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LEASE BY AND BETWEEN GPO R IVERBEND LLC , L ANDLORD

Lease Agreement

LEASE BY AND BETWEEN GPO R IVERBEND LLC , L ANDLORD | Document Parties: CATCHER, INC | GPO RIVERBEND LLC You are currently viewing:
This Lease Agreement involves

CATCHER, INC | GPO RIVERBEND LLC

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Title: LEASE BY AND BETWEEN GPO R IVERBEND LLC , L ANDLORD
Governing Law: Virginia     Date: 11/14/2006
Industry: Security Systems and Services     Law Firm: Reed Smith     Sector: Services

LEASE BY AND BETWEEN GPO R IVERBEND LLC , L ANDLORD, Parties: catcher  inc , gpo riverbend llc
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L EASE

BY AND BETWEEN

GPO R IVERBEND LLC , L ANDLORD ,

AND

C ATCHER , I NC . , T ENANT

D ATED : October 12, 2006

P ROPERTY : 44084 R IVERSIDE P ARKWAY , L ANSDOWNE , V A

 


TABLE OF CONTENTS

 

ARTICLE I - FUNDAMENTAL LEASE PROVISIONS

   1
    1.1     R EFERENCE S UBJECTS    1

ARTICLE II - PREMISES AND TERM

   4
    2.1     P REMISES    4
    2.2     A CCEPTANCE OF P REMISES    4
    2.3     T ERM    4
    2.4     R ENEWAL    4

ARTICLE III – CONDITION OF PREMISES AND TENANT WORK

   6
    3.1     I NITIAL C ONSTRUCTION    6
    3.2     D ELIVERY OF P OSSESSION    6
    3.3     E ARLY A CCESS    6
    3.4     G ENERAL P ROVISIONS A PPLICABLE TO C ONSTRUCTION    6

ARTICLE IV - RENT

   7
    4.1     A NNUAL F IXED R ENT    7
    4.2     M ETHOD OF P AYMENT    7
    4.3     N ET R ETURN TO L ANDLORD    7
    4.4     A DDITIONAL R ENT    7
  4.4.1       Additional Rent - Landlord's Taxes    7
  4.4.2       Landlord’s Taxes - Definition    7
  4.4.3       Additional Rent - Operating Expenses    8
  4.4.4       Landlord’s Operating Expenses - Definition    8
    4.5     A LLOCATION OF C ERTAIN O PERATING E XPENSES    9

ARTICLE V - ADDITIONAL COVENANTS

   9
    5.1     T ENANTS C OVENANTS    9
  5.1.1        Utilities and Services    9
  5.1.2        Maintenance    10
  5.1.3        Use and Compliance with Law    10
  5.1.4        Liens and Encumbrances    10
  5.1.5        Waiver and Indemnity    10
        5.1.5.1           Waiver    10
        5.1.5.2           Indemnity    11
  5.1.6   Landlord’s Right to Enter    11
  5.1.7   Personal Property at Tenant’s Risk    11
  5.1.8   Overloading, Nuisance, Etc.    11
  5.1.9   Yield Up    12
  5.1.10        Holding Over    12
  5.1.11        Assignment, Subletting    13
    5.2     L ANDLORDS C OVENANTS    15
  5.2.1        Building Services    15
        5.2.1.1           Landlord's Maintenance    15
        5.2.1.2           Office Identification    15
        5.2.1.3           Grounds Maintenance    15
        5.2.1.4           Cleaning    15
        5.2.2   Interruptions    15

 


ARTICLE VI - INSURANCE; CASUALTY; TAKING

   16
    6.1     I NSURANCE    16
  6.1.1   Coverage    16
  6.1.2   Avoid Action Increasing Rates    17
  6.1.3   Waiver of Subrogation    17
    6.2     F IRE OR C ASUALTY    17
    6.3     W AIVER OF C LAIM - I NDEMNIFICATION    18
    6.4     N ONWAIVER    18
    6.5     C ONDEMNATION    18

ARTICLE VII - DEFAULT

   19
    7.1     E VENTS OF D EFAULT    19
    7.2     R EMEDIES FOR D EFAULT    20
  7.2.1   Reletting Expenses Damages    20
  7.2.2   Termination Damages    20
  7.2.3   Lump Sum Liquidated Damages    21
    7.3     R EMEDIES C UMULATIVE    21
    7.4     E FFECT OF W AIVERS OF D EFAULT    21
    7.5     N O A CCORD AND S ATISFACTION ; N O S URRENDER    21
    7.6     W AIVER OF J URY    21
    7.7     L ANDLORDS C URING AND E NFORCEMENT    22
    7.8     L ANDLORDS D EFAULT    22
    7.9     V ACANCY D URING L AST S IX M ONTHS    22
    7.10     S ECURITY D EPOSIT    22

