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SINGLE-TENANT LEASE

Lease Agreement

SINGLE-TENANT LEASE | Document Parties: APPLIED FILMS CORP | First Industrial Development Services, Inc You are currently viewing:
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APPLIED FILMS CORP | First Industrial Development Services, Inc

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Title: SINGLE-TENANT LEASE
Governing Law: Colorado     Date: 2/13/2006
Industry: Constr. - Supplies and Fixtures     Sector: Capital Goods

SINGLE-TENANT LEASE, Parties: applied films corp , first industrial development services  inc
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Exhibit 10.4

SINGLE-TENANT LEASE

        This Lease is made as of the 26th day of October, 2005, by and between First Industrial Development Services, Inc., a Maryland corporation (“Landlord”) and Applied Films Corporation, a Colorado corporation (“Tenant”).

W I T N E S S E T H

1 .     Basic Provisions: In addition to other terms which are defined elsewhere in this Lease or any Exhibits, the terms defined in the following subsections of this Section 1 shall have the meaning set forth in such subsection whenever used in this Lease.

        1.1 Building: 126,384 square foot building located on the real property commonly known by the street address of 9586 I-25 Frontage Road, Longmont, Colorado 80504.

        1.2 Premises: Approximately 126,384 square feet of space which is the entire Building and all of the real property on which it is located, including all improvements therein or to be provided by Landlord under the terms of this Lease, commonly known by the street address of 9586 I-25 Frontage Road, Longmont, Colorado 80504, as outlined on Exhibit A attached hereto. In addition to Tenant’s rights to use and occupy the Premises as hereinafter specified, Tenant shall have non-exclusive rights to the Common Areas (as defined in Section 2.4 below) as hereinafter specified, but shall not have any rights to the roof, exterior walls or utility raceways of the Building or to any other buildings in the Building Complex.

        1.3 Building Complex: The Premises and the Building, the Common Areas (as defined below), the land upon which they are located, along with all other buildings and improvements thereon depicted on Exhibit B attached hereto and made a part hereof.

        1.4 Parking : All unreserved vehicle parking spaces in the Building Complex.

        1.5 Term: Five (5) years and six (6) months (“Primary Lease Term”) commencing on the date of acquisition of the Building by Landlord (“Commencement Date”), anticipated to be November 18, 2005, and ending a full five (5) years and six (6) months thereafter (“Expiration Date”), anticipated to be May 17, 2011.

        1.6 Estimated Delivery Date : November 18, 2005.

        1.7 Base Rent:

Lease Year

PSF/NNN

Monthly Rent

           Annual Rent

Monthly Mgmt. Fee

Months 1-12

 

$6

.35

$66,878

.20

$802,538

.40

$1,337

.56

Months 13-24

 

$6

.48

$68,247

.36

$818,968

.32

$1,364

.95

Months 25-36

 

$6

.61

$69,616

.52

$835,398

.24

$1,392

.33

Months 37-48

 

$6

.74

$70,985

.68

$851,828

.16

$1,419

.71

Months 49-60

 

$6

.87

$72,354

.84

$868,258

.08

$1,447

.10

Months 61-66

 

$7

.01

$73,829

.32

$885,951

.84

$1,476

.59



Upon the earlier to occur of: (i) the Commencement Date and (ii) November 18, 2005, Tenant shall pay $68,215.76 as Base Rent and Monthly Management Fee for the first month’s Rent; provided, however, if the Commencement Date is not the first of the month, then said amount shall be prorated. For the Primary Lease Term Base Rent and the Monthly Management Fee shall be payable on the first day of each month.

        1.8 Rentable Area: Approximately 126,384 square feet which is all rentable space available for lease in the Building Complex. Unless otherwise provided herein, any square footage set forth in this Lease or that may have been used in calculating this Rent and/or Common Area Operating Expenses is an approximation which Landlord and Tenant agree is reasonable and the Base Rent and Tenant’s Share based thereon are not subject to revision whether or not the actual square footage is more or less. Notwithstanding the foregoing, if there is: (i) alteration to the Premises or the Building or Building Complex after the Commencement Date; or (ii) any change in the designated Rentable Area of the Building Complex, then Landlord shall have the exclusive discretion to recalculate Tenant’s Share by substituting the revised approximate Rentable Area of the Premises and/or the Building Complex in the calculation described above. Any change in the approximate Rentable Area of the Premises or recalculated by Landlord shall be effective, for purposes of calculating Tenant’s Share as of the first day of the next calendar month after such change.


        1.9 Tenant's Share of Common Area Operating Expenses : 100% (calculated by dividing 126,384 by 126,384).

        1.10 Security Deposit : $50,000.00.

        1.11 Permitted Use : General office, manufacturing, assembly, production and warehouse use.

        1.12 Guarantor . The obligations of the Tenant under this Lease are to be guaranteed by none.

2 .     Premises, Parking and Common Areas.

        2.1 Grant. Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord, the Premises, for the Primary Lease Term, at the rent and upon all of the terms, covenants and conditions set forth in this Lease.

