LEASE AGREEMENT
between
431 Fairway Associates, LLC,
a Florida limited liability
company
(Landlord)
and
China Direct,
Inc.,
a Florida
Corporation
(Tenant)
Dated: August 21,
2007
431 Fairway Drive
Deerfield Beach,
FL 33441
TABLE OF
CONTENTS
Page
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DESCRIPTION OF
PROPERTY; TERM
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1
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1
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2
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Base Rent; Late
Charge; Sales Tax
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2
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3
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Payment Without
Notice or Demand
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3
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3
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3
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3
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Interim
Operating Expenses
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5
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6
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6
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6
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7
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7
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7
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LANDLORD AND
TENANT OBLIGATIONS
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7
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7
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8
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Floor Loads;
Noise and Vibration
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8
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9
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10
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LANDLORD’S AND TENANT’S
PROPERTY
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10
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10
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Landlord’s Lien and Security
Interest
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11
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11
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12
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ALTERATIONS AND
MECHANIC’S LIENS
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12
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12
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13
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13
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13
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Landlord’s Right of Recapture
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14
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Minimum Rental
Requirement
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14
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14
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14
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14
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14
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RIGHT OF
LANDLORD TO PERFORM TENANT’S COVENANTS
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15
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15
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15
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NON-LIABILITY
AND INDEMNIFICATION
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15
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Non-Liability
of Landlord
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15
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15
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Impossibility
of Performance
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15
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16
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16
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16
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17
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Presumption of
Abandonment
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17
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17
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17
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NOTICE OF
SURRENDER/HOLDOVER
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17
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Notice of
Surrender/Holdover
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17
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18
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18
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18
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18
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18
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18
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LANDLORD’S RIGHT OF ACCESS
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19
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Access for
Maintenance and Repair
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19
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Access for
Inspection and Showing
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19
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Landlord’s Alterations and
Improvements
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19
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19
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19
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20
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21
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21
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21
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21
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No Partnership
or Joint Venture
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21
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Approval by
Superior Mortgagee
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22
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Capacity to
Execute Lease
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22
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22
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22
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Anti-Terrorism
Representation
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22
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NonDisclosure
of Lease Terms
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23
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23
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Light and
Air/Adjacent Excavation and Shoring
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23
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Name and Image
of Building
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23
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Entire
Agreement; Modifications
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23
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SUMMARY OF LEASE
THIS
DOCUMENT IS MERELY A SUMMARY AND ANY PROVISIONS OF THE LEASE AND
OTHER AGREEMENTS BETWEEN LANDLORD AND TENANT SHALL PREVAIL OVER
CONFLICTING PROVISIONS CONTAINED HEREIN.
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(A)
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LANDLORD’S MAILING ADDRESS
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c/o Konover
South, LLC
431 Fairway
Drive, Suite 300
Deerfield
Beach, FL 33441
Attn: Beatrice
T. Williams,
Director,
Contract & Lease Administration
With
Simultaneous Copy to:
Gregory V.
Combs, President
(Same
Address)
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TENANT’S
NAME:
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China Direct,
Inc.
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MAILING
ADDRESS
(Prior to the
Rent Commencement Date)
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The
Courtyards
5301 N. Federal
Highway, Suite 120
Boca Raton,
FL 33487
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(C)
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DEMISED
PREMISES:
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5,235 rentable
square feet
Suite
200
431 Fairway
Drive
Deerfield
Beach, FL 33441
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(D)
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TERM:
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Approximately
Five (5) years
commencing on
the Rent Commencement
Date and
expiring on the Expiration Date
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(E)
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RENT
COMMENCEMENT DATE:
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Upon
Substantial Completion of Tenant
Improvements,
as defined in Section 1.2 and
the Work Letter
Agreement attached hereto
as Exhibit
“E”
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EXPIRATION
DATE:
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the last day of
the Sixtieth (60 th )
full
calendar month
following the Rent
Commencement
Date
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(F)
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FIRST YEAR BASE
RENT:
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$22.00 per
rentable square foot
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(G)
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INTERIM
OPERATING EXPENSES
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$10.00 per
rentable square foot
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(H)
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TENANT
IMPROVEMENT ALLOWANCE:
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Not to exceed
$340,275.00 ($65.00 per rentable square foot of the
Premises)
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(I)
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SECURITY/DAMAGE
DEPOSIT:
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$27,920.00
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(J)
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PERMITTED
USE:
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General
Office
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(K)
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PROPORTIONATE
SHARE:
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18.35%
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(L)
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GUARANTOR:
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N/A
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(K)
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EXHIBITS
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The following
exhibits attached to this Lease are hereby incorporated herein
and made a part hereof.
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EXHIBIT
“A”
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Premises
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EXHIBIT
“B”
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Site
Plan
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EXHIBIT
“C”
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Legal
Description
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EXHIBIT
“D”
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Rules &
Regulations
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EXHIBIT
“E”
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Work Letter
Agreement
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Please make all
checks payable to :
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431Fairway
Associates, LLC
c/o Konover
South, LLC
431 Fairway
Drive, Suite 300
Deerfield
Beach, FL 33441
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INCLUDE 431
FAIRWAY ASSOCIATES, LLC AS AN ADDITIONAL INSURED ON ALL INSURANCE
POLICIES.
LEASE
AGREEMENT
THIS LEASE AGREEMENT (hereinafter referred to as the
“Lease”) is made and entered into as of the 21 day of
August, 2007 (the "Effective Date"), by and between 431 FAIRWAY
ASSOCIATES, LLC, a Florida limited liability company (hereinafter
referred to as “Landlord”) and China Direct
Investments, Inc., a Florida Corporation (hereinafter referred to
as “Tenant”).
W I T N E S S E T
H:
THAT LANDLORD , in consideration of the rents and agreements
hereafter promised and agreed by Tenant to be paid and performed,
does hereby lease to Tenant, and Tenant does hereby lease from
Landlord, the Premises described herein, subject to the following
terms.
