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MATERIAL CONTRACTS

Lease Agreement

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This Lease Agreement involves

STEN CORP

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Title: MATERIAL CONTRACTS
Governing Law: Minnesota     Date: 12/29/2005
Industry: Medical Equipment and Supplies     Sector: Healthcare

MATERIAL CONTRACTS, Parties: sten corp
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EXHIBIT 10.39

 

LEASE

BY AND BETWEEN

 

AMBAR, L.L.C.

 

LANDLORD

 

 

AND

 

STEN CORPORATION

 

TENANT

 

 

13 DAY OF SEPTEMBER, 2005

 

9/2/05

 



 

TABLE OF CONTENTS

 

 

 

COVER SHEET

 

1

 

 

 

 

 

 

 

DATA SHEET

 

3

 

 

 

 

 

ARTICLE

 

TITLE

 

PAGE

 

1.

 

PREMISES:

 

4

 

2.

 

TENANT IMPROVEMENTS:

 

4

 

3.

 

TERM:

 

4

 

4.

 

BASE RENT:

 

5

 

5.

 

CONTRIBUTION TO OPERATING COSTS:

 

5

 

6.

 

USE OF PREMISES:

 

8

 

7.

 

ASSIGNMENT AND SUBLETTING:

 

9

 

8.

 

MAINTENANCE AND REPAIRS:

 

11

 

9.

 

ALTERATIONS; SIGNS; EQUIPMENT; MOVING:

 

11

 

10.

 

RIGHT OF ENTRY:

 

12

 

11.

 

SERVICES AND UTILITIES:

 

13

 

12.

 

WAIVER AND INDEMNITY:

 

14

 

13.

 

INSURANCE:

 

14

 

14.

 

FIRE OR OTHER CASUALTY:

 

16

 

15.

 

CONDEMNATION:

 

17

 

16.

 

SECURITY DEPOSIT:

 

17

 

17.

 

DEFAULT:

 

17

 

18.

 

LANDLORD’S RIGHT TO CURE DEFAULT; LATE PAYMENT:

 

19

 

19.

 

WAIVER:

 

19

 

20.

 

SUBORDINATION:

 

20

 

21.

 

RULES AND REGULATIONS:

 

20

 

22.

 

COVENANT OF QUIET ENJOYMENT:

 

21

 

23.

 

NO REPRESENTATIONS BY LANDLORD:

 

21

 

24.

 

NOTICES:

 

21

 

25.

 

ESTOPPEL CERTIFICATES:

 

21

 

26.

 

SURRENDER; HOLDING OVER:

 

22

 

27.

 

ENERGY CONSERVATION:

 

22

 

28.

 

COMMUNICATION AND COMPUTER LINES:

 

22

 

29.

 

RELOCATION:

 

23

 

30.

 

TENANT’S TAXES:

 

23

 

31.

 

UNIFORM COMMERCIAL CODE:

 

23

 

32.

 

MISCELLANEOUS:

 

24

 

33.

 

OPTION TO RENEW:

 

25

 

 

 

 

 

 

 

 

 

EXHIBITS

 

 

A

 

 

FLOOR PLAN

 

 

B

 

 

BUILDING SITE

 

 

C

 

 

LEASEHOLD IMPROVEMENTS/PLAN

 

 

D

 

 

RULES AND REGULATIONS

 

 

 

2



 

DATA SHEET

 

DATE OF LEASE:

 

September 13, 2005

 

 

 

LANDLORD’S ADDRESS

 

AMBAR, L.L.C.

FOR RENT and NOTICES:

 

In Care Of: Great Lakes Management Co.

 

 

1907 East Wayzata Boulevard, Suite 110

 

 

Wayzata, MN 55391

 

 

(952) 476-0303 phone – (952) 476-0404 fax

 

 

 

TENANT’S ADDRESS:

 

STEN Corporation

 

 

Suite 310

 

 

10275 Wayzata Boulevard

 

 

Minnetonka, MN 55305

 

 

 

LEASE PREMISES:

 

Approximately 1,142 rentable square feet, as

 

 

designated on Exhibit A.

 

 

 

TERM:

 

Three (3) years and two and one-half (2 ½)

 

 

months.

