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Exhibit
10.13
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.
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1.1 |
Effective Date of Lease: March 12, 2007 |
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1.2 |
Landlord: First Industrial, L.P., a Delaware
partnership |
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1.3 |
Tenant: InSys Therapeutics, Inc., a Delaware
corporation |
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1.4
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Premises: Approximately
15,839 rentable square feet in the building commonly known as
Phoenix Tech Center located at 10220 S. 51 st Street, Phoenix, Arizona 85044 (the
“ Building ”).
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1.5 |
Property: See Exhibit A . |
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1.6 |
Lease Term: Five (5) years, (“ Term ”),
commencing November 1, 2007 (“ Rent Commencement
Date ”) and ending October 31, 2012, subject to
Section 5.2 below (“ Expiration Date
”). |
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1.7 |
Permitted Uses: Operation of administrative and sales offices,
research and development and testing of therapeutics and related
uses thereof. |
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1.8 |
Tenant’s Guarantor: None |
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1.9 |
Brokers: (See Section 23 ): (A) Tenant’s
Broker: Grubb & Ellis/BRE Commercial, LLC; and
(B) Landlord’s Broker: Grubb & Ellis/BRE
Commercial, LLC |
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1.10 |
Security/Damage Deposit: (See Section 4.4 ):
$26,719.47. Additionally, InSys Therapeutics, Inc. shall secure a
letter of credit with Bank of America in accordance with the terms
of Section 4.4.2 . |
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1.11 |
Initial Estimated Additional Rent Payable by Tenant: $3,959.75
per month |
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1.12 |
Tenant’s Proportionate Share: 69% |
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1.13 |
Exhibits to Lease: The following exhibits are attached to and
made a part of this Lease: A (Property); A-1 (Premises); B (Tenant
Operations Inquiry Form); C (Tenant’s Work); D (Confirmation
of Commencement Date); E (Broom Clean Condition and Repair
Requirements); F (Rules and Regulations); and G (Employee Parking
Area) |
2. LEASE OF PREMISES;
RENT .
2.1 Lease of
Premises for Lease Term . Landlord hereby leases the
Premises to Tenant, and Tenant hereby rents the Premises from
Landlord, for the Term and subject to the conditions of this
Lease.
1.
2.2 Types of
Rental Payment . Tenant shall pay net base rent to Landlord
in monthly installments, in advance, on the first day of each and
every calendar month during the Term of this Lease (the “
Base Rent ”) in the amounts and for the periods as set
forth below, together with all rent tax payable with respect
thereto, beginning on the Rent Commencement Date:
Rental
Payments
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Months
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Monthly Base Rent |
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Per Sq. Ft./Per Month |
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11/01/07 – 06/30/09
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$ |
14,730.27 |
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$ |
0.93 |
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07/01/09 – 02/28/11
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$ |
15,466.78 |
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$ |
0.9765 |
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03/01/11 – 10/31/12
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$ |
16,239.73 |
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$ |
1.0253 |
Tenant shall also pay
(a) Tenant’s Proportionate Share (as set forth in
Section 1.12 ) of Operating Expenses (as hereinafter
defined), and (b) any other amounts owed by Tenant hereunder
(collectively, “ Additional Rent ”). In the
event any monthly installment of Base Rent or Additional Rent, or
both, is not paid within 5 days after the due date thereof, a late
charge in an amount equal to 5% of the then delinquent installment
of Base Rent and/or Additional Rent (the “ Late Charge
”) shall be imposed with respect to the then-delinquent Rent
(as defined below) payment; provided, however, that with respect to
the first late payment of Rent in any twelve (12) month
period, Landlord shall provide written notice to Tenant of such
late payment and the Late Charge shall not be payable unless Tenant
shall fail to cure such late payment within five (5) days
after receipt of Landlord’s written notice. For purposes of
this Lease, the Late Charge, Default Interest, as defined in
Section 22.3 below, Base Rent and Additional Rent shall
collectively be referred to as “ Rent .” All
Rent shall be paid by Tenant to Landlord, c/o First Industrial,
L.P., 21125 Network Place, Chicago IL 600673-1211 or if sent by
overnight courier, Bank One 7th Floor Mailroom 525 W. Monroe
Chicago IL 60661 Attn: First Industrial LP at 21125 Network Place
(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 to Tenant.
2.3 Covenants
Concerning Rental Payments . Commencing on the Rent
Commencement Date, Tenant shall pay the Rent promptly when due,
without notice or demand, and without any abatement, deduction or
setoff, except as otherwise provided herein. 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 Rent 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 (based on a 360 day, 12 month year) and paid to
Landlord on the Rent Commencement Date, and the Term will be
extended to terminate on the last day of the calendar month in
which the Expiration Date stated in Section 1.6
occurs.