ARTICLE I DESCRIPTION
OF PROPERTY; TERM
Section 1.1
Description of Property. Landlord hereby leases
to Tenant and Tenant hereby leases from Landlord approximately
5,235 rentable square feet of office space measured in accordance
with the Standard Method for Measuring Floor Area in Office
Buildings, ANSI Z65.1-1996, as promulgated by the Building Owners
and Managers Association (BOMA) International (which rentable
square footage and all other amounts specified in this Lease which
are a function of rentable square footage, shall be subject to
adjustment based upon Landlord’s final “as built”
measurement of the Premises and the building in which the Premises
are located) on the Second (2nd) floor, and known as Suite 200
(hereinafter referred to as the “Premises”)
approximately as shown on Exhibit “A” attached hereto,
in the office building which is located at 431 Fairway Drive,
Deerfield Beach, FL 33441 together with a first floor
parking garage located therein (hereinafter collectively referred
to as the “Building”) as depicted on the site plan
attached hereto as Exhibit “B”. The
Building and the parcel of land on which it is located as legally
described in Exhibit “C” and all improvements located
on such land is collectively referred to herein as the
“Property”. The “Common Areas”
of the Property include such areas and facilities as delivery
facilities, walkways, landscaped and planted areas, and parking
facilities and are those areas designated by Landlord for the
general use in common of occupants of the Property, including
Tenant. The Common Areas shall at all times be subject
to the exclusive control and management of
Landlord. Landlord may grant third parties specific
rights concerning portions of the Common Areas. Landlord
may increase, reduce, improve, or otherwise alter the Common Areas,
otherwise make improvements, alterations, or additions to the
Property, and change the name or number by which the Building or
Property is known. Landlord may also temporarily close
the Common Areas to make repairs. In addition, Landlord
may temporarily close the Property and preclude access to the
Premises in the event of casualty, governmental requirements, acts
of terrorism, the threat of an emergency such as a hurricane or
other act of God, or if Landlord otherwise reasonably deems it
necessary in order to prevent damage or injury to person or
property. This Lease does not create, nor will Tenant
have any express or implied easement for, or other rights to, air,
light, or view over, from, or about the Property.
Section 1.2
Term . Tenant shall have and hold the Premises
for a term of approximately Five (5) years (hereinafter referred to
as the “Term” or “Lease Term”), commencing
on the Rent Commencement Date which, for purposes of this Lease
shall mean the date of Substantial Completion of Tenant
Improvements as defined in the Work Letter Agreement attached
hereto as Exhibit "E" and expiring on the last day of the sixtieth
(60 th
) full calendar month thereafter
(the “Expiration Date”). Tenant agrees that when the
Rent Commencement Date and Expiration Date are determined, it will
execute a commencement agreement setting forth such dates in the
form attached hereto as Exhibit F certifying said
dates. Tenant’s failure to execute the
commencement agreement shall not affect the rights and/or
obligations of Tenant hereunder or the establishment of such
dates. Notwithstanding the fact that the Rent
Commencement Date of the Lease Term commences after the date of the
execution of this Lease, all of the representations, warranties,
covenants, indemnities and obligations of Landlord and Tenant
shall, except as expressly otherwise set forth in this Lease or
unless the context clearly requires otherwise, be effective and
binding on Landlord and Tenant (and enforceable by either) as, of,
from and after the Effective Date of this Lease. For all
purposes of this Lease, the term “Lease Year” shall
have the following meaning: a Lease Year shall be that twelve (12)
consecutive month period commencing on the Rent
Section 1.3 Commencement
Date and the annual anniversary thereof. In the event
the Rent Commencement Date shall be a day other than the first day
of a calendar month, then the first Lease Year shall commence on
the Rent Commencement Date and continue through and include the
last day of the twelfth (12 th )
month in which the Rent Commencement Date occurred in the next
calendar year and each Lease Year thereafter shall mean the first
day of the first month following the end of the previous Lease Year
continuing through and including the last day of the twelfth
(12 th
) month thereafter (e.g. –
should the Rent Commencement Date be September 6, the first Lease
Year shall be September 6 through and including September 30 of the
following year; each Lease Year thereafter shall be October 1
though and including September 30 of the following
year). For all purposes of this Lease, the term
“calendar year” shall be the twelve (12) month periods
from January 1 through December 31. However, the first
calendar year shall run from the Rent Commencement Date through the
31 st
day of December immediately
following.
Section
1.4 Option
to Extend.
a
Option . Landlord hereby grants Tenant the option
to extend (“Extension Option”) the term of this Lease
for one (1) additional term of five (5) years (the “Extension
Term”), commencing as of the date immediately following the
Expiration Date of the initial Lease Term, subject to the covenants
and conditions of this Section 1.3.
b.
Notice and Exercise of Option . Tenant shall give
Landlord written notice (the “Extension Notice”) of
Tenant’s election to exercise its Extension Option not later
than one hundred and eighty (180) days prior to the expiration of
the Lease Term; provided that Tenant’s failure to give the
Extension Notice by said date, whether due to Tenant’s
oversight or failure to cure any existing defaults after notice and
applicable grace periods, if any, or otherwise, shall render this
Extension Option null and void.
c.
“AS-IS” Condition . Tenant shall be
deemed to have accepted the Premises in “AS-IS”
condition as of the commencement of the Extension Term, subject to
any other repair and maintenance obligations of Landlord under this
Lease, it being understood and agreed that Landlord shall have no
additional obligation to renovate or remodel the Premises or any
portion of the Building as a result of Tenant’s extension of
this Lease.
d.
Covenants . The covenants and conditions of this
Lease in force during the Lease Term, as the same may be modified
from time to time, shall continue to be in effect during the
Extension Term, except as follows:
(1) The
“Rent Commencement Date” for the purposes of this Lease
shall be the first day of the Extension Term.