 

 

 

SCHEDULED

 

 

COMMENCEMENT DATE:

 

October 15, 2005

 

 

 

EXPIRATION DATE:

 

December 31, 2008

 

 

 

OPTION TO RENEW:

 

One 3-year option to renew after December 31, 2008, to then expire December 31, 2011.

 

 

 

BASE RENT:

 

Base Rent shall be due hereunder as follows,

 

 

based on 1,142 rsf:

 

Period

 

Base Rent prsf/Yr.

 

Per Month

 

 

 

 

 

 

 

 

From: 10/15/05 through 12/31/05

 

Free Gross Rent

 

$

00

 

From: 01/01/06 through 12/31/08

 

$14.00 NNN = $15,988.00 =

 

$

1,332.33/mo

 

 

Option Period:

 

 

 

 

 

 

 

 

 

 

 

 

From: 01/01/09 through 12/31/11

 

$16.00 NNN = $18,272.00 =

 

$

1,522.67/mo

 

 

SECURITY DEPOSIT:

 

Equal to 1 month of gross rent = $2,460

 

 

(1 mo base rent = $1,332 ÷ 1 mo real estate taxes & CAM of $1,128 = $2,460)

 

The information in this Data Share and Exhibits A through D are incorporated in and made a part of this lease agreement.

 

3



 

THIS OFFICE LEASE (“Lease”), dated September 13,2005 is made and entered into by and between AMBAR, LLC . (“Landlord”) and STEN Corporation , (“Tenant”) upon the following terms and conditions:

 

1.              PREMISES: Subject to the terms and conditions of this Lease, Landlord leases to Tenant, and Tenant rents from Landlord, the leased premises commonly known as Minnetonka Executive Plaza located at 10275 Wayzata Boulevard, Minnetonka, Minnesota 55305 consisting of approximately 1,142 square feet of Net Rentable Area as depicted on Exhibit ”A” which is attached hereto and incorporated by this reference, hereinafter referred to as the “Premises”, Suite 310, in the building (hereinafter referred to as the “Building”). The square feet of Rentable Area shall be determined in accordance with Industry and BOMA standards and shall be verified by the Landlord’s architect after completion of construction of the Tenant Improvements (defined below). Any adjustment to the square feet of Rentable Area shall then be made based on the architect’s determination. Landlord also hereby leases to Tenant the non-exclusive right, in common with the other tenants of the Building, and Landlord, its customers, agents, invitees, licensees, suppliers, employees, guests, and visitors, to use all “Common Areas” as hereinafter defined. The land upon which the Building and the Leased Premises are a part is hereinafter referred to as the “Property” including all buildings and improvements and personal property of Landlord used in connection with the operation or maintenance thereof located therein and thereon and the appurtenant parking facilities are hereinafter called the “Property”. The Property is depicted on Exhibit ”B” which is attached hereto and incorporated by this reference, and legally described on Exhibit ”B-1” attached hereto and made a part hereof by reference.

 

2.              TENANT IMPROVEMENTS: Subject to the terms hereof, at Tenant’s cost and expense and with no right of reimbursement from Landlord, other than as provided for in this Lease, Tenant shall construct or cause to be constructed all those certain improvements on Exhibit C attached hereto and incorporated herein by reference (the “Tenant Improvements”). Exhibit C shall also consist of a space plan provided by the Tenant.

 

The construction of the Tenant Improvements shall be completed in a good and workmanlike manner, utilizing new and first grade materials, in conformity with all applicable federal state, and local laws, ordinances, regulations building codes, fire regulations, and applicable insurance requirements.

 

3.              TERM: The duration of the Lease shall be for a period of three (3) years and two and one-half (2½%) months.

 

3.1.           The term of this Lease shall commence October 15, 2005. Any entry by Tenant prior to the Commencement Date shall be subject to all of the terms and conditions of this Lease other than the obligation to pay Base Rent and additional rent.

 

3.2.           Landlord may at any time prepare a Supplement to this Lease confirming the Commencement Date and the Rentable Area of the Premises. Tenant shall execute and return such Supplement within ten (10) days after submission unless Tenant gives written notice specifying in reasonable detail Tenant’s objections thereto.

