303 EAST WACKER DRIVE
CHICAGO, ILLINOIS
PROMOTIONAL MARKETING, L.L.C.,
d/b/a UPSHOT
Dated as of June 30, 1998
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Page
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CERTAIN
PROVISIONS AND DEFINITIONS
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1
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GRANT AND
ACCEPTANCE OF LEASE
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4
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RENT
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4
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BASE
RENT
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4
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ADDITIONAL
RENT
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4
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USE OF
PREMISES
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8
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TENANT
IMPROVEMENTS
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9
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SERVICES
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9
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CONDITION AND
CARE OF PREMISES
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13
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SURRENDER OF
PREMISES
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16
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HOLDING
OVER
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18
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RULES AND
REGULATIONS
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18
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RIGHTS RESERVED
TO LANDLORD
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18
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ALTERATIONS
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ASSIGNMENT AND
SUBLETTING
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WAIVERS OF
CERTAIN CLAIMS, INDEMNITIES
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28
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DAMAGE OR
DESTRUCTION BY CASUALTY
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29
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EMINENT
DOMAIN
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31
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DEFAULT;
LANDLORD’S RIGHTS AND REMEDIES
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31
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i
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Page
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RIGHTS OF
MORTGAGEES AND GROUND LESSORS
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36
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DEFAULT UNDER
OTHER LEASES
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38
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INSURANCE AND
SUBROGATION
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38
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NONWAIVER
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40
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ESTOPPEL
CERTIFICATE
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40
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TENANT
CORPORATION, LIMITED LIABILITY COMPANY OR PARTNERSHIP
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40
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REAL ESTATE
BROKERS
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NOTICES
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41
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MISCELLANEOUS
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42
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SECURITY
DEPOSIT
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46
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INTENTIONALLY
OMITTED
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LANDLORD
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49
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TITLE AND
COVENANT AGAINST LIENS
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49
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COVENANT OF
QUIET ENJOYMENT
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49
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INITIAL GROWTH
SPACE
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50
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RIGHT OF FIRST
OFFER
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51
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EXPANSION
OPTION
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55
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RENEWAL
OPTION
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57
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MARKET RENTAL
RATE
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58
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BUILDING
DIRECTORY; LOBBY SIGNAGE
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59
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ii
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Page
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SATELLITE
DISH
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59
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PARKING
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61
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BUILDING
MANAGEMENT
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61
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EXCULPATORY
PROVISIONS
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61
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Depiction of
Land
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Legal
Description of Land
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Floor Plans of
Premises
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Other
Definitions
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Workletter
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Taxes and
Expenses
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Cleaning
Specifications
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Rules and
Regulations
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Form of
Subordination, Non-Disturbance and Attornment Agreement
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Form of Letter
of Credit
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Total Expansion
Space
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iii
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June 30,
1998
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303 Wacker
Realty L.L.C.
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(“Landlord”)
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303 East Wacker
Drive
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Chicago,Illinois 60601
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Promotional
Marketing, L.L.C.,
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(“Tenant”)
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d/b/a
Upshot
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225 West Wacker
Drive
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Suite 700
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Chicago,
Illinois 60606
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Floors 23 and
24
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303 East Wacker
Drive
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Chicago,
Illinois 60601-5210
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Landlord and
Tenant hereby covenant and agree as follows:
1.
CERTAIN PROVISIONS AND DEFINITIONS . The following
provisions and definitions are an integral part of this
lease:
(a)
“Additional Allowance”: The amount, if any,
contributed by Landlord pursuant to the Workletter to the cost of
Tenant’s Work which is in excess of the amount of the Base
Allowance provided for in the Workletter.
(b)
“Base Rent”: The respective amounts for each Lease
Year of the Initial Term set forth in the following table (based on
the respective rates of Base Rent per square foot of Rentable Area
set forth in the following table), subject to adjustment
(i) for the first Lease Year, pursuant to Section 34
below on account of the Initial Growth Space and (ii) for
every Lease Year of the Initial Term, pursuant to the remaining
provisions of this Section l(b) regarding any Additional
Allowance:
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Annual Base Rent
Per
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Lease
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Annual Base
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Monthly
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Square Foot of
Rentable
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Year
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Rent
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Base Rent
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Area of the
Premises
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$
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757,410.00
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$
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63,117.50
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$
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15.00
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$
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937,657.00
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$
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78,138.08
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$
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15.50
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$
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1,028,398.00
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$
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85,699.83
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$
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17.00
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$
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1,209,880.00
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$
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100,823.33
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$
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20.00
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$
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1,270,374.00
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$
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105,864.50
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$
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21.00
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$
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1,270,374.00
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$
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105,864.50
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$
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21.00
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$
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1,330,868.00
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$
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110,905.67
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$
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22.00
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$
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1,330,868.00
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$
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110,905.67
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$
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22.00
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$
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1,451,856.00
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$
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120,988.00
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$
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24.00
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$
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1,572,844.00
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$
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131,070.33
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$
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26.00
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If there is an
Additional Allowance, Base Rent for each Lease Year of the Initial
Term shall be equal to the sum of (i) Base Rent set forth in
the table above, as adjusted pursuant to Section 34 below on
account of the Initial Growth Space, plus (ii) the product of
(A) the amount which will be necessary to pay the Additional
Allowance, together with interest on the balance of the Additional
Allowance from time to time outstanding at the rate of eleven
percent (11%) per annum, in full in one hundred twenty
(120) equal monthly installments multiplied by (B) twelve
(12); Monthly Base Rent for each Lease Year of the Initial Term
shall be one-twelfth-of the respective amounts so determined; and
Base Rent per square foot for each Lease Year shall be an amount
equal to the Base Rent for the particular Lease Year as so
determined divided by the Rentable Area of the Premises.
(c)
“Brokers”: Hines Interests Limited Partnership
and Binswanger,
(d)
“Building”: The office building located at 303
East Wacker Drive, Chicago, Illinois 60601-5210.
(e)
“Commencement Date”: The earlier of
(i) April 1, 1999 or (ii) the day Tenant first
begins to conduct any business operations in the
Premises.
(f)
“Expiration Date”: The last full day of the
Term.
2
]
(g)
“Initial Term”: The period ending on the last
day of the tenth (10th) Lease Year.
(h)
“Land”: The parcel(s) of real estate on which
the Building is located, which are depicted on Exhibit A-l and
legally described on Exhibit A-2.
(i)
“Landlord’s Work”: The work to be
performed by or on behalf of Landlord pursuant to the
Workletter.
(j)
“Lease Year”: If the Commencement Date is the
first day of a calendar month, the period of twelve
(12) consecutive months commencing on the Commencement Date;
if the Commencement Date is not the first day of a calendar month,
the period commencing on the Commencement Date and ending on the
last day of the twelfth (12th) full calendar month of the Term;
and, in either case, each consecutive twelve (12) month period
thereafter which falls in whole or in part during the
Term.
(k)
“Premises”: The entire 23rd and 24th floors of
the Building, as shown on Exhibit A-3, which consist of 60,494
square feet of Rentable Area measured in accordance with the BOMA
method of measurement as more fully described in
Exhibit B.
(l)
“Project”: The Land and the Building, together
with any other improvements located on the Land, all equipment,
fixtures, machinery, systems, apparatus and personal property of
Landlord located at or used in connection with the Land or the
Building from time to time.
(m)
“Security Deposit”: See
Section 29.
(n)
“Tenant Alterations”: Any alteration,
improvements or additions (including decorations) to the Premises
performed or to be performed by or on behalf of Tenant, including,
without limitation, the Tenant’s Work, but excluding any of
Landlord’s Work to be performed by or on behalf of Landlord
under the Workletter.
(o)
“Tenant’s Proportionate Share”: The
percentage determined as described in Exhibit B, which
percentage, as of the date of this lease, is (i) 6.5566% for
the first Lease Year, subject to adjustment pursuant to
Section 34 below on account of the Initial Growth Space, and
(ii) 7.8550% for each subsequent Lease Year.
(p)
“Tenant’s Work”: The work to be performed
by or on behalf of Tenant to ready the Premises for initial
occupancy by Tenant, as more particularly described in
Section 7 hereof and in the Workletter.
3
(q) “
Term”: The Initial Term and any extension or renewal
of the Initial Term specifically provided herein.
(r) “
Use”: General office use.
(s) “
Workletter”: The Workletter, attached hereto as
Exhibit C.
See
Exhibit B and the Workletter for other definitions of terms
used herein.
2.
GRANT AND ACCEPTANCE OF LEASE. Landlord hereby leases
the Premises to Tenant and Tenant hereby accepts and leases the
Premises from Landlord to have and to hold during the Term, subject
to the terms and conditions of this lease.
3.
RENT . Base Rent, Additional Rent, Additional Rent
Estimate and all other amounts becoming due from Tenant to Landlord
hereunder (collectively “ Rent” ) shall be paid
in lawful money of the United States to Landlord at the following
address: 303 East Wacker Drive, Chicago, Illinois 60601 or such
other address as Landlord- shall designate in writing to Tenant
from time to time, without any demand and without any reduction,
abatement, counterclaim,
deduction or set-off whatsoever, except as expressly provided
herein, at the times and in the manner hereinafter provided. Rent
unpaid for five (5) days after the due date shall bear
interest at the Default Rate from the date due until paid. The
payment of Rent hereunder is independent
of each and every other covenant and agreement contained in this
lease.
4.
BASE RENT . Tenant shall pay Base Rent to Landlord in
equal monthly installments in the respective amounts per Lease Year
determined pursuant to Section 1(b), subject to the provisions of
Section 34 below (herein called “ Monthly Base
Rent” ), in advance on the Commencement Date and on or
before the first day of each and every calendar month during the
Term. If the Term shall begin on any day other than the first day
of a calendar month or end on any day other than the last day of a
calendar month, then the Monthly Base Rent for any partial calendar
month within the Term shall be prorated on a per diem
basis.
5.
ADDITIONAL RENT . In addition to paving the Base
Rent, Tenant shall also pay as additional rent the amounts
(collectively “ Additional Rent” ) determined to
be Tax Adjustment and Expense Adjustment in accordance with this
Section 5:
(a)
Computation of Additional Rent . Tenant shall pay as
Additional Rent for each Calculation Year the following
amounts:
(i)
Tenant’s Proportionate Share of Taxes for such Calculation
Year (the “ Tax Adjustment” ); plus
4
(ii)
Tenant’s Proportionate Share of Expenses for such Calculation
Year (the “ Expense Adjustment ”).
(b) Payments
of Additional Rent; Additional Rent Estimate; Projections .
Tenant shall pay Additional Rent to Landlord in the manner
hereinafter provided. The aggregate of payments required to be made
by Tenant on account of Additional Rent for any Calculation Year
until actual Additional Rent is determined is herein called “
Additional Rent Estimate ”.
(i)
Landlord may, at any time and from time to time prior to the first
Calculation Date and during the Term (but not more than twice for
any given calendar year after Tenant’s Additional Rent
Estimate is established for that calendar year), deliver to Tenant
a written notice or notices (“ Projection Notice
”) setting forth:
(A)
Landlord’s reasonable estimates, forecasts or projections
(collectively, the “ Projections ”) of any or
all of Taxes and Expenses for such Calculation Year, and
(B)
Tenant’s Additional Rent Estimate (setting forth the Expense
Adjustment component and Tax Adjustment component separately) based
upon the Projections, being the Tenant’s Proportionate Share
of the Projections.
