OLD SAUK TRAILS PARK LIMITED
PARTNERSHIP
1240 Deming Way
Madison, Wisconsin 53717
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No. 6
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REFERENCE
DATA
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January 26, 2005
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These terms are specific to, and
incorporated in, this lease.
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¶
no.
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Item
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Lease Provision
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Tenant
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TomoTherapy
Incorporated, a Wisconsin corporation
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Premises
Area of the Premises
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all of the
building including seven below-grade test bunkers
61,410 rentable square feet (“RSF”) excluding the test
bunkers
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Additional
Permitted uses
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manufacture,
testing and assembly of medical imaging equipment
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Term
Effective Date
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Through
May 31,2014
this Reference Data page #6 is effective March 14,
2005.
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Rent
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14.25/RSF/yr.
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Rent
Adjustment
Tenant’s pro rata share
Additional Rent
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$0.50/RSF/yr.
each June 1 st
100.00%
$6.82/RSF/yr [subject to adjustment per §2.02]
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Security
deposit
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NONE
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Build out
Allowance
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PAID
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Extension
term
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Four terms,
five years each
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LANDLORD
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TENANT
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Old Sauk Trails
Park Limited Partnership
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TomoTherapy
Incorporated
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Old Sauk Trails
Park Development Company, gen’l partner
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1240 Deming
Way
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8020 Excelsior Drive, Ste.
300
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Madison WI
53717-2911
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/s/ George
Gialamas
George
Gialamas, President
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/s/ Dr.
Frederick A. Robertson
Dr. Frederick
A. Robertson, C.E.O.
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1240 Deming Way
Madison, Wisconsin 53717
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No.
1
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REFERENCE
DATA
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October 22, 2001
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These terms are
specific to, and incorporated in, this lease.
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¶
no.
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Item
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Lease Provision
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Tenant
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Tomotherapy
Incorporated, a Wisconsin corporation
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Premises
Area of the Premises 1
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1
st and 2 nd floor, building to be constructed at 1240 Deming
Way, including test bunkers
appx. 40,000 rentable square feet (“RSF”) of office and
manufacturing space excluding the test bunkers
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Additional
Permitted uses
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manufacture,
testing and assembly of medical imaging equipment
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Term
Target Date
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Ten
(10) years
May 1, 2002, for 1 st floor & bunkers; June 1, 2002, for
2 nd
floor
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Rent at
commencement
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13.00/RSF/yr.
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Rent
Adjustment
Tenant’s pro rata share 1
Additional Rent
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$0.50/RSF/yr.
60.6%
$5.50/RSF/yr [est.]
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Security
deposit
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NONE
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Build out
Allowance
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$23.25/RSF
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Extension
term
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Four terms,
five years each
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LANDLORD
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TENANT
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Old Sauk Trails
Park Limited Partnership
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Tomotherapy
Incorporated
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Old Sauk Trails
Park Development Company, gen’ l
partner
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2228 Evergreen
Road
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8020 Excelsior Drive, Ste.
300
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Middleton, WI
53562-4241
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/s/ George
Gialamas
George
Gialamas, President
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/s/ John J.
Barni
John J. Barni,
C.E.O.
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1
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Area of the
Premises and of the Building and the Tenant’s pro rata share
to be confirmed upon completion of the final building plans, and
prior to commencement, by execution of another Reference Data
page.
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PAGE
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ARTICLE
1
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BASIC LEASE
PROVISIONS
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Section
1.01
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Date and
Parties
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1
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Section
1.02
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Premises
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1
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Section
1.03
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Use
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1
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Section
1.04
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Term
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1
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Section
1.05
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Improvements
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3
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ARTICLE
2
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RENT AND
SECURITY
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Section
2.01
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Rent and Rent
Adjustment
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3
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Section
2.02
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Additional
Rent
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4
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Section
2.03
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Personal
Property Tax
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9
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Section
2.04
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Security
Deposit
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9
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Section
2.05
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Sales
Tax
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ARTICLE
3
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AFFIRMATIVE
OBLIGATIONS
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Section
3.01
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Compliance with
Laws
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9
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Section
3.02
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Services and
Utilities
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10
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Section
3.03
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Repairs and
Maintenance
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12
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ARTICLE
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NEGATIVE
OBLIGATIONS
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Section
4.01
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Alterations
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14
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Section
4.02
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Assignment and
Subleasing
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16
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ARTICLE
5
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INSURANCE
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Section
5.01
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Insurance
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17
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Section
5.02
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Indemnification
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20
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Section
5.03
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Limitation of
Landlord’s Liability
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20
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ARTICLE
6
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LOSS OF
PREMISES
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Section
6.01
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Damages
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21
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Section
6.02
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Condemnation
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23
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ARTICLE
7
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DEFAULT
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Section
7.01
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Tenant’s
Default
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25
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Section
7.02
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Landlord’s Remedies
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26
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Section
7.03
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Landlord’
Default
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Section
7.04
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Exception to
Cure Periods
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27
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Section
7.05
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Self-Help
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27
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Section
7.06
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Survival
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27
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PAGE
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ARTICLE
8
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NONDISTURBANCE
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Section
8.01
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Subordination
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28
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Section
8.02
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Estoppel
Certificate
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28
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Section
8.03
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Quiet
Possession
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29
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ARTICLE
9
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LANDLORD’S RIGHTS
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Section
9.01
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Rules
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29
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Section
9.02
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Mechanic’s Liens
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29
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Section
9.03
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Right to
Enter
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30
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Section
9.04
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Holdover
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31
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Section
9.05
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Signs
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32
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ARTICLE
10
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OPTIONS
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Section
10.01
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Option to
Extend
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33
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ARTICLE
11
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DISPUTES
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Section 11.
