Exhibit 10.14
STANDARD FORM
INDUSTRIAL BUILDING
LEASE
(MULTI-TENANT)
1.
BASIC TERMS.
This Section 1 contains the Basic Terms of
this Lease between Landlord and Tenant, named below. Other
Sections of the Lease referred to in this Section 1 explain and define the
Basic Terms and are to be read in conjunction with the Basic
Terms.
1.1.
Date of
Lease: March 21, 2003
1.2.
Landlord: First
Industrial LP
1.3.
Tenant: The Wornick
Company
1.4.
Premises:
“ Phase I
Premises ” consisting of
approximately 25,336 square feet designated as the “Tenant
8” space on Exhibit A-2 attached hereto, together with
approximately 3,240 square feet designated as the “Tenant
2” space on Exhibit A-2 to be used by Tenant for office and
employee welfare, containing a total of approximately 28,576 square
feet; the “ Phase II Premises ” containing
approximately 31,740 square feet as shown on Exhibit A-2 attached
hereto; and the “ Phase III Premises ” containing
approximately 100,621 square feet as shown on Exhibit A-2 attached
hereto, totaling 160,937 square feet, in the building commonly
known as the Creek Road Business Park, 4700-4750 Creek Road,
Cincinnati, OH 45242 (the “ Building ”). As used in
this Lease, the term “Premises,” when the context so
requires, means whatever portion of the Phase I Premises, Phase II
Premises, and Phase III Premises is being leased by Tenant
hereunder from time to time.
Landlord shall complete
the Phase I Improvements, Phase II Improvements, and Phase III
Improvements (as described on Exhibit B attached hereto) prior to
the Phase I Premises Commencement Date, Phase II Premises
Commencement Date and, Phase III Premises Commencement Date,
respectively. Landlord shall also complete the Additional
Improvements (as described on Exhibit B) to the Phase I Premises,
Phase II Premises, and Phase III Premises prior to the Phase I
Premises Commencement Date, Phase II Premises Commencement Date,
Phase III Premises Commencement Date, respectively.
Nitrogen Tanks:
Beginning on the Phase III Premises Commencement Date and
continuing thereafter during the Term of this Lease, Tenant shall
be permitted to install, store and use for its business purposes
two nitrogen tanks on the west end or in the rear of the Building
in a location mutually agreed upon by Landlord and Tenant but in
any event sufficiently close to the Premises that the same are
practically and economically useable in the business of Tenant
being conducted on the Premises.
Parking Spaces:
During all periods in which Tenant is leasing the Phase I Premises,
Landlord shall provide Tenant with 60 allocated parking spaces at
the Building. During all periods in which Tenant is leasing
the Phase I Premises and Phase II Premises, Landlord shall provide
Tenant with 90 allocated parking spaces at the Building.
During all periods in which Tenant is leasing the Phase I Premises,
Phase II Premises and Phase III Premises, Landlord shall provide
Tenant with 275 allocated parking spaces at the Building.
During all periods in which Tenant is leasing only the Phase I
Premises and Phase III Premises, Landlord shall provide Tenant with
225 allocated parking spaces at the Building. If Tenant
leases Adjacent Space pursuant to Rider No. 3 attached hereto,
Landlord shall provide Tenant with the allocated parking spaces
associated with each of the Adjacent Spaces leased, as outlined on
the attached Exhibit A-2.
Sears Termination
Fee: Landlord and Tenant acknowledge that the Phase II
Premises and Phase III Premises are presently leased to Sears and
that Landlord is in the process of negotiating an early termination
of Sears’ lease of such space, including a fee to be paid by
Sears in consideration for such early termination (the “
Termination Fee
”). At such time as Landlord has received payment from
Sears of the full amount of the Termination Fee and Sears has
vacated such premises, net of any gross rents that Landlord was
scheduled to receive in 2003 from Sears for the Phase III Premises
prior to the Commencement Date for the lease of the Phase III
Premises to Tenant as outlined in Section 1.6, Landlord shall
pay Tenant 100% of the amount of the Termination Fee in excess of
$100,000.00 and up to $200,000.00, for a total of
$100,000.00. Landlord and Tenant shall each receive 50% of
any Termination Fee amount in excess of $200,000.00.
1.5.
Property: See
Exhibit A-1, A-2
.
1.6.
Lease
Term: Approximately five (5) years four (4) months
(“ Term ”), commencing, with
respect to the Phase I Premises, on
March , 2003 (the “
Phase I Premises
Commencement Date ”), and commencing,
with respect to the Phase II Premises, on the later of
March 1, 2004 or completion of the Phase II Improvements (the
“ Phase II
Premises Commencement Date ”), and commencing,
with respect to the Phase III Premises, on the later of
March 1, 2004 or completion of the Phase III Improvements (the
“ Phase III
Premises Commencement Date ”) and ending on
July 31, 2008 (“ Expiration Date ”). As used in
this Lease, the “Term” means the initial Term, as the
same may be extended pursuant to Tenant’s exercise of the
renewal option set forth on Rider No. 4 attached
hereto.
1.7.
Permitted Uses:
(See Section 4.1 ) Food storage, processing,
assembly, packaging, warehousing, distribution, office and employee
facilities (including dining areas and break rooms), and related
purposes.
1.8.
Tenant’s
Guarantor: None
1.9.
Brokers: (See
Section 23
)
(A)
Tenant’s Broker:
Colliers Turley Martin Tucker
(B)
Landlord’s
Broker: None
1.10.
Security/Damage
Deposit: Waived.
1.11.
Initial
Estimated Additional Rent Payable by Tenant: $0.70
psf/year
1.12.
Tenant’s Proportionate
Share: Subject to adjustment as hereafter set forth, the
parties hereto anticipate that the Tenant’s Proportionate
Share shall be 10.78% from and after the Phase I Premises
Commencement Date, 22.76% from and after the Phase II Premises
Commencement Date, and 60.73% from and after the Phase III Premises
Commencement Date; provided that Tenant’s Proportionate Share
shall be calculated by taking the rentable area of the Premises and
dividing it by the total rentable area of the Building (the total
rentable area of the Building being 265,000 sq. ft.).