(2) During
each Lease Year of the Extension Term (including the first Lease
Year thereof) the Base Rent shall increase by four percent (4%)
over the Base Rent payable in the immediately preceding Lease
Year. Operating Expenses and any other Additional Rent
shall continue to be paid on a monthly basis in the same manner as
was applicable during the initial Lease Term.
(4) Following
the expiration of the Extension Term as provided herein, Tenant
shall have no further right to renew or extend this
Lease.
(5) Tenant's
option to renew this Lease shall not be transferable by Tenant and
shall not inure to the benefit of any subtenant or assignee of
Tenant without the express prior consent of Landlord, in its sole
and absolute discretion.
ARTICLE
II BASE
RENT
Section 2.1
Base Rent; Late Charge; Sales Tax . Commencing on
the Rent Commencement Date (defined above) Tenant agrees to pay
Landlord base rent for the first year of the Lease Term in the
amount of Twenty Dollars ($22.00) times the rentable square footage
of the Premises as set forth in Section 1.1 above (the "Base
Rent"), payable in twelve (12) equal monthly installments due on or
before the first day of each and every month during the first year
of the Lease Term, plus the prorated amount of Base Rent for any
partial month if the Rent Commencement Date is other than the first
day of the month. In addition, Tenant shall, during the
entire Lease Term, and any renewal terms, be responsible for the
payment of Operating Expenses (hereafter defined) as provided in
Article III below (the Base Rent and Operating Expenses shall be
considered Rent as that term is used in Florida Statute Chapter 83
and shall sometimes be collectively referred to as the
"Rent"). Unless otherwise expressly provided, all
monetary obligations of Tenant to Landlord under this Lease, of any
type or nature, other than Base Rent, shall be designated as
Additional Rent. In the event the Rent
Commencement Date is a day other than the first
day of the month, the first payment of Rent shall be prorated
accordingly and shall be due and payable on the Rent Commencement
Date. In the event any monthly Rent payment is not paid
within five (5) days after it is due, Tenant agrees to pay a late
charge of five (5%) percent of the amount of the payment
due. Tenant further agrees that the late charge imposed
is fair and reasonable, complies with all laws, regulations and
statutes, and constitutes an agreement between Landlord and Tenant
as to the estimated compensation for costs and administrative
expenses incurred by Landlord due to the late payment of Rent by
Tenant. Tenant further agrees that the late charge
assessed pursuant to this Lease is not interest, and the late
charge assessed does not constitute a lender or borrower/creditor
relationship between Landlord and Tenant, and may be treated by
Landlord as Additional Rent owed by Tenant. The late
charge is not intended to cover Landlord's attorneys' fees and
costs relating to delinquent Rent. Acceptance of any
late charge shall not constitute a waiver of Tenant's default with
respect to such late payment by nor prevent Landlord from
exercising any other rights or remedies available to Landlord under
this Lease. Tenant shall, together with each payment of
Rent, pay to Landlord all sales, use or other taxes pertaining to
the Rent which shall be remitted by Landlord to the Florida
Department of Revenue or other appropriate taxing
authority. No security or guaranty which may now or
hereafter be furnished to Landlord for the payment of Rent due
hereunder or for the performance by Tenant of the other terms of
this Lease shall in any way be a bar or defense to any of
Landlord’s remedies under this Lease or at
law. Tenant’s covenant to pay Rent and all other
amounts due under this Lease (including, without limitation, Base
Rent and Additional Rent) is independent of all other covenants
contained in this Lease.
Section 2.2
Base Rental Adjustment . Commencing on the first
anniversary of the Rent Commencement Date (defined above) (provided
such anniversary date falls on the first day of the month,
otherwise on the first day of the following month) and each and
every anniversary thereafter, the Base Rent shall increase by four
percent (4%) percent over the previous year’s Base Rent,
including the Extension Term, if exercised.
Section 2.3
Payment Without Notice or Demand . The Rent
called for in this Lease shall be paid to Landlord without notice
or demand, and without counterclaim, offset, deduction, abatement,
suspension, deferment, diminution or reduction. Tenant
hereby waives all rights now or hereafter conferred by statute or
otherwise to quit, terminate or surrender this Lease or the
Premises or any party thereof, or to any offset, deduction,
abatement, suspensions, deferment, diminution or reduction of the
Rent on account of any such circumstances or
concurrence.
Section 2.4
Place of Payment . All payments of Rent shall be
made and paid by Tenant to 431 Fairway Associates, LLC c/o Konover
South, LLC, 431 Fairway Drive, Suite 300, Deerfield Beach,
Florida 33441 or at such other place as Landlord may,
from time to time, designate in writing to Tenant. All
Rent shall be payable in current legal tender of the United States,
as the same is then by law constituted. Any extension,
indulgence, or waiver granted or permitted by Landlord in the time,
manner or mode of payment of Rent, upon any one (1) or more
occasions, shall not be construed as a continuing extension,
indulgence or waiver, and shall not preclude Landlord from
demanding strict compliance herewith.
ARTICLE
III OPERATING EXPENSES
Section 3.1
Operating Expenses . In addition to the Base
Rent, Tenant shall pay as Additional Rent its proportionate share
(hereinafter referred to as “Tenant’s Proportionate
Share”) of the Operating Expenses (as herein defined) of the
Building and the Property. “Tenant’s
Proportionate Share” shall, at any given time, be defined as
that fraction having as a numerator the total rentable square
footage leased hereunder at said time, and having as a denominator
the total rentable square footage of the
Building. Operating Expenses shall be paid to Landlord
in accordance with the following provisions:
Operating
Expenses shall be paid to Landlord in accordance with the following
provisions:
A. Landlord
shall furnish to Tenant within thirty (30) days prior to the
beginning of each calendar year, including the first calendar year
following the year in which the Rent Commencement Date occurs, a
budget setting forth Landlord’s estimate of Operating
Expenses for the upcoming year. Tenant shall pay to
Landlord, on the first day of each month an
amount equal to one-twelfth (1/12 th )
of Landlord’s estimate of the Operating Expenses for that
calendar year. If there shall be any increase or
decrease in the Operating Expenses for any year, whether during or
after such year, Landlord shall furnish to Tenant a revised budget
and the Operating Expenses shall be adjusted and paid or credited,
as the case may be. If a calendar year ends after the
expiration or termination of this Lease, the Operating Expenses
payable hereunder shall be prorated to correspond to that portion
of the calendar year occurring within the Term of this
Lease.