(ii)
On or before the first (1st) day of the next calendar month
following Landlord’s service of a Projection Notice, and on
or before the first day of each month thereafter, Tenant shall pay
to Landlord one-twelfth (1/12) of the Additional Rent Estimate
shown in the Projection Notice. Within fifteen (15) days
following Landlord’s service of a Projection Notice, to bring
Tenant’s payments of Additional Rent Estimate current, Tenant
shall also pay Landlord the amount set forth in the Projection
Notice, which shall equal the Additional Rent Estimate shown in the
Projection Notice less (A) any previous payments on account of
Additional Rent Estimate made for such Calculation Year, and
(B) total monthly installments on account of Additional Rent
Estimate not yet due and payable for the remainder of such
Calculation Year. Until such time as Landlord furnishes a
Projection Notice for a Calculation Year, Tenant shall pay to
Landlord a monthly installment of Additional Rent Estimate on the
first day of each month equal to the greater of the latest monthly
installment of Additional Rent Estimate or one-twelfth (1/12) of
Tenant’s latest determined Additional Rent.
5
(i)
Following the end of each Calculation Year and after Landlord shall
have determined the amount of Expenses to be used in calculating
the Expense Adjustment for such Calculation Year, Landlord shall
notify Tenant in writing (any such notice of Expenses and Expense
Adjustment herein called “Landlord’s Expense
Statement”) of such Expenses and Tenant’s Expense
Adjustment for such Calculation Year. If the Expense Adjustment
owed for such Calculation Year exceeds the Expense Adjustment
component of the Additional Rent Estimate paid by Tenant during
such Calculation Year, then Tenant shall, within thirty
(30) days after the date of Landlord’s Expense
Statement, pay to Landlord an amount equal to the excess of the
Expense Adjustment over the Expense Adjustment component of the
Additional Rent Estimate paid by Tenant during such Calculation
Year. If the Expense Adjustment component of the Additional Rent
Estimate paid by Tenant during such Calculation Year exceeds the
Expense Adjustment owed for such Calculation Year, then Landlord
shall credit such excess to Rent payable after the date of
Landlord’s Expense Statement, or may, at its option, credit
such excess to any Rent theretofore due and owing, until such
excess has been exhausted. If this lease shall expire or be
terminated prior to full application of such excess, Landlord
shall, within thirty (30) days thereafter, pay to Tenant the
balance thereof not theretofore applied against Rent and not
reasonably required for payment of Rent for the Calculation Year in
which the lease expires, subject to Tenant’s obligations
under Section 5(e) hereof, provided Tenant shall have vacated the
Premises and otherwise surrendered the Premises to Landlord in
accordance with this lease.
(ii)
Following the end of each Calculation Year and after Landlord shall
have determined the actual amount of Taxes to be used in
calculating the Tax Adjustment for such Calculation Year, Landlord
shall notify Tenant in writing (any such notice of Taxes and Tax
Adjustment herein called “Landlord’s Tax
Statement”) of such Taxes for such Calculation Year. If the
Tax Adjustment owed for such Calculation Year exceeds the Tax
Adjustment component of the Additional Rent Estimate paid by Tenant
during such Calculation Year, then Tenant shall, within thirty
(30) days after the date of Landlord’s Tax Statement,
pay to Landlord an amount equal to the excess of the Tax Adjustment
over the Tax Adjustment component of the Additional Rent Estimate
paid by Tenant during such Calculation Year. If the Tax Adjustment
component of the Additional Rent Estimate paid by Tenant during
such Calculation Year exceeds the Tax Adjustment owed for such
Calculation Year, then Landlord shall credit such excess to Rent
payable after the date of Landlord’s Tax Statement, or may,
at its option, credit such excess to any Rent theretofore due and
owing, until such excess has been exhausted. If this lease shall
expire or be terminated prior to full application of such excess,
Landlord
6
shall, within
thirty (30) days thereafter, pay to Tenant the balance thereof
not theretofore applied against Rent and not reasonably required
for payment of Rent for the Calculation Year in which the lease
expires, subject to Tenant’s obligations under Section 5(e)
hereof, provided Tenant shall have vacated the Premises and
otherwise surrendered the Premises to Landlord in accordance with
this lease.
(d) Books
and Records . Landlord shall maintain books and records
showing Taxes and Expenses in accordance with sound accounting and
management practices. Tenant and its Representative (as hereinafter
defined) shall have the right to examine such books and records
showing Taxes and Expenses upon reasonable prior notice during
normal business hours and without interference with
Landlord’s operations at any time within sixty (60) days
following Tenant’s receipt of Landlord’s Expense
Statement (as it relates to an examination of Expenses) or
Landlord’s Tax Statement (as it relates to an examination of
Taxes) provided for in Section 5(c). Unless Tenant shall take
written exception to any item of Taxes or Expenses, specifying in
detail the reasons for such exception as to a particular item
within ninety (90) days after Tenant’s receipt of
Landlord’s Expense Statement or Landlord’s Tax
Statement (as the case may be), Landlord’s Expense Statement
and Landlord’s Tax Statement, as applicable, shall be
considered as final and accepted by Tenant. Notwithstanding any
exception made by Tenant, Tenant shall pay Landlord the full amount
of its Additional Rent Estimate and its Additional Rent as
determined by Landlord, subject to readjustment at such time as any
such exception may be resolved in favor of Tenant. Tenant’s
“Representative” shall be either a nationally
recognized independent certified public accounting firm licensed to
do business in the State of Illinois, or another accounting firm
reasonably acceptable to Landlord. For each examination of
Landlord’s books and records, the employees of Tenant’s
Representative who personally examine such books and records
shall-include a certified public accountant, but if deemed
necessary or appropriate by the accountant may also include other
real estate professionals who are experienced in management of
first- class office buildings. Tenant shall not retain its
Representative on a contingent fee basis.
(e)
Proration and Survival . With respect to any
Calculation Year which does not fall entirely within the Term,
Tenant shall be obligated to pay as Additional Rent for such
Calculation Year only a pro rata share of Additional Rent as
hereinabove determined, based upon the number of days of the Term
falling within the Calculation Year. Following expiration or
termination of this lease, Tenant shall pay any Additional Rent due
to Landlord within fifteen (15) days after the date of
Landlord’s Expense Statement or Landlord’s Tax
Statement (as the case may be) sent to Tenant. Without limiting
other obligations of Tenant which survive the expiration or
termination of this lease, the obligations of Tenant to pay
Additional Rent provided for in this Section 5 shall survive
the expiration or earlier termination of this lease. No interest or
penalties shall accrue on any amounts which Landlord is obligated
to credit or pay to Tenant by reason of this Section 5 unless
any amount required to be paid to Tenant is not paid when due under
this
7
Section 5,
in which case such amount shall bear interest from the due date at
the Default Rate.
(f)
No Decrease in Base Rent . In no event shall any
Additional Rent result in a decrease of the Base Rent payable
hereunder.
(g)
No Representation or Warranty . Exhibit D
attached hereto sets forth information about the amounts of Taxes
and Expenses for the years indicated therein which was furnished to
Landlord by the predecessor owner and manager of the Project.
Tenant acknowledges, however, that neither Landlord, nor any of its
respective agents or employees, has made or does hereby make any
representation or warranty whatsoever to Tenant as to the amount of
Taxes, Expenses, Tax Adjustment or Expense Adjustment or any
component thereof for prior years or which may become payable
during the Term.
(a)
Use . Tenant shall use and occupy the Premises as set
forth in Section l(r) hereof only and for no other use or
purpose.
(b)
Compliance with Requirements . Tenant shall comply
with all applicable Laws (hereinafter defined) now or hereafter in
force, and with all applicable insurance underwriters regulations
and other requirements, respecting all matters of occupancy,
condition or maintenance of the Premises, whether any of the
foregoing shall be directed to Tenant or Landlord and whether
imposed on the owner or occupant of the Premises.
“Laws” means all statutes, laws, ordinances,
codes, rules and regulations, orders and directions of public
officials or other acts having the force or effect of law, of all
federal, state, county, municipal and other agencies, authorities
or bodies having jurisdiction over the Premises. Notwithstanding
the foregoing, but subject to the provisions of Section 9(f) below
regarding the ADA (as defined therein), Tenant shall not be
obligated to make any structural alterations to the Building if
similar alterations will be required to be made in the Building as
a whole, as distinguished from alterations made necessary by
Tenant’s particular use of the Premises or required to be
made to, or made necessary by, Tenant Alterations; provided,
however, that the cost of any such alterations made by Landlord may
be included in Expenses except for capital alterations which are
required under governmental laws, regulations, or ordinances
applicable to the Building as of the date of this lease and to the
extent otherwise excluded from Expenses by this lease.
Tenant shall not
make or permit any use of the Premises or the Building, or do or
permit to be done anything in or upon the Premises or the Building,
or bring or keep anything in the Premises or the Building, which
directly or indirectly is forbidden by any of the foregoing or
which may be dangerous to persons or property, or which may
invalidate or increase the rate of insurance on the Building above
the standard risk for tenants of first-class office buildings,
its
8
appurtenances,
contents or operations, or which would tend to create or continue a
nuisance or which is contrary to or prohibited by the terms and
conditions of this lease.
7.
TENANT IMPROVEMENTS . Subject to Landlord’s
obligations with respect to the Landlord’s Work, Tenant
shall, at its sole cost and expense (subject to application of the
allowances provided for in the Workletter), perform such work
(“Tenant’s Work”) as may be necessary or
desired by Tenant to improve the Premises for occupancy, all
subject to and in accordance with the provisions of this lease and
the Workletter.
(a)
General Description of Services . So long as this
lease is in full force and effect, Landlord shall furnish the
following services (the cost of which may be included in
Expenses):
(i) Air
conditioning and heat when necessary to provide a temperature
condition required, in Landlord’s reasonable judgment, for
comfortable occupancy of the Premises under normal business
operations, Monday through Friday from 8:00 A.M to 6:00 P.M. and
Saturdays from 8:00 A.M to 1:00 P.M. Holidays excepted. The design
specifications for the Building air conditioning and heating system
servicing the Premises under the design loads for such system are
set forth in the Description of Base Building Work attached to the
Workletter as Attachment 1. Levels of heating and air conditioning
are subject to adjustments pursuant to compliance by Landlord with
Laws and governmental guidelines relating to energy use.
(ii) Domestic
water in common with other tenants for drinking, lavatory and
toilet purposes drawn through fixtures installed by Landlord within
the core of the Building, and warm water in common with other
tenants for lavatory purposes and for ordinary office kitchen
purposes from the same regular Building supply and
fixtures.
(iii) Customary
janitor and cleaning service in and about the Premises and common
areas of the Building in accordance with the specifications
attached hereto as Exhibit E. Tenant shall not provide or use
any other janitor or cleaning service.
(iv) Passenger
elevator service in common with Landlord and other persons, Monday
through Friday from 8:00 A.M. to 6:00 P.M. (Saturdays from 8:00
A;M. to 1:00 P.M.), Sundays and Holidays excepted; and freight
elevator service in common, with Landlord and other persons, and
subject to prior scheduling with Landlord, Monday through Friday
from 8:00 A.M. to 4:00 P.M., Saturdays, Sundays and Holidays
excepted. Limited passenger elevator service shall be provided
daily at all times when the aforesaid passenger elevator service is
not furnished.
9
(v) Without
limitation of Item 3 of Attachment 2 to the Workletter,
security at a level consistent with that provided by comparable
first-class office buildings in downtown Chicago,
Illinois.
(b)
Electricity . Except as hereinafter provided,
electricity shall not be furnished by Landlord, but shall be
furnished by Commonwealth Edison Company or another electric
utility company serving the area selected by Landlord. Landlord
shall permit Tenant to receive such service direct from such
utility company at Tenant’s cost, and shall permit
Landlord’s wire and conduits, to the extent available,
suitable and safely capable, to be used for such purposes. The
capacity of the electrical service to the Premises is set forth in
the Description of Base Building Work attached to the Workletter as
Attachment 1. Tenant shall make all necessary arrangements with the
utility company for metering and paying for electric current
furnished by it to Tenant, and Tenant shall pay for all charges for
electric current consumed on the Premises during Tenant’s
occupancy thereof. Tenant shall make no alterations or additions to
the electric equipment or systems in the Premises or the Building
without the prior written consent of Landlord in each instance.