01
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Arbitration
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33
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ARTICLE
12
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MISCELLANEOUS
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Section
12.01
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Broker’s
Warranty
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34
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Section
12.02
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Attorney’s Fees
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35
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Section
12.03
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Notices
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35
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Section
12.04
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Partial
Invalidity
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35
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Section
12.05
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Waive
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35
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Section
12.06
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Construction
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Section
12.07
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Binding on
Successors
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35
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Section
12.08
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Governing
Law
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35
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Section
12.09
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Insurance
Increase
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35
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Section
12.10
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Lease not an
Offer
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35
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Section
12.11
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Recording
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36
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Section
12.12
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Survival of
Remedies
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36
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Section
12.13
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Authority of
Parties
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36
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Section
12.14
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Business
Days
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36
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Section
12.15
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Entire
Agreement
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36
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Section
12.16
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Definition of
Lease
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36
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Exhibit
A
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Floor
Plan
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Exhibit
B
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Building
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Exhibit
C
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Land
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Exhibit
D 2
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Space
Plan
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Exhibit
E
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Specifications
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Exhibit
F
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Janitorial
Services
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Exhibit
G
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Rules
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Exhibit
H
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Building
Standard
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Exhibit
I
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Tenant Build
Out Agreement
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2
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Exhibits D
& E are to be agreed on by Landlord and Tenant and added hereto
by 10/31/01
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§2.02
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§4.01(a)
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§3.01
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§8.02(a)
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§1.01
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§12.13
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§3.02(b)
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Canceling/Complying Party
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§3.01
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§l.04
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§7.01(a)
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§7.05
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§4.02(f)
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§10.01(a)
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§3.02(a)
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§9.04(a)
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§1.05
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§5.01(d)
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§1.02
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§1.01
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§2.01
(b)
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§1.01
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§2.02
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§1.02
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§2.02(a)
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§2.02(a)
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§2.02(a)
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§1.01
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§6.01
(a)
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§2.01
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§2.02(d)
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.§1.04(b)
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§8.0l(b)
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§1.04(a)
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§6.02(h)
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§1.01
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§1.04(a)
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ARTICLE 1 — BASIC LEASE
PROVISIONS
1.01.
Date and parties. This lease (Lease) is entered into between Old
Sauk Trails Park Limited Partnership, as lessor (Landlord) and the
tenant identified on the Reference Data page at the front of this
Lease, as lessee (Tenant) for space in the building to be
constructed on Lots 65 and 66, Old Sauk Trails Park, Sixth
Addition, Madison, Wisconsin (Building).
1.02.
Premises. Landlord
leases to Tenant the space identified in the Reference Data
(Premises) as shown outlined on the attached floor plan
(Exhibit A). The Premises contain the fixtures, improvements,
and other property now installed therein plus any improvements
required by section 1.05 and Exhibits D and E.
The Building
(Exhibit B) will contain approximately 59,235 rentable square
feet excluding the test bunkers and the Premises will contain the
rentable area which is designated in the Reference Data. These
measurements were made using the American National Standard Method
of Measuring Floor Area in Office Buildings, ANSI/BOMA Z65.1-1996,
published by the Building Owners and Managers Association
International. Any change in the rentable area of the Building or
Premises will be incorporated herein by a revision of the Reference
Data.
Tenant and its
agents, employees, and invitees, have the nonexclusive right with
others designated by Landlord to the free use of the common areas
in the Building and of the land (Land) on which the Building is
located (Exhibit C) for the common areas’ intended and
normal purpose. Common areas include elevators, sidewalks,
surface-lot parking areas, driveways, hallways, stairways, public
bathrooms, common entrances, lobby, and other similar public areas
and access ways. Landlord may change the common areas if the
changes do not materially and unreasonably interfere with
Tenant’s access to the Premises or use of them.
1.03.