If during any
year the entire Building is not occupied or Landlord is not
furnishing utilities or services to all of the premises in the
Building, then the variable Operating Expenses for such year shall
be “grossed up” (using reasonable projections and
assumptions) to the amounts that would apply if the entire Building
were completely occupied and all of the premises in the Building
were provided with the applicable utilities or
services. Variable Operating Expenses are Operating
Expenses that are variable with the level of occupancy of the
Building (such as janitorial services, utilities, refuse and waste
disposal, and management fees). Instead of including in
Operating Expenses certain costs, Landlord may bill Tenant, and
Tenant shall pay for those costs, in any one or a combination of
the following manners: (a) direct charges for services
provided for the exclusive benefit of the Premises that are subject
to quantification; (b) based on a formula that takes into account
the relative intensity or quantity of use of utilities or services
by Tenant and all other recipients of the utilities or services, as
reasonably determined by Landlord; or (c) pro rata based on the
ratio that the rentable square footage of the Premises bears to the
total rentable area of the Building that are benefited by such
costs.
Within 120 days
after the end of each calendar year, Landlord shall furnish to
Tenant an operating statement showing the actual Operating Expenses
incurred for the preceding calendar year. Tenant shall
either receive a refund or be assessed an additional sum based upon
the difference between Tenant’s Proportionate Share of the
actual Operating Expenses and the Operating Expense payments made
by Tenant during said year. Any additional sum owed by
Tenant to Landlord shall be paid within ten (10) days of receipt of
assessment. Any refund owed by Landlord to Tenant shall
be credited toward Tenant’s next month’s rental
payment. If Tenant disputes the statement then, pending
resolution of the dispute, Tenant shall pay the Operating Expenses
in question to Landlord in the amount provided in the disputed
statement. Each Operating Statement given by Landlord shall be
conclusive and binding upon Tenant unless, within thirty
(30) days of Tenant’s receipt thereof, Tenant shall
notify Landlord that it disputes the accuracy of said Operating
Statement, in which event Tenant shall have the right,
within ninety (90) days of its receipt of such statement,
at Tenant’s sole cost and expense, to audit Landlord’s
records pertaining to Operating Expenses. Such audit shall be
performed by an independent firm of certified public
accountants that is not being compensated by Tenant on a
contingency fee basis ; , and shall be performed during
regular business hours at the office where Landlord maintains its
books and records. Any over-billing discovered in the course
of such audit shall be credited to Tenant’s next ensuing
payment of Operating Costs following Landlord’s receipt
of a copy of the audit, or if the Lease has expired, will be paid
to Tenant within thirty (30) days following Landlord's receipt of a
copy of the audit. If the audit discloses an
undercharge to Tenant, Tenant shall pay to Landlord the amount
of such undercharge within thirty (30) days of completion of the
audit. Tenant shall not be entitled to perform any such
audit more than one (1) time per year during the Term hereof, or
during any period within which Tenant is in default under the
Lease.
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The term
“Operating Expenses” shall mean the total of all of the
costs incurred by Landlord relating to the ownership, operation,
management and maintenance of the Building and Property and the
services provided tenants of the Building. By way of
explanation and clarification, but not by way of limitation,
Operating Expenses will include the costs and expenses incurred for
the following:
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Real Estate
Taxes. The term “Real Estate Taxes” shall
mean all ad valorem and non-ad valorem taxes, assessments, and
other charges by any governmental authority, including real and
personal property taxes, transit and other special district taxes,
franchise taxes, and solid waste assessments that are imposed on
the Building or Property. If a tax shall be levied
against Landlord in substitution in whole or in part for the Real
Estate Taxes or otherwise as a result of the ownership of the
Building or Property, then the other tax shall be deemed to be
included within the definition of “Real Estate
Taxes”. “Real Estate Taxes” shall also
include all costs incurred by Landlord in contesting the amount of
the assessment of the Building or Property made for Real Estate Tax
purposes, including attorneys’, consultants’, and
appraisers’ fees;
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trash and
garbage removal (including dumpster rental) and
recycling;
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porter and
matron service (if applicable);
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Common Areas
decorations;
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repairs,
maintenance, and alteration of the systems of the Building and/or
Property, Common Areas, and other portions of the Building or
Property to be maintained by Landlord;
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amounts paid
under easements or other recorded agreements affecting the Building
or the Property, including assessments paid to property
owners’ associations;
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repairs,
maintenance, replacements, and improvements that are appropriate
for the continued operation of the Building as a first class
building;
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improvements
required by law;
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improvements in
security systems;
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materials,
tools, supplies, and equipment to enable Landlord to supply
services that Landlord would otherwise have obtained from a third
party;
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expenditures
designed to result in savings or reductions in Operating
Expenses;
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landscaping,
including fertilization and irrigation supply and
maintenance;
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parking garage
and surface parking area maintenance and supply;
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property
management fees;
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an onsite
management office (or the pro rata share only of an off-site
management office based on Landlord’s estimate of the
percentage allocated to the Property);
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all utilities
serving the Premises, the Building and Property and not separately
billed to or reimbursed by any tenant of the Building including
those in connection with the Generator described in Section 8.6
below;
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cleaning,
window washing, and janitorial services;
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all insurance
customarily carried by owners of comparable buildings in the
suburban Deerfield Beach area or required by any mortgagee of the
Building or Property;
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service and
maintenance contracts for the Building or Property;
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wages,
salaries, and other benefits and costs of employees of the Landlord
up to and including the building manager (including a pro rata
share only of the wages and benefits of employees who are employed
at more than one building; which pro rata share shall be determined
by Landlord and shall be based on Landlord’s estimate of the
percentage of time spent by the employees at the
Property);
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legal,
accounting, and administrative costs; and
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uniforms and
working clothes for employees and the cleaning of them;
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maintenance,
repair and replacement of the HVAC systems; and
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maintenance and
repair of the Generator and fuel consumption in connection
therewith.