1.13.
Riders
to Lease: The following riders are attached to and made a
part of this Lease. (If none, so state): Rider No. 1
(Cancellation Option); Rider No. 2 (Termination Option); Rider No.
3 (Expansion Rights); Rider No. 4 (Renewal Options).
2.
LEASE OF PREMISES;
RENT.
2.1.
Lease of Premises for
Lease Term. Landlord hereby
leases the Premises to Tenant, and Tenant hereby rents the Premises
from Landlord, for the Term and subject to the conditions of this
Lease.
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2.2.
Types of Rental
Payments. Tenant shall pay net
base rent to Landlord in monthly installments, in advance, on the
first day of each and every calendar month during the Term of this
Lease (the “ Base Rent ”) in the amounts and
for the periods set forth below for each of the Premises described
herein:
PHASE
1 PREMISES
(28,576 sq.
ft.)
|
Lease
Period
|
|
Annual
Base Rent
|
|
Monthly
Base Rent
|
|
Annual
Amt. PSF
|
|
|
|
|
|
|
|
|
|
|
|
3/16/03-3/31/04
|
|
$
|
65,724.80
|
|
$
|
5,477.07
|
|
$
|
2.30
|
|
|
|
|
|
|
|
|
|
|
|
4/1/04-3/31/05
|
|
$
|
71,440.00
|
|
$
|
5,953.33
|
|
$
|
2.50
|
|
|
|
|
|
|
|
|
|
|
|
4/1/05-3/31/06
|
|
$
|
77,155.20
|
|
$
|
6,429.60
|
|
$
|
2.70
|
|
|
|
|
|
|
|
|
|
|
|
4/1/06-3/31/07
|
|
$
|
82,870.40
|
|
$
|
6,905.87
|
|
$
|
2.90
|
|
|
|
|
|
|
|
|
|
|
|
4/1/07-7/31/08
|
|
$
|
88,585.60
|
|
$
|
7,382.13
|
|
$
|
3.10
|
|
PHASE
II PREMISES
(31,740 sq.
ft.)
|
Lease
Period
|
|
Annual
Base Rent
|
|
Monthly
Base Rent
|
|
Annual
Amt. PSF
|
|
|
|
|
|
|
|
|
|
|
|
Phase II Premises
Commencement Date – 4/30/06
|
|
$
|
88,872.00
|
|
$
|
7,406.00
|
|
$
|
2.80
|
|
|
|
|
|
|
|
|
|
|
|
5/1/06 –
7/31/08
|
|
$
|
95,220.00
|
|
$
|
7,935.00
|
|
$
|
3.00
|
|
PHASE
III PREMISES
(100,621 sq.
ft.)
|
Lease
Period
|
|
Annual
Base Rent
|
|
Monthly
Base Rent
|
|
Annual
Amt. PSF
|
|
|
|
|
|
|
|
|
|
|
|
Phase III Premises
Commencement Date – 7/31/04
|
|
$
|
276,707.76
|
|
$
|
23,058.98
|
|
$
|
2.75
|
|
|
|
|
|
|
|
|
|
|
|
8/1/04-7/31/05
|
|
$
|
281,738.76
|
|
$
|
23,478.23
|
|
$
|
2.80
|
|
|
|
|
|
|
|
|
|
|
|
8/1/05-7/31/06
|
|
$
|
286,769.88
|
|
$
|
23,897.49
|
|
$
|
2.85
|
|
|
|
|
|
|
|
|
|
|
|
8/1/06-7/31/07
|
|
$
|
291,800.88
|
|
$
|
24,316.74
|
|
$
|
2.90
|
|
|
|
|
|
|
|
|
|
|
|
8/1/07-7/31/08
|
|
$
|
296,832.00
|
|
$
|
24,735.00
|
|
$
|
2.95
|
|
Tenant shall also pay
Tenant’s Proportionate Share (as set forth in Section 1.12 ) of Operating
Expenses (as hereinafter defined) and any other amounts owed by
Tenant hereunder [collectively, “ Additional Rent ”]. In
the
3
event any monthly
installment of Base Rent or Additional Rent, or both, is not paid
within five (5) business days after Tenant’s receipt of
notice from Landlord that such payment is past due, Landlord may
charge Tenant a late charge equal to 4% of the then delinquent
installment of Base Rent and/or Additional Rent [the “
Late Charge ”;
the Late Charge, Default Interest (as defined in Section 22.3 below), Base Rent
and Additional Rent shall collectively be referred to as “
Rent ”) shall
be paid by Tenant to Landlord as Additional Rent. Tenant
shall pay Rent to Landlord at the following address: c/o First
Industrial, L.P., 75 Remittance Drive, Suite 1444, Chicago, IL
60675-1444, or if sent by overnight courier, Northern Trust Receipt
& Dispatch, 350 N. Orleans Street, 8th Floor, Suite 1444,
Chicago, IL 60654, Attention: First Industrial L.P., Lockbox
#1444, (or such other entity designated as Landlord’s
management agent, if any, and if Landlord so appoints such a
management agent, the “Agent” ), or pursuant
to such other directions as Landlord shall designate in this Lease
or otherwise in writing. The foregoing notwithstanding,
Tenant shall be entitled to receive notices from Landlord under
this paragraph on only the first occasion of nonpayment of Rent in
each calendar year and, on the second and each succeeding occasion
of nonpayment of Rent in such calendar year, Tenant shall not be
entitled to the above-described 5-business day written notice and
cure period and, thereafter during such calendar year, the Late
Charge shall be due in the event any monthly installment of Base
Rent or Additional Rent, or both, is not paid within 10 days of the
date when due.
2.3.