Use. Tenant shall use
the Premises for business office purposes only, unless Landlord
gives its advance written consent to another use which shall be
evidenced by inclusion in the Reference Data. Landlord warrants
that applicable laws, ordinances, regulations, and restrictive
covenants permit the Premises to be used for any use permitted by
the Lease. Tenant shall not create a nuisance or use the Premises
for any immoral or illegal purposes.
1.04(a).
Term. The Lease begins (Commencement Date) for any part of the
Premises on the earlier of:
(i) the
date Tenant takes possession and occupies any part of the Premises,
but only for that portion so occupied; or
(ii) the
Target Date for each portion of the Premises, if said portion is
substantially completed on that date; or
(iii) thirty (30) days after the
delivery of the notice required by subsection 1.04(c), if the
applicable part of the Premises is substantially completed on that
date.
If the
Commencement Date would be a Saturday, Sunday, or holiday listed in
paragraph 3.02(b)(ii), the Commencement Date shall be the first
business day following that Saturday, Sunday, or holiday. Within
thirty days after the Commencement Date, the parties shall confirm
the Commencement Date by an amendment to the Reference
Data.
The Lease shall
continue in force from the Commencement Date if said date is the
first day of a calendar month, or else from the first day of the
month following the Commencement Date for the term designated in
the Reference Data, unless ended earlier pursuant to the terms of
this Lease.
1.04(b).
Substantial completion. Landlord shall use its best efforts to
substantially complete the Premises by the Target Dates set in the
Reference Data. Substantially complete means:
(i) the
decoration, fixtures, and equipment to be installed by Landlord
(“Building Standard”, described in Exhibit H) are
installed and in good operating order;
(ii) Tenant, its employees, agents, and
invitees, have ready access to the Building and Premises through
the lobby, entranceways, elevators, and hallways;
(iii) completing Tenant’s
improvements (section 1.05 and Exhibits D and E) so that
(A) Tenant can use the premises for their intended purposes
without material interference to Tenant conducting its ordinary
business activities, and
(B) the
only incomplete items are minor or insubstantial details of
construction, mechanical adjustments, or finishing touches like
touch-up plastering or painting;
(iv) the
Premises are ready for the installation of any equipment,
furniture, fixtures, or decoration that Tenant will
install;
(v) the
following items are installed and in good operating
order:
(B) hallways on floor on which Premises are
located (including walls, flooring, ceiling, lighting,
etc.),
(C) elevators, HVAC, utilities, and
plumbing serving the Premises, and
(D) the
doors and hardware; and
(vi) the
Premises are broom clean.
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1.04(c).
Notice. Landlord shall
give Tenant at least thirty (30) days advance written notice
of the estimated substantial completion date if different from the
Target Date. If the estimated substantial completion date changes
at any time after Landlord gives notice, then Landlord shall give
thirty (30) calendar days advance notice of the new estimated
substantial completion date.
1.04(d).
Inspection and Punchlist. Before the Commencement Date, the parties shall
inspect the Premises, have all systems demonstrated, and prepare a
punch-list. The punch-list shall list incomplete, minor, or
insubstantial details of construction; necessary mechanical
adjustments, and needed finishing touches. Landlord will complete
the punch-list items within thirty (30) days after the
Commencement Date. Landlord will promptly correct any latent
defects as they become known, if Tenant notifies Landlord within
thirty (30) days after Tenant first learns of the
defect.
1.04(e).
Delayed Possession. Tenant may cancel this Lease if Landlord cannot
deliver actual possession of the substantially complete Premises by
one hundred and twenty (120) days after the Target Date. To
cancel Tenant must give notice to Landlord within one hundred and
eighty (180) days after the Target Date and before Landlord
gives notice to Tenant that the Premises are substantially
complete. The one hundred and twenty (120) day and one hundred
and eighty (180) day periods above shall be extended by the
time equal to any period of delay caused by the Tenant. Within
thirty (30) days after cancellation Landlord shall return to
Tenant prepaid consideration including Rent and
deposits.
1.05.
Improvements. Landlord shall make improvements to the Premises
in accord with Exhibits D and E (Improvements) and Exhibit I
(Tenant Build Out Agreement). The Improvements shall be completed
in a good and workmanlike manner and comply with all applicable
laws, ordinances, rules, and regulations of governmental
authorities.
ARTICLE 2 — RENT AND
SECURITY
2.01.
Rent. Tenant shall
pay rent (Rent) to Landlord in the amounts designated in the
Reference Data.
(a) Payment. The Rent shall be paid in equal monthly
installments:
(i) without advance notice, demand, offset,
or deduction unless the offset or deduction is made by Tenant as
permitted under paragraph 11.01(b)(ii) or to recover any unpaid
(nonappealable) court judgment Tenant has against
Landlord;
(ii) by
the first day of each month during the Term; and
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(iii) to
Landlord or to Landlord’s agent as identified in the
Reference Data, or as Landlord may specify in writing to the
Tenant.