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 by
Landlord with respect to, or in connection with, the
ownership,
2.
repair, restoration, maintenance and
operation of the Property. Operating Expenses may include, but are
not limited to, any or all of 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 market-based premiums for commercial property,
casualty, general liability, boiler, flood, earthquake, terrorism
and all other types of insurance provided by Landlord and relating
to the Property, all reasonable 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) management fees to Landlord or Agent or other
persons or management entities actually involved in the management
and operation of the Property, which management fee shall not
exceed 5% per annum of all Rent, collected from all tenants in
the Property; (v) 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; (vi) all professional fees incurred in connection
with the operation, management and maintenance of the Property;
(vii) Taxes, as hereinafter defined in
Section 3.1.3 ; and (viii) dues, fees or other
costs and expenses, of any nature, due and payable to any
association or comparable entity to which Landlord, as owner of the
Property, is a member or otherwise belongs and that governs or
controls any aspect of the ownership and operation of the Property;
and (ix) any real estate taxes and common area maintenance
expenses levied against, or attributable to, the Property under any
declaration of covenants, conditions and restrictions, reciprocal
easement agreement or comparable arrangement that encumbers and
benefits the Property and other real property (e.g., a business
park).
3.1.2 Notwithstanding
the foregoing, Operating Expenses shall not include the following:
(i) any costs or expenses for which Landlord is reimbursed or
indemnified (whether by an insurer, condemnor, tenant or
otherwise); (ii) overhead and administrative costs of Landlord
not directly incurred in the operation and/or maintenance of the
Property; (iii) depreciation or amortization of the Building
or its contents or components; (iv) capital expenditures,
except to the extent provided in Section 3.1.1(v)
above; (v) expenses for the preparation of space or other work
which Landlord performs for any tenant or prospective tenant of the
Building; (vi) expenses incurred in leasing or obtaining new
tenants or retaining existing tenants, including leasing
commissions, legal expenses, advertising or promotion;
(vii) legal expenses incurred in enforcing the terms of any
lease; (viii) interest, amortization or other costs, including
legal fees, associated with any mortgage, loan or refinancing of
the Building or the Common Areas; (ix) expenses incurred for
any necessary replacement of any item to the extent that it is
covered under warranty; (x) the cost of any item or service
which Tenant separately reimburses Landlord or pays to third
parties, or that Landlord provides selectively to one or more
tenants of the Building, other than Tenant, whether or not Landlord
is reimbursed by such other tenant(s), including the actual cost of
any special electrical, heating, ventilation or air conditioning
required by any tenant that exceeds normal building standards or is
required during times other than the business hours stated in this
Lease; (xi) accounting and legal fees relating to the
ownership, construction, leasing or sale of the Common Areas;
(xii) any interest or penalty incurred due to the late payment
of any Operating Expense; (xiii) the cost of correcting
defects in the construction of the Building or the Common Areas;
provided, however, that repairs resulting from ordinary wear and
tear shall not be deemed to be defects; (xiv) the initial cost
of tools and small equipment used in the operation and maintenance
of the Building, and the Common Areas which do not exceed the cost
of $1,000 per year in the aggregate; (xv) the initial cost or
the replacement cost of any permanent landscaping or the regular
landscaping maintenance for any property other than the Property,
unless associated with fees or charges arising from or in
connection with any governing association or the vested owners for
the Building; (xvi) the cost of correcting any
applicable
3.
building or fire code violation(s) of
any other applicable law relating to the Building, or the Common
Areas, or the cost of any penalty or fine incurred for
noncompliance with the same; (xvii) any costs incurred to
test, survey, cleanup, contain, abate or remove any environmental
or hazardous waste or materials, including asbestos containing
materials from the Building or the Common Areas or to remedy any
breach or violation of any environmental laws; (xviii) any
personal property taxes of the Landlord for equipment or items not
used directly in the operation or maintenance of the Building, nor
connected therewith; (xix) all expenditures pertaining to
administration of the Building or the Common Areas including
payroll and payroll-related expenses associated with administrative
and clerical personnel except to the extent attributable based on
time actually spent on the operation and maintenance of the
Property; general office expenditures; other administrative
expenditures (including expenditures for travel, entertainment,
dues, subscriptions, donations, data processing, errors and
omissions insurance, automobile allowances, political donations and
professional fees of any kind) unless specifically enumerated as
Operating Expenses; (xx) rentals and other related expenses,
if any, incurred in leasing capital items; (xxi) any costs or
expenses for sculpture, paintings, or other works of art,
including, costs incurred with respect to the purchase, ownership,
leasing, repair, and/or maintenance of such works of art;
(xxii) contributions to Operating Expense reserves;
(xxiii) the cost of overtime or other expense to Landlord in
performing work expressly provided in this Lease to be borne at
Landlord’s expense; (xxiv) all expenses directly
resulting from the negligence or willful misconduct of the
Landlord, its agents, servants or other employees; (xxv) all
bad debt loss, rent loss, or reserve for bad debt or rent loss; and
(xxvi) any amount paid to an entity related to Landlord which
exceeds the amount that would be paid for similar goods or services
on an arms-length basis between unrelated parties.