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Interim
Operating Expenses . During the period from the Rent
Commencement Date through December 31, 2007 Tenant shall pay as
Interim Operating Expenses Ten ($10.00) Dollars per square foot per
year, payable monthly, which is merely an estimate of the actual
Operating Expenses for such period. Not
later than 120
days after the end of the calendar year, Landlord shall compute the
actual Operating Expenses incurred during such
period. Tenant shall either receive a refund or be
assessed an additional sum based upon the difference between
Tenant’s Proportionate Share of the actual Operating Expenses
and the payments of Interim Operating Expenses made by Tenant
during such period. Any additional sum owed by Tenant to
Landlord shall be paid within ten (10) days of receipt of
assessment. Any additional sum owed by Landlord to
Tenant shall be credited toward Tenant’s next month’s
Rent payment.
Section
3.3 Operating Expense Cap. Tenant’s Proportionate Share
of Operating Expenses consisting of “Controllable Operating
Expenses” (as hereinafter defined) shall not increase from
one (1) calendar year to the next by more than ten percent
(10%) per calendar year during the initial Term of this Lease
on a cumulative basis utilizing the estimated Operating Expenses
for 2008 as the base year amount. “Controllable Operating
Expenses” shall mean all Operating Expenses, except for
insurance premiums, all taxes which are Operating Expenses under
this Lease including, without limitation, real estate taxes,
personal property taxes and other governmental assessments and
impositions, any windstorm restoration costs not covered by
insurance, and costs of fuel consumption in connection with the use
of the Generator. In no event shall there be any annual limit on
increases to Tenant’s Proportionate Share of Operating
Expenses which are not Controllable Operating
Expenses. In the event Tenant extends the Term of
this Lease beyond the initial term hereof, the base amount for
purposes of calculating Tenant's Proportionate Share of Operating
Expenses shall be the actual operating expenses for the
first year of the extended Term, subject to the ten
(10%) percent cumulative cap on Controllable Operating
Expenses through the remainder of the extended
Term. Additionally, any expenses deferred because of
construction warranties (i.e. HVAC service contracts, elevator
service contracts, fire/security service contracts, etc.) will be
added back to the Operating Expenses prior to determining whether
or not the controllable Operating Expense cap has been
exceeded.
ARTICLE IV SECURITY/DAMAGE
DEPOSIT
Section 4.1
Security/Damage Deposit . Simultaneously with the execution
of this Lease, Tenant shall pay the sum of Twenty-Seven Thousand
Nine Hundred Twenty Dollars ($27,920.00) Dollars (the
“Security Deposit”) to be held by Landlord as security
for Tenant’s full and faithful performance of this Lease
including the payment of Rent. It is expressly
understood that such deposit shall not be considered an advance
payment of Rent or a measure of Landlord’s damages in the
event of default by Tenant. Landlord shall have the
right to apply all or any part of the security deposit against any
damage, injury, expense or liability caused Landlord by Tenant or
by Tenant's default hereunder, including, but not limited
to: (a) unreasonable wear and tear of the Premises; (b)
loss or damage to the Premises or other property of the Landlord
caused by Tenant, Tenant’s officers, employees, agents
invitee, or licensees; (c) the cost of restoring the Premises,
except for reasonable wear and tear, to the same condition it was
in at the time Tenant began occupancy thereof; (d) Rent payments
which remain due and owing beyond any applicable grace
period. Landlord shall not be limited in pursuing
Landlord’s remedies against Tenant for costs, losses or
damages to the Premises or to any other property of Landlord for
any such costs, losses or damages which are in excess of the above
described security deposit. Such money shall bear no
interest and may be commingled with other security deposits or
funds of Landlord. Tenant grants Landlord a security
interest in the Security Deposit. Landlord may apply the
Security Deposit to the extent required to cure any default by
Tenant or repair any damage to the Premises. If Landlord
so applies the Security Deposit, Tenant shall deliver to Landlord
the amount necessary to replenish the Security Deposit to its
original sum within five days after notice from
Landlord. The Security Deposit shall not be deemed an
advance payment of Rent or a measure of damages for any default by
Tenant, nor shall it be a defense to any action that Landlord may
bring against Tenant.
ARTICLE V USE OF
PREMISES
Section 5.1
Use of Premises . Tenant shall continuously use
and occupy the Premises only for general office
use. Tenant shall not use or permit or suffer the use of
the Premises for any other business or
purpose. Tenant shall not do or permit any act
which would constitute a public or private nuisance or
waste or which would be a nuisance or annoyance
or cause damage to Landlord or Landlord’s other tenants or
which would invalidate any policies of insurance or increase the
premiums thereof, now or hereafter written on the Building and/or
Premises. Tenant shall conform to the Rules and Regulations of
Landlord. “Rules and Regulations” shall mean
the rules and regulations for the Building promulgated by Landlord
from time to time. The Rules and Regulations which apply
as of the Effective Date of this Lease are attached as Exhibit
“D”.