ARTICLE VIII - MISCELLANEOUS PROVISIONS

   23
    8.1     N OTICE FROM O NE P ARTY TO THE O THER    23
    8.2     Q UIET E NJOYMENT    23
    8.3     L IMITATION OF L ANDLORDS L IABILITY    23
    8.4     A PPLICABLE L AW AND C ONSTRUCTION    24
    8.5     S UCCESSORS AND A SSIGNS    24
    8.6     R ELATIONSHIP OF THE P ARTIES    24
    8.7     E STOPPEL C ERTIFICATE    24
    8.8     N OTICE OF L EASE    25
    8.9     T ENANT AS B USINESS E NTITY    25
    8.10     R ELOCATION    25
    8.11     P ARKING    25
    8.12     R EGISTERED A GENT    25
    8.13     D EED OF L EASE    25

ARTICLE IX - BROKERS

   26
    9.1     B ROKERS    26

ARTICLE X - LANDLORD’S FINANCING

   26
    10.1     S UBORDINATION AND S UPERIORITY OF L EASE    26
    10.2     R ENT A SSIGNMENT    27
    10.3     O THER I NSTRUMENTS    27

APPENDIX A – PREMISES PLAN

   1

APPENDIX B – LANDLORD’S WORK

   1

APPENDIX C – RULES AND REGULATIONS

   1

 

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LEASE

ARTICLE I

Fundamental Lease Provisions

1.1 Reference Subjects . Each reference in this Lease to any of the following subjects shall be construed to incorporate the information stated for that subject in this Section.

 

EFFECTIVE DATE:   August 21, 2006
PREMISES:   A portion of the third (3rd) floor of the Building commonly known as Suite 320 consisting of approximately Two Thousand Six Hundred and Four (2,604) rentable square feet, as depicted on Appendix A attached hereto.
BUILDING:   The building located at 44084 Riverside Parkway, Lansdowne, VA and known as Two Riverbend
PROPERTY:   The Building and the land upon which it is located
LANDLORD:   GPO Riverbend LLC

NOTICE ADDRESS OF LANDLORD:

 

c/o Great Point Investors LLC

Two Center Plaza, Suite 410

Boston, MA 02108

Attn: Randolph L. Kazazian, III

LANDLORD’S MANAGING AGENT:

 

Buchanan Properties

9055 Comprint Court, Suite 200

Gaithersburg, MD 20877

Attn: Kevin Burns

TENANT:   Catcher, Inc., a Delaware corporation

NOTICE ADDRESS OF TENANT:

 

3881 Irish Corner Road

Lovettsville, Virginia 20180

Attn: Ira Tabankin

INITIAL TERM:   Three (3) Years
RENEWAL TERM:   One (1) additional term of two (2) years, as provided in and on the terms set forth in Section 2.4
LEASE YEAR:   The first Lease Year of the Term shall commence on the Lease Commencement Date and end on the last day of the month in which the first (1st) anniversary of the Lease Commencement Date shall occur (unless the

 


    Commencement Date shall occur on the first day of a month, in which case the first Lease Year
shall end on the day before the first (1st) anniversary of the Commencement Date). Subsequent
Lease Years shall commence on the day after the last day of the first Lease Year or an
anniversary thereof, and shall end on an anniversary of the last day of the first Lease Year.

LEASE COMMENCEMENT DATE:

  The later of November 1, 2006 or the date upon which the Landlord substantially completes the Landlord’s Work and provides Tenant at least fourteen (14) days advance notice thereof. For the purposes of determining the date upon which the Landlord substantially completes the Landlord’s Work, such date shall be the date upon which a Certificate of Occupancy for Premises is issued by the appropriate governmental authority.

RENT COMMENCEMENT DATE:

  The Lease Commencement Date.
LEASE EXPIRATION DATE:   The last day of the thirty-sixth (36th) month after the Lease Commencement Date.

ANNUAL FIXED RENT:

    

 

Months In Term

  

Annual Fixed

Rent

Lease Commencement Date – 12    $ 65,100.00
13 – 24    $ 67,053.00
25 – 36    $ 69,064.59

 

BASE OPERATING EXPENSE YEAR:

 

Calendar year 2006 (i.e., January 1, 2006 through December 31, 2006)

BASE TAX YEAR:

 

Calendar year 2006 (i.e., January 1, 2006 through December 31, 2006)

PARKING SPACES:

 

9 unreserved spaces

PREMISES RENTABLE AREA:

 

Approximately Two Thousand Six Hundred and Four (2,604) rentable square feet

TENANT’S PERCENTAGE SHARE:

 

3.74%

PERMITTED USES:

 

General office use

PUBLIC LIABILITY INSURANCE:

 

$1,000,000 combined single limit per occurrence, with $5,000,000 umbrella coverage per occurrence

 

2

 


BROKER:    PM Realty Group is acting solely as agent for the Landlord and Vaaler Real Estate Company is acting solely as agent for the Tenant. Landlord shall be responsible for the fees payable to PM Realty Group and PM Realty Group will in turn be responsible for the fees payable to Vaaler Real Estate Company pursuant to a separate agreement.
SECURITY DEPOSIT:    $21,700

TENANT IMPROVEMENT ALLOWANCE:

   Not Applicable.
APPENDICES:    Appendix A-    Premises Plan
   Appendix B -    Landlord’s Work
   Appendix C -    Rules and Regulations
   Appendix D -    Form of Letter of Credit

 

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ARTICLE II

Premises and Term

2.1 Premises . Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord, the Premises, subject to and with the benefit of the terms, covenants and conditions of this Lease, and rights, agreements, easements and restrictions of record applicable to the property of which the Premises are a part, all of which Tenant shall perform and observe insofar as (i) the same are applicable to the Premises, and (ii) Tenant has prior notice of such rights, agreements, easement and restrictions. Subject to the rules and regulations established by Landlord, attached hereto as Appendix C , as they may be amended from time to time provided any such amendments do not materially adversely affect Tenant’s use of the Premises (the “Rules and Regulations”) Tenant shall have the appurtenant rights in common with others to use (a) the common lobbies, hallways, stairways and elevators of the Building serving the Premises in common with others, (b) the exterior walkways, sidewalks and driveways necessary for access to the Premises and (c) the parking areas serving the Premises. Except as specifically provided herein to the contrary, all the perimeter walls of the Premises except the interior surfaces thereof, any space in or adjacent to the Premises used for shafts, stacks, pipes, conduits, wires and appurtenant fixtures, fan rooms, ducts, electric or other utilities, sinks or other Building facilities, and the use thereof, are expressly excluded from the Premises and reserved to Landlord. Landlord excepts and reserves the right from time to time (a) to install, use, maintain, repair, replace and relocate within the Premises and other parts of the Building, or either, pipes, meters and other equipment, machinery, apparatus and appurtenant fixtures; and (b) to make additions to the Building and alter or relocate any entranceways, common areas or other facilities (including without limitation all access driveways, walkways and parking areas) serving the Premises.

2.2 Acceptance of Premises . Tenant acknowledges that it has inspected the Premises and accepts the same in the condition they are in on the Effective Date hereof, subject to the completion of Landlord’s Work as set forth in Section 3.1, it being expressly agreed that Landlord shall have no obligation, liability or risk whatsoever with respect to the Premises or their condition, except as expressly set forth herein.

Tenant shall have the right to inspect the Premises during the completion of Landlord’s Work, provided, any such inspection by Tenant does not interfere with the completion of Landlord’s Work and Tenant indemnifies and holds harmless Landlord from all injury, loss, claims or damage to any person or property occasioned by or growing out of such Tenant inspections prior to the Commencement Date. Tenant further acknowledges that neither Landlord nor any agent or employee of Landlord has made any representations or warranties of any kind, express or implied, concerning the Premises, their condition or this Lease (including, without limitation, any express or implied warranties of merchantability, fitness, habitability or suitability for Tenant’s particular purposes).

2.3 Term . This Lease is for a Term beginning on the Lease Commencement Date and ending on the Expiration Date.

2.4 Renewal . Provided that as of the time of the giving of each Renewal Notice (as defined below) and the Commencement Date of each Renewal Term (as defined below) (a) Tenant is the Tenant originally named herein, (b) Tenant actually occupies all of the Premises, and (c) no event of default exists or would exist but for the passage of time or the giving of notice, or both; then Tenant will have the right to extend the Lease Term for one (1) additional term of two (2) years each (the “Renewal Terms”) commencing on the day following the expiration of the then current Lease Term (the

 

4

 


“Commencement Date of the Renewal Term”). Tenant will give Landlord notice (the “Renewal Notice”) of its election to extend the term of the Lease Term at least six (6) months, but not more than twelve (12) months, prior to the scheduled expiration date of then current Lease Term (the “Notice Period”). If Tenant does not give the Renewal Notice during the Notice Period, Tenant’s right to extend the Lease Term will automatically terminate. Time is of the essence as to the giving of the Renewal Notice.

The minimum monthly rental payable by Tenant to Landlord for each year during the Renewal Term will be the rate for prior year increased by three percent (3%).

Except for the minimum monthly rental as determined above, Tenant’s occupancy of the Premises during each Renewal Term will be on the same terms and conditions (including the payment of additional rent) as are in effect immediately prior to the expiration of the then current Lease Term; provided, however, except as specified in this Section 2.4, Tenant will have no further right to any allowances, credits or abatements or any options to expand, contract, renew or extend the Lease. Landlord will have no obligation to refurbish (other than repairs in the event of casualty as set forth herein) or otherwise improve the Premises for any Renewal Term. The Premises will be tendered on the Commencement Date of the Renewal Term in “as-is” condition.

2.5 Right of First Offer . Provided that (a) there has been no Default or event which with the giving of notice or passage of time or both would constitute a Default at any time during the Lease Term and provided further, that as of the date of the giving of the First Offer Notice (as defined below) (b) Tenant is the Tenant originally named herein and (c) Tenant actually occupies all of the Premises originally demised under this Lease and any space added to the Premises, if and when the current lease for Suite 300 with Reed Smith, LLP expires and becomes available (the “ Offered Space ”), Landlord, before offering the Offered Space to anyone (other than the tenant and/or occupant then occupying such space or their affiliates), will offer to Tenant on one occasion the right to include the Offered Space within the Premises on the same terms and conditions upon which Landlord intends to offer the Offered Space for lease.