If the Term
does not begin on the first day or end on the last day of a month,
the Rent for that partial month shall be prorated by multiplying
the monthly Rent by a fraction, the numerator of which is the
number of days of the partial month included in the Term and the
denominator of which is the total number of days in the full
calendar month.
(b) Late payment. If Tenant fails to pay part or all of the Rent
or Additional Rent (section 2.02) within ten (10) days after
it is due, the Tenant shall also pay:
(i) a late charge
equal to 1 percent of the unpaid Rent and Additional Rent,
plus
(ii) interest at
18 percent per annum or the maximum then allowed by applicable
law, whichever is less, on the remaining unpaid balance,
retroactive to the date originally due until paid, but the interest
accumulation shall stop after thirty (30) days unless Landlord
gives Tenant written notice of the Tenant’s failure to pay
Rent or Additional Rent within 30 days of the date payment was
due.
2.02.
Additional Rent . Tenant shall also pay its pro rata share of real
estate taxes and operating expenses for the Property as Additional
Rent in accordance with the following provisions.
(i)
Tenant’s pro rata share, which is shown in the
Reference Data, was calculated by dividing the rentable area of the
Premises by the rentable area of the Building and expressing the
fraction as a percentage.
(ii)
Property means the Building and its equipment and systems,
and the Land.
(iii) Real
Estate Taxes means real property taxes and currently due
installments of assessments, special or otherwise, imposed upon the
Property, and reasonable legal fees, costs, and disbursements
incurred for proceedings to contest, determine, or reduce Real
Estate Taxes, but only to the extent the Real Estate Taxes are
reduced.
Real Estate
Taxes do not
include:
(A) federal, state, or local income
taxes,
(B) franchise, gift, transfer, excise,
capital stock, estate, succession, or inheritance taxes,
(C) penalties or interest for late payment
of Real Estate Taxes, and
(D) the
portion of Real Estate Taxes that is allocable to any Building
capital improvements made after the Building was fully assessed as
a completed and occupied unit and the Lease was signed except to
the extent the additional improvements benefit the
Tenant.
(iv)
Operating Expenses means Landlord’s operating expenses
that are reasonable, actual and necessary, out-of-pocket, obtained
at competitive prices, and that are directly attributable to the
operation, maintenance, management, and repair of the Property, as
determined under generally accepted accounting principles
consistently applied, including:
(A) salaries, and other compensation;
including payroll taxes, vacation, holiday, and other paid
absences; and welfare, retirement, and other fringe benefits; that
is paid to employees, independent contractors, or agents of
Landlord engaged in the operation, repair, management, or
maintenance of the Property;
(B) repairs and maintenance of the Property
and the cost of necessary supplies, tools, materials, and equipment
for Property repairs and maintenance, that under generally accepted
accounting principles would not be capitalized;
(C) premiums and other charges incurred by
Landlord for insurance on the Property and for employees specified
in subparagraph 2.02(a)(iv)(A)(l);
(D) costs
incurred for inspection and servicing, including all outside
maintenance contracts necessary or proper for the maintenance of
the Property, such as janitorial and window cleaning, rubbish
removal, exterminating, water treatment, elevator, electrical,
plumbing, and mechanical equipment, and the cost of materials,
tools, supplies, and equipment used for inspection and
servicing;
(E) costs
incurred for electricity, water, gas, fuel, or other
utilities;
(F) sales,
use, and excise taxes on goods and services purchased by
Landlord;
(G) license, permit, and inspection
fees;
(H) fees for
public accounting;
(I) legal
fees, costs, and disbursements but excluding those
(1) relating to disputes with
tenants,
(2) based
upon Landlord’s negligence or other tortious
conduct,
(3) relating to enforcing any leases except
for enforcing lease provisions for the benefit of the Building
tenants generally, or
(4) relating to the defense of
Landlord’s title to, or interest in, the Property;
(J) management fees to a person or entity
other than Landlord;
(K) the
annual amortization over its useful life with a reasonable salvage
value on a straight-line basis of the costs of any capital
improvements made by
Landlord and
(i) required by any changes in applicable laws, rules, or
regulations of any governmental authorities enacted after the
Building was assessed as a completed and occupied unit and the
Lease was signed, or (ii) which are for the benefit of the
Building tenants generally;
(L) the
annual amortization over its useful life with a reasonable salvage
value on a straight-line basis of the costs of any capital
improvements made by Landlord as a labor-saving measure or to
accomplish other savings in operating, repairing, managing, or
maintaining the Property, after the Building was assessed as a
completed and occupied unit and the Lease was signed, but only to
the extent of the savings; and
(M) other
costs reasonably necessary to operate, repair, manage, and maintain
the Property in a first class manner and condition.