Tenant also agrees to purchase from Landlord or its agents, as
Landlord shall direct, all lamps, bulbs, ballasts and starters used
in the Premises during the Term. Tenant covenants and agrees that
at all times its use of electric current shall never exceed the
capacity referred to above. Notwithstanding the foregoing, Landlord
reserves the right to provide electricity to the Premises in whole
or in part, and in such event Tenant agrees to purchase such
electricity from Landlord, at Landlord’s then current charges
at rates which shall not exceed the rates for such service charged
to tenants of the Building leasing space comparable in size to the
space leased by Tenant. If the Premises are not separately metered
for any reason, or are separately metered only in part, then Tenant
shall pay Landlord, as additional Rent, in monthly installments at
the time prescribed for monthly installments of Monthly Base Rent,
amounts determined by Landlord based upon Landlord’s then
established rates therefor, which shall not exceed the rates for
such service charged to tenants of the Building leasing space in
size comparable in size to the space leased by Tenant.
(c)
Telephone . All telegraph, telephone, and electric
connections which Tenant may desire shall be first approved by
Landlord in writing, before the same are installed, and the
location of all wires and the work in connection therewith shall be
performed by contractors approved by Landlord, which approval shall
not be unreasonably withheld, and shall be subject to the
reasonable direction of Landlord. Landlord reserves the right to
designate and control the entity or entities providing telephone or
other communication cable installation, repair and maintenance in
the Building and to restrict and control access to telephone
cabinets. In the event landlord designates a particular vendor or
vendors to provide such cable installation, repair and maintenance
for the Building, Tenant agrees to abide by and participate in such
program, provided that the rates for such installation, repair and
maintenance are commercially reasonable in view of similar programs
in comparable buildings. Tenant shall be responsible for and shall
pay all costs incurred in connection with the installation of
telephone cables and related wiring in the Premises, including,
without limitation, any hook-up, access and maintenance fees
related to the
10
installation of
such wires and cables in the Premises and the commencement of
service therein, and the maintenance thereafter of such wire and
cables; and there shall be included in Expenses for the Building
all installation, hook-up or maintenance costs incurred by Landlord
in connection with telephone cables and related wiring in the
Building which are not allocable to any individual users of such
service but are allocable to the Building generally. If Tenant
fails to maintain all telephone cables and related wiring in the
Premises and such failure affects or interferes with the operation
or maintenance of any other telephone cables or related wiring in
the Building, Landlord or any vendor hired by Landlord may, if such
failure is not cured upon reasonable prior notice to Tenant (except
in the case of an emergency, where no notice shall be required),
enter into and upon the Premises and perform such repairs,
restorations or alterations as Landlord deems necessary in order to
eliminate any such interference (and Landlord may recover from
Tenant all of Landlord’s costs in connection therewith and
Landlord shall have no liability to Tenant by reason thereof). Upon
the Expiration Date, Tenant agrees to remove all telephone cables
and related wiring installed by Tenant for and during
Tenant’s occupancy, which Landlord shall request Tenant to
remove. Tenant agrees that neither Landlord nor any of its agents
or employees shall be liable to Tenant, or any of Tenant’s
employees, agents customers or invitees or anyone claiming through,
by or under Tenant, for any damages, injuries, losses, expenses,
claims or causes of action because of any interruption, diminution,
delay or discontinuance at any time for any reason in the
furnishing of any telephone service to the Premises and the
Building.
(d)
Extra or Additional Services . Tenant may request
Landlord to provide services which are extra or additional services
to those described in Section 8(a), by advance request to
Landlord. If Landlord shall agree to so provide any such services
which are extra or in addition to those services described in
Section 8(a), Tenant shall pay for any such extra or
additional services so provided by Landlord at Landlord’s
established rates therefor from time to time, or if there are no
established rates, then at the rate of 115% (or, with respect to
after-hours HVAC,- at the rate of 100%) of the cost of providing
such service, or as otherwise agreed by Landlord and Tenant.
Landlord’s current rates for after-hours HVAC are $70.50 per
hour for ventilation only, $139.16 per hour for heating
(perimeter) and ventilation, and $167.69 per hour for air
conditioning and ventilation. All charges for any such extra or
additional services so provided by Landlord shall be deemed to be
additional Rent hereunder and shall be due and payable within ten
(10) days after Tenant receives Landlord’s bill
therefor, or in installments as may be designated by Landlord to
Tenant in writing. If Tenant fails to pay when due Landlord’s
proper charges for any such extra or additional services, Landlord
shall have the right, in addition to all other rights and remedies
available to Landlord, to discontinue furnishing any such extra or
additional services for which Tenant has failed to pay. If Landlord
discontinues any such extra or additional services as provided in
this Section 8(d), no such discontinuance shall be deemed an
eviction or disturbance of Tenant’s use of the Premises or
render Landlord liable for damages or relieve Tenant from
performance of Tenant’s obligations under this
lease.
(e)
Holidays . For purposes of this Section 8,
“Holidays” means New Year’s Day, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day, Christmas Day and
any other
11
day customarily
designated as a holiday by landlords operating first-class office
buildings in downtown Chicago, Illinois.
(f)
Interruption of Services. Tenant agrees that neither
Landlord, nor any of Landlord’s constituent members, nor any
of their respective agents, partners or employees, shall be liable
for damage or injury to person, property or business or for loss or
interruption of business, or for any other matter, in the event
there is any failure, delay, interruption or diminution in
furnishing any service. No such failure, delay, interruption or
diminution shall be deemed to constitute an eviction or disturbance
of Tenant’s use or possession of the Premises, in whole or in
part, actual or constructive, nor entitle Tenant to any claim for
set-off, abatement or reduction of Rent, nor render Landlord liable
for damages, nor relieve Tenant from the performance of or affect
any of Tenant’s obligations under this lease. Notwithstanding
the foregoing, if due to Landlord’s wrongful act or omission
services described in Sections 8(a)(i), (ii) (limited to water
supplied to base building washrooms) and (iv) and 8(b) above
are interrupted, so that Tenant is not able and actually ceases to
conduct any business activities in the Premises for a period of
five (5) consecutive business days, Base Rent and Additional
Rent shall abate as of the sixth (6th) consecutive business day and
thereafter until such time as service is restored so that Tenant is
able to or actually resumes occupancy of the Premises for any of
its customary business activities.
Landlord shall use
commercially reasonable efforts to minimize any failure, delay,
interruption or diminution in furnishing any service.
(g)
Tenant’s Cooperation. Tenant agrees to
cooperate fully with Landlord, at all times, in abiding by
reasonable regulations and requirements which Landlord may
prescribe for the proper functioning and protection of all
utilities and services reasonably necessary for the operation of
the Premises or the Project. Landlord and its contractors shall
have free access, upon reasonable prior notice (except in an
emergency, where no notice shall be required), to any and all
mechanical installations in the Premises, and Tenant agrees that
there shall be no construction of partitions or other obstructions
which might interfere with the moving of the servicing equipment of
Landlord to or from the enclosures containing said installations.
Tenant further agrees that neither Tenant nor its employees, agents
or contractors shall at any time tamper with, adjust or otherwise
in any manner adversely affect Landlord’s mechanical
installations in the Premises or the Project.
(h)
Supplemental Heating or Cooling. Whenever, in
Landlord’s reasonable judgment, Tenant’s use or
occupation of the Premises, including lighting, personnel, heat
generating machines or equipment, or airborne emissions of smoke or
other particulates, individually or cumulatively, causes the design
loads for the system providing heat and air-cooling to be exceeded,
or otherwise affects adversely the temperature, humidity or air
quality otherwise maintained by the heating, ventilating and air
handling or conditioning system in the Premises or the Building,
and Tenant fails to cure such effect by adjusting Tenant’s
loads or installing supple-
12
mentary heating
or air handling or conditioning units within fifteen (15) days
after notice from Landlord, Landlord may, but shall not be
obligated to, temper such excess loads by installing supplementary
heating or air handling or conditioning units in the Premises or
elsewhere where necessary. In such event, the cost of such units
and the expense of installation, including without limitation, the
cost of preparing working drawings and specifications, plus ten
percent (10%) of the cost of such units and of the hard costs of
installation as an overhead and supervision fee if such cost and
hard costs are less than $100,000.00 in any instance and five
percent (5%) of the cost of such units and of the hard costs of
installation as an overhead and supervision fee if such cost and
hard costs are $100,000.00 or more, shall be paid by Tenant as
additional Rent within ten (10) days after Landlord’s
demand therefor. Alternatively, Landlord may require Tenant to
install such supplementary heating or air handling or conditioning
units at Tenant’s sole expense. Landlord may operate and
maintain any such supplementary units, but shall have no continuing
obligation to do so or liability in connection therewith. The
expense resulting from the operation and maintenance of any such
supplementary heating or air handling or conditioning units,
including utility charges, charges for condenser water, repair
costs, labor costs and rent for space occupied by any supplementary
heating or air handling or conditioning units installed in Rentable
Area outside the Premises, shall be paid by Tenant to Landlord as
additional rent at rates fixed by Landlord, which shall be, for
condenser water, actual tap fees incurred plus $98.65 per ton of
supplemental cooling capacity per year, subject to adjustment to
reflect changes in costs of supplying condenser water.
Alternatively, Landlord may require Tenant to operate and maintain
any such supplementary units, also at Tenant’s sole
expense.
9.
CONDITION AND CARE OF PREMISES .
(a)
Condition of Premises . Tenant’s taking possession
of the Premises or any portion thereof shall be conclusive evidence
against Tenant that such portion of the Premises was then in good
order and satisfactory condition, subject to completion of the Base
Building Work and to latent defects in any Base Building Work of
which Tenant gives Landlord notice within one (1) year after
substantial completion of such Base Building Work, and also subject
to Landlord’s obligations under this lease. Tenant
acknowledges that, except as expressly set forth herein and in the
Workletter, the Premises shall be accepted by Tenant in their
“as-is” condition, and that no promise by or on behalf
of Landlord, any of Landlord’s constituent members, the
leasing agent of the Project or any of their respective agents,
partners or employees, to alter, remodel, improve, repair, decorate
or clean the Premises has been made to or relied upon by Tenant,
and that no representation respecting the condition of the Premises
or the Project by or on behalf of Landlord, its constituent
members, or any of their respective agents, partners or employees
has been made to or relied upon by Tenant, except to the extent
expressly set forth in this lease or in the Workletter.
(b)
Tenant’s Repairs . Subject to the provisions
regarding fire and other casualty losses set forth in
Section 17 hereof, Tenant, at its expense, shall (i) keep
the Premises (including all Landlord’s Work and Tenant
Alterations) in good order, repair and condition at all
times
13
during the
Term, and (ii) promptly and adequately repair all damage to
the Premises, including damage to interior windows and to any
portion of the Building air conditioning, heating, electrical and
plumbing systems which run through the Premises and which serve the
Premises, caused by Tenant or its contractors, agents, employees or
invitees. Tenant shall give prompt notice to Landlord of any
material repair, maintenance or replacement items required under
this Section 9(b). All work with respect to any such
maintenance, repair or replacement shall be performed within a
reasonable period after the need for such action arises and shall
be subject to the provisions of Section 14 hereof. If Tenant
fails to perform such work within a reasonable period and such
failure continues for thirty (30) days after written notice to
Tenant from Landlord (except in the case of an emergency, when no
such notice or cure period shall be required), Landlord may, in its
sole discretion, elect to effect such repairs whether or not Tenant
would otherwise be prepared to do so, and, in such case, Tenant
shall pay Landlord the cost thereof plus a coordination and
management fee equal to ten percent (10%) of such cost, upon
Landlord’s written demand.