2.5.1 Such offer will be made by Landlord to Tenant in a written notice (the “ First Offer Notice ”), which offer will designate the space being offered and specify the terms which Landlord intends to offer with respect to the Offered Space. Landlord may, but shall not be obligated to send the First Offer Notice prior to the expiration of the lease with Reed Smith LLP. Tenant may accept the offer set forth in the First Offer Notice by delivering Landlord an unconditional acceptance (“ Tenant’s Notice ”) of such offer within ten (10) business days after delivery by Landlord of the First Offer Notice to Tenant. Tenant may not revoke Tenant’s Notice once such notice has been delivered to Landlord. Time will be of the essence with respect to the giving of Tenant’s Notice. If Tenant does not accept (or fails to timely accept) the offer made by Landlord in the First Offer Notice, Landlord will have no further obligation to Tenant with respect to the Offered Space.

2.5.2 Tenant must accept all Offered Space offered by Landlord if Tenant desires to accept the Offered Space and may not exercise its right with respect to only part of the Offered Space; provided, however, Landlord may, in its sole discretion, agree to lease a portion of the Offered Space to Tenant upon reasonably acceptable terms.

2.5.3 If Tenant at any time declines or is deemed to have declined the Offered Space, Tenant will be deemed to have irrevocably waived all rights with respect to the Offered Space and Landlord will be free to lease the Offered Space to third parties including on terms which may be more or less favorable to Landlord than those offered to Tenant. In such event, upon Landlord’s request, Tenant shall execute a release evidencing its waiver of such rights with respect to the Offered Space.

 

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ARTICLE III

Condition of Premises and Tenant Work

3.1 Initial Construction . Landlord shall complete the work (“Landlord’s Work”) as specified in Appendix B . Except for Landlord’s Work, Landlord is leasing the Premises to Tenant “as is”, without any representations or warranties of any kind (including, without limitation, any express or implied warranties of merchantability, fitness or habitability), subject to all recorded matters, laws, ordinances and governmental regulations and orders.

3.2 Delivery of Possession . Except for latent defects, and subject to (i) the conditions noted by Tenant in writing not later than ten (10) business days after the Lease Commencement Date, which items can be completed after Tenant’s occupancy without undue interference with Tenant’s use of the Premises (“Punchlist Items”), and (ii) the issuance of a certificate of occupancy for the Premises with respect to Landlord’s Work, Tenant shall accept delivery of the Premises and Tenant shall have no claim that Landlord failed to perform any of Landlord’s Work. Landlord shall use reasonable efforts to complete all Punchlist Items within thirty (30) days or, if such completion is not feasible for any reason, as soon as conditions permit, and Tenant shall afford Landlord access to the Premises for such purpose pursuant to the terms of this Lease, provided that Landlord does not unreasonably interfere with Tenant’s use or occupancy of the Premises.

3.3 Early Access . Landlord shall permit Tenant access (at Tenant’s sole risk) for purposes of making measurements, installing equipment and furnishings in the Premises, and inspecting Landlord’s Work prior to Tenant’s taking possession of the Premises if such can be done without interference with Landlord’s Work in the Premises and in harmony with Landlord’s contractors and subcontractors. Any interference with Landlord’s Work shall be deemed a Tenant Delay.

3.4 General Provisions Applicable to Construction . With the exception of cosmetic alterations, Tenant shall not make any installations, alterations, additions, or improvements in or to the Premises, including, without limitation, any apertures in the walls, partitions, ceilings or floors, without on each occasion obtaining the prior written consent of Landlord, which shall not be unreasonably withheld. Tenant shall reimburse Landlord for all costs incurred by Landlord or any Superior Mortgagee (as defined below) in reviewing Tenant’s proposed installation, alterations, additions or improvements. Any such work so approved by Landlord shall be performed only in accordance with plans and specifications therefor approved by Landlord. Tenant shall procure at Tenant’s sole expense all necessary permits and licenses before undertaking any work on the Premises and shall perform all such work in a good and workmanlike manner employing materials of good quality and so as to conform with all applicable insurance requirements, laws, ordinances, regulations and orders of governmental authorities. Tenant shall employ for such work only contractors approved by Landlord and shall require all contractors employed by Tenant to carry worker’s compensation insurance in accordance with statutory requirements and commercial general liability insurance covering such contractors on or about the Premises with a combined single limit not less than $3,000,000 and shall submit certificates evidencing such coverage to Landlord prior to the commencement of such work. Tenant shall indemnify and hold harmless Landlord from all injury, loss, claims or damage to any person or property occasioned by or growing out of such work. Landlord may inspect the work of Tenant at reasonable times and give notice of observed defects. Upon completion of any such work, Tenant shall provide Landlord with “as built” plans, copies of all construction contracts and proof of payment for all labor and materials.