        2.2 Landlord Delivery. Landlord shall deliver the Premises to Tenant on the Commencement Date in its current “AS IS” condition with no representations or warranties whatsoever. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS LEASE, LANDLORD HEREBY DISCLAIMS ANY EXPRESS OR IMPLIED REPRESENTATION OR WARRANTY THAT THE PREMISES ARE SUITABLE FOR TENANT’S INTENDED PURPOSE OR USE, WHICH DISCLAIMER IS HEREBY ACKNOWLEDGED BY TENANT. THE TAKING OF POSSESSION BY TENANT SHALL BE CONCLUSIVE EVIDENCE THAT TENANT: (i) ACCEPTS THE PREMISES, THE BUILDING AND LEASEHOLD IMPROVEMENTS AS SUITABLE FOR THE PURPOSES FOR WHICH THE PREMISES WERE LEASED; (ii) ACCEPTS THE PREMISES AND PROJECT AS BEING IN GOOD AND SATISFACTORY CONDITION; (iii) WAIVES ANY DEFECTS IN THE PREMISES AND ITS APPURTENANCES EXISTING NOW OR IN THE FUTURE; AND (iv) WAIVES ALL CLAIMS BASED ON ANY IMPLIED WARRANTY OF SUITABILITY OR HABITABILITY.

        2.3 Acceptance of Premises. Tenant hereby acknowledges: (a) that it has been advised to satisfy itself with respect to the condition of the Premises including, but not limited to, the electrical and fire sprinkler systems, security, environmental aspects, and compliance with the Americans with Disabilities Act and applicable zoning, municipal, county, state and federal laws, ordinances and regulations and any covenants or restrictions of record (collectively, “Applicable Laws”) and the present and future suitability of the Premises for Tenant’s intended use; (b) that Tenant has made such investigation as it deems necessary with reference to such matters, is satisfied with reference thereto, and assumes all responsibility therefore as the same relate to Tenant’s occupancy of the Premises and/or the terms of this Lease; and (c) that neither Landlord, nor any of Landlord’s agents, has made any oral or written representations or warranties with respect to said matters other than as set forth in this Lease. If Landlord has agreed to complete finish work in the Premises, such work shall be completed in accordance with Exhibit C attached hereto and made a part hereof (the “Work Agreement”), and such work may be referred to herein as “Landlord’s Work”. Except as set forth expressly in the Work Agreement, Landlord shall have no obligation for completion of remodeling of the Premises and shall Tenant accept the Premises in its “ AS IS” condition.

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        2.4 Common Areas. The term “Common Areas” is defined as all areas and facilities outside the Premises and within the exterior boundary line of the Building Complex that are provided and designated by the Landlord from time to time for the general non-exclusive use of Landlord, Tenant and other tenants of the Building Complex and their respective employees, suppliers, shippers, customers, contractors and invitees, including parking areas, utility rooms, loading and unloading areas, trash areas, roadways, sidewalks, walkways, parkways, driveways and landscaped areas. Landlord hereby grants to Tenant, for the benefit of Tenant and its employees, suppliers, shippers, contractors, customers and invitees, during the Primary Lease Term the non-exclusive right to use, in common with others entitled to such use, the Common Areas as they exist from time to time, subject to any rights, powers, and privileges reserved by Landlord under the terms hereof or under the terms of any rules and regulations or restrictions governing the use of the Building Complex. Under no circumstances shall the right therein granted to use the Common Areas be deemed to include the right to store any property, temporarily or permanently, in the Common Areas. Any such storage shall be permitted only by the prior written consent of Landlord or Landlord’s designated agent, which consent may be revoked at any time. In the event that any unauthorized storage shall occur, then Landlord shall have the right, without notice, in addition to such other rights and remedies that it may have, to remove the property and charge the cost to Tenant, which cost shall be immediately payable upon demand by Landlord. Landlord or such other person(s) as Landlord may appoint shall have the exclusive control and management of the Common Areas and shall have the right, from time to time, to establish, modify, amend and enforce reasonable rules and regulations with respect thereto. Landlord shall have the right, in Landlord’s sole discretion, from time to time: (i) to make changes to the Common Areas, including, without limitation, changes in the location, size, shape and number of driveways, entrances, parking spaces, parking areas, loading and unloading areas, ingress, egress, direction of traffic, landscaped areas and walkways; (ii) to close temporarily any of the Common Areas for maintenance purposes so long as reasonable access to the Premises remains available; (iii) to designate other land outside the boundaries of the Building Complex to be a part of the Common Areas; (iv) to add additional building and improvements to the Common Areas; (v) to use the Common Areas while engaged in making additional improvements, repairs or alterations to the Building Complex, or any portion thereof; and (vi) to do and perform such other acts and make such other changes in, to or with respect to the Common Areas and Building Complex as Landlord may, in the exercise of sound business judgment deem to be appropriate.

        2.5 Parking. Tenant shall be entitled to use the number of unreserved parking spaces specified in Section 1.4 on those portions of the Common Areas designated from time to time by Landlord for parking. Tenant shall not use more parking spaces than said number. Said parking spaces shall be used for parking by vehicles no larger than full-size passenger automobiles or pick-up trucks, herein called “Permitted Size Vehicles.” Vehicles other than Permitted Size Vehicles shall be parked and loaded or unloaded as directed by Landlord in the Rules and Regulations issued by Landlord. Tenant shall not permit or allow any vehicles that belong to or are controlled by Tenant or Tenant’s employees, suppliers, shippers, customers, contractors or invitees to be loaded, unloaded, or parked in areas other than those designated by Landlord for such activities. If Tenant permits or allows use of the prohibited areas, then Landlord shall have the right, without notice, in addition to such other rights and remedies that it may have, to remove or tow away the vehicle involved and charge the cost to Tenant, which cost shall be immediately payable upon demand by Landlord.