3.1.3
Taxes . The term “ Taxes ,” as
referred to in Section 3.1.1(vii) 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, Tenant shall be responsible for any Taxes that are
due and payable at any time or from time to time during the Term
and for any Taxes that are assessed, become a lien, or accrue
during any Operating Year (defined in Section 3.1.4
below), which obligation shall survive the termination or
expiration of this Lease.
3.1.4 Operating
Year . The term “ Operating Year ” shall
mean the calendar year commencing January 1st of each year
(including the calendar year within which the Rent 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 commences to
accrue upon the Commencement Date. 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 written 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
4.
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 Agent shall pay Tenant the
then-applicable excess promptly after determination thereof.
Landlord’s accounting to Tenant shall be accompanied by an
itemized written statement setting forth: (a) a reconciliation
of Tenant’s impound accounts of monies collected in advance
by Landlord based on Landlord’s estimate of Tenant’s
Pro Rata Share, and (b) the actual Operating Expenses for the
subject year broken down by component expenses.
3.4 Inspection
Rights . Tenant, at Tenant’s sole cost and expense,
shall have the right upon fifteen (15) days’ prior
written notice to Landlord (a “ Review Notice
”), to be given only within sixty (60) days after Tenant
receives Landlord’s determination of Tenant’s actual
ultimate liability for Operating Expenses for any particular
Operating Year, to review Landlord’s books and records
relating to such determination for such immediately preceding
Operating Year with respect to any specific charge or charges
disputed in writing by Tenant, subject to the further terms and
provisions of this Section 3.4 : (a) no review
shall be conducted at any time that Tenant is in breach or default
of any of the terms, covenants or provisions of this Lease;
(b) any review shall be conducted only by independent
certified public accountants practicing for an accounting firm of
national or regional prominence, employed by Tenant on an hourly or
fixed fee basis, and not on a contingency fee basis; and
(c) Tenant shall not review Landlord’s books and records
more than one (1) time for any Operating Year. Tenant
acknowledges that Tenant’s right to review Landlord’s
books and records with respect to Operating Expenses for the
preceding Operating Year is for the exclusive purpose of
determining whether Landlord has complied with the terms of this
Lease with respect to Operating Expenses. Tenant shall have sixty
(60) days after Tenant’s Review Notice to complete
Tenant’s review of Landlord’s books and records
concerning Operating Expenses at Landlord’s accounting
office. During its review, Tenant agrees to request, in writing,
all pertinent documents relating to the review. If in
Landlord’s possession, Landlord will provide such documents
to Tenant within ten (10) days after Landlord’s receipt
of Tenant’s request and Tenant shall not remove such records
from Landlord’s accounting office, but Tenant shall have the
right to make copies of the relevant documents at Tenant’s
sole cost and expense. Tenant shall deliver to Landlord a copy of
the results of such review within fifteen (15) days after
receipt by Tenant. The nature and content of any review are
strictly confidential. Tenant, for itself and on behalf of
Tenant’s Parties (defined in Section 9.2 ), shall
not disclose the information obtained from the review to any other
person or entity including, without limitation, any other tenant of
the Property or any representative of any such tenant of the
Property. A breach of this confidentiality agreement shall
constitute a Default under this Lease. No assignee or other
transferee of Tenant shall conduct a review for any period during
which such transferee was not in possession of the Premises. In the
event Tenant’s review shall disclose that Landlord has
overstated Tenant’s actual liability for Operating Expenses
for such Operating Year by seven percent (7%) or more and
Tenant has paid such overstated amounts, then Landlord shall pay
for the reasonable costs of the review, not to exceed, however,
Four Thousand and No/100 Dollars ($4,000.00).
4. USE OF PREMISES AND
COMMON AREAS; SECURITY DEPOSIT .
4.1 Use of
Premises and Property .
4.1.1 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,
without the prior written consent of Landlord
5.
which shall not be unreasonably withheld
or delayed. 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, provided that a copy of the same has been
provided by Landlord to Tenant; (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, provided that copies of the same have been
provided by Landlord to Tenant; (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
(f) 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 B
describing the nature of Tenant’s proposed business
operations at the Premises, which form is intended to, and shall
be, relied upon by Landlord. From time to time during the Term (but
no more often than once in any twelve month period unless Tenant is
in default hereunder or unless Tenant assigns this Lease or
subleases all or any portion of the accordance with
Section 8 ), Tenant shall provide an updated and
current Tenant Operations Inquiry following receipt of
Landlord’s written request therefor.
4.1.2 Notwithstanding
any provision of this Lease to the contrary, materials of in
connection with Tenant’s research, development and testing of
therapeutics shall be subject to consent, which consent shall not
be unreasonably withheld or delayed, and (b) all applicable
laws.
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,
non-discriminatory rules and regulations as Landlord may uniformly
establish from time to time provided the same do not conflict with
the terms of this Lease. Tenant shall not unreasonably 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, or access to, 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
this Lease; provided, however, that Landlord shall use reasonable
efforts to limit any disruption of Tenant’s use and operation
of the Premises in connection therewith, and so long as such acts
do not materially and adversely affect Tenant’s use of, or
access to, the Premises. Landlord shall, at no cost to Tenant,
provide Tenant with forty-eight (48) surface parking spaces,
of which eleven (11) shall be covered, in the location
identified on Exhibit G attached hereto.