 

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ARTICLE IV

Rent

4.1 Annual Fixed Rent . Annual Fixed Rent during the Term of this Lease shall be the amount per annum set forth in Section 1.1.

4.2 Method of Payment . Tenant covenants and agrees to pay the Annual Fixed Rent to Landlord in advance in equal monthly installments (or in the appropriate monthly installments for monthly periods during any Lease Year) on the first day of each calendar month during the Term beginning on the Rent Commencement Date. Tenant shall make ratable payment of Annual Fixed Rent for any portion of a Lease Year (or month) in which the same accrues, all payments of Annual Fixed Rent and additional rent and other sums due hereunder to be paid in current U.S. exchange at the Original Address of Landlord or such other place as Landlord may by notice in writing to Tenant from time to time, without demand and without set-off or deduction.

Without limiting the generality of the foregoing, Tenant’s obligation so to pay shall not be discharged or otherwise affected by reason of the application of any law or regulation now or hereafter applicable to the Premises, or any other restriction of or interference with the use thereof by Tenant, or any damage to or destruction of the Premises by casualty or taking, or on account of any failure by Landlord to perform hereunder or otherwise, or due to any other occurrence; nor shall Tenant ever be entitled and 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 part thereof, or to assert any defense in the nature of constructive eviction to any action seeking to recover rent. Tenant shall, however, have and maintain, subject to the provisions hereof, the right to seek and obtain from time to time judgments for direct money damages occasioned by Landlord’s breach of the covenants of this Lease.

4.3 Net Return to Landlord . It is intended that Annual Fixed Rent payable hereunder shall be a net return to Landlord throughout the Term, free of expense, charge, offset, diminution or other deduction whatsoever on account of the Premises (excepting financing expenses, federal and state income taxes of general application and those expenses which this Lease expressly makes the responsibility of Landlord), and all provisions hereof shall be construed in terms of such intent.

4.4 Additional Rent .

4.4.1 Additional Rent - Landlord’s Taxes . Tenant covenants and agrees to pay to Landlord, as additional rent, an escalation charge calculated as Tenant’s Percentage Share of the increase in Landlord’s Taxes (hereafter defined) for each fiscal tax period, or ratable portion thereof, included in the Lease Term over the Base Taxes (hereinafter defined). Tenant shall make estimated payments on account of increases in Landlord’s Taxes above the Base Taxes in monthly installments on the first day of each month, in amounts reasonably estimated from time to time by Landlord to provide for the full payment of Tenant’s obligation with respect to Landlord’s Taxes on the date such Taxes are due, and with a final payment adjustment between the parties within thirty (30) days after Landlord provides Tenant a statement (together with reasonable supporting documentation) of Landlord’s Taxes and Tenant’s Share of the increase of such Taxes above Base Taxes for Landlord’s most recent tax year. “Base Taxes” as used herein means the amount of Landlord’s Taxes for the Base Tax Year. This section shall survive the expiration or earlier termination of this Lease.

4.4.2 Landlord’s Taxes - Definition . As used in this Lease, the term “Landlord’s Taxes” shall mean all taxes, assessments, betterments, excises, user fees and all other governmental charges and fees of any kind or nature, or impositions or agreed payments in lieu thereof or voluntary

 

7

 


payments made in connection with the provision of governmental services or improvements of benefit to the Building (including any so-called linkage, impact or voluntary betterment payments), and all penalties and interest thereon (if due to Tenant’s failure to make timely payments on account of Landlord’s taxes), assessed or imposed against the Premises or the property of which the Premises are a part (including without limitation any personal property taxes levied on such property or on fixtures or equipment used in connection therewith), or upon Landlord by virtue of its ownership thereof, other than a federal or state income tax of general application. If during the Term the present system of ad valorem taxation of property shall be changed so that, in lieu of or in addition to the whole or any part of such ad valorem tax, there shall be assessed, levied or imposed on such property or Premises or on Landlord any kind or nature of federal, state, county, municipal or other governmental capital levy, income, sales, franchise, excise or similar tax, assessment, levy, charge or fee (as distinct from the federal and state income tax in effect on the Lease Commencement Date) measured by or based in whole or in part upon Building valuation, mortgage valuation, rents or any other incidents, benefits or measures of real property or real property operations, then any and all of such taxes, assessments, levies, charges and fees shall be included within the term Landlord’s Taxes.

Landlord’s Taxes include reasonable expenses, including fees of attorneys, appraisers and other consultants, incurred in connection with any efforts to obtain abatements or reductions or to assure maintenance of Landlord’s Taxes for any tax fiscal year wholly or partially included in the Term, whether or not successful and whether or not such efforts involve filing of actual abatement applications or initiation of formal proceedings.