(c)
Landlord’s Repairs . Subject to the provisions
regarding fire and other casualty losses set forth in
Section 17 hereof, Landlord shall (i) keep the
foundations, roofs, exterior walls, and the structural elements of
the Building, and the public areas in the Building, exclusive of
the Premises and other tenant spaces occupied by or under the
control of tenants, in good order, .repair and condition at all
times during the Term, and (ii) keep in good order, condition
and repair all outside windows of the Premises and the electrical,
plumbing, heating, ventilating and air conditioning systems
servicing the Premises (other than as set forth in Section 9(b)
above). Notwithstanding the foregoing, (A) Landlord shall not
be responsible for the maintenance or repair of any floor or wall
coverings in the Premises or any of such systems which are located
within the Premises and are supplemental or special to the
Building’s standard systems which are located within the
Premises and are supplemental or special to the Building’s
standard systems; and (B) subject to the provisions of
Sections 16(a) and 22(b) below, the cost of performing any of said
maintenance or repairs, whether to the Premises or to the Building,
caused by the negligence of Tenant, its employees, agents,
servants, subtenants or contractors, shall be paid by Tenant
immediately upon Landlord’s demand therefor. Upon reasonable
prior notice (except in the case of an emergency, where no such
notice Shall be required), and so long as Landlord uses good faith
efforts to maintain reasonable access to the Premises, minimize
unreasonable interference with the conduct of Tenant’s
business, and avoid any permanent material adverse affect on the
appearance of the Premises, and subject to the restrictions
contained in Section 13(n) below, Landlord may, but shall not be
required to, enter the Premises at all reasonable times to make
repairs, alterations, improvements and additions to the Premises as
Landlord shall deem necessary; to make repairs, alterations,
improvements and additions to the Building or to any equipment
located in the Building as Landlord shall deem necessary or
reasonably deem desirable; and to make repairs, alterations,
improvements and additions to the Premises, the Building or such
equipment as Landlord may be required to make by governmental
authority or court order or decree.
14
(d)
No Rights to Light. Air or View. This lease does not
grant any rights to light, air or view over or about the real
property of Landlord or any other real property. Landlord
specifically excepts and reserves to itself all rights to and the
use of any roofs, the exterior portions of the Premises, the land,
improvements and air and other rights below the improved floor
level of the Premises, the improvements and air and other rights
above the improved ceiling of Premises, the improvements and air
and other rights located outside the demising walls of the Premises
and, subject to the restrictions contained in Section 13(n) below,
such areas within the Premises as are required for installation of
utility lines and other installations required to serve the
Building or any occupants of the Building, and Landlord
specifically reserves to itself the right to use, maintain and
repair same, and no rights with respect thereto are conferred upon
Tenant, unless otherwise specifically provided herein.
(e)
Hazardous Substances. Tenant shall comply, at its sole
expense, with all Laws relating to the protection of public health,
safety and welfare and with all environmental Laws in the use,
occupancy and operation of the Premises. Tenant agrees that no
Hazardous Substances (as hereinafter defined) shall be used,
located, stored or processed on the Premises or be brought into the
Building by Tenant except for (i) minor quantities of cleaning
materials customary for office use and (ii) aerosol glue in
quantities which are both safe and reasonably necessary for
Tenant’s normal use in its production room, provided that the
foregoing are handled, stored and disposed of in compliance with
all applicable Laws, and subject to the provisions of
Section 6 of this Lease. Tenant further agrees that no
Hazardous Substances will be released or discharged from the
Premises (including, but not limited to, ground water
contamination), except that aerosol glue shall be vented directly
from Tenant’s production room to the extent required by Law
or by Landlord, and to the extent permitted by Law, by means of a
venting system installed as part of the Tenant’s Work under
the Workletter or pursuant to Section 14 of this Lease. The
term “Hazardous Substances” shall mean and include all
hazardous and toxic substances, waste or materials, any pollutant
or contaminant, including, without limitation, PCB’s,
asbestos and raw materials that include hazardous constituents or
any other similar substances or materials that are now or hereafter
included under or regulated by any environmental Laws or that would
pose a health, safety or environmental hazard. In the event that
Tenant is notified of any investigation or violation of any
environmental Law arising from Tenant’s activities at the
Premises, Tenant shall immediately deliver to Landlord a copy of
such notice. In such event or in the event Landlord reasonably
believes that a violation of environmental Law arising from
Tenant’s activities exists, Landlord may conduct such tests
and studies relating to compliance by Tenant with environmental
Laws or the alleged presence of Hazardous Substances upon the
Premises as Landlord deems desirable, all of which shall be
completed at Tenant’s expense. Landlord’s inspection
and testing rights are for Landlord’s own protection only,
and Landlord has not, and shall not be deemed to have assumed any
responsibility to Tenant or any other party for compliance with
environmental Laws, as a result of the exercise, or non-exercise of
such rights. Tenant shall indemnify, defend, protect and hold
harmless Landlord, its constituent members, and their respective
officers, directors, members, partners, agents, employees,
successors and assigns (collectively, the “Landlord
Parties”), from and against any and all loss, claim, expense,
liability
15
and cost
(including attorneys’ fees) arising out of or in any way
related to the presence of any Hazardous Substance introduced to
the Premises during the Term by Tenant or its employees, agents,
servants, subtenants or contractors.
Landlord agrees,
as to any Hazardous Substances (as now defined) existing in the
Premises on the date hereof, to remove or otherwise remediate such
Hazardous Substances if and to the extent required by law, at
Landlord’s sole cost and expense.
(f)
Americans with Disabilities Act . Landlord and Tenant
acknowledge that the Americans With Disabilities Act of 1990 (42
U.S.C §12101 et seq.) and regulations and guidelines
promulgated thereunder, as all of the same may be amended and
supplemented from time to time (collectively referred to herein as
the “ADA” ) establish requirements for business
operations, accessibility and barrier removal, and that such
requirements may or may not apply to the Premises and the Building
depending on, among other things: (1) whether Tenant’s
business is deemed a “public accommodation” or
“commercial facility” , (2) whether such
requirements are “readily achievable” , and
(3).whether a given alteration affects a primary function area or
triggers “path of travel” requirements. The
parties hereby agree that: (a) Landlord shall be responsible
for ADA Title III compliance in the common areas of the Building,
except as provided below, (b) Tenant shall be responsible for
ADA Title III compliance in the Premises, including any leasehold
improvements or other work to be performed in the Premises under or
in connection with this lease, and (c) Landlord may perform,
or require that Tenant perform, and Tenant shall be responsible for
the cost of, ADA Title HI “path of travel”
requirements triggered by alterations in the Premises. Tenant shall
be solely responsible for requirements under Title I of the ADA
relating to Tenant’s employees.
10.
SURRENDER OF PREMISES .
(a)
Surrender . Upon the termination of this lease by lapse
of time or otherwise or upon the earlier termination of
Tenant’s right of possession, Tenant shall surrender
possession of the Premises to Landlord and deliver all keys,
computer cards or codes and other entry devices to the Premises to
Landlord and make known to Landlord the combinations of all locks
of vaults then remaining in the Premises, and shall, subject to the
following subparagraphs, return the Premises and all equipment and
fixtures of Landlord therein to Landlord in as good condition as
when Tenant originally took possession, except for ordinary wear
and tear, and except for loss or damage by fire or other casualty
or condemnation, failing which Landlord may restore the Premises
and such equipment and fixtures to such condition, and Tenant shall
pay the cost thereof to Landlord on demand.
(b)
Ownership of Improvements . All installations,
additions, partitions, hardware, fixtures and improvements,
temporary or permanent (including Tenant Alterations), except
movable furniture and equipment and other personal property or
trade fixtures belonging to Tenant, and except as may be otherwise
agreed by Landlord and Tenant pursuant to the
16
Workletter, in
or upon the Premises, whether placed there by Tenant or Landlord,
shall, upon the termination of this lease by lapse of time or
otherwise or upon the earlier termination of Tenant’s right
of possession, become Landlord’s property and shall remain
upon the Premises, all without compensation, allowance or credit to
Tenant; provided, however, that if at the time Landlord consents to
Tenant’s installation of Tenant Alterations or other
installations, additions, partitions, hardware, fixtures and
improvements or at any other time prior to termination of this
lease or Tenant’s right to possession, Landlord requires or
agrees to permit removal of the same upon termination, then Tenant,
at Tenant’s sole cost and expense, upon termination of this
lease by lapse of time or otherwise or upon the earlier termination
of Tenant’s right of possession, shall promptly remove such
designated items, and Tenant shall thereafter repair any damage to
the Premises or the Project caused by such removal, failing which
Landlord may remove the same and repair the Premises or the
Project, as the case may be, and Tenant shall pay the cost thereof
to Landlord on written demand. Without limitation of the foregoing,
if any of the Tenant Alterations involved the lowering of ceilings,
raising of floors or the installation of specialized wall or floor
coverings or lights, then Tenant, at Landlord’s request,
shall also be obligated to return such surfaces to their condition
prior to the commencement of this lease. Further, at
Landlord’s request, Tenant shall be required to close any
staircases or other openings between floors within the Premises.
Tenant’s failure to perform the work described in the
preceding sentences on or before the expiration or earlier
termination of this lease or Tenant’s right of possession
hereunder, shall, without limitation on other rights or remedies
available to Landlord, give rise to the right of Landlord to
perform such work, and Tenant shall pay the costs thereof to
Landlord on written demand. Notwithstanding any of the foregoing,
Tenant shall not be required to remove any Tenant’s Work
performed pursuant to the Workletter. Furthermore, Tenant shall not
be required to remove the existing staircases between floors of the
Premises if this lease expires as to the portion of the Premises in
which such staircases are located by lapse of time, without earlier
termination of this lease or Tenant’s right of possession as
to such portion of the Premises or any other termination of this
lease as to all or such portion of the Premises prior to the stated
expiration of the Term.
(c)
Removal of Personal Property. Upon the termination of
this lease by lapse of time or otherwise or upon the earlier
termination of Tenant’s right of possession, Tenant shall
remove from the Premises Tenant’s furniture, machinery, safes
and other items of movable personal property of every kind and
description and Tenant’s trade fixtures, and Tenant shall
restore any damage to the Premises or the Project caused thereby
(such removal and restoration to be performed prior to the
expiration of the Term and prior to or immediately following any
earlier termination of this lease or Tenant’s right of
possession), failing which Landlord may do so and thereupon the
provisions of Section 19(f) shall apply; provided, however, if this
lease or Tenant’s possession terminates prior to the
originally stated Expiration Date, Tenant may not, without
Landlord’s prior written consent, remove any of its
furniture, trade fixtures or other personal property for which
Landlord paid or gave Tenant an allowance, in whole or in part, in
which case, at Landlord’s election, such property shall be
deemed to have been conveyed to Landlord as by bill of sale without
further payment or credit by Landlord to Tenant.
17
(d)
Survival. Without limitation of any other obligations of
Tenant which shall survive the expiration or termination of this
lease, all obligations of Tenant under this Section 10 shall
survive the expiration or earlier termination of this
lease.
11.
HOLDING OVER. If Tenant retains possession of the
Premises or any part thereof after the termination of the lease by
lapse of time or otherwise or after the earlier termination of
Tenant’s right of possession, Tenant shall pay to Landlord as
Rent during such holdover period an amount equal to 150% of the
Rent (based on the Base Rent plus the most current Additional Rent
Estimate for the entire Premises) on a per diem basis. In addition
to and without limiting any other rights and remedies which
Landlord may have on account of such holding over by Tenant, Tenant
shall indemnify Landlord from and against any and all direct and
consequential damages suffered by Landlord on account of such
holding over by Tenant, including any damages and claims by tenants
entitled to future possession. No occupancy by Tenant after the
expiration or other termination of this lease shall be construed to
extend the Term. The provisions of this Section 11 shall not
be deemed to limit or constitute a waiver of any rights or remedies
of Landlord as provided herein or at law or equity.
