EXHIBIT 10.1
OFFICE LEASE
1707 NORTH RANDALL
ROAD
ELGIN,
ILLINOIS
DATE: April 15,
2005
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TABLE OF
CONTENTS
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Introductory
Article |
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ARTICLE 1
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DEMISED PREMISES; TERM |
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ARTICLE 2
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RENT |
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ARTICLE 3
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RENT ADJUSTMENTS |
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ARTICLE 4
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USE |
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ARTICLE 5
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SERVICES |
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ARTICLE 6
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POSSESSION |
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ARTICLE 7
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CONDITION OF PREMISES |
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ARTICLE 8
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REPAIRS |
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ARTICLE 9
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ALTERATIONS |
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ARTICLE 10
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COVENANT AGAINST LIENS |
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ARTICLE 11
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DAMAGE OR DESTRUCTION BY FIRE OR
CASUALTY |
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ARTICLE 12
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INSURANCE |
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ARTICLE 13
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DELETED |
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ARTICLE 14
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CONDEMNATION |
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ARTICLE 15
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WAIVER OF CLAIMS |
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ARTICLE 16
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NONWAIVER |
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ARTICLE 17
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WAIVER OF NOTICE |
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ARTICLE 18
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LANDLORD’S REMEDIES |
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ARTICLE 19
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SURRENDER OF POSSESSION |
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ARTICLE 20
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HOLDING OVER |
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ARTICLE 21
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COSTS, EXPENSES AND ATTORNEYS’
FEES |
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ARTICLE 22
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COMPLIANCE WITH LAWS |
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ARTICLE 23
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CERTAIN RIGHTS RESERVED BY
LANDLORD |
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ARTICLE 24
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ESTOPPEL |
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ARTICLE 25
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RULES AND REGULATIONS |
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ARTICLE 26
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PARKING |
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ARTICLE 27
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ASSIGNMENT AND SUBLETTING |
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ARTICLE 28
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NOTICE |
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ARTICLE 29
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DEFAULT UNDER OTHER LEASE |
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ARTICLE 30
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CONVEYANCE BY LANDLORD |
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ARTICLE 30
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SUBORDINATION OF LEASE |
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ARTICLE 32
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BROKERS |
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ARTICLE 33
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SIGNAGE |
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ARTICLE 34
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MISCELLANEOUS |
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ARTICLE 35
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EXCULPATION |
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ARTICLE 36
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LATE PAYMENT |
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ARTICLE 37
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COVENANT OF QUIET ENJOYMENT |
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ARTICLE 38
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OPTIONS TO EXTEND |
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ARTICLE 39
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OPTIONS TO EXPAND AND REDUCE
PREMISES |
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EXHIBITS
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EXHIBIT A
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PLAN OF PREMISES |
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EXHIBIT B
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LEGAL DESCRIPTION OF PROPERTY |
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EXHIBIT C
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BUILDING RULES AND REGULATIONS |
iii
OFFICE LEASE
THIS OFFICE LEASE, made as of
April15, 2005, between JOHN B. SANFILIPPO & SON, INC., a
Delaware corporation (“Landlord”) and PANASONIC
CORPORATION OF NORTH AMERICA, a Delaware corporation
(“Tenant”).
WITNESSETH THAT, in
consideration of the covenants and agreements hereinafter set
forth, Landlord hereby lets to Tenant and Tenant hereby leases from
Landlord the Premises described herein, on the following terms and
conditions contained in this Lease:
INTRODUCTORY
ARTICLE:
BASIC LEASE PROVISIONS
AND ENUMERATION OF EXHIBITS
A. Basic Lease
Provisions. The provisions of this Introductory Article are
intended to be in outline form and are addressed in detail in other
Articles of this Lease.
LEASE TERM
(Also see Article 1): Thirty-six (36) months
COMMENCEMENT DATE (Also see Article 1): April 15,
2005
TERMINATION
DATE (Also see Article 1): April 14, 2008
RENTABLE
SQUARE FOOTAGE: 164,691 square feet (hereinafter referred to as
the
“Premises” and depicted on Exhibit A)
1
RENT (Also see Article 2):
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Rate |
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Annualized |
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Monthly Installment |
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Period |
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PSF |
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Rent |
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of Rent |
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Commencement Date
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9.23 |
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1,535,634.60 |
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127,969.55 |
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Termination
Date
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(The rental amount set forth above
shall be hereinafter referred to as “Rent”.)
TENANT’S PROPORTIONATE SHARE
(Also see Article 3): 41.47%
ADDITIONAL BROKER (Also see
Article 32): Paine Wetzel Associates, Inc.