4.4.3 Additional Rent - Operating Expenses . Tenant covenants and agrees to pay to Landlord, as additional rent, an escalation charge calculated as Tenant’s Percentage Share of the increase in Landlord’s Operating Expenses (hereafter defined) for each of Landlord’s calendar years, or ratable portion thereof, included in the Lease Term above Base Operating Expenses (hereinafter defined). Tenant shall make estimated payments on account of increases in Operating Expenses in monthly installments on the first day of each month in advance, based on amounts reasonably estimated from time to time by Landlord, and with a final payment adjustment between the parties within thirty (30) days after Landlord provides Tenant a reasonably detailed statement of Landlord’s Operating Expenses and Tenant’s Share of the increase of such Operating Expenses over Base Operating Expenses for Landlord’s most recent calendar year. “Base Operating Expenses” as used herein means the amount of Operating Expenses for the Base Operating Expense Year. This section shall survive the expiration or earlier termination of this Lease.

4.4.4 Landlord’s Operating Expenses - Definition . “Landlord’s Operating Expenses” means all costs paid or incurred in servicing, operating, managing, maintaining, and repairing the Property and the facilities and appurtenances thereto, including, without limitation, the costs of the following: (i) supplies, materials and total wage and labor costs and all costs and expenses of independent contractors paid or incurred on account of all persons engaged in the operation, maintenance, security, cleaning and repair of the Building and the land, facilities and appurtenances thereto, including social security, unemployment compensation, pension, vacation, sick pay and other so-called “fringe benefits”; (ii) services furnished generally to tenants of the Building by Landlord; (iii) utilities (including electricity) consumed and expenses incurred in the operation of the Property and the land, facilities and appurtenances thereto; (iv) casualty, liability, workmen’s compensation and all other insurance expenses (and the amount of any deductible in the event of an insured loss), all insurance to be in such amounts and insuring against such risks as Landlord may, in its sole discretion from time to time decide; (v) snow removal, planting, landscaping, grounds and parking operation, maintenance and repair expenses and any charges payable pursuant to any declarations or recorded covenants; (vi) management fees which do not exceed those customarily paid with respect to buildings in the area

 

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which are similar to the Building, and fees for required licenses or permits; (vii) rental or reasonable depreciation of equipment used in the operation of the Building and the land, facilities and appurtenances thereto, and personal property taxes assessed upon such equipment; and (viii) expenses of periodic testing to assure that the Premises and surrounding land are free of hazardous materials, agents or substances, and to assure compliance with codes, regulations and laws. In addition, if Landlord from time to time repairs or replaces any improvements or equipment or installs any new improvements or equipment to the Building (including without limitation energy conservation improvements or other improvements), then the cost of such items amortized over their reasonable life, together with an actual or imputed interest rate (at the level then being charged by institutional first mortgagees for new permanent first mortgage loans on buildings in the area which are similar to the Building) shall be included in Landlord’s Operating Expenses. Landlord’s Operating Expenses shall not include payments of principal, interest or other charges on mortgages or payments of any rent by Landlord on account of any ground lease of the land on which the Building is situated or any lease of the Building; costs of work or services (including utilities) for particular tenants to the extent such costs of work or services are separately reimbursable to Landlord by such tenants; advertising, marketing costs and leasing commissions; costs for repairs or replacements to the Property that are reimbursable from insurance proceeds (net of any applicable deductible or other related expenses and whether under policies maintained by or for Landlord or any tenant or other occupant of the Property) and costs of so-called leasehold improvements to rentable areas in the Building.

4.5 Allocation of Certain Operating Expenses . If at any time during the Term, Landlord provides services only with respect to portions of the Building which include the Premises or incurs other Operating Expenses allocable to portions of the Building which include the Premises alone, then such Operating Expenses shall be charged entirely to those tenants, including Tenant, of such portions, notwithstanding the provisions hereof referring to Tenant’s Percentage Share. If, during any period for which Landlord’s Operating Expenses are being computed, less than all of the Building is occupied by tenants, or if Landlord is not supplying all tenants with the services being supplied hereunder, Operating Expenses shall be reasonably estimated and extrapolated by Landlord to determine the Operating Expenses that would have been incurred if the Building were ninety-five percent (95%) occupied for such year and such services were being supplied to all tenants, and such estimated and extrapolated amount shall be deemed to be Landlord’s Operating Expenses for such period.

ARTICLE V

Additional Covenants

5.1 Tenant’s Covenants . Tenant covenants that at all times during the Term and such further time as Tenant (or persons claiming by, through or under it) occupies the Premises or any part thereof, it shall perform and observe the following conditions, all at its sole cost and expense:

5.1.1 Utilities and Services . Tenant shall provide and pay all charges and deposits for gas, water, sewer, electricity, and other energy, utilities and services if and to the extent used or consumed on the Premises and not included in the Operating Expenses of the Building during the Term which now or hereafter separately serve the Premises, or are not expressly to be provided by Landlord elsewhere hereunder. It is understood and agreed that except as may be expressly provided hereunder, Landlord shall be under no obligation whatsoever to furnish any such services to the Premises, and shall not be liable for (nor suffer any reduction in any rent on account of) any interruption or failure in the supply of the same.

