cost and expense), then the cost of such Capital Item shall be
amortized at 8.5% over the manufacturer’s estimated useful
life of such Capital Item, as reasonably determined by Landlord in
accordance with generally accepted accounting principles, and
Expenses shall include, on an annual basis, that portion of said
amortized cost which relates to the portion of the Term (including
any Renewal Term) remaining on the date of such repair or
replacement. Landlord shall use commercially reasonable efforts to
perform all required maintenance, repairs and replacements under
this Section 8.2 as soon as possible.
ARTICLE IX — TENANT’S INSURANCE
Section 9.1.
Coverage Required . Tenant shall procure and
maintain, or cause to be maintained, at all times during the term
of this Lease, at Tenant’s sole cost and expense, and until
each and every obligation of Tenant contained in the Lease has been
fully performed, the types of insurance reasonably required by
Landlord, with insurance companies authorized to do business in the
State of Illinois covering all operations under this Lease, whether
performed by Tenant or by its contractors and subcontractors:
Section 9.2.
Policies . All insurance policies shall be
written with insurance companies acceptable to Landlord with a
minimum A.M. Best rating of A-VII. All insurance policies shall
name Landlord and Landlord’s mortgagee, if any, as additional
insured and loss payee as their respective interests may appear and
shall provide that they may not be terminated or modified without
thirty (30) days advance written notice to Landlord and its
mortgagee, if any. Tenant shall furnish to Landlord, prior to the
Commencement Date, such insurance required to be carried by Tenant,
and thereafter at least fifteen days prior to the expiration of
each such policy, certificates of insurance for any required
insurance.
Section 9.3.
Subrogation . Landlord and Tenant agree to
have all property insurance which may be carried by either of them
endorsed to provide that the insurer waives all rights of
subrogation which such insurer might have against the other party
and Landlord’s mortgagee, if any. Without limiting any
release or waiver of liability or recovery contained in any other
Section of this Lease but rather in confirmation and furtherance
thereof, Landlord waives all claims for recovery from Tenant, and
Tenant waives all claims for recovery from Landlord, and their
respective agents, partners and employees, for any loss or damage
to any of its property insured under valid and collectible
insurance policies to the extent of any recovery collectible under
such insurance policies.
Section 9.4.
Miscellaneous Insurance Provisions . Landlord
and Tenant further agree as follows : (i) any and all
deductibles on referenced insurance coverages shall be borne by
Tenant; (ii) Tenant expressly understands and agrees that any
insurance maintained by Landlord shall apply in excess of and not
contribute with insurance provided by the Tenant under the Lease;
and (iii) all insurance companies shall have a Best rating of not
less than A/VII, or an equivalent rating in the event Best ceases
to exist or provide a rating.
ARTICLE X — DAMAGE OR DESTRUCTION
Section 10.1.
Damage: Lease to Terminate . In the event that
the Building or any portion thereof is so damaged by fire or other
casualty that Landlord shall decide to demolish or not rebuild the
same, then, in
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such
event, Landlord shall have the right to terminate this Lease by
notice to Tenant given within sixty (60) days after the date
of such fire or other casualty. In such event Rent shall be
apportioned on a per diem basis and paid to the date of such
termination.
Section 10.2.
Damage: Lease to Continue . In the event the
Premises are damaged by fire or other casualty and Landlord chooses
to rebuild, then Landlord shall proceed with reasonable diligence
to repair and restore the Premises. In such event, Rent shall abate
in proportion to the non usability of the Premises during the
period while repairs are in progress.
Notwithstanding the foregoing, if
Landlord determines, in its commercially reasonable judgment, that
the time required to adjust the loss with the insurer and to
thereafter commence and substantially complete the repair and
restoration of Premises will exceed two hundred and seventy
(270) days from the date of the fire or other casualty,
Landlord shall so notify Tenant, within sixty (60) days after
the date of such fire or other casualty, and either Landlord or
Tenant shall have the right to terminate this Lease by written
notice to the other party with fourteen (14) days after
Tenant’s receipt of Landlord’s notice described in the
preceding sentence.
ARTICLE XI — LIENS
Section 11.1. Lien
Claims . Tenant shall not do any act which shall in
any way encumber the title of Landlord in and to the Premises or
the Building, nor shall any interest or estate of Landlord in the
Premises or the Building be in any way subject to any claim by way
of lien or encumbrance, whether by operation of law or by virtue of
any express or implied contract by Tenant, and any claim to or lien
upon the Premises or the Building arising from any act or omission
of Tenant shall accrue only against the leasehold estate of Tenant
and shall in all respects be subject and subordinate to the
paramount title and rights of Landlord in and to the Premises or
the Building. Tenant will not permit the Premises or the Building
to become subject to any mechanics’, laborers’ or
materialmen’s lien on account of labor or material furnished
to Tenant or claimed to have been furnished to Tenant in connection
with work of any character performed or claimed to have been
performed on the Premises by or at the direction or sufferance of
Tenant.