Notwithstanding anything contained in this Lease to the contrary,
if at any time, Landlord determines, in its sole discretion, that
the parking areas at the Property are or have become overburdened,
Landlord may allocate parking on a proportionate basis or assign
parking spaces among all tenants at the Property, provided that the
number of spaces allocated to Tenant shall not be reduced below the
amount of spaces identified above or changed from the type of
spaces identified above.
6.
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. 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
Security/Damage Deposit; Letter of Credit
.
4.4.1
Deposit . Simultaneously with the execution and
delivery of this Lease, Tenant shall deposit with Landlord or Agent
the sum set forth in Section 1.10 above, in cash (the
“ Security ”), representing security for the
performance by Tenant of the covenants and obligations hereunder.
The Security shall be held by Landlord or Agent, without interest,
in favor of Tenant; provided, however, that no trust relationship
shall be deemed created thereby; the Security may be commingled
with other assets of Landlord; and Landlord shall not be required
to pay any interest on the Security. If Tenant defaults in the
performance of any of its covenants hereunder, Landlord or Agent
may, without notice to Tenant, apply all or any part of the
Security to the cure of such default or the payment of any sums
then due from Tenant under this Lease (including, but not limited
to, amounts due under Section 22.2 of this Lease as a
consequence of termination of this Lease or Tenant’s right to
possession), in addition to any other remedies available to
Landlord. In the event the Security is so applied, Tenant shall,
upon demand, immediately deposit with Landlord or Agent a sum equal
to the amount so used. If Tenant fully and faithfully complies with
all the covenants and obligations hereunder, the Security (or any
balance thereof) shall be returned to Tenant within thirty
(30) days after the last to occur of (i) the date the
Term expires or terminates or (ii) delivery to Landlord of
possession of the Premises. Landlord may deliver the Security to
any lender with a mortgage lien encumbering the Property or to any
Successor Landlord (defined below), and thereupon Landlord and
Agent shall be discharged from any further liability with respect
to the Security.
4.4.2 Letter of
Credit .
4.4.2.1 Within three
(3) weeks after complete execution of this Lease, Tenant shall
deliver to Landlord, as protection for the full and faithful
performance by Tenant of all its obligations under this Lease and
for all losses and damages Landlord may suffer (or which Landlord
reasonably estimates that it may suffer) as a result of any breach
or default by Tenant under this Lease, an irrevocable and
unconditional negotiable clean standby letter of credit (the
“ Letter of Credit ”), in form and substance
acceptable to Landlord in its sole discretion, containing the terms
required herein, payable in the City of Phoenix, Arizona, running
in favor of Landlord and issued by Bank of America (the “
Bank ”), in the amount of $100,000.00 (the “
Letter of Credit Amount ”). On or before the
Commencement Date, Tenant shall provide to Landlord, for
Landlord’s approval, a draft of the proposed form of the
Letter of Credit. After Landlord approves the draft, Tenant shall
provide to Landlord the original Letter of Credit by the deadline
set forth above. The Letter of Credit shall (i) be
“callable” at sight, irrevocable and unconditional,
(ii) be maintained in effect, whether through automatic
renewal or extension, for the period from the Commencement Date and
continuing until the date (the “ LC Expiration Date
”) that is one hundred twenty (120) days after the
expiration of the Lease Term, and Tenant shall deliver a new Letter
of Credit or certificate of renewal or extension to Landlord at
least sixty (60) days prior to the expiration of the Letter of
Credit then held by Landlord, without any action whatsoever on the
part of Landlord, (iii) be fully assignable by Landlord, its
successors and assigns, (iv) permit partial draws and multiple
presentations and drawings, and (v) be otherwise subject to
the Uniform Customs and Practices for Documentary Credits
(1993-Rev), International Chamber of Commerce Publication #500, or
the International Standby Practices-ISP 98, International Chamber
of Commerce Publication #590. In addition to the foregoing, the
form and terms of the Letter of Credit shall be acceptable to
Landlord, in Landlord’s sole discretion. Landlord, or its
then managing agent, shall have
7.
the right to draw down an amount up to
the face amount of the Letter of Credit if any of the following
shall have occurred or be applicable: (1) such amount is due
to Landlord under the terms and conditions of this Lease, or
(2) Tenant has filed a voluntary petition under the U.S.
Bankruptcy Code or any state bankruptcy code (collectively, “
Bankruptcy Code ”), or (3) an involuntary
petition has been filed against Tenant under the Bankruptcy Code,
or (4) the Bank has notified Landlord that the Letter of
Credit will not be renewed or extended through the LC Expiration
Date. The Letter of Credit will be honored by the Bank regardless
of whether Tenant disputes Landlord’s rights to draw upon the
Letter of Credit. Within thirty (30) days after the expiration
or earlier termination of this Lease and provided Tenant has fully
complied with all of its obligations under this Lease, Landlord
shall promptly return the Letter of Credit to Tenant.