3.     Term.

        3.1 Term . The Commencement Date, Expiration Date and Primary Lease Term of this Lease are as specified in Section 1.5.

        3.2 Delivery Date. If a Delivery Date is specified in Section 1.6 and if Tenant totally or partially occupies the Premises after the Delivery Date but prior to the Commencement Date, the obligation to pay Base Rent shall be abated for the period of such early occupancy. All other terms of this Lease, however (including but not limited to the obligations to pay Tenant’s Share of Common Area Operating Expenses and to carry the insurance required in the Lease) shall be in effect during such period.

        3.3 Delay in Possession. If for any reason Landlord cannot deliver possession of the Premises to Tenant by the Estimated Delivery Date, if one is specified in Section 1.6, or if no Delivery Date is specified, by the Commencement Date, Landlord shall not be subject to any liability therefor, nor shall such failure affect the validity of this Lease, or the obligations of Tenant hereunder, or extend the Primary Lease Term hereof; but in such case, Tenant shall not, except as otherwise provided herein, be obligated to pay Base Rent or perform any other obligation of Tenant under the terms of this Lease until Landlord delivers possession of the Premises to Tenant. The delay of said date shall be in full satisfaction of any claims Tenant might otherwise have as a result of such delay. In order to place in writing the exact Commencement Date and Expiration Date of the Lease, the parties agree to execute a supplemental agreement to become a part hereof setting forth such dates as determined under the provisions of this Section 3.3.

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        3.4 Lease Year. “Lease Year” as used in this Lease shall be defined as each twelve (12) month period beginning with the Commencement Date or any anniversary thereof and ending on the immediately preceding day one year later.

4 .     Rent.

        4.1 Base Rent . Tenant shall pay Base Rent and other rent or charges, as the same may be adjusted from time to time, to Landlord in lawful money of the United States, without offset or deduction on or before the day on which it is due under the terms of this Lease. Base Rent and all other rent and charges for the period during the term hereof which is for less than one full month shall be prorated based upon the actual number of days of the month involved. Payment of Base Rent and other charges shall be made to Landlord at its address stated herein or to such other persons or at such other addresses as Landlord may from time to time designate in writing to Tenant.

        4.2 Property Taxes, Insurance and Management Fees . Tenant shall pay to Landlord during the term hereof, in addition to the Base Rent, Tenant’s Share (as specified in Section 1.9) of all Property Taxes, Insurance and Management Fees, as hereinafter defined, during each calendar year of the Primary Lease Term, in accordance with the following provisions:

 

        (a)        “Property Taxes, Insurance and Management Fees” are defined, for purposes of this Lease, as the insurance premiums and Real Property Taxes paid for by Landlord and to be reimbursed by Tenant pursuant to Sections 9 and 11 hereof (collectively, the “Property Taxes and Insurance”), and a property management fee equal to the amounts set forth in Section 1.7.



 

        (b)        Tenant’s Share of Property Taxes and Insurance shall be payable by Tenant within ten (10) days after a reasonably detailed statement of actual expenses is presented to Tenant by Landlord. Management Fees shall be paid monthly, in advance, in accordance with the table set forth in Section 1.7. At Landlord’s option, however, an amount may be estimated by Landlord from time to time of Tenant’s Share of annual Property Taxes and Insurance and the same shall be payable monthly, as Landlord shall designate, during each calendar year on the same day as the Base Rent is due hereunder. If during any particular calendar year, there is a change in the information on which Landlord based the estimate upon which Tenant is then making its estimated Property Tax, and Insurance payments so that such estimate furnished to Tenant is no longer accurate, Landlord shall be permitted to revise such estimate from time to time (but no more than twice in any calendar year) by notifying Tenant and there shall be such adjustments made in the monthly amount of Tenant’s Share on the first day of the month following the serving of such statement to Tenant. Landlord shall deliver to Tenant after the expiration of each calendar year a reasonably detailed statement showing Tenant’s Share of the actual Property Taxes and Insurance incurred during the preceding year. If Tenant’s payments under this Section 4.2(b) during said preceding calendar year exceed Tenant’s Share as indicated on said statement, Tenant shall be credited the amount of such overpayment against Tenant’s Share of Property Taxes and Insurance next becoming due. If Tenant’s payments under this Section 4.2(b) during said preceding year were less than Tenant’s Share as indicated on said statement, Tenant shall pay to Landlord the amount of the deficiency within thirty (30) days after delivery by Landlord to Tenant of said statement. Landlord’s failure to deliver statement of Tenant’s share within one hundred and twenty (120) days shall not relieve Tenant of the obligation to pay sums otherwise due. Tenant’s obligation to pay Tenant’s Share of Property Taxes, Insurance and Management Fees shall survive the expiration or termination of the Lease or the early termination of Tenant’s right to occupy the Premises.



 

        (c)        Tenant shall have the right to review Landlord’s books and records relating to Property Taxes, Insurance and Management Fees. Tenant shall conduct such review at its own expense and shall perform such review in a manner that does not unreasonably interfere with the conduct of Landlord’s business. In the event that such review reveals that Tenant’s Share of Property Taxes, Insurance and Management Fees has been overstated, Landlord shall promptly reimburse to Tenant the amount of such overpayment within ten (10) days after notice thereof from Tenant to Landlord. In addition, if any such review reveals that Tenant’s Share of Property Taxes, Insurance and Management Fees were misstated by three percent (3%) or more, Landlord shall reimburse Tenant for the cost of Tenant’s review within ten (10) days after receipt of written demand from Tenant.