12.
RULES AND REGULATIONS. Tenant agrees to observe and not
to interfere with the rights reserved to Landlord contained in
Section 13 hereof and elsewhere in this lease and agrees, for
itself, its employees, agents and contractors, to accept and comply
with the rules and regulations set forth in Exhibit F attached
to this lease, and elsewhere in this lease, and such other rules
and regulations as may be adopted from time to time by Landlord for
the Building pursuant to Section 13(o) or any other Section of
this lease, and to use reasonable efforts to cause its invitees to
comply with such rules and regulations. The rules and regulations
in Exhibit F and all other rules and regulations made in
accordance with this lease are intended and shall be construed to
supplement and not limit or restrict in any way any of
Landlord’s rights or Tenant’s obligations contained in
Section 13 or any other Section of this lease. Nothing
contained in this lease shall be construed to impose upon Landlord
any duty or obligation to enforce any of said rules and regulations
or the terms, covenants or conditions of any other lease against
any other tenant or any other person. Landlord shall not, however,
discriminatorily enforce against Tenant rules and regulations
applicable to office tenants of the Building generally.
13.
RIGHTS RESERVED TO LANDLORD. Landlord reserves and shall
have the following rights, each of which shall, unless expressly
provided otherwise, be exercisable without notice and without
liability of Landlord, its constituent members, or any of their
respective agents, partners or employees, to Tenant for damage or
injury to property, person or business or for loss or interruption
of business, or for any other matter, and without effecting an
eviction or disturbance of Tenant’s use or possession, in
whole or in part, actual or constructive, or giving rise or
entitling Tenant to any claim for set-off, abatement or reduction
of Rent or relieving Tenant from the performance of or affecting
any of Tenant’s obligations under this lease:
18
(a) To change
the name or, upon not less than sixty (60) days’ notice,
the street address of the Building; provided that if Landlord
voluntarily changes the Building’s street address it shall
reimburse Tenant for any reasonable printing costs incurred by
Tenant to replace obsolete stationery and business
cards;
(b) To
install and maintain or remove signs on the exterior and interior
of the Building and the Project.
(c) To
prescribe the location and style of the suite number and
identification sign or lettering for the Premises.
(d) To retain
at all times, and to use in appropriate instances, pass keys and
other entry devices for all doors into and within the Premises;
provided, however, that Tenant may from time to time designate
limited areas of the Premises as secured areas to which Landlord
shall not have access except in emergencies and except as otherwise
hereinafter provided. Landlord shall not be required to supply
janitor service or other routine maintenance services to any such
secured areas. In an emergency, Landlord, Building service
personnel or other emergency personnel may immediately use
self-help measures, including force, to gain access to any such
secured areas, and the expense of repair of any damage caused
thereby shall be borne by Tenant, subject to the provisions of
Section 16 below. Tenant shall, upon reasonable verbal notice
from Landlord, and in the company of an employee of Tenant if
Tenant so requires, allow Landlord access to secured areas for the
purposes referred to in Sections 13(f) and
(i) below.
(e) To grant
to anyone the right to conduct any business or render any service
in any part of the Project.
(f) To enter
the Premises for supplying janitor service or other services to be
provided to Tenant hereunder, or in the exercise of
Landlord’s rights hereunder, and upon reasonable prior notice
(except for routine services to be performed by Landlord hereunder,
or where this lease otherwise permits entry without notice or in
the event of an emergency, in which case immediate entry shall be
permitted) for other reasonable purposes.
(g) To
require all persons entering or leaving the Project or any part
thereof during such non-business hours as Landlord may from time to
time reasonably determine to identify themselves to security
personnel by registration or otherwise and to establish their right
to enter or leave in accordance with Landlord’s security
controls. Landlord shall not be liable in damages or otherwise for
any error with respect to admission to or eviction or exclusion
from the Project or any part thereof of any person. Notwithstanding
anything contained herein to the contrary, in case of fire,
casualty, invasion, insurrection, mob, riot, act of terrorism,
civil disorder, public excitement or other commotion, or
threat
19
thereof,
Landlord reserves the right to limit or prevent access to the
Project or any part thereof during the continuance of the same,
halt elevator service, activate elevator emergency controls, or
otherwise take such action or preventive measures reasonably deemed
necessary by Landlord for the safety or security of the tenants or
other occupants of the Project or the protection of the Project and
the property in or about the Project. Tenant agrees to cooperate in
any reasonable safety or security program developed by Landlord
from time to time.
(h) To
control, restrict and prevent access to any areas of the Project,
provided that reasonable access to the Premises shall be
maintained.
(i) To
rearrange, relocate, enlarge, reduce or change corridors, exits,
elevators, stairs, lavatories, doors, entrances in or to the
Building and to decorate and to make repairs, alterations,
additions and improvements, structural or otherwise, in or to the
Land or the Project or any part thereof, including the Premises,
and any adjacent building, land, street or alley, including for the
purpose of connection with or entrance into or use of the Land or
the Project in conjunction with any adjoining or adjacent building
or buildings or pedestrian ways, now existing or hereafter
constructed, provided that Landlord uses good faith efforts to
maintain reasonable access to the Premises, minimize unreasonable
interference with the conduct of Tenant’s business, and avoid
any permanent material adverse affect on the appearance of the
Premises. In that regard, Landlord may erect scaffolding and other
structures reasonably required by the character of the work to be
performed, and during such operations to enter upon the Premises
upon reasonable prior notice and take into and upon or through any
part of the Project, including the Premises, all materials that may
be required to do such work or make such decorations, repairs,
alterations, improvements or additions, and in connection with any
of the foregoing, to close public entryways, other public spaces,
stairways or corridors and interrupt or temporarily suspend any
services or facilities agreed to be furnished by Landlord. Landlord
may at its option do any such work and make any such decorations,
repairs, alterations, improvements and additions in and about the
Project and the Premises during ordinary business hours, so long as
Landlord shall use reasonable efforts in any entry to the Premises
not to unreasonably disturb Tenant’s occupancy during
business hours of the Building.
(j) To
establish reasonable controls for the purpose of regulating all
property and packages to be taken into or removed from the Building
and Premises.
(k) To
reasonably regulate delivery of supplies and services in order to
ensure the cleanliness and security of the Project and to avoid
congestion of the loading docks, receiving areas and freight
elevators.
20
(l) To approve the
weight, size and location of safes, vaults, books, files and other
heavy equipment and articles in and about the Premises and the
Building so as not to exceed the design live load per square foot
designated by the structural engineers for the Building, and to
require all such items and furniture and similar items to be moved
into or out of the Building and Premises only at such times and in
such manner as Landlord shall direct in writing. Tenant shall not
install or operate machinery or any mechanical devises of a nature
not directly related to Tenant’s ordinary use of the Premises
without the prior written consent of Landlord.
(m) To show the
Premises to prospective tenants at reasonable hours during the last
twelve (12) months of the Term or to prospective mortgagees,
ground lessors or purchasers of the Land or Building or both at any
time.
(n) To erect, use
and maintain concealed pipes, ducts, wiring and conduits, and
appurtenances thereto, in and through the Premises in walls, below
the floor and above the suspended ceiling.
(o) From time to
time to make and adopt such rules and regulations, in addition to
or as an amendment to rules and regulations contained in
Exhibit F attached to this lease or other Sections of this
lease, or adopted pursuant to this or other Sections of this lease,
for the use, entry, operation or management of the Premises or the
Project or for the protection or welfare of the Project or its
tenants or occupants, or any property therein, as Landlord may
reasonably determine, and Tenant agrees to accept, abide by and
comply with all such rules and regulations.
(p) To designate
and/or approve, prior to installation, all types of window shades,
blinds, drapes, awnings or other similar items, and all internal
lighting that may be visible from the exterior of the
Premises.
(q) To have access
to any mail chute and boxes located in or on the Premises as
required by any applicable rules of the Building or of the United
States Post Office.
(a)
Consent; Conditions . Tenant shall not perform any
Tenant Alterations without first obtaining the prior written
consent of Landlord. Without limitation on the foregoing, Landlord
may impose such conditions with respect to Tenant Alterations as
Landlord deems appropriate, including, without limitation,
requiring Tenant to furnish to Landlord for its approval prior to
commencement of any work or entry by Tenant’s contractors
into the Premises or the Building, security for the payment of all
costs to be in connection with any such Tenant Alterations (if
reasonably deemed prudent by Landlord), insurance against
liabilities which may
21
arise out of
the Tenant Alterations and plans and specifications and permits
necessary for the Tenant Alterations.
Landlord agrees
not to unreasonably withhold or delay its consent to any Tenant
Alterations; provided, however, that Landlord shall not be deemed
to have acted unreasonably if it withholds its consent because, in
Landlord’s opinion, such work: could adversely affect
building systems, the structure of the Building or the safety of
its occupants; would increase Landlord’s cost of repairs,
insurance or furnishing services or otherwise adversely affect
Landlord’s ability to efficiently operate the Building or
furnish services to Tenant or other tenants; involves toxic or
hazardous materials; could be costly or hazardous to remove or
demolish; requires entry into another tenant’s premises or
use of public areas; or is prohibited by any mortgage on the
Building. The foregoing reasons, however, shall not be exclusive of
the reasons for which Landlord may reasonably withhold consent,
whether or not such other reasons are similar or dissimilar to the
foregoing.
In addition,
Tenant may perform certain interior decorating or other
non-structural alterations to the Premises such as carpeting,
painting (so long as the odors from the same do not interfere with
any other tenant’s operations), hanging artwork or wall
coverings, installing furniture systems, or other similar interior
decorating improvements, without obtaining Landlord’s consent
therefor, but only if (i) such items do not affect the
Building structure or systems, the public areas of the Building or
any other tenant space, (ii) the cost of such items does not
exceed, in any twelve-month period, $25,000.00 and
(iii) Tenant gives prior written notice to Landlord of such
items, including a description of the contemplated work and the
types of materials being used, and subject to the remaining
requirements of this Section except that approval of plans and
specifications shall not be required for interior decorating where
plans and specifications are not appropriate for the work to be
performed.
(b)
Contractors. Tenant Alterations shall be done at
Tenant’s expense by agents or contractors hired by Tenant who
are reasonably acceptable to Landlord and whose work will not cause
or threaten to cause disharmony or interference with Landlord or
other tenants, contractors or service providers at the Building.
Before employing any such contractors, Tenant shall submit to
Landlord the names and addresses of such contractors.
(c)
Costs; Mechanic Liens. Tenant shall promptly pay the
cost, when due, of all Tenant Alterations. In addition to the cost
of such Tenant Alterations, Tenant shall also pay to Landlord or to
its designated agent, as Landlord shall direct, an amount equal to
ten percent (10%) of the hard costs of Tenant Alterations when such
hard costs are less than $100,000.00 in any instance and five
percent (5%) of the hard costs of Tenant Alterations when such hard
costs are $100,000.00 or more, as a coordination and management fee
allocable to the Tenant Alterations. Upon completion of any Tenant
Alterations, Tenant shall deliver to Landlord, if payment is made
directly to contractors, evidence of payment, contractors’
affidavits and full and final waivers of all liens for labor,
services and materials sufficient to waive all rights to liens
under
22
the Illinois
Mechanic’s Lien law arising or from the work done. Tenant
shall not permit any lien or claim for lien of any mechanic, labor
or supplier or any other lien to be filed against the Building, the
Land or the Premises or any part thereof, arising out of any Tenant
Alterations or other work performed or alleged to be performed, by
or at the direction of Tenant. If any such lien or claim for lien
is filed, Tenant shall, within ten (10) days of receiving
notice of such lien or claim, (i) have such lien or claim for
lien released of record, (ii) cause Landlord’s title
insurer to insure over such lien or claim for lien on each
outstanding owner’s and loan policy or (iii) deliver to
Landlord security in form, content, and amount satisfactory to
Landlord relative to such lien or claim for lien. Without
limitation of the foregoing, Tenant shall indemnify, defend and
hold harmless, Landlord and the other Landlord Parties, from and
against any such lien or claim for lien, and the foreclosure or
attempted foreclosure thereof. If Tenant fails to take the one of
the actions described in subclauses (i), (ii) or
(iii) above, then Landlord, without investigating the Validity
of such lien or claim for lien, may pay or discharge the same, and
Tenant shall, as payment of additional Rent hereunder, reimburse
Landlord upon demand for the payment so paid by Landlord, including
Landlord’s expenses and attorneys’ fees related
thereto.