ARTICLE
VI PARKING
Section 6.1
Parking . Throughout the Lease Term, there shall
be available six (6) parking spaces "reserved" for the exclusive
use of Tenant in the ground floor parking area within the Building
and fifteen (15) spaces in the surface parking area located
adjacent to the Building, for the non-exclusive use of Tenant on a
first-come, first-served basis. Landlord has and
reserves the right to alter the methods used to control parking and
the right to establish such controls and rules and regulations
(such as parking stickers to be affixed to vehicles) regarding
parking that Landlord deems desirable. Tenant’s
employees, agents, contractors, and invitees shall abide by all
posted roadway signs in and about the parking
facilities. Landlord shall have the right to tow or
otherwise remove vehicles of Tenant and its employees, agents,
contractors, or invitees that are improperly parked, blocking
ingress or egress lanes, or violating parking rules, at the expense
of Tenant or the owner of the vehicle, or both, and without
liability to Landlord. On request by Landlord, Tenant
shall furnish Landlord with the license numbers and descriptions of
any vehicles of Tenant, its principals, employees, agents, and
contractors. Parking spaces may be used for the parking
of passenger vehicles only and shall not be used for parking
commercial vehicles or trucks (except sports utility vehicles,
mini-vans, and pick-up trucks utilized as personal transportation),
boats, personal watercraft, or trailers. No parking
space may be used for the storage of equipment or other personal
property. Overnight parking in the parking garage or
other parking areas is prohibited. Landlord, in
Landlord’s sole and absolute discretion, may establish from
time to time a parking decal or pass card system, security
check-in, or other reasonable mechanism to restrict parking in the
parking garage or other parking areas, in which event Tenant shall
purchase such access cards, or parking decals from Landlord at a
Building standard charge. Landlord shall have no
obligation to police or enforce the use of any reserved parking
spaces by unauthorized individuals. Landlord shall not
have any liability on account of any loss or damage to any vehicle
or the contents thereof, Tenant hereby agreeing to bear the risk of
loss for same.
ARTICLE
VII LEASEHOLD IMPROVEMENTS
Section 7.1
Leasehold Improvements . Landlord shall provide
an allowance (the “Allowance”) in an amount of up to
$340,275.00 ($65.00 per rentable square foot of the Premises) for
the design, permitting and construction of improvements to the
Premises ("Tenant’s Improvements") in accordance with the
Work Letter Agreement attached hereto as Exhibit
“E". The cost of all space planning and
architectural and mechanical drawings for the Tenant’s
Improvements, as well as project management fees (if charged by the
general contractor within the construction contract) shall be
deducted from the Allowance. The Tenant’s
Improvements shall be performed by Landlord's contractor during
regular business hours. Tenant shall use reasonable
efforts to assist Landlord in coordinating the design and
construction process, obtaining any approvals required from
Landlord and any governmental agencies, and in scheduling
deliveries. Any portion of the Allowance not used to pay the costs
of the Tenant’s Improvements in accordance with this Section
7.1 and the Work Letter Agreement shall be retained by Landlord and
no credit for any unused portion thereof shall be given to
Tenant. Any cost for such work in excess of the
Allowance shall be paid by Tenant within ten (10) days of receipt
of an invoice therefor from Landlord along with appropriate
supporting documentation.
Section 7.2
Acceptance of Premises. Landlord shall complete
Landlord's Work in a good and workmanlike manner and in accordance
with all applicable governmental regulations including those
imposed by the ADA. Neither Landlord nor any assignee of
Landlord shall be liable for any latent defect therein; provided,
however, Landlord shall be responsible for correcting
any
latent defect discovered within the Building or
Landlord's Work within the Premises. The taking of
possession of the Premises by Tenant shall be conclusive evidence
that the Premises were in good and satisfactory condition at the
time such possession was taken, subject to Landlord’s
performance of the Tenant Improvements in accordance with the Work
Letter Agreement and the terms and conditions of this
Lease.
ARTICLE
VIII LANDLORD AND TENANT
OBLIGATIONS
Section 8.1
Tenant’s Obligations . Tenant shall, at its
sole cost, repair and maintain the Premises (including the walls,
ceilings and floor therein), all to a standard consistent with a
Class "A" office building, with the exception only of those repairs
which are the obligation of Landlord pursuant to this
Lease. Without limiting the generality of the foregoing,
Tenant is specifically required to maintain and make repairs to (i)
the portion of any pipes, lines, ducts, wires, or conduits
contained within the Premises; (ii) windows, plate glass, doors,
and any fixtures or appurtenances composed of glass (excluding
exterior washing of windows and plate glass); (iii) Tenant's sign;
and (iv) any specialized electrical, plumbing, mechanical,
fire protection, life safety and HVAC systems serving the Premises
requested by Tenant exclusively for its use. All repair
and maintenance performed by Tenant in the Premises or elsewhere in
or upon the Building shall be performed by contractors or workmen
designated or approved by Landlord. Tenant shall be
responsible for all repairs, the need for which arises out
of: (a) the performance or existence of Tenant’s
Work or alterations; (b) the installation, use or operation of
Tenant’s property in the Premises; (c) the moving of
Tenant’s property in or out of the Building; (d) the act,
omission, misuse or neglect of Tenant or any of its officers,
employees, agents, contractors or invitees. All such
repairs and maintenance shall be performed at such times and in
such a manner as shall cause the least interference with the
operation of the Building and the use of the Building by other
occupants. By taking possession of the Premises, Tenant
agrees that the Premises are in good condition and
repair. Tenant, its agents, employees, or contractors
shall not enter onto the roof of the Building without the express
prior consent of Landlord or its Building
Manager. Landlord specifically reserves the right to
require Landlord’s roofing contractor to perform any work
required to be performed by Tenant with respect to any equipment on
the roof of the Building
Section 8.2
Landlord’s Obligations . Landlord shall
repair and maintain in good order and condition, ordinary wear and
tear excepted, the Common Areas, mechanical and equipment rooms,
the roof of the Building, the exterior walls of the Building, the
exterior windows of the Building, the structural portions of the
Building, the elevators, the electrical, plumbing, mechanical, fire
protection, and life safety, systems serving the Common Areas of
the Building, and the HVAC system serving the Premises and the
Common Areas of the Building. However, unless the Waiver
of Subrogation section of this Lease applies, Tenant shall pay the
cost of any such repairs or maintenance resulting from acts or
omissions of Tenant, its employees, agents, or
contractors. Additionally, Landlord shall replace the
Building standard fluorescent light tubes in the
Premises. Tenant waives all claims against Landlord for
damage to person or property arising for any reason in connection
with Landlord’s performance of repair and maintenance
obligations set forth herein, other than the gross negligence or
willful acts of Landlord.