B. Enumeration of
Exhibits. The following exhibits and schedules are attached
hereto and incorporated herein by this reference, as though set
forth in full herein:
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EXHIBIT A
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Plan of Premises. |
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EXHIBIT B
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Legal Description of Property |
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EXHIBIT C
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Rules and Regulations |
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SCHEDULE I
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Removable Equipment |
ARTICLE
1
DEMISED PREMISES;
TERM
Landlord does hereby demise and lease
to Tenant, and Tenant hereby accepts, that certain space as shown
on the plan attached hereto and made a part hereof as
Exhibit A, located on a portion of the first and second floors
and consisting of 164,691 rentable square feet (the
“Premises”) in the building known as 1707 North Randall
Road (the “Building”), situated on certain property
(including all easements appurtenant thereto) in Elgin, Illinois
(the “Property”) as described on Exhibit B
attached hereto for a term commencing on the 15th day of April,
2005 and ending on the 14 th day of April,
2008 (the “Term”), unless sooner terminated or extended
as provided herein, subject to the terms, covenants, and agreements
herein contained.
2
ARTICLE
2
RENT
Tenant shall pay to Landlord or
Landlord’s agent at the office of Landlord or at such other
place as Landlord may from time to time designate, monthly Rent in
the amount set forth in the Introductory Article, payable in
advance on the first day of each and every calendar month during
the Term. If the Term commences on a day other than the first day
of a calendar month, or ends on a day other than the last day of a
calendar month, then the Rent for such fractional month shall be
prorated on the basis of 1/365th of the annual Rent for each day of
such fractional month. Rent shall be payable without any prior
notice or demand therefor and without any deductions or set-offs
whatsoever, except as expressly set forth herein. The obligation
for the timely and full payment of Rent and additional Rent
(defined herein) is independent of all the obligations of Landlord
under this Lease, and no offset, deduction or setoff shall be
allowed or permitted unless otherwise specifically provided for in
this Lease.
ARTICLE
3
RENT
ADJUSTMENTS
Landlord and Tenant agree that the
following rent adjustments described below shall be made with
respect to each calendar year of the Term after the Base Year
commencing with the calendar year 2008, or portion thereof,
including the calendar year in which the Lease terminates. The Base
Year for purposes of calculating Tenant’s rent adjustments
shall be the year 2007:
(A) Tenant shall pay to Landlord
as additional Rent an amount equal to Tenant’s Proportionate
Share of the amount of the increases in Ownership Taxes payable by
Landlord for each calendar year of the Term over the Base Year.
Tenant’s Proportionate Share of such Ownership Taxes is
agreed to be as set forth in Introductory Article A, being the
percentage calculated by dividing the rentable area contained in
the Premises (164,691) by the rentable area of the Building
(397,085).
Ownership Taxes shall mean all taxes
and assessments of every kind and nature which Landlord shall be
obligated to pay with respect to any calendar year or portion
thereof during the Term, regardless of when such taxes or
assessments are payable, because of or in any way connected with
the ownership, leasing, and operation of the Building and the
Property subject to the following:
(i) the amount of ad valorem real and
personal property taxes against Landlord’s real and personal
property to be included in Ownership Taxes shall be the amount
payable with respect to such calendar year, notwithstanding that
such taxes are payable in a later calendar year. The amount of any
tax refunds received by Landlord with respect to Ownership Taxes
payable hereunder shall be deducted from such Ownership Taxes
regardless of when received by Landlord, less the Landlord’s
cost of obtaining any such reduction or refund;
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(ii) the amount of special taxes and
special assessments to be included shall be limited to the amount
of the installments (plus any interest, other than penalty
interest, payable thereon) of such special tax or special
assessment payable during the calendar year in respect of which
Ownership Taxes are being determined;
(iii) the amount of any tax or excise
levied by the State of Illinois or the City of Elgin, any political
subdivision of either, or any other taxing body, on rents or other
income from the Property (or the value of the leases thereon) to be
included shall not be greater than the amount which would have been
payable on account of such tax or excise by Landlord during the
calendar year in respect of which Ownership Taxes are being
determined had the income received by Landlord from the Building
been the sole taxable income of Landlord for such calendar
year;
(iv) there shall be excluded from
Ownership Taxes all income, excess profits taxes, franchise,
capital stock, and inheritance or estate taxes; and
(v) notwithstanding anything set
forth herein to the contrary, in the event the Building and a
reasonable allocation of land value are not taxed separately and
tax bills for Ownership Taxes payable hereunder include such taxes
for the entire Property, Ownership Taxes payable with respect to
the Premises shall be determined as hereinafter set forth. Such
real estate tax bill or bills for the entire Property as described
above shall be allocated to the Building and the existing
warehouse/industrial building located on the Property (the
“Industrial Building”) per rentable square foot on the
basis of the total rentable square feet in the Industrial Building
and double the total rentable square feet in the Building (the
“Property Allocation”). For example, if the Building
had one hundred (100) rentable square feet and the Industrial
Building had two hundred (200) rentable square feet, each
would be allocated an equal one-half of such taxes. Tenant will
then be obligated to pay Tenant’s Proportionate Share of such
Ownership Taxes allocated to the Building in accordance with the
other terms and provisions of this Section 3(A). In no event
shall Tenant be required to pay any part of real estate taxes and
assessments imposed as a result of any expansion by Landlord of the
Building or the Industrial Building or the construction of new
improvements on the Property and any such taxes shall be excluded
from any computation to be made hereunder.