(d)
General . Tenant agrees to indemnify, defend by
counsel reasonably acceptable to Landlord and hold Landlord and the
other Landlord Parties, and the Project, harmless of, from and
against any and all losses, damages, liabilities, claims, liens;
costs and expenses, including without limitation court costs and
reasonable attorneys’ fees and expenses, arising in
connection with any Tenant Alterations. All Tenant Alterations done
by Tenant or its contractors, including work done pursuant to
Section 9, shall be performed in a first class workerlike
manner using only good grades of materials and shall comply with
all insurance requirements of Landlord and all Laws. Within thirty
(30) days after substantial completion of any Tenant
Alterations by or on behalf of Tenant, Tenant shall furnish to
Landlord “as built” working drawings of such Tenant
Alterations. All Tenant Alterations shall be performed in
accordance with Landlord’s standard construction rules and
regulations for the Building. In no event shall any supervision or
right to supervise by Landlord, nor shall any approvals given by
Landlord hereunder, constitute any warranty by Landlord to Tenant
of the adequacy of the design, workmanship or quality of the Tenant
Alterations, or impose any liability upon Landlord in connection
with the performance of such work.
15.
ASSIGNMENT AND SUBLETTING.
(a)
Prohibitions. Tenant shall not, either prior or
subsequent to the commencement of the Term, (i) assign,
transfer, mortgage, pledge, hypothecate or encumber or subject to
or permit to exist Upon or be subjected to any lien or charge, this
lease or any interest under it, (ii) allow to exist or occur any
transfer of or lien upon this lease or Tenant’s interest
herein by operation of law, (iii) sublet the Premises or any
part thereof, or (iv) permit the use or occupancy of the
Premises or any part thereof for any purpose not provided for under
Section 6 of this lease or by anyone other than Tenant and
Tenant’s employees. Landlord has the absolute right to
withhold its consent to any of such acts without giving any reason
whatsoever, except as herein
23
expressly
provided to the contrary in Section 15(d). In no event shall
this lease be assigned or assignable by voluntary or involuntary
bankruptcy proceedings or otherwise, except as provided by law, and
in no event shall this lease or any rights or privileges hereunder
be an asset of Tenant under any bankruptcy, insolvency or
reorganization proceedings, except as provided by law. Any of the
foregoing performed or attempted in violation of the provisions of
this Section shall be null and void.
(b)
Continuing Liability . No assignment, subletting, use,
occupancy, transfer or encumbrance by Tenant shall operate to
relieve Tenant from any covenant, liability or obligation hereunder
except to the extent, if any, expressly provided for in any such
written consent of Landlord to the foregoing, and none of the
foregoing, and no consent to any of the foregoing, shall be deemed
to be a consent to or relieve Tenant from obtaining
Landlord’s consent to any subsequent assignment, subletting,
use, occupancy, transfer or encumbrance. Tenant shall pay all of
Landlord’s reasonable costs, charges and expenses, including,
without limitation, reasonable attorneys’ fees and expenses,
incurred .in connection with any assignment, subletting, use,
occupancy, transfer or encumbrance made or requested by
Tenant.
(c) Notice
of Proposed Assignment or Sublease; Recapture . Tenant
shall, by notice in writing, advise Landlord of its intention from,
on and after a stated date (which shall not be less than thirty
(30) nor more than one hundred eighty (180) days after
the date of the giving of Tenant’s notice to Landlord) to
assign this lease or sublet all or any part of the Premises for the
balance or any part of the Term, and, in such event, Landlord shall
have the right, to be exercised by giving written notice to Tenant
within fifteen (15) days after its receipt of Tenant’s
notice, (1) in the case of (A) an assignment of this
Lease or (B) a subletting of space which, when added to all
prior sublettings of space which are still in effect, aggregates
15,000 square feet or more of Rentable Area, to terminate this
lease with respect to the space described in Tenant’s notice
as of the date stated in Tenant’s notice for the commencement
of the proposed assignment or sublease, or (2) to consent or
refuse to consent to the proposed assignment or sublease, as
described in Section 15(d) below. Tenant’s notice shall
include the name and address of the proposed assignee or subtenant,
a true and complete copy of the. proposed assignment or sublease
and sufficient information, as Landlord deems reasonably necessary,
to permit Landlord to determine (i) the financial
responsibility and character and the nature of the business of the
proposed assignee or subtenant, and (ii) whether Landlord has
the right under this lease to withhold consent to the proposed
assignment or sublease. If Tenant’s notice covers all of the
Premises and if Landlord exercises its right to terminate this
lease as to such space, then this lease shall expire and end on the
date stated in Tenant’s notice for the commencement of the
proposed assignment or sublease as fully and completely as if that
date had otherwise been the Expiration Date. If, however,
Tenant’s notice covers less than all of the Premises, and if
Landlord exercises its right to terminate this lease with respect
to such space described in Tenant’s notice, then as of the
date stated in Tenant’s notice for the commencement of the
proposed sublease, the Base Rent and Tenant’s Proportionate
Share shall be adjusted on the basis of the number of square feet
of
24
Rentable Area
retained by Tenant, and this lease as so amended, shall continue
thereafter in full force and effect. Landlord shall pay the cost of
separately demising any such space.
Notwithstanding
any of the foregoing to the contrary, if Landlord notifies Tenant
that Landlord has elected to terminate this lease with respect to
the space described in a notice from Tenant regarding a prospective
assignment or sublease transaction, as described in clause (1)
above, Tenant shall have the right, at its election, to rescind its
earlier notice to Landlord regarding such transaction, which
rescission shall be exercised by notice to Landlord no later than
five (5) days following Tenant’s receipt of
Landlord’s election (time being of the essence), whereupon
this lease shall continue in full force and effect, and
Tenant’s earlier notice to Landlord of a desire to make the
subject assignment or sublease shall be deemed null and
void.
(d)
Grounds for Withholding Consent. If Landlord, upon
receiving Tenant’s notice with respect to any such space,
does not exercise its right to terminate as aforesaid or is not
entitled to do so, Landlord will not unreasonably withhold or delay
its consent to Tenant’s assignment of this lease or
subletting the space covered by Tenant’s notice. Landlord
shall not be deemed to have unreasonably withheld its consent to a
proposed assignment of this lease or to a proposed sublease of part
or all of the Premises if its consent is withheld because:
(i) any monetary default or any other uncured Default by
Tenant shall then exist (which shall no longer be a basis for
withholding consent if such default or Default is cured);
(ii) any notice of termination of this lease or termination of
Tenant’s right of possession shall have been given under
Section 19; (iii) either the portion of the Premises
which Tenant proposes to sublease, or the remaining portion of the
Premises, or the means of ingress or egress to either the portion
of the Premises which Tenant proposes to sublease or the remaining
portion of the Premises is of such nature that it will violate any
applicable Law, is of such accessibility, size or irregular shape
so as not to be suitable for normal renting purposes as space on a
multi-tenant floor within the Building; (iv) the proposed use
of the Premises by the proposed assignee or subtenant does not
conform with the use set forth in Section 6 hereof, or will
violate any applicable Law, will impose any obligation upon
Landlord or increase Landlord’s obligations under or cost of
compliance with any Laws, or will violate any exclusive right
Landlord has granted to any tenant of any part of the Project;
(v) in the reasonable judgment of Landlord the proposed
assignee or subtenant is of a character or is engaged in a business
which would be deleterious to the reputation of the Project,
Landlord or any of the constituent members of Landlord;
(vi) in the reasonable judgment of Landlord, the proposed
assignee or subtenant is not sufficiently financially responsible
to perform its obligations under the proposed assignment or
sublease; (vii) the proposed assignee or subtenant is a
government (or subdivision or agency thereof); or (viii) the
proposed assignee or subtenant is an occupant of the Building and
Landlord has space available and suitable for it; provided,
however, that the foregoing are merely examples of reasons for
which Landlord may withhold its consent and shall not be deemed
exclusive of any permitted reasons for reasonably withholding
consent, whether similar or dissimilar to the foregoing examples,
and Landlord may consider all relevant factors in determining
whether to give or withhold its consent. Tenant agrees that all
advertising by Tenant or on Tenant’s behalf with respect to
the assignment of this lease or
25
subletting of
any part of the Premises must be approved in writing by Landlord
prior to publication, which approval shall not apply to the quoted
rent, and shall not be unreasonably withheld or delayed.
(e)
Excess Rent Payment . If Tenant (as Tenant or
debtor-in-possession) shall assign this lease or sublet the
Premises, or any part thereof, at a rental or for other
consideration in excess of the Rent or pro rata portion thereof due
and payable by Tenant under this lease, then Tenant shall pay to
Landlord as additional Rent one-half (1/2) of any such excess rent
or other consideration immediately upon receipt under any such
assignment or, in the case of a sublease, (i) on the later of
the first day of each month during the term of any sublease, or the
day of receipt from such subtenant, one-half (1/2) of the excess of
all rent and other consideration paid by the subtenant for such
month over the Rent then payable to Landlord pursuant to the
provisions of this lease for said month (or if only a portion of
the Premises is being sublet, one-half (1/2) of the excess of all
rent and other consideration due from the subtenant for such month
over the portion of the Rent then payable to Landlord pursuant to
the provisions of this lease for said month which is allocable on a
Rentable Area basis to the space sublet), and (ii) immediately
upon the receipt thereof, one-half (1/2) of any other consideration
realized by Tenant from such subletting. Landlord shall not be
responsible for any deficiency if Tenant shall assign this lease or
sublet the Premises or any part thereof at a rental less than that
provided for herein. Whenever reference is made to the
“excess” of rent or other consideration, such excess
shall be reduced by charging against the rent or other
consideration paid by such assignee or subtenant, reasonable
brokerage commissions and leasehold improvements which Tenant has
paid in connection with assigning the lease or subleasing the
applicable portion of the Premises. Amounts received by Tenant
representing the reasonable value of assets other than this lease
(such as personal property and trade fixtures) sold in conjunction
with an assignment or sublease shall not be taken into account as
consideration paid for the assignment or sublease.
(f)
Lease Assumption; Subtenant Attornment . If Tenant shall
assign this lease, the assignee shall expressly assume all of the
obligations of Tenant thereafter accruing hereunder in a written
instrument provided by Landlord and delivered to Landlord not later
than ten (10) days prior to the effective date of the assignment.
If Tenant shall sublease any part of the Premises, Tenant shall
obtain and furnish to Landlord, not later than ten (10) days
prior to the effective date of such sublease and in form reasonably
satisfactory to Landlord, the written agreement of such subtenant
to the effect that the subtenant will attorn to Landlord, at
Landlord’s option and written request (at Landlord’s
sole election), on the terms and conditions of the sublease if this
lease terminates before the expiration of the sublease, provided
that (if Landlord makes such election) at the time of such
attornment Landlord agrees to recognize and be bound by the terms
of such sublease. Tenant shall, not later than fifteen
(15) days after the effective date of any such assignment or
sublease, deliver to Landlord a certified copy of the instrument of
assignment or sublease.