4.4.2.2 The Letter of
Credit shall also provide that Landlord, its successors and
assigns, may, at any time and without notice to Tenant and without
first obtaining Tenant’s consent thereto, transfer (one or
more times) all or any portion of its interest in and to the Letter
of Credit to another party, person or entity in connection with a
sale, transfer or financing of Landlord’s interest in the
Building; provided, however, if such transfer of Landlord’s
interest in and to the Letter of Credit is made in connection with
a financing, such transfer may be made separate from or as a part
of the assignment by Landlord of its rights and interests in and to
this Lease. In the event of a transfer of Landlord’s interest
in the Building, Landlord shall transfer the Letter of Credit, in
whole or in part, to the transferee and thereupon Landlord shall,
without any further agreement between the parties, be released by
Tenant from all liability therefor, and it is agreed that the
provisions hereof shall apply to every transfer or assignment of
the whole or any portion of said Letter of Credit to a new
landlord. In connection with any such transfer of the Letter of
Credit by Landlord. Tenant shall, at Tenant’s sole cost and
expense, execute and submit to the Bank such applications,
documents and instruments as may be necessary to effectuate such
transfer, and Tenant shall be responsible for paying the
Bank’s transfer and processing fees in connection therewith
and, if Landlord advances any such fees (without having any
obligation to do so), Tenant shall reimburse Landlord for all such
fees as Additional Rent within ten (10) days after
Landlord’s written request therefor.
4.4.2.3 If, as a
result of any drawing by Landlord on the Letter of Credit, the
amount of the Letter of Credit shall be less than the Letter of
Credit Amount, Tenant shall, within five (5) days thereafter,
provide Landlord with additional letter(s) of credit in an amount
equal to the deficiency, and any such additional letter(s) of
credit shall comply with all of the provisions of this
Section 4.4.2 , and if Tenant fails to comply with the
foregoing, notwithstanding anything to the contrary contained in
Section 22 below, the same shall constitute an
incurable event of default by Tenant. Tenant further covenants and
warrants that it will neither assign nor encumber the Letter of
Credit or any part thereof and that neither Landlord nor its
successors or assigns will be bound by any such assignment,
encumbrance, attempted assignment or attempted encumbrance. Without
limiting the generality of the foregoing, if the Letter of Credit
expires earlier than the LC Expiration Date, Landlord will accept a
renewal thereof (such renewal letter of credit to be in effect and
delivered to Landlord, as applicable, not later than sixty [60]
days prior to the expiration of the Letter of Credit), which shall
be irrevocable and automatically renewable as above provided
through the LC Expiration Date upon the same terms as the expiring
Letter of Credit or such other terms as may be acceptable to
Landlord in its sole discretion. However, if the Letter of Credit
is not timely renewed, or if Tenant fails to maintain the Letter of
Credit in the amount and in accordance with the terms set forth in
this Section 4.4.2 , Landlord shall have the right to
present the Letter of Credit to the Bank in accordance with the
terms of this Section 4.4.2 , and the proceeds of the
Letter of Credit may be applied by Landlord against any Base Rent,
Additional Rent and other charges payable by Tenant under this
Lease that are not paid when due and/or to pay for all losses and
damages that Landlord has suffered or that Landlord reasonably
estimates that it will suffer as a result of any breach or default
by Tenant under this Lease. Any unused proceeds shall constitute
the property of Landlord and need not be segregated from
Landlord’s other assets. Landlord agrees to pay to
Tenant
8.
within thirty (30) days after the
LC Expiration Date the amount of any proceeds of the Letter of
Credit received by Landlord and not applied against any Base Rent,
Additional Rent and other charges payable by Tenant under this
Lease that were not paid when due or used to pay for any losses
and/or damages suffered by Landlord (or reasonably estimated by
Landlord that it will suffer) as a result of any breach or default
by Tenant under this Lease; provided, however, that if prior to the
LC Expiration Date a voluntary petition is filed by Tenant, or an
involuntary petition is filed against Tenant by any of
Tenant’s creditors, under the Bankruptcy Code, then Landlord
shall not be obligated to make such payment in the amount of the
unused Letter of Credit proceeds until either all preference issues
relating to payments under this Lease have been resolved in such
bankruptcy or reorganization case or such bankruptcy or
reorganization case has been dismissed, in each case pursuant to a
final court order not subject to appeal or any stay pending
appeal.