Section 8.3
Floor Loads; Noise and Vibration . Tenant shall
not place a load upon any floor of the Premises which exceeds the
lesser of the load per square foot which such floor was designed to
carry or the load which is allowed by law. Business
machines and mechanical equipment belonging to Tenant which cause
noise, electrical interference or vibration that may be transmitted
to the structure of the Building or to the Premises to such a
degree as to be objectionable to Landlord shall, at Tenant’s
expense, be placed and maintained by Tenant in settings of cork,
rubber, or spring-type vibration eliminators sufficient to
eliminate such noise, electrical interference or
vibration.
Section 8.4
Services . Landlord shall furnish the following
services: (a) janitorial and general cleaning service on
business days (Tenant shall pay to Landlord on demand, the
additional cost incurred by Landlord for extra cleaning work in the
Premises required because of (i) misuse or neglect on the part of
Tenant
or subtenants or its employees or visitors; (ii)
the use of portions of the Premises for purposes requiring greater
or more difficult cleaning than is provided as Building standard;
(iii) interior glass partitions or unusual quantity of interior
glass surfaces, and (iv) non-Building standard materials or
finishes installed by Tenant or at its request); (b) passenger
elevator service to all floors of the Building; and (c) rest room
facilities and necessary lavatory supplies, including cold running
water on each multi-tenant floor. Landlord shall
have the right to select the Building’s electric service
provider and to switch providers at any time. In
no event shall Landlord be liable for damages resulting from the
failure to furnish any service, and any interruption or failure
shall in no manner entitle Tenant to any remedies including
abatement of Rent.
Section 8.5
Utilities.
Tenant’s
use of electrical energy in the Premises shall not, at any time,
exceed the capacity of any of the electrical conductors and
equipment in or otherwise serving the Premises. In order
to ensure that such capacity is not exceeded and to avert possible
adverse effects upon the Building's electric service, Tenant shall
not, without Landlord's prior written consent in each instance
connect major equipment to the Building’s electric
distribution system or telephone system, or make any alteration or
addition to the electric system existing on the Commencement
Date. Tenant’s electrical usage under this Lease
contemplates only the use of normal and customary office
equipment. In the event Tenant wishes to install any
office equipment which uses substantial additional amounts of
electricity, then Tenant agrees that Landlord’s consent is
required before the installation of such additional office
equipment. Tenant shall contract for and pay directly
all utilities not otherwise provided by Landlord in accordance with
Section 8.4 above including, but not limited to electricity,
telephone, telecommunications, and security, together with any
taxes thereon. In addition, to the extent the utilities
to the tenant occupying a small office adjacent to the Premises are
not separately metered and the electricity and HVAC are connected
to the Premises electric meter, Tenant shall look solely to the
adjacent tenant for any reimbursement of electricity charges it may
seek. Likewise, if at some future date, it becomes
necessary for the adjacent office to possess its own electric
service and meter, Tenant and/or the adjacent tenant shall be
responsible for all the costs associated with same.
Section
8.6 Telecommunications.
(a) Tenant's
Responsibility. Tenant acknowledges and agrees that all
telephone and telecommunications services, including wiring,
aerials and antennae or other infrastructure to which Tenant's
telecommunications equipment may be connected (herein collectively
referred to as "Telecom Cabling") desired by Tenant shall be
ordered and utilized at the sole expense of
Tenant. Unless Landlord otherwise requests or consents
in writing, all of Tenant's Telecom Cabling shall be and remain
solely in the Premises and the telephone closet(s) on the floor(s)
on which the Premises is located, in accordance with the Rules and
Regulations adopted by Landlord from time to
time. Unless otherwise specifically agreed to in
writing, Landlord shall have no responsibility for the maintenance
of Tenant's Telecom Cabling. Tenant agrees that, to the
extent any such service is interrupted, curtailed or discontinued,
Landlord shall have no obligation or liability with respect thereto
and it shall be the sole obligation of Tenant at its expense to
obtain substitute service.
(b) Necessary
Service Interruptions. Landlord shall have the right,
upon reasonable prior notice to Tenant, to interrupt or turn off
telecommunications facilities in the event of emergency or as
necessary in connection with repairs to the Building or
installation of telecommunications equipment for other tenants of
the Building.
(c) Removal
of Equipment and Wiring and Other Facilities. Any and
all Telecom Cabling installed in the Premises or elsewhere in the
Building by or on behalf of Tenant, shall be removed prior to the
expiration of the Term, by Tenant at its sole cost or, at
Landlord's election, by Landlord at Tenant's sole cost, with the
cost therefor to be paid as Additional Rent. Landlord
shall have the right, however, upon written notice to Tenant given
no later than 30 days prior to the expiration or earlier
termination of the Term, to require Tenant to abandon and leave in
place, without any payment to Tenant or credit against Rent, any
and all Telecom Cabling, or selected components thereof, whether
located in the Premises or elsewhere in the Building. In
the event Landlord elects to retain the foregoing, Tenant covenants
that (a) Tenant shall be the sole owner of such Telecom Cabling,
that Tenant shall have good right to surrender and convey the
same,
and that the same shall be free of all liens and
encumbrances, and (b) all such Telecom Cabling shall be left in
good condition, working order, clearly marked to show Tenant's
name, address, telephone number, the name of the person to contact
in case of emergency, FCC call sign, frequency and location; the
transmissions lines shall be identified at the bottom and top of
each line. In the event of Landlord's retention of the Telecom
Cabling, Tenant's conveyance of the Telecom Cabling shall be
effective on the expiration date or date of earlier termination of
this Lease without the requirement of further action, and on such
date Landlord shall become the owner of the Telecom
Cabling.