Operating
Expenses exclude:
(A) Real
Estate Taxes as defined in paragraph 2.02(a)(iii);
(B) leasing commissions, costs,
disbursements, and other expenses incurred for leasing, renovating,
or improving space for tenants;
(C) costs
incurred by Landlord in discharging its obligations under section
1.05 and Exhibit C;
(D) costs
(including permit, license, and inspection fees) incurred in
renovating, improving, decorating, painting, or redecorating vacant
space or space for tenants;
(E) Landlord’s cost of electricity or
other service sold to tenants for which Landlord is to be
reimbursed as a charge over the Rent and Additional Rent payable
under the lease with that tenant;
(F) depreciation and amortization on the
Building except as expressly permitted elsewhere in the
Lease;
(G) costs
of a capital nature including capital improvements, capital
repairs, capital equipment, and capital tools, as determined under
generally accepted accounting principles consistently applied,
except that the annual amortization of these costs shall be
included to the extent expressly permitted in subparagraph
2.02(a)(iv)(K) and (L);
(H) costs
incurred because the Landlord or another tenant violated the terms
of any lease;
(I) interest on debt or amortization
payments on mortgages or deeds of trust or any other debt for
borrowed money;
(J) items
and services for which Landlord is reimbursed by Tenant or others
or which Landlord provides selectively to one or more tenants of
the Building other than Tenant without reimbursement;
(K) advertising and promotional
expenditures;
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(L) repairs or other work needed because of
fire, windstorm, or other casualty or cause insured against by
Landlord or to the extent Landlord’s insurance required under
Article 5 would have provided insurance, whichever is the
greater coverage;
(M) nonrecurring costs incurred to remedy
structural defects in original construction materials or
installations;
(N) any
costs, fines, or penalties incurred because Landlord violated any
governmental rule or authority;
(O) costs
incurred to test, survey, cleanup, contain, abate, remove, or
otherwise remedy hazardous wastes or asbestos-containing materials
from the Property unless the wastes or asbestos-containing
materials were in or on the Property because of Tenant’s
negligence or intentional acts;
(P) other
expenses that under generally accepted accounting principles
consistently applied would not be considered normal maintenance,
repair, management, or operation expenses.
2.02(b).
Adjustments. Operating
Expenses as defined in paragraph 2.02(a)(iv) shall be adjusted as
follows:
(i) Vacancy
Adjustment . If, during the term of this Lease, any area of the
Building reserved for occupancy by tenants is vacant, Landlord
shall pay the Pro Rata Share of the Operating Expenses and Real
Estate Taxes allocated to that area. The amount paid by Landlord
under this paragraph shall be reduced by the full amount of any
reduction in Operating Expenses directly attributable to the
vacancy.
(ii)
Credits/Reimbursements. Operating Expenses shall be reduced
by reimbursements, credits, discounts, reductions, refunds or other
allowances received or receivable by Landlord for items of cost
included in Operating Expenses, except reimbursements to the
Landlord by tenants under the Additional Rent (Operating
Expenses/Taxes) provision.
(iii)
Increased Building Rentable Square Feet. If Landlord
increases the Building’s rentable square feet after the
Building was fully assessed as a completed and occupied unit and
the Lease was signed, then the Operating Expenses and Real Estate
Taxes attributable to the additional rentable square feet shall be
included in the Operating Expenses and Real Estate Taxes and
Tenant’s pro rata share shall be reduced using the same
formula in paragraph 2.02(a)(i).
2.02(c).
Payment by Landlord. Subject to reimbursement under subsection
2.02(d), Landlord shall pay the Property’s Operating Expenses
and Real Estate Taxes before delinquency.
2.02(d).
Payment by Tenant.
(i) From
and after the commencement date of this Lease, the Tenant shall pay
monthly, together with the Rent, Additional Rent in the amount
designated in the Reference Data. Landlord reserves the right to
adjust the amount of Additional Rent due from Tenant in accordance
with the following paragraph (ii).
(ii) On or
before January 21 st of
each year during the term of this Lease, or as soon thereafter as
reasonably practical, Landlord shall deliver to Tenant:
(A) an
itemized statement (Statement) showing the amount of Additional
Rent received from Tenant together with the Real Estate Taxes and
actual Operating Expenses for the prior year broken down by
component expenses, such as repairs, management fees, utility
charges and janitorial costs; and
(B) a
budget showing the estimated cost for Real Estate Taxes and
Operating Expenses for the next twelve calendar months and a
calculation of the Tenant’s Pro Rata Share of Additional Rent
for the next twelve months. Landlord shall supply, upon
Tenant’s request, reasonable additional information to
explain or support the Statement. Any adjustment of the amount of
Additional Rent due from Tenant shall be effective, and paid by the
Tenant, with the Monthly Rent payment which is due at least ten
(10) days after Tenant’s receipt of a revised Reference Data
page for this Lease showing the adjusted amount of Additional Rent
due from Tenant.