Covenants Concerning
Rental Payments. Tenant shall pay the
Rent promptly when due, without notice or demand, and without any
abatement, deduction or setoff, except as may otherwise be
expressly and specifically provided in this Lease. No payment
by Tenant, or receipt or acceptance by Agent or Landlord, of a
lesser amount than the correct Rent shall be deemed to be other
than a payment on account, nor shall any endorsement or statement
on any check or letter accompanying any payment be deemed an accord
or satisfaction, and Agent or Landlord may accept such payment
without prejudice to its right to recover the balance due or to
pursue any other remedy available to Landlord. If the
Commencement Date occurs on a day other than the first day of a
calendar month, the Rent due for the first calendar month of the
Term shall be prorated on a per diem basis and paid to Landlord on
the Commencement Date.
3.
OPERATING
EXPENSES.
3.1.
Definitional Terms
Relating to Additional Rent . For purposes of this
Section and other relevant provisions of the
Lease:
3.1.1.
Operating Expenses.
The term “ Operating Expenses ” shall mean all costs
and expenses paid or incurred with respect to the ownership,
repair, replacement, restoration, maintenance and operation of the
Property, including, without limitation, the following: (i)
services provided directly by employees of Landlord or Agent in
connection with the operation, maintenance or rendition of other
services to or for the Property; (ii) to the extent not separately
metered, billed, or furnished, all charges for utilities and
services furnished to either or both of the Property and the
Premises (including, without limitation, the Common Areas [as
hereinafter defined]), together with any taxes on such utilities;
(iii) all premiums for casualty, workers’ compensation,
liability, boiler, flood and all other types of insurance provided
by Landlord and relating to the Property, all third party
administrative costs incurred in connection with the procurement
and implementation of such insurance policies, and all deductibles
paid by Landlord pursuant to insurance policies required to be
maintained by Landlord under this Lease; (iv) the cost of all
supplies, tools, materials and equipment utilized in the ownership
and operation of the Property, and sales and other taxes thereon;
(v) amounts charged (including, without limitation, those costs and
expenses set forth in Section 13.2(i) below) by any or all
of contractors, materialmen and suppliers for services, materials
and supplies furnished to Landlord in connection with any or all of
the operation, repair and maintenance of any part of the Property,
including, without limitation, the structural elements of the
Property and the Common Areas; (vi) an annual management fee equal
to four percent (4%) of the annual Rent payable hereunder to
Landlord or Agent or other persons or management entities actually
involved in the management and operation of the Property; (vii) any
capital improvements made by, or on behalf of, Landlord to the
Property that are either or both (a) designed to reduce Operating
Expenses and (b) required to keep the Property in compliance with
all governmental laws, rules and regulations applicable thereto,
from time to time, the cost of which capital improvements shall be
reasonably amortized by Landlord over the useful life of the
improvement, in accordance with generally accepted accounting
principles; (viii) all professional fees incurred in connection
with the operation, management and maintenance of the Property; and
(ix) Taxes, as hereinafter defined in Section 3.1.2 . Notwithstanding the
definitions set forth in section 3.1.1 and section 3.1.2,
the definitions of Operating Expenses and Taxes shall exclude the
following: costs of services provided exclusively to other tenants
and not to Tenant; late
4
fees incurred by Landlord
for late payments of bills not due to the acts or omissions of
Tenant, its employees, agents or representatives; any cost or
expense which Landlord incurs which is charged directly to the
tenant on whose behalf it is incurred (whether or not the same
shall finally be paid) or for which Landlord is otherwise
reimbursed by insurance proceeds or condemnation awards; income,
profit, franchise, corporate, capital stock, estate, inheritance
and any other taxes imposed on, or measured by, the income of
Landlord from the operation of the Property; payments to
subsidiaries or affiliates of Landlord for services or materials to
the extent such payments would not have been made had the services
or materials been provided by an unaffiliated party on a
competitive basis; legal fees, arbitration and mediation expenses
and other expenses incurred in connection with the resolution of
disputes between Landlord and tenants at the Property; costs
arising from the negligence or willful misconduct of Landlord or
its agents, employees, contractors or other tenants or occupants at
the Property; costs arising from a breach by any other tenant of
its obligations under its lease; costs incurred in Landlord’s
leasing activities, including leasing fees, commissions and other
compensation paid to brokers or to Landlord’s employees and
agents, advertising costs, costs of renovations, tenant
improvements, or alterations made at the initiation or in
connection with the renewal of tenant leases, and legal fees
incurred in negotiating and preparing lease documents; salaries or
other compensation paid to employees of Landlord above the grade of
building manager; costs of capital improvements (except to the
extent expressly permitted under this Section 3.1.1 ); cost of correcting
defects in the original construction of the improvements at the
Property or related improvements; costs of remediating or otherwise
addressing environmental contamination at the property; interest
and principal payments on any mortgage, deed of trust or
indebtedness of Landlord; depreciation; payments made under any
ground lease; and construction and other costs related to any
addition to or expansion of improvements at the
Property.
3.1.2.
Taxes . The term
“ Taxes ,” as referred to
in Section 3.1.l(ix ) above shall mean (i)
all governmental taxes, assessments, fees and charges of every kind
or nature (other than Landlord’s income taxes), whether
general, special, ordinary or extraordinary, due at any time or
from time to time, during the Term and any extensions thereof, in
connection with the ownership, leasing, or operation of the
Property, or of the personal property and equipment located therein
or used in connection therewith; and (ii) any reasonable expenses
incurred by Landlord in contesting such taxes or assessments and/or
the assessed value of the Property. For purposes hereof,
Taxes for any year shall be Taxes that are due for payment or paid
in that year rather than Taxes that are assessed, become a lien, or
accrue during such year.
3.1.3.
Operating Year
.
The term “Operating Year” shall mean the calendar year
commencing January 1st of each year (including the calendar
year within which the Commencement Date occurs) during the
Term.
3.2.
Payment of Operating
Expenses. Tenant shall pay, as
Additional Rent and in accordance with the requirements of
Section 3.3
,
Tenant’s Proportionate Share of the Operating Expenses as set
forth in Section 3.3 . Additional Rent for
the Phase I Premises, Phase II Premises, and Phase III Premises
shall commence to accrue upon the Phase I Premises Commencement
Date, Phase II Premises Commencement Date, and Phase III Premises
Commencement Date, respectively. The Tenant’s
Proportionate Share of Operating Expenses payable hereunder for the
Operating Years in which the Term begins and ends shall be prorated
to correspond to that portion of said Operating Years occurring
within the Term. Tenant’s Proportionate Share of
Operating Expenses and any other sums due and payable under this
Lease shall be adjusted upon receipt of the actual bills therefor,
and the obligations of this Section 3 shall survive the
termination or expiration of the Lease.