26
(g)
Corporation, Partnership and Limited Liability Company
Transfers. If Tenant is a corporation, any transaction or
series of transactions (including without limitation any
dissolution, merger, consolidation or other reorganization of
Tenant, or any issuance, sale, gift, transfer or redemption of any
capital stock of Tenant, whether voluntary, involuntary or by
operation of law, or any combination of any of the foregoing
transactions) resulting in the transfer of control of Tenant, other
than by reason of death or retirement, shall be deemed to be a
voluntary assignment of this lease by Tenant subject to the
provisions of this Section 15. If Tenant is a partnership or
limited liability company, any transaction or series of
transactions (including without limitation any withdrawal or
admittance of a partner or member or any change in any
partner’s or member’s interest in Tenant, whether
voluntary, involuntary or by operation of law, or any combination
of any of the foregoing transactions) resulting in the transfer of
control of Tenant, other than by reason of death or retirement,
shall be deemed to be a voluntary assignment of this lease by
Tenant subject to the provisions of this Section 15. The term
“control” as used in this lease means the power
to directly or indirectly direct or cause the direction of the
management or policies of the subject entity, whether through the
ownership of voting securities or other beneficial interests or
otherwise.
Notwithstanding
any of the foregoing, the provisions of this Section 15(g) shall
not apply to an entity the outstanding voting stock of which is
listed at the time of a transaction referred to herein on a
“national securities exchange”, as defined in
the Securities Exchange Act of 1934.
(h)
Permitted Transfers. Notwithstanding any of the
foregoing, Landlord’s consent shall not be required for an
assignment or sublet to a Tenant Successor or Tenant Affiliate (as
such terms are hereinafter defined), and Landlord shall not
terminate this lease with respect to the Premises or any portion of
the Premises as a result of such assignment or sublet to a Tenant
Successor or Tenant Affiliate, as long as (i) Tenant gives
reasonable prior notice to Landlord of the proposed assignment or
sublet; (ii) if an assignment, such assignee assumes the
obligations of Tenant under this lease; (iii) if an assignment to a
Tenant Successor, in the reasonable judgment of Landlord such
assignee has a net worth (computed in accordance with generally
accepted accounting principles) equal to or greater than the
original named Tenant at the time of such assignment; and
(iv) if an assignment to a Tenant Affiliate, in the reasonable
judgment of Landlord such assignee is sufficiently financially
responsible to perform the obligations of the Tenant under this
lease. As used herein, the term “Tenant
Successor” shall mean any entity (i) which results from a
merger or consolidation with the original Tenant under this lease
or (ii) which acquires all or substantially all of the assets of
the original Tenant under this lease for a legitimate business
purpose; and the term “Tenant Affiliate” shall
mean any entity which is controlled by, controls, or is under
common control with (A) the original Tenant named in this
lease or (B) a Tenant Successor.
27
16.
WAIVERS OF CERTAIN CLAIMS. INDEMNITIES.
(a)
General Waiver. In addition to and without limiting or
being limited by any other releases or waivers of claims in this
lease, but rather in confirmation and furtherance thereof, to the
extent not prohibited by law, Landlord and Tenant each releases and
waives any and all claims for, and rights to recover, damages
against and from the other, and the other’s respective
agents, members, partners, shareholders, officers and employees
(collectively, the “Released Parties”), for loss,
damage or destruction to any of its property (including the
Premises, the Building and their contents), the elements of which
are insured against by the party suffering such loss, damage or
destruction, or are required under Section 22 hereof to be
insured against by such party. In no event shall this clause be
deemed, construed or asserted (i) to affect or limit any
claims or rights against any Released Parties other than the right
to recover damages for loss, damage or destruction to property, or
(ii) to benefit any third party other than the Released
Parties.
(b)
indemnity by Tenant. In addition to and without limiting
or being limited by any other indemnity in this lease, but rather
in confirmation and furtherance thereof, to the extent not
prohibited by law, Tenant agrees to indemnify, defend by counsel
reasonably acceptable to Landlord and hold Landlord and the
Landlord Parties, and the Project, harmless of, from and against
any and all losses, damages, liabilities, claims, liens, costs and
expenses, including court costs and reasonable attorneys’
fees and expenses, imposed on them in connection with injury to or
death of third parties, other than the Landlord Parties, or with
respect to damage to or theft, loss or loss of the use of any
properly of third parties, other than the Landlord Parties,
occurring in or about the Premises or the Project arising from
Tenant’s occupancy of the Premises, or the conduct of its
business or from any activity, work, or thing done, permitted or
suffered by Tenant in or about the Premises or the Project, or due
to any other negligent act or omission or wilful misconduct of
Tenant, or any of its employees, agents or contractors.
(c) Indemnity by Landlord. In addition to and without
limiting or being limited by any other indemnity in this lease, but
rather in confirmation and furtherance thereof, to the extent not
prohibited by law, Landlord agrees to indemnify, defend by counsel
reasonably acceptable to Tenant and hold Tenant, its constituent
members, and their respective officers, directors, members,
partners, agents, employees, successors and assigns (collectively,
the “Tenant Parties” ) harmless of, from and
against any and all losses, damages, liabilities, claims, liens,
costs and expenses, including court costs and reasonable
attorneys’ fees and expenses, imposed on them in connection
with injury to or death of third parties, other than the Tenant
Parties, occurring within the common areas of the Building, or with
respect to damage to or theft, loss or loss of the use of property
of third parties, other than Tenant Parties, occurring within the
common areas of the Building, but only to the extent that the
foregoing losses, damages, liabilities, claims, liens, costs and
expenses arise from or are caused directly or indirectly by any
negligent act or omission or wilful misconduct of Landlord, or any
of its employees, agents, officers, directors or partners. Such
third parties shall not be deemed third party beneficiaries to this
lease.
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(d)
Waiver . To the extent permitted by law, Tenant releases
Landlord and the Landlord Parties from, and waives all claims for,
damage or injury to person or property sustained by the Tenant or
any occupant of the Building or Premises resulting directly or
indirectly from any existing or future condition, defect, matter or
thing in and about the Project or the Premises or any part of
either or any equipment or appurtenance therein, or resulting from
any accident in or about the Project or resulting directly or
indirectly from any act of neglect of any tenant or occupant of the
Building or of any other person, including Landlord’s agents
and servants, except where resulting from the neglect or willful
act of Landlord or any of the Landlord Parties. Tenant hereby
waives any consequential damages, compensation or claims for
inconvenience or loss of business, rents, or profits as a result of
any injury or damage occurring at or about the Building.
(e)
Landlord’s Negligence . Subject to the provisions
of Section 16(a), no agreement of Tenant in this lease shall
be deemed to exempt Landlord from liability or damages for injury
to persons or damage to property caused by or resulting from the
negligence of Landlord, its agents, servants or employees, in the
operation or maintenance of the Premises or Building.
17.
DAMAGE OR DESTRUCTION BY CASUALTY .
(a)
Termination of Lease: Repair by Landlord . If the
Premises or the Building shall be damaged by fire or other casualty
and if such damage does not render all or a substantial portion of
the Premises or the Building untenantable (as hereinafter defined),
then Landlord shall proceed with reasonable promptness to repair
and restore the Building and the Premises so as to render the
Premises tenantable, subject to reasonable delays for insurance
adjustments and delays caused by matters beyond Landlord’s
reasonable control, and also subject to zoning laws and building
codes then in effect. If any such damage renders all or a
substantial portion of the Premises or the Building untenantable,
Landlord shall, with reasonable promptness after the occurrence of
such damage, estimate the length of time that will be required to
substantially complete the repair and restoration of the Building
and the Premises, as the case may be, necessitated by such damage
and shall by notice advise Tenant of such estimate. If it is so
estimated that the amount of time required to substantially
complete such repair and restoration will exceed two hundred
seventy (270) days from the date such damage occurred, then
either Landlord or Tenant (but Tenant shall have such right only if
the damage was not caused by the willful act of Tenant, its agents,
employees or contractors, and only if all or a substantial portion
of the Premises is rendered untenantable and the estimated time for
Landlord required to substantially complete such repair or
restoration to render the Premises tenantable will exceed such two
hundred seventy (270) day period) shall have the right to
terminate this lease as of the date of notice of such election by
giving notice to the other at anytime within twenty (20) days
after Landlord gives Tenant the notice containing said estimate (it
being understood that Landlord may, if it elects to do so, also
give such notice of termination together with the notice containing
said estimate). Unless this lease is terminated as provided in the
preceding sentence, Landlord shall proceed with reasonable
promptness to repair and restore the Building or the Premises
so
29
as to render
the Premises tenantable, subject to reasonable delays for insurance
adjustments and delays caused by matters beyond Landlord’s
reasonable control, and also subject to zoning laws and building
codes then in effect. Landlord shall have no liability to Tenant,
and Tenant shall not be entitled to terminate this lease (except as
hereinafter provided) if such repairs and restoration are not in
fact completed within the time period estimated by Landlord, as
aforesaid, or within said two hundred seventy (270) days.
However, if such repairs and restoration are not completed by a
date (“ Outside Date ”) which is twelve
(12) months after the date of such fire or other casualty (or
ninety-five (95) days after the expiration of the time period
estimated by Landlord as aforesaid, if longer than two hundred
seventy (270) days and neither party terminated the lease as
permitted), which Outside Date shall be extended by all periods of
delay attributable to the acts or omissions of Tenant or
Tenant’s agents, employees or contractors, for any reason
whatsoever, then tenant may terminate this lease, effective as of
the date of notice of such election, by giving written notice to
Landlord within the thirty (30) day period after said Outside
Date as extended as aforesaid, but prior to substantial completion
of repair or restoration. Notwithstanding anything to the contrary
herein set forth: (i) Landlord shall not be obligated (but
may, at its option, so elect) to repair or restore the Premises or
Building if the damage is due to an uninsurable casualty or if
insurance proceeds are insufficient to pay for such repair or
restoration, or if any Mortgagee applies proceeds of insurance to
reduce its loan balance, and the remaining proceeds, if any,
available to Landlord are not sufficient to pay for such repair or
restoration, provided that if Landlord does not elect in the
circumstances referred to in this clause to repair or restore the
Premises, Landlord shall so notify Tenant and Tenant shall
thereafter have the right to terminate this lease upon notice to
that effect given within thirty (30) days after receipt of
such notice from Landlord, time being of the essence; or
(ii) if any such damage rendering all or substantial portion
of the Premises or Building untenantable shall occur during the
last year of the Term, either party (but as to Tenant’s
right, only if all or a substantial portion of the Premises is
rendered untenantable) shall have the option to terminate this
lease by giving written notice to the other within thirty
(30) days after the date such damage occurred, and if such
option is so exercised, this lease shall terminate as of the date
of such notice.
(b)
Abatement of Rent . In the event any such fire or
casualty damage renders the Premises untenantable, Rent shall abate
during the period beginning with the date of such damage and ending
with the date when Landlord substantially completes its repair or
restoration required hereunder. Such abatement shall be in an
amount bearing the same ratio to the total amount of Rent for such
period as the portion of the Rentable Area of the Premises which is
untenantable and not used by Tenant from time to time bears to the
Rentable Area of the entire Premises. In the event of termination
of this lease pursuant to this Section 17, Rent shall be
apportioned on a per diem basis and be paid to the date of the
termination, subject to the foregoing abatement.
(c)
Untenantability . As used in this lease, the term
“untenantable” means reasonably incapable of being
occupied for its intended use due to damage to the Premises or
Building. Notwithstanding anything contained to the contrary in
this Section 17, neither the Premises nor
30
any portion of
the Premises shall be deemed untenantable if Tenant continues to
actually occupy the subject portion of the Premises.