(iii) If the
Statement shows that the amount of Tenant’s pro rata share
for the prior year is less than the amount of Additional Rent paid
by Tenant during that year, Landlord shall credit the difference to
the installment(s) of Rent and Additional Rent next due from Tenant
(or, after expiration of the Lease, mail a refund with the
statement). If the Statement shows that the amount of
Tenant’s pro rata share for the prior year is greater than
the amount of Additional Rent paid by Tenant during that year, the
difference shall be assessed to Tenant as Additional Rent and shall
be due with the installment of Rent which is due thirty
(30) days following Landlord’s delivery of an invoice
for said assessment to Tenant. Any overpayment or underpayment of
Additional Rent, including interest and penalty, shall survive the
ending of the Lease.
(iv) For
any year in which this Lease is not in effect for the complete
calendar year, unless it was ended because of Tenant’s
default, Tenant’s obligation for Additional Rent for that
year shall be prorated by multiplying Tenant’s pro rata share
by a fraction expressed as a percentage, the numerator of which is
the number of days of the year included in the Term and the
denominator of which is 365.
2.03.
Personal Property Tax. Tenant shall pay, before they become delinquent,
taxes assessed during the Term against trade fixtures or personal
property placed by Tenant in the Premises. If these taxes are
assessed against the Building, Tenant shall pay its share of the
taxes to the Landlord within ten (10) days after receiving
Landlord’s written statement setting forth the amount of
taxes applicable to Tenant’s property and the basis for the
charge to Tenant. Tenant’s failure to pay within the ten-day
period shall entitle the Landlord to the same remedies it has upon
Tenant’s failure to pay Rent.
2.04.
Security Deposit. The
Tenant has deposited the amount designated in the Reference Data
(Security Deposit) with the Landlord to secure Tenant’s
performance of its Lease obligations. If Tenant defaults Landlord
may, after giving five (5) days advance notice to Tenant,
without prejudice to Landlord’s other remedies, apply part or
all of the Security Deposit to cure Tenant’s default. If
Landlord so uses part or all of the Security Deposit, then Tenant
shall within ten (10) days after written demand, pay Landlord the
amount used to restore the Security Deposit to its original
amount.
Any part of the
Security Deposit not used by the Landlord as permitted by this
section shall be returned to Tenant, without interest, within
thirty (30) days after the Lease ends. If Landlord sells the
Building then the Landlord shall be relieved of any liability for
the Security Deposit and accumulated interest if the requirements
of subsection 5.03(a) are met.
2.05. Sales Tax . Tenant shall pay sales, excise or any similar
taxes which may be levied against the Rent, Additional Rent, or any
other payments due to Landlord under this Lease.
ARTICLE 3 — AFFIRMATIVE
OBLIGATIONS
3.01.
Compliance with Laws.
3.01(a).
Compliance at Commencement. Landlord and Tenant warrant, each to the other,
that on the Commencement Date, the Premises and the Tenant’s
use of the same, will comply with all applicable laws, ordinances,
rules, and regulations of governmental authorities (Applicable
Laws). Any failure to comply with the Applicable Laws following
notice from the other party and a reasonable period of cure shall
constitute a default under this Lease.
3.01(b).
Notice of Noncompliance. If there should be a change in the Applicable
Laws which would cause either party to be found out of compliance
therewith, that party shall immediately notify the other party and
undertake all actions necessary to achieve compliance with the
changed Laws, subject to the limits in the following subsection
3.01(c).
3.01(c).
Compliance Limits. Either
party, instead of complying with Applicable Laws as required by
subsection 3.01(b), may cancel the Lease by giving prompt notice to
the other if:
(i) the
estimated cost to comply exceeds an amount equal to six
months’ current rent
(A) due
from Tenant to Landlord if Tenant is not in compliance;
or
(B) due
from all tenants in the Building then paying rent to Landlord if
Landlord is not in compliance;
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(ii)
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less than twelve (12) months
remain in the Term and Tenant does not have an option to extend the
Term.
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If either party
(Canceling Party) cancels the Lease under (i) above, the other
(Complying Party) may, within ten (10) days of receiving the
Canceling Party’s notice, agree to achieve compliance with
the Applicable Laws at its expense by giving notice to the
Canceling Party and this Lease shall continue in effect. If the
Complying Party incurs any expense in its exercise of this right,
then the Canceling Party shall promptly reimburse the Complying
Party the amount of the limit identified for the Canceling Party in
(i) above, or the Complying Party’s actual cost of
compliance, whichever is less.
3.02.
Services and Utilities.
3.02(a).