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5.      Security Deposit. Upon the earlier to occur of: (i) the Commencement Date and (ii) November 18, 2005, Tenant shall deposit with Landlord the Security Deposit set forth in Section 1.10 as security for Tenant’s faithful performance of Tenant’s obligations under this Lease. Upon the occurrence of an Event of Default, Landlord may use, apply or retain all or any portion of said Security Deposit for the payment of any amount due Landlord or to reimburse or compensate Landlord for any liability, cost, expense, loss or damage (including attorneys’ fees) which Landlord may suffer or incur by reason thereof. If Landlord uses or applies all or any portion of said Security Deposit, Tenant shall within ten (10) days after written request therefore deposit monies with Landlord sufficient to restore said Security Deposit to the full amount required by this Lease. Landlord shall not be required to keep all or any part of the Security Deposit separate from its general accounts. Landlord shall, within sixty (60) days after the expiration of the Primary Lease Term hereof and after Tenant has vacated the Premises, return to Tenant (or, at Landlord’s option, to the last assignee, if any, of Tenant’s interest herein), that portion of the Security Deposit not used by Landlord to return the Premises to its original condition (normal wear and tear excluded) at the termination of Lease , or applied by Landlord. No part of the Security Deposit shall be considered to be held in trust, to bear interest or other increment for its use, or to be prepayment for any monies to be paid by Tenant under this Lease. At Landlord’s election, Landlord may elect to have the Security Deposit held by Landlord’s manager in a separate security deposit, trust, trustee or escrow account established and maintained by such manager with respect to certain security deposits of tenants within the Building Complex. Unless Tenant is so notified, (i) Landlord will hold the Security Deposit and be responsible for its return; and (ii) Tenant may request return of the Security Deposit by giving Landlord written notice in accordance with the provisions of the Lease, and Landlord’s manager, if any, agrees that in the event of a dispute over the ownership of the Security Deposit, the manager will not wrongfully withhold Landlord’s true name and current mailing address from Tenant. Landlord may deliver the funds deposited herein by Tenant to the purchaser of Landlord’s interest in the Premises in the event such interest be sold, provide Tenant the name and address of the transferee and thereupon, Landlord shall be discharged from further liability with respect to such deposit. If the claims of Landlord exceed said Security Deposit, Tenant shall remain liable for the balance of such claims.

6.     Use .

        6.1 Permitted Use .

 

        (a)                Tenant shall use and occupy the Premises only for the Permitted Use set forth in Section 1.11 and for no other purpose. Tenant shall not use or permit the use of the Premises in a manner that is unlawful, creates waste or a nuisance, or that disturbs owners and/or occupants of, or causes damage to the Premises or neighboring premises or properties.



 

        (b)                Landlord hereby agrees to not unreasonably withhold or delay its consent to any written request by Tenant, Tenant’s assignees or subtenants, and by prospective assignees and subtenants of Tenant, its assignees and subtenants, for a modification of said Permitted Use so long as the same will not impair the structural integrity of the improvements on the Premises or in the Building or the mechanical or electrical systems therein does not conflict with uses by other tenants, is not significantly more burdensome to the Premises or the Building and the improvements thereon, and is otherwise permissible pursuant to this Section 6. If Landlord elects to withhold such consent, Landlord shall within five (5) business days after such request give a written notification of same, which notice shall include an explanation of Landlord’s reasonable objections to the change in use.



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7.     Hazardous Substances .

        7.1 Consent. The term “Hazardous Substance” as used in this Lease shall mean any product, substance, chemical, material or waste whose presence, nature, quantity and/or intensity of existence, use, manufacture, disposal, transportation, spill, release or effect, either by itself or in combination with other materials expected to be on the Premises, is either: (i) potentially injurious to the public health, safety or welfare, the environment, or the Premises; (ii) regulated or monitored by any governmental authority; or (iii) a basis for potential liability of Landlord to any governmental agency or third party under any applicable statute or common law theory. Hazardous Substance shall include, but not be limited to hydrocarbons, petroleum gasoline, crude oil or any products or by-products thereof. Tenant shall not engage in any activity in or about the Premises which constitutes a Reportable Use (as hereinafter defined) of Hazardous Substances without the express prior written consent of Landlord and compliance in a timely manner (at Tenant’s sole cost and expense) with all Applicable Requirements (as defined in Section 7.4). “Reportable Use” shall mean (i) the installation or use of any above or below ground storage tank; (ii) the generation, possession, storage, use, transportation, or disposal of a Hazardous Substance that requires a permit from, or with respect to which a report, notice, registration or business plan is required to be filed with, any governmental authority; and (iii) the presence in, on or about the Premises of a Hazardous Substance with respect to which any Applicable Laws require that a notice be given to persons entering or occupying the Premises or neighboring properties. Notwithstanding the foregoing, Tenant may, without Landlord’s prior consent but upon notice to Landlord and in compliance with all Applicable Requirements, use any ordinary and customary materials reasonably required to be used by Tenant in the normal course of the Permitted Use, so long as such use is not a Reportable Use and does not expose the Premises or neighboring properties to any meaningful risk of contamination or damage or expose Landlord to any liability therefor. In addition, Landlord may (but without any obligation to do so) condition its consent to any Reportable Use of any Hazardous Substance by Tenant upon Tenant’s giving Landlord such additional assurances as Landlord, in its reasonable discretion, deems necessary to protect itself, the public, the Premises and the environment against damage, contamination or injury and/or liability therefor including but not limited to the installation (and, at Landlord’s option, removal on or before Lease expiration or earlier termination or the early termination of Tenant’s right to occupy the Premises) of reasonably necessary protective modifications to the Premises (such as concrete encasements) and/or the deposit of an additional Security Deposit under Section 5.