 

4



 

3.3.           Fourteen (14) days prior to the Scheduled Commencement Date, Landlord shall allow Tenant to have reasonable access to the Premises, free of rent, for the purpose of installing trade fixtures and furniture. Tenant agrees to indemnify, defend and hold Landlord and its partners, officers and employees and property manager harmless from and against any claim, loss or expense arising out of injury, death or property loss or damage occurring in the Premises, except only to the extent caused by the negligent act or intentional misconduct of Landlord or its partners, officers or employees or property manager.

 

4.              BASE RENT: Tenant shall pay as monthly “Base Rent” for the Premises one-twelfth of the product of: (i) the Rental Rate set forth in the Data Sheet, times (ii) the number of square feet of Rentable Area of the Premises. The Base Rent shall be paid to Landlord without notice or demand in lawful money of the United States in monthly installments, in advance, on the first day of each and every calendar month during the Term. If the initial or final month of the Term of this Lease is less than a calendar month, Base Rent for such partial month shall be prorated at the rate of one-thirtieth of the monthly Base Rent for each day, payable in advance. Tenant will pay said Base Rent, together with Operating Costs and all other amounts due under this Lease, to Landlord at Landlord’s Address set forth in the Data Sheet, or to such other party or to such other address as Landlord may designate from time to time by written notice to Tenant. Tenant’s obligation to pay the Base Rent, Operating Costs and other amounts due under this Lease is an independent covenant, and, except as provided otherwise herein, shall not be subject to any abatement, deduction, counterclaim, reduction, setoff or defense of any kind whatsoever.

 

5.              CONTRIBUTION TO OPERATING COSTS:

 

5.1.           Tenant shall, for the entire Term of this Lease, and, except as provided otherwise herein, without any abatement, set-off or deduction therefrom, pay to Landlord as additional rent its Pro Rata Share, as hereinafter defined, of all costs which Landlord may incur in maintaining and operating the entire Property. Said costs shall be referred to herein as “Operating Costs” and are hereby defined with respect to any calendar year to include but not be limited to the following costs incurred by Landlord in such calendar year with respect to the Property: all real estate taxes and installments of special assessments which shall accrue or become a lien against, or are payable in respect of, any part of the Property during the Term of this Lease; all other governmental impositions, including but not limited to amounts payable under assessment agreements, gross receipts taxes and taxes on rentals (other than income taxes) relating to the Property; the costs of heat, cooling, utilities, insurance (including but not limited to liability insurance and fire and casualty insurance with rental abatement endorsement, boiler and pressure vessel insurance, builders risk insurance, and owners protective liability insurance), security, landscaping, janitorial and cleaning services; all employment costs including salaries, wages and fringe benefits; all management fees, including expenses reimbursable to any manager and rental of property management office; fees for professional services; charges under maintenance and service contracts; all supplies purchased for use in the Property; all maintenance and repair costs; any equipment rental; depreciation of the cost of capital improvements made to (i) reduce Operating Costs or limit increases therein, or (ii) required by Landlord’s insurance carrier or (iii) required by any law, rule, regulation or order of any governmental or quasi-governmental authority having jurisdiction; all costs, charges, and expenses incurred by Landlord in connection with any change of any company providing electricity service, including, without limitation, maintenance, repair, installation, and service

 

5



 

costs associated therewith; and any and all other costs of operation, whether ordinary or extraordinary.

 

Operating Costs shall not include direct out-of-pocket costs of the following: leasing commissions and costs of marketing; the cost of constructing leasehold improvements; payments of principal and interest on any mortgages, deeds of trust or other encumbrances upon the Property; depreciation of the capital cost of the Property except as provided above; the cost of any items for which Landlord is directly reimbursed by insurance proceeds, condemnation awards, a tenant of the Property or the like; wages, salaries or other compensation paid to executive employees of Landlord or the property manager ranking above the highest-ranking, on-site employee; costs associated with the operation of the business of the entity which constitutes Landlord, which costs are not directly related to maintaining or operating the Property (by way of example, the formation of the entity, internal accounting and legal matters, including but not limited to preparation of tax returns and financial statements and gathering of data therefor, costs of defending any lawsuits related to maintaining or operating the Property, costs of selling, syndicating, financing, mortgaging or hypothecating any of Landlord’s interest in the Property, and costs of any disputes between Landlord and its employees); any expense representing an amount paid for products or services (other than overall property management) to a person or entity related to or affiliated with Landlord which is in excess of the fair market value of such services and products; fees incurred in disputes with tenants; costs of remediation of Hazardous Materials which are (i) in or on the Property as of the date of this Lease and which are classified as Hazardous Materials as of the date of this Lease under laws in effect as of the date of this Lease, or (ii) which are subsequently brought onto the Property by Landlord or with the express consent of Landlord and which are on the date of their introduction onto the Property classified as Hazardous materials under laws in effect as of the date of such introduction, excluding in the case of both (i) and (ii) above, lawful use and disposition of reasonable quantities of supplies used in the ordinary course of operation and maintenance of like projects.