Services. Landlord shall
provide at its expense, subject to reimbursement under subsection
2.02(d):
(i) Heating, ventilation, and air
conditioning (HVAC) for the Premises during business hours to
maintain temperatures for comfortable use and occupancy in light of
Tenant’s space plan (Exhibit D);
(ii) Automatic passenger elevators
providing adequate service leading to the floor on which the
Premises are located;
(iii) Janitorial services to the Premises
as specified in Exhibit F;
(iv) Hot
and cold water sufficient for drinking, lavatory, toilet, and
ordinary cleaning purposes to be drawn from approved fixtures in
the Premises if shown on Exhibit D or on the floor on which
the Premises are located;
(v) Electricity to the Premises during
business hours that provides electric current in reasonable amounts
necessary for normal office use, lighting, and HVAC;
(vi) Replacement of lighting tubes, lamp
ballasts, and bulbs;
(vii) Extermination and pest control when
necessary; and
(viii) Maintenance of common areas in a
first class manner comparable to other first class office buildings
in the area. The maintenance shall include cleaning, HVAC,
illumination, snow shoveling, deicing, repairs, replacements, lawn
care, and landscaping.
3.02(b).
Business Hours . In
section 3.02 business hours means:
(i) Monday
through Friday, 7:00 a.m. to 7:00 p.m., and
(ii) Saturday, 8:00 a.m. to 1:00 p.m., but
excludes the following holidays or the days on which the holidays
are designated for observance: New Year’s Day, Memorial Day,
July Fourth, Labor Day, Thanksgiving Day, and Christmas
Day.
3.02(c). 24
Hour Access. Tenant, its
employees, agents, and invitees shall have access to the Premises
twenty-four (24) hours a day, seven (7) days a week.
During nonbusiness hours Landlord may restrict access by requiring
an entry or identification card issued by the Landlord. Landlord
shall not be liable for denying entry to any person who does not
have the required card.
Landlord may
temporarily close the Building if required because of a
life-threatening or Building-threatening situation. Landlord shall
use its best efforts to close the Building during nonbusiness hours
only. If, however, the Building must be closed during business
hours, then the Rent and Additional Rent shall abate during any
closing that lasts more than eight (8) consecutive business
hours.
3.02(d).
Extra Services . Whenever
Landlord knows that any tenant (including Tenant) is using extra
services because of either nonbusiness-hours use or high
electricity consumption installations, the Landlord will directly
charge that tenant for the extra use and exclude those charges form
Operating Expenses. Extra services include:
(i)
NonBusiness-Hours Use . HVAC and electricity required by
Tenant during nonbusiness hours shall be supplied upon reasonable
advance verbal notice. If more than one tenant directly benefits
from these services then the cost shall be allocated
proportionately between or among the benefitting tenants based upon
the amount of time each tenant benefits and the square footage each
leases.
(ii) Excess
Utility Use. Tenant shall not place or operate in the Premises
any electrically operated equipment or other machinery, other than
typewriters, personal computers, adding machines, reproduction
machines, and other machinery and equipment normally used in
offices, unless Tenant receives Landlord’s advance written
consent. Landlord shall not unreasonably withhold or delay its
consent. But Landlord
may require
payment for the extra use of electricity caused by operating this
equipment or machinery.
Landlord may
require that special, high electricity consumption installations of
Tenant such as computer or reproduction facilities (except personal
computers or normal office photocopy machines) be separately
ventilated or sub-metered for electrical consumption at
Tenant’s cost.
(iii)
Payment. Tenant’s charges for the utilities provided
under (i) and (ii) above shall be the lesser of:
(A) one
hundred and ten percent (110%) of Landlord’s actual cost of
labor and utilities; or
(B) the
lowest rate charged to any other tenant in the Building for extra
services during the calendar year.
Tenant’s
failure to pay the charges in (i) and (ii) above within
thirty (30) days of receiving a proper and correct invoice
shall entitle Landlord to the same remedies it has upon
Tenant’s failure to pay Rent.
3.02(e). Interruption of Services.
(i)
Interruptions. Landlord does not warrant that any services
Landlord supplies will not be interrupted. Services may be
interrupted because of accidents, repairs, alterations,
improvements, or any reason beyond the reasonable control of the
Landlord. Except as noted in (ii) below, any interruption
shall not:
(A) be
considered an eviction or disturbance of Tenant’s use and
possession of the Premises;
(B) make
Landlord liable to Tenant for damages;
(C) abate
Rent or Additional Rent; or
(D) relieve Tenant from performing
Tenant’s Lease obligations.
(ii)
Remedy. If any essential services (such as HVAC, passenger
elevators, electricity, water) supplied by Landlord are
interrupted, and the interruption does not result from the
negligence or willful misconduct of Tenant, its employees,
invitees, or agents, Tenant shall be entitled to an abatement of
Rent and Additional Rent. The abatement shall begin on the third
consecutive business day of the interruption or when Tenant stops
using the Premises because of the interruption, whichever is later.