        7.2 Duty to Inform Landlord. If Tenant knows, or has reasonable cause to believe, that a Hazardous Substance has come to be located in, on, under or about the Premises or the Building, other than as previously consented to by Landlord, Tenant shall immediately give Landlord written notice thereof, together with a copy of any statement, report, notice, registration, application, permit, business plan, license, claim, action, or proceeding given to, or received from, any governmental authority or private party concerning the presence, spill, release, discharge of, or exposure to, such Hazardous Substance including but not limited to all such documents as may be involved in any Reportable Use involving the Premises. Tenant shall not cause or knowingly permit any Hazardous Substance to be spilled or released in, on, under or about the Premises (including, without limitation, through the plumbing or sanitary sewer system).

        7.3 Indemnification. Tenant shall indemnify, protect, defend and hold Landlord, its managers, members, officers, directors, agents, employees, lenders and ground Landlord, if any, and the Premises, harmless from and against any and all damages, liabilities, judgments, costs, claims, liens, expenses, penalties, loss of permits and reasonable attorneys’ and consultants’ fees arising out of or involving any Hazardous Substance brought onto the Premises by or for Tenant or by anyone under Tenant’s control. Tenant’s obligations under this Section 7.3 shall include, but not be limited to, the effects of any contamination or injury to any person, property or the environment created or suffered by Tenant, and the cost of investigation (including reasonable consultants’ and attorneys’ fees and testing), removal, remediation, restoration and/or abatement thereof, or of any contamination therein involved, and shall survive the expiration or earlier termination of this Lease or the early termination of Tenant’s right to occupy the Premises. No termination, cancellation or release agreement entered into by Landlord and Tenant shall release Tenant from its obligations under this Lease with respect to Hazardous Substances, unless specifically so agreed by Landlord in writing at the time of such agreement. The indemnification set forth above shall survive the expiration or termination of this Lease or the early termination of Tenant’s right to occupy the Premises.

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        7.4 Tenant’s Compliance with Requirements. Tenant shall at Tenant’s sole cost and expense, fully, diligently and in a timely manner, comply with all “Applicable Requirements,” which term is used in this Lease to mean all laws, rules, regulations, ordinances, directives, covenants, easements and restrictions of record, permits, the requirements of any applicable fire insurance underwriter or rating bureau, relating to Tenant’s use of the Premises (including but not limited to matters pertaining to (i) industrial hygiene, (ii) environmental conditions on, in, under or about the Premises, including soil and groundwater conditions; and (iii) the use, generation, manufacture, production, installation, maintenance, removal, transportation, storage, spill, or release of any Hazardous Substance), now in effect or which may hereafter come into effect. Tenant shall immediately upon receipt, notify Landlord in writing (with copies of any documents involved) of any threatened or actual claim, notice, citation, warning, complaint or report pertaining to or involving failure by Tenant or the Premises to comply with any Applicable Requirements.

        7.5 Inspection. Landlord, Landlord’s agents, employees, contractors and designated representatives, and the holders of any mortgages, deeds of trust or ground leases on the Premises (“Lenders”) shall have the right to enter the Premises at any time in the case of an emergency, and otherwise at reasonable times and upon at least twenty-four (48) hours advance notice, for the purpose of inspecting the condition of the Premises and for verifying compliance by Tenant with this Lease and all Applicable Requirements, and Landlord shall be entitled to employ experts and/or consultants in connection therewith to advise Landlord with respect to Tenant’s activities, including but not limited to Tenant’s installation, operation, use, monitoring, maintenance, or removal of any Hazardous Substance on or from the Premises. The costs and expenses of any such inspections shall be paid by the party requesting same, unless a Default of this Lease by Tenant or a violation of Applicable Requirements or a contamination, caused or materially contributed to by Tenant, is found to exist or to be imminent, or unless the inspection is requested or ordered by a governmental authority as the result of any such existing or imminent violation or contamination. In such case, Tenant shall upon request reimburse Landlord or Landlord’s Lender, as the case may be, for the costs and expenses of such inspections.

8 .     Maintenance, Repairs, Utility Installations, Trade Fixtures and Alterations.

        8.1 By Tenant.

 

        (a)        Subject to the provisions of Sections 10 and 15, Tenant shall, at Tenant’s sole cost and expense and at all times, keep the Premises and Building Complex and every part thereof in good order, condition and repair (whether or not such portion of the Premises requiring repair, or the means of repairing the same, are reasonably or readily accessible to Tenant, and whether or not the need for such repairs occurs as a result of Tenant’s use, any prior use, the elements or the age of such portion of the Premises), including, without limiting the generality of the foregoing, all equipment or facilities specifically serving the Premises; whether or not the equipment or facilities are located within the Premises, such as such as plumbing, heating, air conditioning and ventilating system, electrical lighting facilities, boilers, fired or unfired pressure vessels, fire hose connections if within the Premises, fixtures, interior walls, interior surfaces of exterior walls, ceilings, floors, windows, doors serving the Premises, including overhead doors, dock bumpers, dock pads, dock levelers, plate glass, skylights, landscaping, parking lots, snowplowing, walkways and fire systems. Tenant, in keeping the Premises and Building Complex in good order, condition and repair, shall exercise and perform good maintenance practices. Tenant’s obligations shall include restorations, replacements or renewals when necessary to keep the Premises and Building Complex and all improvements thereon or a part thereof in good order, condition and state of repair. Tenant shall be responsible for trash removal.