 

5.2.           As frequently hereafter as Landlord shall deem appropriate, Landlord may give Tenant notice of Landlord’s estimate of Operating Costs for the then-current calendar year (“Estimated Operating Costs”). Tenant shall pay on the first day of each calendar month during the Term, as additional rent hereunder, one-twelfth (or portion thereof for partial months) of Tenant’s Pro Rata Share of Estimated Operating Costs.

 

5.3.           Tenant’s “Pro Rata Share” is a fraction, the numerator of which is the Rentable Area of the Premises, and the denominator of which is the Rentable Area of all areas in the Property designated by Landlord for lease, excluding separately leased storage and parking areas. Landlord may reasonably redetermine Tenant’s Pro Rata Share from time to time to reflect reconfiguration, additions or modifications to the Building.

 

5.4.           Within a reasonable time after the expiration of each calendar year, Landlord shall submit to Tenant a statement (“Landlord’s Statement”) setting forth the actual Operating Costs of the Property for such calendar year (“Actual Operating Costs”), (a) Tenant’s Pro Rata Share of Actual Operating Costs, and (b) the aggregate of Tenant’s payments of Estimated Operating Costs for such year. Within thirty (30) days after the delivery of such statement (including any statement delivered after the expiration or termination of the Term of this Lease), the party in

 

6



 

whose favor the difference, if any, between (a) and (b) exists shall pay the amount of such difference to the other; provided, however, that overpayments by Tenant may at Landlord’s option be credited against future payments of Estimated Operating Costs except with respect to the last year of the Term.

 

Provided that Tenant is not then in default beyond any applicable cure period of its obligations to pay Base Rent, or any other payments required to be made by it under this Lease and provided further that Tenant strictly complies with the provisions of this Section 5.4, Tenant shall have the right, once each calendar year, to reasonably review supporting data for any portion of a Landlord’s Statement (provided, however Tenant may not have an audit right to all documentation relating to Building operations as this would far exceed the relevant information necessary to properly document a pass through billing statement, but real estate tax statements and information on utilities, repairs, maintenance and insurance will be available), in accordance with the following procedure:

 

(A)           Tenant shall, within ten (10) business days after any such Landlord’s Statement is delivered, deliver a written notice to Landlord specifying the portions of the Landlord’s Statement that are claimed to be incorrect, and Tenant shall simultaneously pay to Landlord all amounts due from Tenant to Landlord as specified in the Landlord’s Statement. Except as expressly set forth in subsection (C) below, in no event shall Tenant be entitled to withhold, deduct, or offset any monetary obligation of Tenant to Landlord under the Lease (including, without limitation, Tenant’s obligation to make all payments of Base Rent and all payments of Tenant’s Pro Rata Share of Tax and Operating Costs) pending the completion of and regardless of the results of any review of record under this Section 5.4. The right of Tenant under this Section 5.4 may only be exercised once per calendar year for any Landlord’s Statement, and if Tenant fails to meet any of the above conditions as a prerequisite to the exercise of such right, the right of Tenant under this Section 5.4 for a particular Landlord’s Statement shall be deemed waived.