4.4.2.4 Tenant hereby
acknowledges and agrees that Landlord is entering into this Lease
in material reliance upon the ability of Landlord to draw upon the
Letter of Credit upon the occurrence of any breach or default on
the part of Tenant under this Lease. If Tenant shall breach any
provision of this Lease or otherwise be in default hereunder, or if
a voluntary petition is filed by Tenant, or an involuntary petition
is filed against Tenant by any of Tenant’s creditors, under
the Bankruptcy Code, Landlord may, but without obligation to do so,
and without notice to Tenant, draw upon the Letter of Credit, in
part or in whole, to cure any breach or default of Tenant and/or to
compensate Landlord for any and all damages of any kind or nature
sustained or which Landlord reasonably estimates that it will
sustain resulting from Tenant’s breach or default. If for any
reason the Letter of Credit does not permit partial draws, Landlord
shall have the right to make a full draw on the Letter of Credit,
notwithstanding that the full amount may not be required to cure
any default by Tenant. In order to draw upon the Letter of Credit,
Landlord shall submit a statement, signed by Landlord or
Landlord’s managing agent or legal counsel, bearing the
clause “Drawn under [name of Bank] Letter of Credit No.
_____”, which statement shall be accompanied by the original
Letter of Credit. The use, application or retention of the Letter
of Credit, or any portion thereof, by Landlord shall not prevent
Landlord from exercising any other right or remedy provided by this
Lease or by any applicable law, it being intended that Landlord
shall not first be required to proceed against the Letter of
Credit, and shall not operate as a limitation on any recovery to
which Landlord may otherwise be entitled. Tenant agrees not to
interfere in any way with payment to Landlord of the proceeds of
the Letter of Credit, either prior to or following a
“draw” by Landlord of any portion of the Letter of
Credit, regardless of whether any dispute exists between Tenant and
Landlord as to Landlord’s right to draw upon the Letter of
Credit. No condition or term of this Lease shall be deemed to
render the Letter of Credit conditional to justify the issuer of
the Letter of Credit in failing to honor a drawing upon such Letter
of Credit in a timely manner. Tenant agrees and acknowledges that
(a) the Letter of Credit constitutes a separate and
independent contract between Landlord and the Bank, (b) Tenant
is not a third party beneficiary of such contract, (c) Tenant
has no property interest whatsoever in the Letter of Credit or the
proceeds thereof, and (d) in the event Tenant becomes a debtor
under any chapter of the Bankruptcy Code, neither Tenant, any
trustee, nor Tenant’s bankruptcy estate shall have any right
to restrict or limit Landlord’s claim and/or rights to the
Letter of Credit and/or the proceeds thereof by application of
Section 502(b)(6) of the U.S. Bankruptcy Code or
otherwise.
4.4.2.5 Landlord and
Tenant acknowledge and agree that in no event or circumstance shall
the Letter of Credit or any renewal thereof or substitute therefor
or any proceeds thereof be deemed to be or treated as a
“security deposit”. The parties hereto (A) recite
that the Letter of Credit is not intended to serve as a security
deposit and any and all laws, rules and regulations applicable to
security deposits in the commercial context (“ Security
Deposit Laws ”) shall have no applicability or relevancy
thereto and (B) waive any and all rights, duties and
obligations either party may now or, in the future, will have
relating to or arising from the Security Deposit Laws. Tenant
hereby waives the provisions of any Security Deposit Laws, now or
hereafter in effect, which (i) establish the time frame
by
9.
which Landlord must refund a security
deposit under a lease, and/or (ii) provide that Landlord may
claim from the security deposit only those sums reasonably
necessary to remedy defaults in the payment of rent, to repair
damage caused by Tenant or to clean the Premises, it being agreed
that Landlord may, in addition, claim those sums specified in this
Section 4.4.2 and/or those sums reasonably necessary to
compensate Landlord for any loss or damage caused by Tenant’s
breach of this Lease or the acts or omissions of Tenant, including
any damages Landlord suffers following termination of this
Lease.
5. CONDITION AND
DELIVERY OF PREMISES .
5.1 Condition of
Premises . Tenant agrees that Tenant is familiar with the
condition of both the Premises and the Property, and Tenant hereby
accepts the foregoing on an “AS-IS,”
“WHERE-IS” basis, except as is otherwise expressly and
specifically described on Exhibit C attached hereto and
incorporated herein by this reference, it being understood that, if
Landlord has agreed to perform any tenant improvements in or to the
Premises in consideration of Tenant’s entry into this Lease
(collectively, “ Landlord’s Work ”), all
of Landlord’s Work shall be described on
Exhibit C . Tenant acknowledges that neither Landlord
nor Agent, nor any representative of Landlord, has made any
representation as to the condition of the foregoing or the
suitability of the foregoing for Tenant’s intended use.
Tenant represents and warrants that Tenant has made its own
inspection of the foregoing. 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
foregoing in connection with, or in consideration of, this Lease,
except as expressly and specifically set forth in this Lease,
including, but not limited to, Exhibit C .
5.2 Delivery of
Premises . Landlord shall deliver to Tenant, and Tenant
shall accept from Landlord, possession of the Premises on or before
the later of (a) the date Tenant shall have delivered to
Landlord (i) the Security, (ii) all Tenant Policies or
Certificates of Insurance and applicable endorsements (as required
by Section 10.2 ), and (iii) the draft Letter of
Credit required by Section 4.4.2 above (collectively,
the “ Pre-Commencement Deliveries ”), and
(b) March 19, 2007 (the “ Commencement Date
”). Notwithstanding the foregoing, if Tenant shall have
delivered to Landlord the Pre-Commencement Deliveries on or before
March 19, 2007, and Landlord has not delivered or attempted to
deliver possession of the Premises to Tenant on or before
March 19, 2007, Tenant shall have the right to terminate this
Lease by written notice to Landlord on or before March 19,
2007, in which event any amounts previously paid by Tenant to
Landlord shall be returned to Tenant and the parties shall have no
further obligations hereunder.