 

        (b)        Tenant shall, at Tenant’s sole cost and expense, procure and maintain a contract, with copies to Landlord, customary form and substance for and with a contractor specializing and experienced in the inspection, maintenance and service of the heating, air conditioning and ventilation system for the Premises. However, Landlord reserves the right, upon notice to Tenant, to procure and maintain the preventative maintenance contract for the heating, air conditioning and ventilating systems, and if Landlord so elects, Tenant shall reimburse Landlord, upon demand, for the cost thereof.



 

        (c)        If Tenant fails to perform Tenant’s obligations under this Section 8.1, Landlord may enter upon the Premises after twenty (20) days prior written notice to Tenant (except in the case of an emergency, in which case no notice shall be required), perform such obligations on Tenant’s behalf, and put the Premises in good order, condition and repair.



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        8.2 By Landlord . Intentionally left blank.

        8.3 Utility Installations, Trade Fixtures, Alterations.

 

        (a)        Definitions, Consent Required . The term “Utility Installations” is used in this Lease to refer to all air lines, power panels, electrical distribution, security, fire protection systems, communications systems, lighting fixtures, heating, ventilating and air conditioning equipment, plumbing, and fencing in, on, or about the Premises. The term “Trade Fixtures” shall mean Tenant’s machinery and equipment which can be removed without doing material damage to the Premises. The term “Alterations” shall mean any modification of the improvements on the Premises which are provided by Landlord under the terms of this Lease, other than Utility Installations or Trade Fixtures. “Tenant-Owned Alterations and/or Utility Installations” are defined as Alterations and/or Utility Installations made by Tenant that are not yet owned by Landlord pursuant to Section 8.4(a). Tenant shall not make nor cause to be made any Alterations or Utility Installations in, on, under or about the Premises without Landlord’s prior written consent. Tenant may, however, make non-structural Utility Installations to the interior of the Premises (excluding the roof) without Landlord’s consent but upon notice to Landlord, so long as they are not visible from the outside of the Premises, do not involve puncturing, relocating or removing the roof or any existing walls or changing or interfering with the fire sprinkler or fire detection systems and the cumulative cost thereof during the term of this Lease as extended does not exceed Two Thousand Five Hundred Dollars ($2,500.00.)



 

        (b)        Consent. Any Alterations or Utility Installations that Tenant shall desire to make and which require the consent of the Landlord shall be presented to Landlord in written form with detailed plans. All consents given by Landlord, whether by virtue of Section 8.3(a) or by subsequent specific consent, shall be deemed conditioned upon: (i) Tenant acquiring all applicable permits required by governmental authorities; (ii) the furnishing of copies of such permits together with a copy of the plans and specifications for the Alteration or Utility Installation to Landlord prior to commencement of the work thereon; and (iii) the compliance by Tenant with all conditions of said permits in a prompt and expeditious manner. Any Alterations or Utility Installations by Tenant during the Primary Lease Term shall be done in a good and workmanlike manner, with good and sufficient materials, and be in compliance with all Applicable Requirements. Tenant shall promptly upon completion thereof furnish Landlord with as-built plans and specifications therefor. Landlord may, (but without obligation to do so) condition its consent to any requested Alteration or Utility Installation that costs Two Thousand Five Hundred Dollars ($2,500.00) or more upon Tenant providing Landlord with a lien and completion bond in an amount equal to one and one-half times the estimated cost of such Alteration or Utility Installation.



 

        (c)        Lien Protection. Tenant shall pay when due all claims for labor or materials furnished or alleged to have been furnished to or for Tenant at or for use on the Premises, which claims are or may be secured by any mechanic’s or materialmen’s lien against the Premises or any interest therein. Tenant shall give Landlord not less than ten (10) days’ notice prior to the commencement of any work in, on, or about the Premises, and Landlord shall have the right to post notices of non-responsibility in or on the Premises as provided by law. If Tenant shall, in good faith, contest the validity of any such lien, claim or demand, then Tenant shall, at its sole expense, defend and protect itself, Landlord and the Premises against the same and shall pay and satisfy any such adverse judgment that may be rendered thereon before the enforcement thereof against the Landlord or the Premises. If Landlord shall require, Tenant shall furnish to Landlord a surety bond satisfactory to Landlord in an amount equal to one and one-half times the amount of such contested lien, claim or demand, indemnifying Landlord against liability for the same, as required by law for the holding of the Premises free from the effect of such lien or claim. In addition, Landlord may require Tenant to pay Landlord’s attorneys’ fees and costs in participating in such action if Landlord shall decide it is to its best interest to do so.



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8.4      Ownership, Removal, Surrender, and Restoration.