 

(B)            Tenant acknowledges that Landlord maintains its records for the Building at Landlord’s manager’s corporation offices presently located at the address set forth in the Data Sheet and Tenant agrees that any review of the records under this Section 5.4 shall be at the sole expense of Tenant and shall be conducted by an independent firm of certified public accounts which will be engaged by Tenant on a fee, not contingency basis. Tenant may exercise the right to audit only during normal business hours, at Landlord’s offices. Tenant acknowledges and agrees that any records reviewed under this Section 5.4 constitute confidential information of Landlord, which shall not be disclosed to anyone other than the accountants performing the review and principals of Tenant who receive the result of the review. The disclosure of such information to any person, whether or not caused by the conduct of Tenant shall constitute a material breach of this Lease,

 

(C)            Any errors disclosed by the review shall be promptly corrected by Landlord, provided, however, that if Landlord disagrees with any such claimed

 

7



 

errors, Landlord shall have the right to cause another review to be made by an independent firm of certified public accountants of national standing. In the event of a disagreement between the two accounting firms, the review that discloses the least amount of deviation from the Landlord’s Statement shall be deemed to be correct. In the event that the result of the review of records (taking into account, if applicable, the result of any additional review caused by Landlord) reveal that Tenant has overpaid obligations for a preceding period the amount of such overpayment shall be credited against Tenant’s subsequent installment obligations to pay the estimated Tax and Operating Expense Adjustment. In the event that such results shows that Tenant has underpaid its obligation for a preceding period, Tenant shall be liable for Landlord’s actual accounting fees, and the amount of such underpayment shall be paid by Tenant to Landlord with the next succeeding installment obligation of estimated Tax and Operating Costs.

 

5.5.           Landlord may at its option by thirty (30) days written notice to Tenant Change its accounting year hereunder from the calendar year to a fiscal year, making such adjustments from the end of the last calendar year to the commencement of the first full fiscal year as shall be appropriate pursuant to generally accepted accounting principles. Upon such change, references in this Section 5.5 to a calendar year shall be deemed to be references to a fiscal year.

 

5.6.           When in the reasonable determination of Landlord any service, including but not limited to HVAC, electrical, janitorial and property management service, is provided disproportionately either to the Premises or to any other premises within the Property, then the Operating Cost per square foot payable hereunder may be increased or reduced, as the case may be, by Landlord’s determination of the increased or reduced cost per square foot of such disproportionate service. Other than the actual increase in utility costs for the disproportionate service, as determined by Landlord, Landlord shall not charge any fee for the disproportionate service. Tenant agrees to pay for any additional HVAC and utility usage beyond the Buildings normal hours of operation. A cost per hour fee for the additional HVAC and utilities usage shall be determined by and between the parties. The cost per hour fee shall be equal to an amount to be determined based upon mechanical engineering estimates and current market estimates for similar Class Buildings. In the case of unoccupied space, those elements of Operating Costs that increase with occupancy shall be adjusted upward to the amount that would be incurred if the Project were fully occupied; provided, however, in no event shall such adjustment permit Landlord to collect from tenants in the Project as Operating Costs, more than 100% of actual Operating Costs attributable to such adjusted elements.

 

6.              USE OF PREMISES: Tenant will use and occupy the Premises for purposes of conducting the business of: General Office Use.

 

6.1.           Tenant will not use or occupy the Premises for any unlawful purpose, and will comply with all present and future laws, ordinances, regulations and orders of all governmental units having jurisdiction over the Premises. Tenant shall not cause or permit any unusual noise, vibrations, odors or nuisance in or about the Premises. Landlord disclaims any warranty that the Premises are suitable for Tenant’s use and Tenant acknowledges that it has had a full opportunity to make its own determination in this regard.

 

8



 

6.2.           Tenant will not conduct or permit to be conducted any activity, or place any equipment in or about the Premises, which will in any way increase the rate of fire insurance or other insurance on the Property; and if any increase in the rate of fire insurance or other insurance is stated by any insurance company or by the applicable Insurance Rating Bureau to be due to activity or equipment of Tenant in or about the Premises, such statement shall be conclusive evidence that such increase in such rate is due to such activity or equipment and, as a result thereof, Tenant shall be liable for such increase and shall reimburse Landlord therefor and, further, shall discontinue or cause the discontinuance of such conduct or shall remove such equipment upon Landlord’s demand made at any time thereafter.