5.3 Confirmation
of Commencement Date . Upon Landlord’s delivery of
possession, and as a condition precedent to such delivery, of the
Premises to Tenant, and Tenant shall deliver to Landlord a
Confirmation of Commencement Date in substantially the form
attached hereto as Exhibit D .
6.
SUBORDINATION; ESTOPPEL CERTIFICATES; ATTORNMENT
.
6.1
Subordination and Attornment . This Lease is and
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. Tenant shall execute and deliver, within ten (10) days
of Landlord’s request, and in the form reasonably requested
by Landlord (or its lender), any documents evidencing the
subordination of this Lease. Tenant hereby covenants and agrees
that Tenant shall attorn to any successor to Landlord.
Notwithstanding the foregoing, upon the written request of
Tenant,
10.
Landlord shall use commercially
reasonable efforts to cause a future lessor, mortgagee, trustee, or
holder of any such mortgage or deed of trust (collectively, a
“ Lender ”), if any, to deliver to Tenant such
Lender’s customary subordination, non-disturbance and
attornment agreement (“ SNDA ”) in form and
substance reasonably suitable to said Lender, which provides, among
other things, that Tenant’s right to possession of the
Premises shall not be disturbed on account of such subordination so
long as Tenant has not committed a default under this Lease;
provided, however, it shall not be a default by Landlord or a
defense to the enforceability of this Lease in favor of Tenant if
Landlord is unable to obtain delivery of such an SNDA to Tenant,
and further provided that Tenant shall agree to pay all actual and
reasonable fees and costs incurred by Landlord and/or its Lender in
connection with procuring or attempting to procure any such
SNDA.
6.2 Estoppel
Certificate . 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. 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. Notwithstanding anything to the
contrary contained in this Section 6.2 , any estoppel
agreement executed by Tenant pursuant to this
Section 6.2 shall not include provisions which modify
the provisions of this Lease, nor which result in any increase of
Tenant’s obligations or decrease any of Tenant’s rights
under this Lease.
6.3 Transfer by
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, and in
such event Tenant agrees to look solely to Landlord’s
successor in interest (“ Successor Landlord ”)
with respect thereto and agrees to attorn to such
successor.
7. QUIET
ENJOYMENT . Subject to the provisions of this Lease, so
long as no Event of Default (as defined in Section 21.1
) has occurred and is continuing, 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
AND SUBLETTING . Tenant shall not (a) assign (whether
directly or indirectly), in whole or in part, this Lease, or
(b) allow this Lease to be assigned, in whole or in part, by
operation of law or otherwise, including, without limitation, by
transfer of 49% or more of stock, membership interests or
partnership interests, or by dissolution, which transfer of a
controlling interest, or dissolution shall be deemed an assignment
for purposes of this Lease, or (c) mortgage or pledge the
Lease, or (d) sublet the Premises, in whole or in part,
without (in the case of any or all of (a) through
(d)
11.
above) the prior written consent of
Landlord, which consent shall not be unreasonably withheld or
delayed. Notwithstanding the provisions of this
Section 8 , Landlord hereby acknowledges and
consents to Tenant’s right, without further approval from
Landlord, but only after written notice to Landlord, to sublease
the Premises or assign its interest in this Lease (i) to a
person or entity that directly, or indirectly through one or more
intermediaries, controls, is controlled by or is under common
control with Tenant; (ii) in the event of the merger or
consolidation of Tenant with another entity; (iii) in the
event of a sale or transfer of all or substantially all of the
stock of Tenant or all or substantially all of Tenant’s
assets; or (iv) in the event Tenant has an initial public
offering of its shares pursuant to the Security and Exchange Act of
1933 or any other comparable federal or state securities acts;
provided that immediately following the events enumerated in
clauses (i) to (iv) above, the tangible net worth of
Tenant, calculated in accordance with generally accepted accounting
principles, consistently applied, and the credit standing of Tenant
is not less than the tangible net worth, calculated in accordance
with generally accepted accounting principles, consistently
applied, and credit standing of Tenant immediately prior to the
events described in clauses (i) through (iv) above; and
provided further that Tenant advises Landlord, in writing, in
advance, and otherwise complies with the succeeding provisions of
this Section 8 . In no event shall any assignment or
sublease ever release Tenant or any guarantor from any obligation
or liability hereunder; and in the case of any assignment, Landlord
shall retain all rights with respect to the Security. 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. Regardless of whether or not an assignee or sublessee
executes and delivers any documentation to Landlord pursuant to the
preceding sentence, any assignee or sublessee shall be deemed to
have automatically attorned to Landlord in the event of any
termination of this Lease. 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.