 

        (a)        Ownership. Subject to Landlord’s right to require their removal and to cause Tenant to become the owner thereof as hereinafter provided in this Section 8.4, all Alterations and Utility Installations made to the Premises by Tenant shall be the property of and owned by Tenant, but considered a part of the Premises. Landlord may, at any time and at its option, elect in writing to Tenant to be the owner of all or any specified part of the Tenant-Owned Alterations and Utility Installations. Unless otherwise instructed per Section 8.4(b) hereof, all Tenant-Owned Alterations and Utility Installations shall, at the expiration or earlier termination of this Lease or the early termination of Tenant’s right to occupy the Premises, become the property of Landlord and remain upon the Premises and be surrendered with the Premises by Tenant.



 

        (b)        Removal. Unless otherwise agreed in writing, and except for any Tenant-Owned Alterations or Utility Installations which are part of the Premises as of the Commencement Date, Landlord may require that any or all Tenant-Owned Alterations or Utility Installations be removed by the expiration or earlier termination of this Lease or at the early termination of Tenant’s right to occupy the Premises, notwithstanding that their installation may have been consented to by Landlord. Landlord may require the removal at any time of all or any part of any Alterations or Utility Installations made without the required consent of Landlord.



 

        (c)        Surrender/Restoration. Subject to the provisions of Sections of 8.2, 8.4(b), 10 and 15, Tenant shall surrender the Premises by the end of the last day of the Primary Lease Term or any earlier termination date, clean and free of debris and in good operating order, condition and state of repair, ordinary wear and tear excepted per the requirements of Exhibit D attached hereto and incorporated herein by reference. Ordinary wear and tear shall not include any damage or deterioration that would have been prevented by good maintenance practice or by Tenant performing all of its obligations under this Lease. Except as otherwise agreed or specified herein, the Premises, as surrendered, shall include the Alterations and Utility Installations. The obligation of Tenant shall include the repair of any damage occasioned by the installation, maintenance or removal of Tenant’s Trade Fixtures, furnishings, equipment, and Tenant-Owned Alterations and Utility Installations, as well as the removal of any storage tank installed by or for Tenant, and the removal, replacement, or remediation of any soil, material or ground water contaminated by Tenant, all as may then be required by Applicable Requirements and/or good practice. Tenant’s Trade Fixtures shall remain the property of Tenant and shall be removed by Tenant subject to its obligation to repair and restore the Premises per this Lease. Any Trade Fixtures, Alterations and/or Utility Installations not removed upon the expiration of this Lease or upon the early termination of Tenant’s right to occupy the Premises shall be deemed abandoned and may be disposed of by Landlord, as Landlord may determine appropriate, without further notice to Tenant. Tenant shall pay Landlord all expenses incurred in connection with such items including, but not limited to, the costs of repairing any damage to the Premises caused by removal of such items. Tenant’s obligation hereunder shall survive the expiration or other termination of the Lease or the early termination of Tenant’s right to occupy the Premises.



9.     Insurance; Indemnity .

        9.1 Payment of Premiums . The cost of the premiums for the insurance policies maintained by Landlord under this Section 9 shall be a Common Area Operating Expense pursuant to Section 4.2 hereof. Premiums for policy periods commencing prior to, or extending beyond, the term of this Lease shall be prorated to coincide with the corresponding Commencement Date or Expiration Date.

        9.2 Liability Insurance.

 

        (a)        Carried by Tenant. Tenant shall obtain and keep in force during the Primary Lease Term a Commercial General Liability policy of insurance protecting Tenant, Landlord and any Lender(s) whose names have been provided to Tenant in writing (as additional insureds) against claims for bodily injury, personal injury and property damage based upon, involving or arising out of the ownership, use, occupancy or maintenance of the Premises and all areas appurtenant thereto. Such insurance shall be on an occurrence basis providing single limit coverage in an amount not less than Three Million Dollars ($3,000,000) per occurrence with an “Additional Insured-Managers or Landlords of Premises” endorsement and contain the “Amendment at the Pollution Exclusion” endorsement for damage caused by heat, smoke or fumes from a hostile fire. The policy shall not contain any intra-insured exclusions as between insured persons or organizations, but shall include coverage for liability assumed under this Lease as an “insured contract” for the performance of Tenant’s indemnity obligations under this Lease. The limits of said insurance required by this Lease or as carried by Tenant shall not, however, limit the liability of Tenant nor relieve Tenant of any obligation hereunder. All insurance to be carried by Tenant shall be primary to and not contributory with any similar insurance carried by Landlord, whose insurance shall be considered excess insurance only. In addition, Tenant shall maintain workers’ compensation insurance as is required by state law.



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        (b)        Carried By Landlord. Subject to reimbursement of premiums as described in Section 9.1, Landlord shall also maintain liability insurance described in Section 9.2(a) above, in addition to and not in lieu of, the insurance required to be maintained by Tenant. Tenant shall not be named as an additional insured therein.


        9.3 Property Insurance. Subject to reimbursement of premiums as described in Section 9.1, Landlord shall maintain property damage insurance on such portions of the Building Complex from time to time which Landlord has the obligation to maintain and repair under this Lease, above foundation walls, insuring against loss or damage by fire or other casualty covered by a so-called “special form” policy, in such amounts, and from companies and on such terms and conditions as Landlord reasonably deems appropriate from time to time. Tenant-Owned Alterations and Utility Installations, Trade Fixtures and Tenant’s personal property shall be insured by Tenant pursuant to Section 9.4. Landlord may also obtain and keep in force during the Primary Lease Term a policy or policies in the name of Landlord, with loss payable to Landlord and any Lender(s), insuring the loss of the full rental and other charges payable by all tenants of the Building to Landlord for one year (including all Real Property Taxes, insurance costs, all Common Area Operating Expenses and any scheduled rental increases). Tenant shall pay for any increase in the premiums for the property insurance of the Building and for the Common Areas or other buildings in the Building Complex if said increase is caused by Tenant’s acts, omissions, use or occupancy of the Premises.