3.3.
Payment of Additional
Rent. Landlord shall have the
right to reasonably estimate the Operating Expenses for each
Operating Year. Upon Landlord’s or Agent’s notice
to Tenant of such estimated amount, Tenant shall pay, on the first
day of each month during that Operating Year, an amount (the
“ Estimated
Additional Rent ” ) equal to the estimate of the
Tenant’s Proportionate Share of Operating Expenses divided by
12 (or the fractional portion of the Operating Year remaining at
the time Landlord delivers its notice of the estimated amounts due
from Tenant for that Operating Year). If the aggregate amount
of Estimated Additional Rent actually paid by Tenant during any
Operating Year is less than Tenant’s actual ultimate
liability for Operating Expenses for that particular Operating
Year, Tenant shall pay the deficiency within 30 days of
Landlord’s written demand therefor. If the aggregate
amount of Estimated Additional Rent actually paid by Tenant during
a given Operating Year exceeds Tenant’s actual liability for
such Operating Year, the excess shall be credited against the
Estimated Additional Rent next due from Tenant during the
immediately subsequent Operating Year, except that in the event
that such excess is paid by Tenant during the final Lease Year,
then upon the expiration of the Term, Landlord or
5
Agent shall pay Tenant the
then-applicable excess promptly after determination thereof.
No interest shall be payable to Tenant on account of payments of
Estimated Additional Rent and such payments may be
commingled.
Within one hundred
twenty (120) days after the end of each calendar year during the
Lease Term, Landlord shall furnish to Tenant (i) annual statements
itemizing the Operating Expenses for the year just ended, which
statements shall be reasonably detailed, prepared in the ordinary
course of Landlord’s business and certified by Landlord as
being true and complete, and (ii) Landlord’s calculations
showing Tenant’s Proportionate Share of the Operating
Expenses for such year. Upon thirty (30) days prior notice
and not more than once per year during the Lease Term, Tenant shall
have the right to inspect Landlord’s books and records for
the sole purpose of verifying the Operating Expenses and the
calculation of the Tenant’s Proportionate Share
thereof. If any such inspection reveals that Tenant was
overcharged and not otherwise properly reconciled pursuant to this
Section 3.3 ,
Landlord shall credit any such amounts to the next payment(s) of
Additional Rent becoming due or, in the final year, refund any such
excess amount charged to Tenant. Tenant agrees to maintain in
strict confidence any information Tenant obtains or reviews
pursuant to its inspections rights granted under this
Section 3.3
except that Tenant shall be permitted to disclose such information
to its attorneys and advisors, provided Tenant informs such parties
of the confidential nature of such information and uses good faith
and diligent efforts to cause such parties to maintain such
information as confidential.
4.
USE OF PREMISES AND COMMON
AREAS; SECURITY DEPOSIT.
4.1.
Use of Premises and
Property. The Premises shall be used
by the Tenant for the purpose(s) set forth in Section 1.7 above and for no other
purpose whatsoever. Tenant shall not, at any time, use or
occupy, or suffer or permit anyone to use or occupy, the Premises,
or do or permit anything to be done in the Premises or the
Property, in any manner that may (a) violate any Certificate of
Occupancy for the Premises or the Property; (b) cause, or be liable
to cause, injury to, or in any way impair the value or proper
utilization of, all or any portion of the Property (including, but
not limited to, the structural elements of the Property) or any
equipment, facilities or systems therein; (c) constitute a
violation of the laws and requirements of any public authority or
the requirements of insurance bodies or the rules and regulations
of the Property, including any covenant, condition or restriction
affecting the Property, (d) exceed the load bearing capacity of the
floor of the Premises; (e) impair or tend to impair the character,
reputation or appearance of the Property; or (e) unreasonably
annoy, inconvenience or disrupt the operations or tenancies of
other tenants or users of the Property. On or prior to the
date hereof, Tenant has completed and delivered for the benefit of
Landlord a “Tenant Operations Inquiry Form” in the form
attached hereto as Exhibit D describing the nature of
Tenant’s proposed business operations at the Premises, which
form is intended to, and shall be, relied upon by
Landlord.
4.2.
Use of Common
Areas. As used herein,
“ Common
Areas ” shall mean all areas
within the Property that are available for the common use of
tenants of the Property and that are not leased or held for the
exclusive use of Tenant or other tenants or licensees, including,
but not limited to, parking areas, driveways, sidewalks, loading
areas, access roads, corridors, landscaping and planted
areas. Tenant shall have the nonexclusive right to use the
Common Areas for the purposes intended, subject to such reasonable
rules and regulations as Landlord may uniformly establish from time
to time. Tenant shall not interfere with the rights of any or
all of Landlord, other tenants or licensees, or any other person
entitled to use the Common Areas. Without limitation of the
foregoing, Tenant shall not park or store any vehicles or trailers
on, or conduct truck loading and unloading activities in, the
Common Areas in a manner that unreasonably disturbs, disrupts or
prevents the use of the Common Areas by Landlord, other tenants or
licensees or other persons entitled to use the Common Areas.
Landlord, from time to time, may change any or all of the size,
location, nature and use of any of the Common Areas although such
changes may result in inconvenience to Tenant, so long as such
changes do not materially and adversely affect Tenant’s use
of the Premises. In addition to the foregoing, Landlord may,
at any time, close or suspend access to any Common Areas to perform
any acts in the Common Areas as, in Landlord’s reasonable
judgment, are desirable to improve or maintain either or both of
the Premises and the Property, or are required in order to satisfy
Landlord’s obligations under either or both of
Sections 13.2
and 18 ; provided, however, that
Landlord shall use reasonable efforts to limit any disruption of
Tenant’s use and operation of the Premises in connection
therewith.
4.3.
Signage.