 

6.3.           Tenant shall not install, use, generate, store or dispose of in or about the Premises any hazardous substance, toxic chemical, pollutant or other material regulated by the Comprehensive Environmental Response, Compensation and Liability Act of 1985 or the Minnesota Environmental Response and Liability Act or any similar law or regulation, including without limitation any material containing asbestos, PCB, CFC or HCFC (collectively “Hazardous Materials”) without Landlord’s written approval of each Hazardous Material. Landlord shall not unreasonably withhold its approval of use by Tenant of immaterial quantities of Hazardous Materials customarily used in office business operations so long as Tenant uses such Hazardous Materials in accordance with all applicable laws. Tenant shall indemnify, defend and hold Landlord harmless from and against any claim, damage or expense arising out of Tenant’s installation, use, generation, storage, or disposal of any Hazardous Materials, regardless of whether Landlord has approved the activity.

 

6.4.           To the best of Landlord knowledge, the Building is new construction and no Hazardous Materials were utilized in the construction of the Building.

 

6.5.           To the best of Landlord knowledge, the Building was constructed in accordance with the requirements imposed under the Americans with Disabilities Act (ADA).

 

7.              ASSIGNMENT AND SUBLETTING:

 

7.1.           Tenant will not assign, transfer, mortgage or encumber this Lease or sublet or rent or permit occupancy or use of the Premises, or any part thereof by any third party; nor shall any assignment or transfer of this Lease be effectuated by operation of law or otherwise, (any of the foregoing being hereinafter referred to as an “Assignment”) without in each such, case obtaining the prior written consent of Landlord, which consent shall be subject to Landlord s sole discretion. The consent by Landlord to any Assignment shall not be construed as a waiver or release of Tenant from the terms of any covenant or obligation under this Lease, nor shall the collection or acceptance of rent from any transferee under an Assignment constitute an acceptance of the Assignment or a waiver or release of Tenant or any transferee of any covenant or obligation contained in this Lease, nor shall any Assignment be construed to relieve Tenant from the requirement of obtaining the consent in writing of Landlord to any further Assignment.

 

Landlord’s consent to a proposed assignment or subletting shall not be unreasonably withheld; but, in addition to any other ground for denial, Landlord’s consent shall be deemed reasonably withheld if, in Landlord’s good faith judgement: (i) the proposed assignee or subtenant does not have the financial strength to perform its obligations under this Lease or any proposed sublease;

 

9



 

(ii) the business and operations of the proposed assignee or subtenant are not of comparable quality to the business and operations being conducted by other tenants in the Building; (iii) the proposed assignee or subtenant intends to use any part of the Premises for a purpose not permitted under this Lease; (iv) either the proposed assignee or subtenant, or any person which directly or indirectly controls, is controlled by, or is under common control with the proposed assignee or subtenant occupies space in the Building, or is negotiating with Landlord to lease space in the Building; (v) the proposed assignee or subtenant is disreputable; or (vi) the use of the Premises or the Building by the proposed assignee or subtenant would, in Landlord’s reasonable judgement, impact the Building in a negative manner including but not limited to significantly increasing the pedestrian traffic in and out of the Building or requiring any alterations to the Building to comply with applicable laws; (vii) the subject space is not regular in shape with appropriate means of ingress and egress suitable for normal renting purposes; (viii) the transferee is a government (or agency or instrumentality thereof) or (ix) Tenant has failed to cure a default at the time Tenant requests consent to the proposed Transfer.

 

7.2.           Notwithstanding the foregoing, Tenant shall have the right to assign or sublet, with Landlord’s consent, to a) any entity resulting from a merger or consolidation with Tenant, b) any partnership succeeding to the business and assets of Tenant, and c) any subsidiary or Affiliate of Tenant. Affiliate means any person or entity that controls is controlled by, or is under common control with Tenant with “control” meaning ownership of fifty percent (50%) or more of the voting interests in Tenant.

 

7.3.           If Tenant desires at any time to make an Assignment, it shall first notify Landlord of its desire to do so and shall submit in writing to Landlord (i) the name of the proposed assignee, mortgagee, subtenant or other transferee (any of the foregoing being hereinafter referred to as an “Assignee”), (ii) the nature of the proposed Assignee’s business to be carried on the Premises, (iii) a copy of the proposed Assignment agreement and any other agreements to be entered into concurrently with such Assignment, including full disclosure of all financial terms, and (iv) such financial information as Landlord may reasonably request concerning the proposed Assignee. Tenant shall pay to Landlord a reasonable fee for Landlord’s expenses, including attorneys’ fees, in reviewing such proposed Assignment. Neither the furnishing of such information nor the payment of such fee shall limit any of Landlord’s rights or alternatives under this Section.