 

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5.1.2 Maintenance . Tenant shall maintain, repair and secure the Premises, all improvements and appurtenances thereto, all access areas thereof, and all utilities, facilities, installations and equipment used in connection therewith, and shall pay all costs and expenses of so doing, keeping the Premises in good order, repair and condition, reasonable wear and tear, and damage by casualty and taking (to the extent provided in Article VI only) excepted. Without limiting the generality of the foregoing, Tenant shall keep all interior walls, floor surfaces and coverings, glass, windows, doors, partitions, all fixtures and equipment, utilities, pipes and drains and other interior installations used in connection with the Premises in such good order, repair and condition.

5.1.3 Use and Compliance with Law . Tenant shall use the Premises continuously and uninterruptedly only for the Permitted Uses, and then only as permitted under federal, state, and local laws, regulations and orders applicable from time to time, including without limitation municipal bylaws, land use and zoning laws, environmental laws and regulations (including all laws and regulations regulating the production, use, and disposal of any pollutant or toxic or hazardous material), and occupational health and safety laws, and shall procure all approvals, licenses and permits necessary therefor, in each case giving Landlord true and complete copies of the same and all applications therefor. Tenant shall timely comply with all present and future laws applicable to Tenant’s use of the Premises or Tenant’s signs thereon, foreseen or unforeseen, and whether or not the same necessitate structural or other extraordinary changes or improvements to the Premises or interfere with its particular use and enjoyment of the Premises, and shall keep the Premises equipped with adequate safety appliances and comply with all requirements reasonable in light of the use Tenant is making of the Premises. If Tenant’s use of the Premises results in any increase in the premium for any insurance carried by Landlord, then upon Landlord’s notice to Tenant of such increase Tenant shall pay the same to Landlord upon demand as additional rent. Tenant shall, in any event, indemnify, save Landlord harmless, and defend from all loss, claim, damage, cost or expense (including reasonable attorneys’ fees of counsel of Landlord’s choice against whom Tenant makes no reasonable objection) on account of Tenant’s failure so to comply with the obligations of this Section (paying the same to Landlord upon demand as Additional Rent). Tenant’s obligations in the preceding sentence shall survive the expiration or earlier termination of this Lease. Tenant shall bear the sole risk of all present or future laws affecting the Premises or appurtenances thereto, and Landlord shall not be liable for (nor suffer any reduction in any rent on account of) any interruption, impairment or prohibition affecting the Premises or Tenant’s use thereof resulting from the enforcement of laws. Tenant shall conform to the Rules and Regulations from time to time promulgated by Landlord for the operation, care and use of the common areas of the Building and appurtenant improvements and areas in which Tenant is granted rights of use by the terms of this Lease.

5.1.4 Liens and Encumbrances . Tenant shall not create or suffer, shall keep Landlord’s property, the Premises and Tenant’s leasehold free of, and shall promptly remove and discharge, any lien, notice of contract, charge, security interest, mortgage or other encumbrance which arises for any reason, voluntarily or involuntarily, as a result of any act or omission by Tenant or persons claiming by, through or under Tenant, or any of their agents, employees or independent contractors, including without limitation liens which arise by reason of labor or materials furnished or claimed to have been furnished to Tenant or for the Premises.

5.1.5 Waiver and Indemnity .

5.1.5.1 Waiver . Tenant releases Landlord, Landlord’s mortgagee, Landlord’s property manager and their respective agents and employees from, and waives all claims for, damage or injury to person or property and loss of business sustained by Tenant and resulting from the Building or the Premises or any part thereof or any equipment therein becoming in disrepair, or resulting from any accident in or about the Building, except for any of the foregoing resulting from Landlord’s gross

 

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negligence or intentional misconduct. This paragraph shall apply particularly, but not exclusively, to flooding, damage caused by Building equipment and apparatus, water, snow, frost, steam, excessive heat or cold, broken glass, sewage, gas, odors, excessive noise or vibration or the bursting or leaking of pipes, plumbing fixtures or sprinkler devices. Without limiting the generality of the foregoing, Tenant waives all claims and rights of recovery against Landlord, its property manager and their respective agents and employees for any loss or damage to any property of Tenant, which loss or damage is insured against, or required to be insured against, by Tenant pursuant to Section 6.1 hereof, whether or not such loss or damage is due to the fault or negligence of Landlord, its property manager or their respective agents or employees, and regardless of the amount of insurance proceeds collected or collectible under any insurance policies in effect.