(a)
Substantial Taking . If the entire Project or the
entire Building, or a substantial part of either of them, or any
part of the Project which includes all or a substantial part of the
Premises, shall be taken or condemned by any competent authority
for any public or quasi-public use or purpose, the Term of this
lease shall end upon and not before the earlier of the date when
the possession of the part so taken shall be required for such use
or purpose or the effective date of the taking. If any condemnation
proceeding shall be instituted in which it is sought to take or
damage any part of the Project, the taking or damaging of which
would, in Landlord’s reasonable opinion, prevent the
economical operation of the Project, Landlord shall have the right
to terminate this lease upon written notice to Tenant given not
less than ninety (90) days prior to the date of termination
designated in the notice. In either of the events above referred
to, Rent shall be apportioned on a per diem basis and be payable to
the date of the termination.
(b)
Taking of Part . In the event a part of the Building
or the Premises is taken or condemned by any competent authority
and this lease is not terminated as provided in Section 18(a)
above, the lease shall be amended to reduce the Monthly Base Rent
and reduce or increase, as the case may be, Tenant’s
Proportionate Share to reflect the Rentable Area of the Premises or
Building, as the case may be, remaining after any such taking or
condemnation. Landlord, upon receipt and to the extent of the award
in condemnation (or proceeds of sale) shall make necessary repairs
and restorations to the Premises and to the Building to the extent
necessary to constitute the portion of the Building not so taken or
condemned as a complete architectural and economically efficient
unit.
(c)
Compensation . Landlord shall be entitled to receive
the entire award (or sale proceeds) from any such taking,
condemnation or sale without any payment to Tenant, and Tenant
hereby assigns to Landlord all of Tenant’s interest, if any,
in such award; provided, however, Tenant shall have the right
separately to pursue against the condemning authority a separate
award in respect of the loss, if any, to Tenant Alterations paid
for by Tenant without any credit or allowance from Landlord, so
long as there is no diminution of Landlord’s award as a
result, and subject to the rights of any ground lessor or mortgagee
of Landlord with respect thereto.
19.
DEFAULT; LANDLORD’S RIGHTS AND REMEDIES
.
(a)
Default . The occurrence of any one or more of the
following matters constitutes a “ Default ” by
Tenant under this lease:
(i) Failure by
Tenant to pay any Rent when due, if such failure continues for five
(5) days after written notice to Tenant of such
failure;
31
(ii) Failure by
Tenant to pay any other money required to be paid by Tenant under
this lease when due, if such failure continues for five
(5) days after written notice to Tenant of such
failure;
(iii) Failure by
Tenant to observe or perform any of the covenants in respect of
assignment and subletting set forth in Section 15;
(iv) Failure by
Tenant to cure forthwith, immediately after receipt of notice from
Landlord, any hazardous condition which Tenant has created or
permitted in violation of law or of this lease;
(v) Failure by
Tenant to complete, execute and deliver any instrument or document
required to be completed, executed and delivered by Tenant pursuant
to Section 20 or Section 24 of this lease within the time
required for such instrument or document in accordance with such
Sections, if such failure continues for five (5) business days
after written notice to Tenant of such failure;
(vi) Failure by
Tenant to observe or perform any other covenant, agreement,
condition or provision of this lease, if such failure shall
continue for thirty (30) days after written notice thereof
from Landlord to Tenant; provided that such 30-day period shall be
extended for the time reasonably required to complete such cure
(not to exceed, in any event, an additional 90-day period), if such
failure cannot reasonably be cured within said 30-day period and
Tenant commences to cure such failure within said 30-day period and
thereafter diligently and continuously proceeds to cure such
failure;
(vii) The levy
upon execution or the attachment by legal process of the leasehold
interest of Tenant, which levy or attachment shall not be released
or discharged within ten (10) days from the date
thereof;
(viii) Tenant
abandons the Premises;
(ix) Tenant
becomes insolvent or bankrupt or admits in writing its inability to
pay its debts as they mature, or makes an assignment for the
benefit of creditors, or applies for or consents to the appointment
of a trustee or receiver for Tenant or for the major part of its
property;
(x) A trustee or
receiver is appointed for Tenant or for a major part of its
property, without Tenant’s application therefor or consent
thereto, and is not discharged within sixty (60) days after such
appointment;
(xi) Any
bankruptcy, reorganization, arrangement, insolvency or liquidation
proceeding, or other proceeding for relief under any bankruptcy law
or similar law for the
32
relief of
debtors, is instituted (A) by Tenant, or (B) against
Tenant and is allowed against it or is consented to by it or is not
dismissed within sixty (60) days after such institution;
or
(xii) Upon the
third occurrence within any twelve-month period that Tenant fails
to pay Rent when due or has breached a particular covenant of this
lease (whether or not such failure or breach is thereafter cured
within any stated cure or grace period or statutory
period).
(b)
Landlord’s Rights and Remedies . If a Default
occurs, Landlord shall have the rights and remedies hereinafter set
forth, which shall be distinct, separate and cumulative and shall
not operate to exclude or deprive Landlord of any other right or
remedy allowed it at law or in equity:
(i) Landlord may
terminate this lease, in which event the Term of this lease shall
end, and all right, title and interest of Tenant hereunder shall
expire, on the date stated in such notice;
(ii) Landlord may
terminate the right of Tenant to possession of the Premises without
terminating this lease, whereupon the right of Tenant to possession
of the Premises or any part thereof shall cease on the date stated
in such notice; and
(iii) Landlord may
enforce the provisions of this lease and may enforce and protect
the rights of Landlord hereunder by a suit or suits in equity or at
law for the specific performance of any covenant or agreement
contained herein, and, except as specifically hereinafter provided,
for the enforcement of any other appropriate legal or equitable
remedy, including without limitation injunctive relief, recovery of
all money due or to become due from Tenant under any of the
provisions of this lease and recovery of damages incurred by
Landlord by reason of the Default. Notwithstanding any of the
foregoing or anything else to the contrary in this lease, Landlord
waives all rights to distrain for rent against Tenant’s
property in the Premises.
(iv) Landlord may
cure or correct such Default or take steps to perform any covenant,
agreement, condition or provisions of this lease, and all costs and
expenses incurred by Landlord in so doing (including reasonable
attorneys’ fees) shall be paid by Tenant to Landlord as
additional rent upon demand plus interest at the Default Rate
(defined in Section 28(i)) from the date of expenditure.
Landlord’s proceeding under the rights reserved to Landlord
under this Section 19(b)(iv) shall not in any way prejudice or
waive any rights as Landlord might otherwise have against Tenant by
reason of that or any other Default.
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(c)
Surrender . If Landlord exercises any of the remedies
provided for in subparagraphs (i) and (ii) of
Section 19(b), Tenant shall surrender possession of and vacate
the Premises and immediately deliver possession thereof to
Landlord, and Landlord may re-enter and take complete and peaceful
possession of the Premises, with process of law if Tenant is in
occupancy of the Premises, full and complete license so to do being
hereby granted to Landlord, and Landlord may remove all occupants
and property therefrom, using such lawful force as may be
necessary, without being deemed in any manner guilty of trespass,
eviction or forcible entry and detainer, and without relinquishing
Landlord’s right to Rent or any other right given to Landlord
hereunder or by law or in equity.
(d)
Termination of Right of Possession . If Landlord
terminates the right of Tenant to possession of the Premises
without terminating this lease, as provided for by subparagraph
(ii) of Section 19(b), then Landlord shall be entitled to
recover from Tenant all the fixed dollar amounts of Rent accrued
and unpaid for the period up to and including such termination
date, as well as all other additional sums payable by Tenant, or
for which Tenant is liable or in respect of which Tenant has agreed
to indemnify Landlord under any of the provisions of this lease,
which may be then owing and unpaid, and all costs and expenses,
including without limitation court costs and reasonable
attorneys’ fees and expenses incurred by Landlord in the
enforcement of its rights and remedies hereunder, and in addition,
Landlord shall be entitled to recover from Tenant from time to
time, and Tenant shall remain liable for, all Rent and all other
additional sums thereafter accruing as they become due under this
lease during the period from the date of such notice of termination
of possession to the stated end of the Term. In any such case,
Landlord shall use reasonable efforts to relet the Premises for the
account of Tenant for such rent, for such time (which may be for a
term extending beyond the Term of this lease), in such portions and
upon such terms as Landlord in Landlord’s reasonable judgment
shall determine, and Landlord shall not be required to accept any
tenant offered by Tenant or to observe any instructions given by
Tenant relative to such reletting. Landlord may give priority over
leasing the Premises to any other space Landlord desires to lease
in the Building and shall not be required in any case to offer
rent, length of terms or other terms for the Premises which are or
would be less favorable to Landlord than being offered for
comparable space of Landlord in the Building. Also, in any such
case, Landlord may make repairs, alterations and additions in or to
the Premises and redecorate the same to the extent deemed by
Landlord necessary, and in connection therewith Landlord may change
the locks to the Premises, and Tenant shall upon written demand pay
the cost thereof together with Landlord’s expenses of
reletting. Landlord may collect the rents from any such reletting
and shall apply the same first to the payment of the expenses of
reentry, redecoration, repair, alterations and reletting and second
to the payment of Rent herein provided to be paid by Tenant, and
any excess or residue shall operate only as an offsetting credit
against the amount of Rent, if any, due and owing or as the same
thereafter becomes due and payable hereunder, but the use of such
offsetting credit to reduce the amount of Rent due Landlord, if
any, shall not be deemed to give Tenant any right, title or
interest in or to such excess or residue, and any such excess or
residue shall belong to Landlord solely; provided that in no event
shall Tenant be entitled to such a credit against Rent in excess of
the aggregate sum (including Base Rent and
34
Additional
Rent) which would have been paid by Tenant for the period for which
the credit to Tenant is being determined had no Default occurred.
No such re-entry, repossession, repairs, alterations, additions or
reletting shall be construed as an eviction or ouster of Tenant or
as an election on Landlord’s part to terminate this lease,
unless a written notice of such intention is given to Tenant, or
shall operate to release Tenant in whole or in part from any of
Tenant’s obligations hereunder, and Landlord may, at any time
and from time to time, sue and recover judgment for any
deficiencies from time to time remaining after the application from
time to time of the proceeds of any such reletting.
(e)
Termination of Lease . In the event of the
termination of this lease by Landlord as provided for by
subparagraph (i) of Section 19(b), Landlord shall be
entitled to recover from Tenant all the fixed dollar amounts of
Rent accrued and unpaid for the period up to and including such
termination date, as well as all other additional sums payable by
Tenant, or for which Tenant is liable or in respect of which Tenant
has agreed to indemnify Landlord under any of the provisions of
this lease, which may be then owing and unpaid, and all costs and
expenses, including without limitation court costs and reasonable
attorneys’ fees and expenses incurred by Landlord in the
enforcement of its rights and remedies hereunder, and in addition,
Landlord shall be entitled to recover an amount equal to the
present value of the aggregate Base Rent and Additional Rent
payable for the period from the termination date stated in
Landlord’s notice terminating this lease until the date which
would have been the Expiration Date but for such termination, less
the present value of the fair rental value of the Premises for the
same period (which fair rental value shall be calculated so as to
include a reasonable vacancy period for reletting the Premises and
deductions for reasonable expenses and inducements incurred by
Landlord to achieve such reletting, including without limitation
attorneys’ fees and expenses, brokerage fees, advertising
costs, rent abatements, tenant improvement allowances and the
like).
(f)
Tenant’s Property . All property of Tenant
removed from the Premises by Landlord or which becomes
Landlord’s property pursuant to any provisions of this lease
or by law may be handled, removed or stored by Landlord at the cost
and expense of Tenant, and Landlord shall in no event be
responsible for the value, preservation or safekeeping thereof.
Tenant shall pay Landlord for all expenses incurred by Landlord in
such removal and for storage charges for such property so long as
the same shall be in Landlord’s possession or under
Landlord’s control. All property not remo
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