Tenant
shall not affix any sign of any size or character to any portion of
the Property, without prior written approval of Landlord, which
approval shall not be unreasonably withheld or delayed.
6
Tenant shall remove all
signs of Tenant upon the expiration or earlier termination of this
Lease and immediately repair any damage to either or both of the
Property and the Premises caused by, or resulting from, such
removal.
4.4.
Intentionally
Omitted.
5.
CONDITION AND DELIVERY OF
PREMISES.
5.1.
Conditions of
Premises. Landlord presents and
warrants to Tenant that, on the Phase I Premises Commencement Date,
Phase II Premises Commencement Date, and Phase III Premises
Commencement Date, respectively, and as applicable, all plumbing,
electrical, heating, ventilating, air-conditioning, ventilating and
mechanical systems, including the dock doors permitted to be used
by Tenant hereunder, located within the Premises, or located
outside the Premises but which service the Premises, shall be in
good condition and repair and in proper working order. Tenant
acknowledges that, except as set forth in this Lease, neither
Landlord or Agent, nor any representative of Landlord, has made any
representation as to the condition of the Premises or the
suitability of the Premises for Tenant’s intended use.
Neither Landlord nor Agent shall be obligated to make any repairs,
replacements or improvements (whether structural or otherwise) of
any kind or nature to the Premises in connection with, or in
consideration of, this Lease, except (a) as set forth in
Sections 13.2
and 18 and (b) with respect to all
(if any) repairs and improvements expressly and specifically
described in Exhibit B attached hereto
(“ Landlord
Work Items ”) and (c) as may be
required in order to deliver the Premises to Tenant in the
condition required under this paragraph. Landlord shall
enforce, or cause Agent to enforce, upon Tenant’s request,
all manufacturer’s or contractor’s warranties, if any,
issued in connection with any of the Landlord Work Items.
Landlord shall perform, or caused to be performed, the Landlord
Work Items in a good and workmanlike manner.
5.2.
Delay in
Commencement. Landlord shall not be liable
to Tenant if Landlord does not deliver possession of the Phase I
Premises, Phase II Premises, or Phase III Premises to Tenant on the
Phase I Premises Commencement Date, Phase II Premises Commencement
Date, or Phase III Premises Commencement Date, respectively.
The obligations of Tenant under the Lease shall not be affected
thereby, except that the applicable Commencement Date shall be
delayed until Landlord delivers possession of the Phase I Premises,
Phase II Premises, or Phase III Premises (as the case may be) to
Tenant. A delay in the Commencement Date shall not change the
Expiration Date. Notwithstanding the foregoing provisions, in
the event any such premises are not delivered by Landlord as
required herein by September 1, 2003, Tenant may elect to
terminate this Lease.
6.
SUBORDINATION; NOTICES TO
SUPERIOR LESSORS AND MORTGAGEES; ATTORNMENT.
6.1.
Subordination. Provided that Tenant
is provided with a reasonable and customary subordination,
nondisturbance and attornment agreement duly executed by the holder
of any mortgage or deed of trust or the landlord pursuant to any
ground lease, this Lease shall be subject and subordinate at all
times to (a) all ground leases or underlying leases that may now
exist or hereafter be executed affecting either or both of the
Premises and the Property and (b) any mortgage or deed of trust
that may now exist or hereafter be placed upon, and encumber, any
or all of (x) the Property; (y) any ground leases or underlying
leases for the benefit of the Property; and (z) all or any portion
of Landlord’s interest or estate in any of said items.
Notwithstanding the foregoing, Landlord shall have the right to
subordinate or cause to be subordinated any such ground leases or
underlying leases that benefit the Property or any such mortgage or
deed of trust liens to this Lease. Tenant shall execute and
deliver, upon demand by Landlord any additional documents
evidencing the priority of subordination of this Lease with respect
to any such ground leases or underlying leases for the benefit of
the Property or any such mortgage or deed of trust provided such
documents are in a commercially reasonable form.
6.2.
Estoppel
Certificates. Tenant agrees, from time to
time and within 10 days after request by Landlord, to deliver to
Landlord, or Landlord’s designee, an estoppel certificate
stating such matters pertaining to this Lease as may be reasonably
requested by Landlord provided such certificate is in a
commercially reasonable form. Failure by Tenant to timely
execute and deliver such certificate shall constitute an acceptance
of the Premises and acknowledgment by Tenant that the statements
included therein are true and correct without exception.
Landlord and Tenant intend that any statement delivered pursuant to
this section may be relied upon by any prospective purchaser
or mortgagee of the Property or of any interest therein or any
other Landlord designee.
7
6.3.
Transfer for
Landlord. In the event of a sale or
conveyance by Landlord of the Property, the same shall operate to
release Landlord from any future liability for any of the covenants
or conditions, express or implied, herein contained in favor of
Tenant to the extent such covenants and conditions are assumed by
Landlord’s successor-in-interest, and in such event Tenant
agrees to look solely to Landlord’s successor in interest
with respect thereto and agrees to attorn to such
successor.
7.
QUIET
ENJOYMENT. Subject to the provisions of
this Lease, so long as Tenant pays all of the Rent and performs all
of its other obligations hereunder, Tenant shall not be disturbed
in its possession of the Premises by Landlord, Agent or any other
person lawfully claiming through or under Landlord; provided,
however, in addition to Landlord’s rights under
Section 16
and
elsewhere in this Lease, Landlord and Landlord’s agents,
employees, contractors and representatives shall be provided
reasonable access to the Premises such that Landlord and
Landlord’s agents, employees, contractors and representatives
may perform the General Maintenance Services (as hereinafter
defined) without undue interruption, delay or hindrance. This
covenant shall be construed as a covenant running with the Property
and is not a personal covenant of Landlord. Tenant shall not
unreasonably interrupt, delay, prevent or hinder the performance of
the General Maintenance Services by or on behalf of Landlord.