 

7.4.           Upon any request for Landlord’s consent under this Section, Landlord shall have the option, to be exercised by giving written notice to Tenant within fourteen (14) days after receipt by Landlord of the information concerning such Assignment required by this Section, to terminate this Lease as to the portion of the Premises for which Tenant proposes an Assignment, effective as of the date Tenant proposes the Assignment to take place. Upon termination of this Lease as to such portion of the Premises, (i) the Base Rent shall be reduced by the lesser of (x) the then-current Base Rent per square foot of Rentable Area, multiplied by the number of square feet of Rentable Area for which Tenant proposes an Assignment and (y) the Base Rent stated in Tenant’s notice under Section 7.3; (ii) Tenant’s Pro Rata Share shall be reduced in proportion to the reduction of the Rentable Area of the Premises; (iii) such portion of the Premises shall, at Tenant’s expense, be a separately demised area complying with all codes and with a reasonable and appropriate entrance separate from the entrance for the remainder of the Premises; (iv)

 

10



 

Tenant shall at all times provide non-exclusive use of any common facilities; and (v) Landlord shall have the right to use such portion of the Premises for any legal purpose compatible with a first class office building, in its sole discretion, and the right to further assign or sublease the portion of the Premises shall be subject to Landlord’s election without the consent of Tenant. Upon termination of this Lease as to all or any portion of the Premises, any option to extend the term of this Lease with respect to such portion of the Premises shall also terminate, whether or not such options have been exercised. Non-exercise by Landlord of its rights under this Section shall not limit any of Landlord’s other rights and alternatives under this Section.

 

7.5.           Whether or not Landlord has consented to the applicable Assignment, the amount by which the income received by Tenant with respect to any Assignment exceeds, in any month, the Base Rent and Operating Costs payable by Tenant to Landlord, shall be payable by Tenant directly to Landlord, as additional rent hereunder on or before the last day of each such month. Tenant shall make full disclosure to Landlord of a consideration paid or payable, agreements and other relevant understandings with respect to any such Assignment.

 

8.              MAINTENANCE AND REPAIRS: Without limitation of Landlord’s obligation to provide routine janitorial services as set forth in Section 11 Tenant agrees to keep and maintain the Premises and the fixtures and equipment therein in first class, properly, functioning, safe, orderly and sanitary condition, will make all necessary replacements thereto, will suffer no waste or injury thereto, and will at the expiration or other termination of the Term of this Lease, surrender the same with all improvements in the same order and condition in which they were on the Commencement Date, or in such better condition as they may hereafter be put, ordinary wear and tear and casualty damage to the extent covered by insurance, excepted. Landlord shall make all necessary repairs to the outer walls, roof, downspouts, gutters and basic structural elements and common areas of the Property. Landlord shall also make all necessary repairs to the portions of the building systems (plumbing, sewage, heating, air conditioning and electrical) providing service jointly to the Premises and other portions of the Property. Notwithstanding anything apparently to the contrary in this Section, any cost of repairs or improvements to the Property, to the Premises or to any common areas which are occasioned by the negligence or the fault of Tenant, its officers, employees, agents or invitees, and which arise out of the nature of Tenant’s use and occupancy of the Premises or the installations of Tenant in the Premises shall be paid for by Tenant, as additional rent hereunder, immediately upon billing.

 

9.              ALTERATIONS; SIGNS; EQUIPMENT; MOVING:

 

9.1.           Tenant will not make or permit anyone to make any alterations, decorations, additions or improvements, structural or otherwise, in or to the Premises or the Property without the prior written consent of Landlord. Landlord shall not unreasonably withhold consent to Tenant’s interior decorations provided they comply with Section 2 of this Lease. As a condition precedent to consent of Landlord hereunder, Tenant agrees to obtain and deliver to Landlord such security against mechanic’s liens, as Landlord shall reasonably request. If any mechanic&#8217


 
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