In the event of an assignment of this Lease and the payment of
consideration from the assignee to the Tenant in connection
therewith, 50% of such consideration shall be paid to Landlord.
With respect to the allocable portion of the Premises sublet, 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 subtenant and such amount shall he deemed a
component of the Additional Rent.
9. COMPLIANCE
WITH LAWS .
9.1 Compliance
with Laws . Tenant shall, at its sole reasonable 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, and including, but
not limited to, all Laws concerning or addressing matters of an
environmental nature. If any license or permit is required for the
conduct of Tenant’s business in the Premises, Tenant, at its
sole 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.
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
12.
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 relating to
Hazardous Materials, 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 upon reasonable prior written notice to Tenant and
(y) conduct appropriate tests for the purposes of ascertaining
Tenant’s compliance with all applicable Laws 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, 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 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 9.1 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 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 Laws
and to the reasonable satisfaction of Landlord. 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,
“ 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 Law. The
undertakings, covenants and obligations imposed on Tenant under
this Section 9.1 shall survive the termination or
expiration of this Lease.
10.
INSURANCE .
10.1 Insurance
to be Maintained by Landlord . Landlord shall maintain:
(a) a commercial property insurance policy covering the
Property (at its full replacement cost), but excluding
Tenant’s personal property; (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; (c) rent loss insurance; and
(d) any other insurance coverage deemed appropriate by
Landlord or required by Landlord’s lender. All of the
coverages described in (a) through (d) shall be
determined from time to time by Landlord, in its sole discretion.
All insurance maintained by Landlord shall he in addition to and
not in lieu of the insurance required to be maintained by the
Tenant.
13.
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 (collectively, “
Tenant’s Policies ”). All Tenant’s
Policies shall (a) be issued by an insurance company with a
Best rating of A 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; (c) provide
for deductible amounts that are reasonably acceptable to Landlord
(and its lender, if applicable) and (d) otherwise be in such
form, and include such coverages, as Landlord may reasonably
require. The Tenant’s Policies described in (i) and
(ii) below shall (1) provide coverage on an occurrence
basis; (2) name First Industrial, L.P. (and its lender, if
applicable) as additional insured; (3) provide coverage, to
the extent insurable, for the indemnity obligations of Tenant under
this Lease; (4) contain a separation of insured parties
provision; (5) be primary, not contributing with, and not in
excess of, coverage that Landlord may carry; and (6) provide
coverage with no exclusion for a pollution incident arising from a
hostile fire, All Tenant’s Policies (or, at Landlord’s
option, Certificates of Insurance and applicable endorsements,
including, without limitation, an “Additional
Insured-Managers or Landlords of Premises” endorsement) shall
be delivered to Landlord prior to the Commencement Date and
renewals thereof shall be delivered to Landlord’s Corporate
and Regional Notice Addresses at least 30 days prior to the
applicable expiration date of each Tenant’s Policy. In the
event that Tenant fails, at any time or from time to time, to
comply with the requirements of the preceding sentence, Landlord
may (i) order such insurance and charge the cost thereof to
Tenant, which amount shall be payable by Tenant to Landlord upon
demand, as Additional Rent or (ii) impose on Tenant, as
Additional Rent, a monthly delinquency fee, for each month during
which Tenant fails to comply with the foregoing obligation, in an
amount equal to five percent (5%) of the Base Rent then in
effect. 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.
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 personal injuries
or deaths of persons and property damage based upon or arising out
of the ownership, use, occupancy or maintenance of a motor vehicle
at the Premises and all areas appurtenant thereto in the amount of
not less than $1,000,000, combined single limit;
(iii) commercial property insurance covering Tenant’s
personal property (at its full replacement cost); and
(iv) workers’ compensation insurance per the applicable
state statutes covering all employees of Tenant; and if Tenant
handles, stores or utilizes Hazardous Materials in its business
operations, (v) pollution legal liability
insurance.
10.3 Waiver of
Subrogation . Notwithstanding anything to the contrary in
this Lease, Landlord and Tenant mutually waive their respective
rights of recovery against each other and each other’s
officers, directors, constituent partners, members, agents and
employees, and Tenant further waives such rights against
(a) each lessor under any ground or underlying lease
encumbering the Property and (b) each lender under any
mortgage or deed of trust or other lien encumbering the Property
(or any portion thereof or interest therein), to the extent any
loss is insured against or required to be insured against under
this Lease, including, but not limited to, losses, deductibles or
self insured retentions covered by Landlord’s or
Tenant’s commercial property, general liability, automobile
liability or workers’ compensation policies described above,
This provision is intended to waive, fully and for the benefit of
each party to this Lease, any and all rights and claims that might
give rise to a right of subrogation by any insurance carrier. Each
party shall cause its respective insurance policy(ies) to be
endorsed to evidence compliance with such waiver.
14.
11.
ALTERATIONS . 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, which consent shall not be unreasonably withheld or
delayed. All of the following shall apply with respect to all
Alterations: (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) subject to the mod
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