Notwithstanding the foregoing, however, Tenant acknowledges and
agrees that Landlord shall have the unfettered and unilateral right
to use portions of the Common Areas (inclusive of the roof of the
Building) for such purposes and uses as Landlord may desire;
provided, however, that in all events and under all circumstances,
Landlord’s use of any portion of the Common Areas shall not
interfere, in any material respect, with any or all of (a)
Tenant’s rights to occupy and use the Common Areas (in the
manner and for the purposes contemplated hereunder); (b)
Tenant’s right to utilize the vehicular parking areas located
on the Common Areas; and (c) Tenant’s right of access,
ingress and egress to and from the Common Areas.
8.
ASSIGNMENT, SUBLETTING AND
MORTGAGING.
8.1.
Prohibition.
Tenant
acknowledges that this Lease and the Rent due under this Lease have
been agreed to by Landlord in reliance upon Tenant’s
reputation and creditworthiness and upon the continued operation of
the Premises by Tenant for the particular use described in
Section 4.1
above;
therefore, Tenant shall not, whether voluntarily, or by operation
of law, or otherwise: (a) assign or otherwise transfer this Lease;
(b) sublet the Premises or any part thereof, or allow the same to
be used or occupied by anyone other than Tenant; or (c) mortgage,
pledge, encumber, or otherwise hypothecate this Lease or the
Premises, or any part thereof, in any manner whatsoever, without in
each instance obtaining the prior written consent of Landlord,
which consent may be given or withheld in Landlord’s sole,
but reasonable, discretion. Except as otherwise specified
herein, any purported assignment, mortgage, transfer, pledge or
sublease made without the prior written consent of Landlord shall
be absolutely null and void. No assignment of this Lease
shall be effective and valid unless and until the assignee executes
and delivers to Landlord any and all documentation reasonably
required by Landlord in order to evidence assignee’s
assumption of all obligations of Tenant hereunder. Any
consent by Landlord to a particular assignment, sublease or
mortgage shall not constitute consent or approval of any subsequent
assignment, sublease or mortgage, and Landlord’s written
approval shall be required in all such instances. No consent
by Landlord to any assignment or sublease shall be deemed to
release Tenant from its obligations hereunder and Tenant shall
remain fully liable for performance of all obligations under this
Lease.
8.2.
Rights of
Landlord. If this Lease is assigned,
or if the Premises (or any part thereof) are sublet or used or
occupied by anyone other than Tenant, whether or not in violation
of this Lease, Landlord or Agent may (without prejudice to, or
waiver of its rights), collect Rent from the assignee, subtenant or
occupant. Landlord or Agent may apply the net amount
collected to the Rent herein reserved, but no such assignment,
subletting, occupancy or collection shall be deemed a waiver of any
of the provisions of this Section 8 . With respect to the
allocable portion of the Premises sublet by Tenant to any person or
entity not affiliated with Tenant, in the event that the total rent
and any other considerations received under any sublease by Tenant
is greater than the total Rent required to be paid, from time to
time, under this Lease, Tenant shall pay to Landlord fifty percent
(50%) of such excess as received from any such subtenant (after
deducting any brokerage commissions, tenant improvement costs and
other costs incurred by Tenant in connection with such subletting),
and such amount shall be deemed a component of the Additional
Rent.
8.3.
Permitted
Transfers. The provisions of
Section 8.1(a)
shall
not apply to a transfer of a majority (i.e. greater than 50%
interest) of the voting stock of Tenant or to any other change in
voting control of
8
Tenant (if Tenant is a
corporation), or to a transfer of a majority of the general
partnership or membership interests in Tenant (if Tenant is a
partnership or a limited liability company) or to a change in the
managerial control of Tenant, or to transfer in connection with a
merger, reorganization, or sale of all or substantially all the
assets of Tenant, and Tenant shall be permitted to assign this
Lease without Landlord’s consent in connection with any such
transfer, provided, in any of such events, the successor to Tenant
(or any party remaining liable for the obligations of Tenant
hereunder) has a net worth equal to or greater than
$10,000,000.00. Any such permitted transferee shall execute
and deliver to Landlord any and all documentation reasonably
required by Landlord in order to evidence assignee’s
assumption of all obligations of Tenant hereunder.
9.
COMPLIANCE WITH
LAWS.
9.1.
Compliance with
Laws. Tenant shall, at its sole
expense (regardless of the cost thereof), comply with all local,
state and federal laws, rules, regulations and requirements now or
hereafter in force and all judicial and administrative decisions in
connection with the enforcement thereof (collectively,
“ Laws
”), pertaining to
either or both of the Premises and Tenant’s use and occupancy
thereof. If any license or permit is required for the conduct
of Tenant’s business in the Premises, Tenant, at its expense,
shall procure such license prior to the Commencement Date, and
shall maintain such license or permit in good standing throughout
the Term. Tenant shall give prompt notice to Landlord of any
written notice it receives of the alleged violation of any Law or
requirement of any governmental or administrative authority with
respect to either or both of the Premises and the use or occupation
thereof. The judgment of any court of competent jurisdiction,
or the admission of Tenant in any action or proceeding against
Tenant, whether Landlord is a party thereto or not, that any such
Law pertaining to the Premises has been violated, shall be
conclusive of that fact as between Landlord and Tenant.
Landlord represents and warrants to Tenant that, on the Phase I
Premises Commencement Date, Phase II Premises Commencement Date,
and Phase III Premises Commencement Date, the Phase I Premises,
Phase II Premises, and Phase III Premises, respectively, shall, to
Landlord’s actual knowledge, be in compliance with all
applicable Laws in all material respects. Landlord shall
indemnify Tenant against all Tenant Losses (as defined in
Section 17.2.2 hereof) actually suffered by
Tenant as the direct result of the applicable portion of the
Premises not being in material compliance with Laws on the
applicable Commencement Date.
9.2.