5.1.5.2 Indemnity . Tenant agrees to indemnify, defend and hold harmless Landlord, Landlord’s mortgagee, Landlord’s property manager and their respective agents and employees, from and against any and all claims, demands, actions, liabilities, damages, costs and expenses (including attorneys’ fees), for injuries to any persons and damage to or theft or misappropriation or loss of property occurring in or about the Building and arising from the use and occupancy of the Premises or from any activity, work, or thing done, permitted or suffered by Tenant in or about the Premises (including, without limitation, any alteration by Tenant) or from any breach or default on the part of Tenant in the performance of any covenant or agreement on the part of Tenant to be performed under this Lease or due to any other act or omission of Tenant, its subtenants, assignees, invitees, employees, contractors and agents. Without limiting the foregoing, Tenant shall indemnify, defend and hold Landlord, Landlord’s property manager and Landlord’s mortgagee harmless from any claims, liabilities, damages, costs and expenses arising out of the use or storage of hazardous or toxic materials in the Building by Tenant. If any such proceeding is filed against Landlord or any such indemnified party, Tenant agrees to defend Landlord or such party in such proceeding at Tenant’s sole cost by legal counsel reasonably satisfactory to Landlord, if requested by Landlord.

The provisions of Section 5.1.5 shall survive the expiration or earlier termination of this Lease.

5.1.6 Landlord’s Right to Enter . Landlord and its agents or employees may upon reasonable notice enter the Premises during business hours (and in case of emergency at any time) for the purpose of performing repairs or replacements, or exercising any of the rights reserved to Landlord herein, or securing or protecting Landlord’s property or the Premises, or removing any alterations or additions not consented to by Landlord, and similarly upon reasonable notice may show the Premises to prospective purchasers and lenders, and during the last 12 months of the Term to prospective tenants, and may keep affixed in suitable places notices for letting and selling. Except in case of emergency, Landlord shall be subject in entering the Premises to reasonable security conditions, if any, set forth by Tenant in writing to Landlord.

5.1.7 Personal Property at Tenant’s Risk . Landlord’s obligation or election to repair or restore the Premises under this Lease shall not include the repair, restoration or replacement of the furniture or any other personal property owned by or in the possession of Tenant, all of which shall be at Tenant’s sole risk.

5.1.8 Overloading, Nuisance, Etc . Tenant shall not, either with or without negligence, injure, overload, deface, damage or otherwise harm Landlord’s property, the Premises or any part or component thereof; commit any nuisance; permit the emission of any hazardous agents or substances; allow the release or other escape of any biologically or chemically active or other hazardous substances or materials so as to impregnate, impair or in any manner affect, even temporarily, any element or part of Landlord’s property or the Premises or allow the storage or use of such substances or materials in any

 

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manner not sanctioned by law or by the highest standards prevailing in the industry for the storage and use of such substances or materials; nor shall Tenant bring onto the Premises any such materials or substances except to use in the ordinary course of Tenant’s business, and then only after written notice is given to Landlord of the identity of such substances or materials; permit the occurrence of objectionable noise or odors; or make, allow or suffer any waste whatsoever to Landlord’s property or the Premises. Landlord may inspect the Premises from time to time (subject to the requirements set forth in Section 5.1.6 above), and Tenant will cooperate with such inspections. Without limitation, “hazardous substances” shall include such substances described in the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. §9601 et seq. and the regulations adopted thereunder, and “hazardous materials” shall include such materials described in the Resource Conservation and Recovery Act, as amended, 42 U.S.C. §6901 et seq.; any state or local statutes governing hazardous materials, and the regulations adopted under these acts. In addition, Tenant shall execute affidavits, representations and the like from time to time at Landlord’s request concerning Tenant’s best knowledge and belief regarding the presence or absence of hazardous materials and substances on the Premises or Property. In all events, Tenant shall indemnify Landlord, Landlord’s property manager, and Landlord’s mortgagees as provided in Section 5.1.5 from any liability arising from or related to the release or threatened release of hazardous materials and substances on the Premises. (At the request of Landlord, Tenant will from time to time confirm such indemnity to mortgagees directly with such mortgagees.) The provisions of this Section 5.1.8 shall survive the expiration or earlier termination of this Lease.

5.1.9 Yield Up . At the expiration or earlier termination of this Lease, Tenant (and all persons claiming by, through or under it) shall, without the necessity of any notice, surrender the Premises (including all Tenant Work, and all replacements thereof, except such additions, alterations and other Tenant Work as Landlord may have directed in advance of their installation and otherwise in accordance with this Lease, to be removed at the end of the expiration or termination of this Lease, which shall be removed by Tenant and the Premises restored to their pre-existing condition) and all keys to the Premises, remove all of its trade fixtures and personal property not bolted or otherwise attached to the Premises (and such trade fixtures and other property bolted or attached to the Premises as Landlord may have directed in advance of their installation and otherwise in accordance with this Lease to be removed at the end of the expiration or termination of this Lease), and all Tenant’s signs wherever located, in each case repairing damage to the Premises and Property which results in the course of such removal and restoring the Premises and Property to a fully functional and tenantable condition (including the filling of all floor holes, the removal of all disconnected wiring back to junction boxes and the replacement of all damaged ceiling tiles) except in each case for ordinary wear and tear. Tenant shall yield up the Premises broom-clean and in good order, repair and condition, reasonable wear and tear and damage by casualty and taking (to the extent provided in Article VI only) excepted. Any property not so removed within thirty (30) days after the expiration or termination of the Lease shall be deemed


 
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