        9.4 Tenant’s Property Insurance.  Subject to the requirements of Section 9.5, Tenant at its cost shall either by separate policy or, at Landlord’s option, by endorsement to a policy already carried, maintain insurance coverage on all of Tenant’s personal property, Trade Fixtures and Tenant Owned Alterations and Utility Installations in, on, or about the Premises similar in coverage to that carried by Landlord as the insuring party under Section 9.3.  Such insurance shall be full replacement cost coverage.  The proceeds from any such insurance shall be used by Tenant for the replacement of personal property and the restoration of Trade Fixtures and Tenant Owned Alterations and Utility Installations.  Upon request from Landlord, Tenant shall provide Landlord with written evidence that such insurance is in force.  Tenant shall not do or permit to be done anything which shall invalidate the insurance policies referred to in this Section 9.  Tenant shall cause to be delivered to Landlord, within seven (7) days after the earlier of the Delivery Date or the Commencement Date evidence of the existence and amounts of, the insurance required under Section 9.2(a) and 9.4.  No such policy shall be cancelable or subject to modification except after thirty (30) days’ prior written notice to Landlord.  Tenant shall at least thirty (30) days prior to the expiration of such policies, furnish Landlord with evidence of renewals or “insurance binders” evidencing renewal thereof, or Landlord may order such insurance and charge the cost thereof to Tenant, which amount shall be payable by Tenant to Landlord upon demand.

        9.5 Waiver. Tenant and Landlord each hereby release and relieve the other, and waive their entire right to recover damages (whether in contract or in tort) against the other, for loss or damage to their property or for any business interruption arising out of or incident to the perils to the extent such loss or damage or business interruption is coverable by a standard or special form policy regardless of whether such insurance is carried or not, or if so carried, payable to or protects Landlord or Tenant or both. The effect of such releases and waivers of the right to recover damages shall not be limited by the amount of insurance carried or required, or by any deductibles applicable thereto. Landlord and Tenant agree to have their respective insurance companies issuing property damage insurance waive any right to subrogation that such companies may have against Landlord or Tenant, as the case may be, so long as the insurance is not invalidated thereby.

        9.6 Indemnity . Except for Landlord's willful misconduct or gross negligence, Tenant shall indemnify, protect, defend and hold harmless the Premises, Landlord and its agents, employees, Landlord’s master or ground Landlord, members, partners and Lenders, from and against any and all claims, loss of rents and/or damages, costs, liens, judgments, penalties, loss of permits, attorneys’ and consultants’ fees, expenses and/or liabilities arising out of, involving, or in connection with, the occupancy of the Premises by Tenant, the conduct of Tenant’s business, any act, omission or neglect of Tenant, its agents, contractors, employees or invitees, and out of any Default or breach by Tenant in the performance in a timely manner of any obligation on Tenant’s part to be performed under this Lease. The foregoing shall include, but not be limited to, the defense or pursuit of any claim or any action or proceeding involved therein, and whether or not (in the case of claims made against Landlord) litigated and/or reduced to judgment. In case any action or proceeding be brought against Landlord by reason of any of the foregoing matters, Tenant upon notice from Landlord shall defend the same at Tenant’s expense by counsel reasonably satisfactory to Landlord and Landlord shall cooperate with Tenant in such defense. Landlord need not have first paid any such claim in order to be so indemnified. The provisions of this Section shall survive the expiration or termination of this Lease or the early termination of Tenant’s right to occupy the Premises.

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        9.7 Exemption of Landlord from Liability. Except for matters arising from Landlord’s willful misconduct or gross negligence, Landlord shall not be liable for injury or damage to the person or goods, wares, merchandise or other property of Tenant, Tenant’s employees, contractors, invitees, customers, or any other person in or about the Premises, whether such damage or injury is caused by or results from fire, steam, electricity, gas, water or rain or from the breakage, leakage, obstruction or other defects of pipes, fire sprinklers, wires, appliances, plumbing, air conditioning or lighting fixtures, or from any other cause, whether said injury or damage results from conditions arising upon the Premises or upon other portions of the Building of which the Premises are a part, from other sources or places, and regardless of whether the cause of such damage or injury or the means of repairing the same is accessible or not. Landlord shall not be liable for any damages arising from any act or neglect of any other tenant of Landlord nor from the failure by Landlord to enforce the provisions of any other lease in the Building Complex. Notwithstanding Landlord’s negligence or breach of this Lease, Landlord shall under no circumstances be liable for injury to Tenant’s business or for any loss of income or profit therefrom, or for any consequential damages of Tenant. Notwithstanding anything to the contrary contained herein, Landlord’s liability under this Lease shall be limited to its interest in the Building Complex.

10.     Damage or Destruction .

        10.1 Total Damage. If the Premises or the Building shall be so damaged by fire or other casualty as to render the Premises wholly untenantable and if such damage shall be so great that a competent architect, in good standing, selected by Landlord shall certify in writing to Landlord and Tenant withi


 
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