Hazardous
Materials. If, at any time or from time
to time during the Term (or any extension thereof), any Hazardous
Material (defined below) is generated, transported, stored, used,
treated or disposed of at, to, from, on or in either or both of the
Premises and the Property by, or as a result of any act or omission
of, any or all of Tenant and any or all of Tenant’s Parties
(defined below): (i) Tenant shall, at its own cost, at all times
comply (and cause all others to comply) with all laws (federal,
state or local) relating to Hazardous Materials, including, but not
limited to, all Environmental Laws (defined below), and Tenant
shall further, at its own cost, obtain and maintain in full force
and effect at all times all permits and other approvals required in
connection therewith; (ii) Tenant shall promptly provide Landlord
or Agent with complete copies of all communications, permits or
agreements with, from or issued by any governmental authority or
agency (federal, state or local) or any private entity relating in
any way to the presence, release, threat of release, or placement
of Hazardous Materials on or in the Premises or any portion of the
Property, or the generation, transportation, storage, use,
treatment, or disposal at, on, in or from the Premises, of any
Hazardous Materials; (iii) Landlord, Agent and their respective
agents and employees shall have the right to either or both (x)
enter the Premises and (y) conduct appropriate tests for the
purposes of ascertaining Tenant’s compliance with all
applicable laws (including Environmental Laws), rules or permits
relating in any way to the generation, transport, storage, use,
treatment, disposal or presence of Hazardous Materials on, at, in
or from all or any portion of either or both of the Premises and
the Property; and (iv) upon written request by Landlord or Agent
and only if Landlord has a reasonable basis for believing that
Tenant’s activities at the Premises are not in compliance
with applicable Environmental Laws, Tenant shall provide Landlord
with the results of reasonably appropriate tests of air, water or
soil to demonstrate that Tenant complies with all applicable laws,
rules or permits relating in any way to the generation, transport,
storage, use, treatment, disposal or presence of Hazardous
Materials on, at, in or from all or any portion of either or both
of the Premises and the Property. This Section 9.2 does not authorize the
generation, transportation, storage, use, treatment or disposal of
any Hazardous Materials at, to, from, on or in the Premises in
contravention of this Section 9 . Tenant covenants to
investigate, clean up and otherwise remediate, at Tenant’s
sole expense, any release of Hazardous Materials caused,
contributed to, or created by any or all of (A) Tenant and (B) any
or all of Tenant’s officers, directors, members, managers,
partners, invitees, agents, employees, contractors or
representatives (“ Tenant Parties ”) during the
Term. Such investigation and remediation shall be performed
only after Tenant has obtained Landlord’s prior
written
9
consent; provided, however,
that Tenant shall be entitled to respond immediately to an
emergency without first obtaining such consent. All
remediation shall be performed in strict compliance with
Environmental Laws and to the reasonable satisfaction of
Landlord. Tenant shall be liable for any and all conditions
covered hereby, and for all costs relating thereto, that are caused
or created by any or all of Tenant and any or all of Tenant’s
Parties. Tenant shall not enter into any settlement
agreement, consent decree or other compromise with respect to any
claims relating to any Hazardous Materials in any way connected to
the Premises without first obtaining Landlord’s written
consent (which consent may be given or withheld in Landlord’s
sole, but reasonable, discretion) and affording Landlord the
reasonable opportunity to participate in any such
proceedings. As used herein, the term (x) “
Environmental Laws
”
shall mean any and all laws pertaining to Hazardous Materials or
that otherwise deal with, or relate to, air or water quality, air
emissions, soil or ground conditions or other environmental matters
of any kind; and (y) “ Hazardous Materials ” shall mean any
waste, material or substance (whether in the form of liquids,
solids or gases, and whether or not airborne) that is or may be
deemed to be or include a pesticide, petroleum, asbestos,
polychlorinated biphenyl, radioactive material, urea formaldehyde
or any other pollutant or contaminant that is or may be deemed to
be hazardous, toxic, ignitable, reactive, corrosive, dangerous,
harmful or injurious, or that presents a risk to public health or
to the environment, and that is or becomes regulated by any
Environmental Law. The undertakings, covenants and
obligations imposed on Tenant under this Section 9.2 shall survive the
termination or expiration of this Lease. Notwithstanding
anything in this Lease to the contrary, Landlord hereby
indemnifies, defends, and holds Tenant Indemnified Parties (defined
In Section 17.2.2 below) harmless from and
against any and all Tenant Losses (defined below) actually suffered
or incurred by Tenant or any Tenant Indemnified Parties as the
direct result of the presence of Hazardous Materials in existence
as of, or prior to, the applicable Commencement Date, or shown to
have arisen subsequent to the applicable Commencement Date as a
result of the use of the Building by Landlord.
10.
INSURANCE.
10.1.
Insurance to be Maintained
by Landlord. Landlord shall maintain (a)
“all-risk” property insurance policy covering the
Property (at its full replacement cost), but excluding
Tenant’s Property (AS defined in Section
12.2 below), and (b)
commercial general public liability insurance covering Landlord for
claims arising out of liability for bodily injury, death, personal
injury, advertising injury and property damage occurring in and
about the Property and otherwise resulting from any acts and
operations of Landlord, its agents and employees, and (c) rent loss
insurance, all of the above with limits that are required by any
lender(s) of Landlord, or as are otherwise reasonably determined by
Landlord.
10.2.
Insurance to be Maintained
by Tenant. Tenant shall purchase, at
its own expense, and keep in force at all times during this Lease
the policies of insurance set forth below in Sections 10.2.1 and 10.2.2 (collectively,
“ Tenant’s Policies ”). All
Tenant’s Policies shall (a) be issued by an insurance company
with a Best rating of A-X or better and otherwise reasonably
acceptable to Landlord and shall be licensed to do business in the
state in which the Property is located; (b) provide that said
insurance shall not be canceled or materially modified unless 30
days’ prior written notice shall have been given to Landlord;
and (c) otherwise be in such form, and include such coverages, as
Landlord may reasonably require. All Tenant’s Policies
(or, at Landlord’s option, Certificates of Insurance, in a
form reasonably acceptable to Landlord, evidencing said
Tenant’s Policies), shall be delivered to Landlord by Tenant
upon commencement of the Lease and renewals thereof shall be
delivered at least 30 days prior to the expiration of each
Tenant’s Policy. Tenant shall give prompt notice to
Landlord and Agent of any bodily injury, death, personal injury,
advertising injury or property damage occurring in and about the
Property.