ARTICLE XII — TENANT ALTERATIONS
Section 12.1.
Alterations . Tenant shall not make any
alterations, additions or improvements to the Premises or any
portion thereof (collectively, “ Alterations ”)
without in each instance, the prior written consent of Landlord;
provided, however, upon notice to, but without the consent of
Landlord, Tenant shall have the right to make any Alterations where
same are non structural, do not require openings on the roof or
exterior walls of the Building, do not affect any Building system,
and the cost of same does not exceed $10,000.00 in the aggregate in
any twelve month period. Any Alteration by Tenant hereunder shall
be done in a good and workmanlike manner in compliance with any
applicable governmental laws, statutes, ordinances and regulations.
Before commencing any Alterations requiring Landlord’s
consent: (a) plans and specifications therefor, prepared by a
licensed architect, shall be submitted to and approved by Landlord
(such approval shall not be unreasonably withheld or delayed); (b)
Tenant shall furnish to Landlord an estimate of the cost of the
proposed work, certified by the architect who prepared such plans
and specifications; (c) all contracts for any proposed work shall
be submitted to and approved by Landlord; (d) Tenant shall have
furnished Landlord with a satisfactory certificate or certificates
from an insurance company acceptable to Landlord reflecting
insurance coverage reasonably acceptable to Landlord; and (e)
Tenant shall either furnish to Landlord a bond in form and
substance satisfactory to Landlord, or such other security
reasonably satisfactory to Landlord to insure payment for the
completion of all work free and clear of liens. Upon completion of
any Alteration by Tenant hereunder, Tenant shall furnish Landlord
with a copy of the “as built” plans covering such
construction.
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Section 12.2.
Ownership of Alterations . Upon Tenant’s
written request prior to such time as Tenant intends to make any
Alteration, Landlord shall indicate to Tenant whether or not such
Alteration must be removed upon surrender of the Premises. To the
extent Tenant does not request such an indication from Landlord at
the time Tenant intends to make an Alteration, then at the
termination of this Lease, Landlord shall have the option of
requiring removal of such Alteration or requiring that such
Alteration become the property of Landlord and remain upon and be
surrendered with the Premises as part thereof. Landlord agrees that
Tenant’s initial improvements to the Premises, as described
on Exhibit “G” attached hereto, will not
have to be removed at the termination of the Lease.
Section 12.3.
Signs . Tenant shall not place any signs on
any part of the Land without the prior consent of Landlord which
consent shall not be unreasonably withheld. Tenant shall have the
right subject to the prior consent of Landlord which consent shall
not be unreasonably withheld, to install wall signage on the
Building at Tenant’s sole cost and expense, which wall and
wall signage shall remain subject to the requirements of the
Property Owners Association and the Village of Gurnee Zoning
Department. Landlord hereby approves Tenant’s wall signage in
accordance with the specifications set forth on Exhibit
“E” attached hereto and made a part hereof.
Landlord shall install at its sole cost and expense a building
monument sign, and Tenant shall have the right to be listed on the
sign along with other tenants in the Building; provided, however,
that Tenant shall be listed at the top of such monument sign.
ARTICLE XIII — CONDEMNATION
Section 13.1.
Taking: Lease to Terminate . If a portion of
the Premises shall be lawfully taken or condemned for any public or
quasi public use or purpose, or conveyed under threat of such
condemnation and as a result thereof the Premises cannot be used
for the same purpose as before such taking, sale or condemnation,
the Tenant’s right to possession under this Lease shall end
upon the date of the taking, sale or condemnation by the condemning
authority. Tenant hereby assigns to Landlord, Tenant’s
interest in such award, if any. If any part of the Premises shall
be so taken or condemned, or if the grade of any street or alley
adjacent to the Premises is changed by any competent authority and
such taking or change of grade makes it necessary or desirable to
demolish, substantially remodel, or restore the Building, Landlord
shall also have the right to terminate this Lease upon written
notice given not less than sixty days prior to the date of
termination designated in such notice.
Section 13.2.
Taking: Lease to Continue . If a portion of
the Premises shall be lawfully taken or condemned for any public or
quasi public use or purpose or conveyed under threat of such
condemnation and Landlord does not terminate the Lease as permitted
by Section 13.1 or as a result of such taking, sale or
condemnation, the balance of the Premises can be used for the same
purpose as before such taking, sale or condemnation, this Lease
shall not terminate. In such event, Landlord, at its sole cost and
expense up to the amount of any award, shall, to the extent
practical, promptly (subject to extension due to delay because of
matters beyond the control of Landlord and Landlord’s receipt
of insurance proceeds) repair and restore the Premises. Any award
paid as a consequence of such taking, sale or condemnation, shall
be paid to Landlord and any sums not disbursed by Landlord in
connection with the repair or restoration of the Premises shall be
retained by Landlord. In the event of
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