(d) New
Telecommunications Provider Installations. In the event
that Tenant wishes at any time to utilize the services of a
telephone or telecommunications provider whose equipment is not
then servicing the Building, no such provider shall be permitted to
install its lines through other equipment within the Building
without first securing the prior written approval of Landlord,
which approval may be conditioned or withheld in Landlord's sole
discretion. If Landlord gives its approval, the provider
must agree to deliver to Landlord detailed, "as-built" plans
immediately after the installation of the provider's equipment is
complete.
(e) Limits
on Provider Relationship. Notwithstanding anything
herein to the contrary, no Telecom Cabling provider shall be deemed
a third party beneficiary of this Lease.
(f) Installation
and Use of Wireless Technologies. Tenant shall not
utilize any wireless communications equipment (other than usual and
customary cellular telephones), including antenna and satellite
receiver dishes, within the Premises or the Building, without
Landlord's prior written consent, which consent may be arbitrarily
withheld. Such consent may be conditioned in such manner
so as to protect Landlord's financial interest and the interest of
the Building and the other tenants therein, in a manner similar to
the arrangement described in the immediately preceding
paragraphs. Landlord reserves the right, at
Tenant’s sole cost and expense, to obtain a survey or require
Tenant to obtain a survey, at Tenant’s sole cost and expense,
from a surveyor acceptable to Landlord, to determine the impact of
any such installation on the Building, the Property or other
tenants of the Building. Tenant may install a wireless
computer network in the Premises, but to the extent it interferes
with Landlord’s or other tenants’ operations or
building systems, Tenant will immediately rectify any such conflict
at its cost and expense.
(g) Liability
for Equipment Interference. In the event that any
Telecom Cabling installed by or at the request of Tenant within the
Premises, on the roof, or elsewhere within or on the Building
causes interference to equipment used by another third party,
Tenant shall assume all liability related to such
interference. Tenant shall use reasonable efforts, and
shall cooperate with Landlord and other third parties to promptly
eliminate such interference. In the event Tenant is
unable to do so, Tenant will substitute alternative equipment which
remedies the situation. If such interference persists,
Tenant shall discontinue the use of such equipment, and at
Landlord's discretion, remove such equipment according to
specifications provided by Landlord. Tenant agrees to
and shall indemnify and hold Landlord harmless for any liabilities
and claims against Landlord resulting from such
interference. The provisions of this Section 8.5 shall
survive the expiration or earlier termination of the
Lease.
Tenant acknowledges that the Property is
equipped with a diesel fuel-powered generator and related
components (collectively, the “Generator”), for the
sole and exclusive purpose of providing back-up power to the
Building, including the Premises. Tenant shall, at all
times during the Term hereof, comply with all rules and regulations
promulgated by Landlord or applicable governmental authority with
respect to the Generator. Tenant shall indemnify and
hold Landlord and all Superior Mortgagees and its or their
respective joint venture partners, directors, officers, agents,
employees and invitees, harmless against and from any and all
claims from or in connection with; (a) the conduct, maintenance or
management of the Generator located on the Property, or any
condition created by Tenant, its employees or guests or invitees
relating to the Generator during the Term of this Lease or during
the period of time, if any, prior to the Rent Commencement Date
that Tenant may have been given access to the
Premises. Landlord shall at all times, have the right,
in its sole discretion, to determine the method for activating the
Generator, the hours within which the Generator shall be activated
for the purpose of providing back-up power to the Building, and the
amount and level of such power. All costs
associated with the repair and maintenance of
the Generator and any utility consumed in connection with the
Generator shall be passed through to all tenants of the Building in
accordance with Section 3.1.C above. It is understood
and agreed that, if installed, the Generator will provide back-up
for building-standard power only, and not for any specialty or
supplemental equipment installed by Tenant. Tenant shall
solely be responsible for the compatibility with the Generator
including, but not limited to, electrical systems, wire, conduit,
panels, switchgear and breakers in the Premises, and Tenant's
equipment to be connected to the Generator.
ARTICLE
IX LANDLORD’S AND TENANT’S
PROPERTY
All Alterations, including HVAC equipment, wall
coverings, carpeting and other floor coverings, ceiling tiles,
blinds and other window treatments, lighting fixtures and bulbs,
built in or attached shelving, built in furniture, millwork,
counter tops, cabinetry, all doors (both exterior and interior),
bathroom fixtures, sinks, kitchen area improvements, and wall
mirrors, made by Landlord or Tenant to the Premises shall become
Landlord’s property on the expiration or sooner termination
of the Lease Term. On the expiration or sooner termination of the
Lease Term, Tenant, at its expense, shall remove from the Premises
all moveable furniture, furnishings, equipment, and other articles
of moveable personal property owned by Tenant and located in the
Premises that can be removed without damage to the
Premises. Tenant, at its expense, shall also remove all
computer and telecommunications wiring and all non-standard
Alterations to the Premises, including any vault, stairway, or
computer room Alterations or any Alterations involving roof,
ceiling, raised flooring or floor
penetrations. Additionally, Tenant shall be responsible
for any and all personal property taxes relating to Tenant’s
property located within the Premises. Tenant shall
repair any damage caused by the removal. Any items of
Tenant’s property that shall remain in the Premises after the
expiration or sooner termination of the Lease Term, may, at the
option of Landlord, be deemed to have been abandoned, and in that
case, those items may be retained by Landlord as its property to be
disposed of by Landlord, without accountability to Tenant or any
other party, in the manner Landlord shall determine, at
Tenant’s expense.
Section
9.2 Landlord’s
Lien and Security Interest.
Tenant hereby grants to Landlord a lien and
security interest on all property of Tenant now or hereafter placed
in or upon the Premises including, but not limited to, all
fixtures, furniture, inventory, machinery, equipment, merchandise,
furnishings and other articles of personal property, and all
proceeds of the sale or other disposition of such property
(collectively, the “Collateral”) to secure the payment
of all rent to be paid by Tenant pursuant to this
lease. Such lien
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