10.2.1.
General Liability and Auto
Insurance. Tenant shall purchase and
maintain, throughout the Term, a Tenant’s Policy(ies) of (i)
commercial general or excess liability insurance, including
personal injury and property damage, in the amount of not less than
$2,000,000.00 per occurrence, and $5,000,000.00 annual general
aggregate, per location; (ii) comprehensive automobile liability
insurance covering Tenant against any losses arising out of
liability for personal injuries or deaths of persons and property
damage occurring in or about the Premises in the amount of not less
than $1,000,000, combined single limit. The Tenant’s
Policies required by this Section 10.2.1 shall (a) name
Landlord, Agent, and any party holding an interest to which this
Lease may be subordinated whose name shall have been furnished in
writing to Tenant, as additional insureds; (b) provide coverage on
an occurrence basis; (c) provide coverage for the indemnity
obligations of Tenant under this Lease; (d) contain a severability
of insured parties provision and/or a cross liability endorsement;
(e) be primary, not
10
contributing with, and not
in excess of, coverage that Landlord may carry; and (f) provide
coverage with no exclusion for a pollution incident arising from a
hostile fire.
10.2.2.
Property and
Workers’ Compensation Insurance. Tenant shall purchase
and maintain, throughout the Term, a Tenant’s Policy or
Policies of (i) “all-risk” property insurance covering
Tenant’s Property and damage to other property resulting from
any acts or operations of Tenant, and (ii) workers’
compensation insurance per the applicable state statutes covering
all employees of Tenant.
10.3.
Waiver of
Subrogation. Notwithstanding anything in
this Lease to the contrary, and to the extent permitted by law and
without affecting the coverage provided by insurance required to be
maintained hereunder, Landlord and Tenant each waive any right to
recover against the other for (a) damages to property, (b) damages
to all or any portion of either or both of the Premises and the
Property, (c) claims arising by reason of the foregoing, to the
extent such damages and claims are insured against, or required to
be insured against, by Landlord or Tenant under this Lease, or (d)
claims paid by Tenant’s workers’ compensation
carrier. This provision is intended to waive, fully and for
the benefit of each party, any rights and/or claims which might
give rise to a right of subrogation by any insurance carrier.
The coverage obtained by each party pursuant to this Lease shall
include, without limitation, a waiver of subrogation by the carrier
which conforms to the provisions of this section.
11.
ALTERATIONS.
11.1.
Procedural
Requirements. Tenant may, from time to
time, at its expense, make alterations or improvements in and to
the Premises (hereinafter collectively referred to as
“ Alterations ”), provided that
Tenant first obtains the written consent of Landlord in each
instance. Landlord’s consent to Alterations shall not
be unreasonably withheld, provided that: (a) the Alterations are
non-structural and the structural integrity of the Property shall
not be affected; (b) the Alterations are to the interior of the
Premises; (c) the proper functioning of the mechanical, electrical,
heating, ventilating, air-conditioning (“ HVAC ”), sanitary and other
service systems of the Property shall not be affected and the usage
of such systems by Tenant shall not be increased; (d) the
Alterations have no adverse effect on other leased premises in the
Property; (e) Tenant shall have appropriate insurance coverage,
reasonably satisfactory to Landlord, regarding the performance and
installation of the Alterations; (f) the Alterations shall conform
with all other requirements of this Lease; and (g) Tenant shall
have provided Landlord with reasonably detailed plans for such
Alterations in advance of requesting Landlord’s
consent. Additionally, before proceeding with any
Alterations, Tenant shall (i) at Tenant’s expense, obtain all
necessary governmental permits and certificates for the
commencement and prosecution of Alterations; (ii) submit to Agent,
for Landlord’s written approval, working drawings, plans and
specifications and all permits for the work to be done and Tenant
shall not proceed with such Alterations until it has received said
approval; and (iii) cause those contractors, materialmen and
suppliers engaged to perform the Alterations to deliver to Landlord
certificates of insurance (in a form reasonably acceptable to
Landlord) evidencing policies of commercial general liability
insurance (providing the same coverages as required in
Section 10.2.1
above)
and workers’ compensation insurance. Such insurance
policies shall satisfy the obligations imposed under
Section 10.2.1(a) through
(d) and (f) . After obtaining
Landlord’s approval to the Alterations, Tenant shall give
Landlord at least five days’ prior written notice of the
commencement of any Alterations at the Premises, and Landlord may
elect to record and post notices of non-responsibility at the
Premises. Notwithstanding anything to the contrary contained
in this Section 11.1 , Landlord’s consent
shall not be required for Alterations satisfying clauses (a)
through (f) above and costing $25,000.00 or less in any one
instance (up to an maximum aggregate or $100,000 over the Term)
provided that Tenant notifies Landlord of such Alterations prior to
commencing thereon and obtains all approvals and permits from third
parties necessary for the commencement and prosecution of such
Alterations. Notwithstanding anything to the contrary
contained in this Section 11.1 , the dollar amounts set
forth above shall apply only to the cost of the alterations to or
improvements of the Premises and shall not apply to the value or
cost of the equipment Tenant elects to use or install at that
Premises.
11.2.
Performance of
Alterations. Tenant shall cause the
Alterations to be performed in compliance with all applicable
permits, laws and requirements of public authorities, and with
Landlord’s reasonable rules and regulations or any other
restrictions that Landlord or Agent may impose on the
Alterations. Tenant shall cause the Alterations to be
diligently performed in a good and workmanlike manner, using new
materials and equipment at least equal in quality and class to the
standards for the Property established by Landlord or Agent.
Tenant shall obtain all necessary permits and certificates for
final governmental approval of the Alterations and
shall
11
provide Landlord with
“as built” plans, copies of all construction contracts,
governmental permits and certificates and proof of payment for all
labor and materials, including, without limitation, copies of paid
invoices and final lien waivers. Notwithstanding anything in
this Lease to the contrary, with Landlord’s prior consent,
which consent shall not be unreasonably withheld, conditioned or
delayed, Tenant shall be permitted to install telecommunications
and other lines and wires at the Property a
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