The abatement shall end on the second day after the services are
restored. Tenant shall have the option to cancel the Lease if the
interruption unreasonably and materially interferes with
Tenant’s use of or access to the Premises for at least thirty
(30) consecutive days and Landlord is not exercising its best
efforts to restore the services. To exercise this
option Tenant
must give Landlord notice of the cancellation within ten
(10) days from the end of the thirty (30) day
period.
3.03.
Repairs and Maintenance.
3.03(a).
Tenant’s Care of Premises. Tenant shall:
(i) keep
the Premises and fixtures in good order;
(ii) make
repairs and replacements to the Premises or Building needed because
of Tenant’s misuse or primary negligence, except to the
extent that the repairs or replacements are covered by
Landlord’s insurance or the insurance Landlord is required to
carry under Article 5, whichever is greater;
(iii) repair and replace special equipment
or decorative treatments installed by or at Tenant’s request
and that serve the Premises only, except
(A) to the
extent the repairs or replacements are needed because of
Landlord’s misuse or primary negligence, and are not covered
by Tenant’s insurance or the insurance Tenant is required to
carry under Article 5, whichever is greater; or
(B) if the
Lease is ended under sections 6.01 (Damage) or 6.02 (Condemnation)
or 7.03 (Landlord’s Default); and
3.03(b).
Landlord’s Repairs. Except for repairs and replacements that Tenant
must make under subsection 3.03(a), Landlord shall make all other
repairs and replacements to the Premises, common areas and Building
(including Building fixtures and equipment).
Landlord shall
make the repairs and replacements to maintain the Building in a
first class condition comparable to other first class buildings in
the area. This maintenance shall include the roof, foundation,
exterior walls, interior structural walls, all structural
components, and all systems such as mechanical, electrical, HVAC,
and plumbing.
3.03(c).
Time for Repairs .
Repairs or replacements required under subsections 3.03(a) or
3.03(b) shall be made within a reasonable time (depending on the
nature of the repair or replacement needed) after receiving notice
or having actual knowledge of the need for a repair or
replacement.
3.03(d). Surrendering the Premises. Upon the last
day of the initial or of the last extension term elected by Tenant
(if any), Tenant shall surrender the Premises to Landlord in the
same broom clean condition that the Premises were in on the
Commencement Date except for:
(i) ordinary wear and tear;
(ii) damage by the elements, fire, and
other casualty unless Tenant would be required to repair under
subsection 3.03(a);
(iv) damage arising from any cause not
required to be repaired or replaced by Tenant; and
(v) alterations as permitted by this Lease
unless consent was conditioned on their removal.
On surrender
Tenant shall remove from the Premises its personal property, trade
fixtures, and any alterations required to be removed under section
4.01 and repair any damage to the Premises caused by the removal.
Any items not removed by Tenant as required above shall be
considered abandoned. Landlord may dispose of abandoned items as
Landlord chooses and bill the Tenant for the cost of their
disposal, minus any revenues received by Landlord for their
disposal.
ARTICLE 4 — NEGATIVE
OBLIGATIONS
4.01(a).
Definition. “Alterations” means alterations,
additions, substitutions, installations, changes, and improvements,
but excludes minor decorations and the Improvements Landlord is to
make under section 1.05 and Exhibits D and E.
4.01(b).
Consent. Tenant shall not
make Alterations without the Landlord’s advance written
consent. Landlord’s consent shall not be unreasonably
withheld or unduly delayed for non-structural interior Alterations
to the Premises that do not adversely affect the Building’s
appearance, value, or structural strength.
4.01(c).
Conditions of consent. Landlord may condition its consent under
subsection 4.01(b) on all or any part of the following:
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(i) Tenant
shall furnish Landlord with reasonably detailed plans and
specifications of the Alterations;
(ii) The
Alterations shall be performed and completed:
(A) in
accord with the submitted plans and specifications,
(B) in a workmanlike manner,
(C) in compliance with all Applicable Laws,
(D) using new materials and installations at least equal in
quality to the original Building materials and installations,
(E) by not disturbing the quiet possession of the other
tenants,
(F) by not interfering with the construction, operation, or
maintenance of the Building, and
(G) with due diligence;
(iii) Tenant shall use workers and
contractors whom Landlord employs or approves in writing, which
approval shall not be unreasonably withheld or unduly
delayed;
(iv) Tenant shall modify plans and
specifications because of reasonable conditions set by Landlord
after reviewing the plans and specifications;
(v) Tenant’s contractors shall carry
builder’s risk insurance in an amount then customarily
carried by prudent contractors and workers’ compensation
insurance for its employees in statutory limits;
(vi) Tenant’s workers or contractors
shall work in harmony and not unreasonably interfere with
Landlord’s w
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