(B) Tenant shall pay to Landlord
as additional Rent an amount equal to Tenant’s Proportionate
Share of the amount of the increases in Operating Expenses for each
calendar year of the Term after the Base Year over the Base Year.
Tenant’s Proportionate Share of such Operating Expenses is
agreed to be 41.47% (calculated as set forth in Article 3(A)
herein).
Operating Expenses shall mean all
reasonable and customary expenses, incurred or paid on behalf of
Landlord for the ownership, management, operation, maintenance and
repair of, and necessary replacements in, the Building and the
Property which, in accordance with generally accepted accounting
practice as applied to the operation and maintenance of office
buildings, are properly chargeable to the ownership, management,
operation, maintenance and repair of, and necessary replacements
in, the Building. Operating Expenses include, without limitation
and except
4
as limited elsewhere in
this Article, management fees, landscaping, the cost of up to two
(2) window washings in any year, scavenger service, maintenance or
repair of the roof, façade, parking lot, walkways, detention
areas and of any heating, ventilation and air conditioning
equipment and other Building systems and improvements, non-capital
expenditures required under any governmental law or regulation,
installation, maintenance and repair of fire safety systems,
including sprinkler and smoke detection systems, wages and benefits
of janitors, cleaning personnel, engineers and other employees
(including the amount of any social security taxes, unemployment
insurance contributions and “fringe benefits”),
insurance premiums, fuel costs and utility costs, legal and
accounting expenses, and amortization of the costs of any capital
improvement to the Property not excluded as set forth below, with
interest at two percent (2%) over the corporate base rate of
interest from time to time published by Bank One, Illinois, N.A. on
the unamortized amount of such costs. All such capital costs shall
be amortized over the shortest of (i) the reasonable life of
the capital improvement items, (ii) if applicable, the
economic payback period of the items, with the reasonable
life/economic payback period and amortization schedule being
determined in accordance with sound management accounting
principles or (iii) the remaining Term of the Lease. To the
extent any item of expense is incurred with respect to the entire
Property, such expense shall be allocated to the Building and the
Industrial Building in accordance with the Property Allocation,
provided, however, no item of expense shall be included in
Operating Expenses if it is incurred solely with respect to the
Industrial Building or other improvements on the Property other
than the Building. Notwithstanding the foregoing, Operating
Expenses shall not include:
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(i) |
costs of alterations of tenant spaces or space occupied by
Landlord or its affiliates; |
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(ii) |
depreciation, interest and principal payments on mortgages, and
other debt costs, and rental payments under any superior,
underlying or ground lease, if any; |
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(iii) |
costs of capital improvements, except for such costs including
interest thereon, as set forth above, where (a) the purpose of
such capital improvements is to reduce Operating Expenses, or
(b) such capital improvement is required due to any rule,
regulation, ordinance or statute of any applicable governmental
body not in effect as of the date hereof; |
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(iv) |
real estate brokers’ leasing commissions or
compensation; |
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(v) |
payments to affiliates of the Landlord for goods and/or
services in excess of what would be paid to non-affiliated parties
for such goods and/or services in an arm’s length
transaction; |
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(vi) |
costs of other services or work performed for the singular
benefit of another tenant or occupant; |
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(vii) |
legal, space planning, construction, building permit and code
compliance fees and costs and other expenses incurred in procuring
tenants for the Building, preparing space for occupancy or renewing
or amending leases with existing tenants or occupants of the
Building; |
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(viii) |
costs of advertising and public relations and promotional costs
and attorneys’ fees associated with the leasing of the
Building; |
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(ix) |
any costs, fines or penalties incurred due to the violation by
Landlord of any governmental rule or authority (and not caused by
Tenant), any negligence of Landlord or its agents or any default by
Landlord hereunder; |
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(x) |
any expense for which Landlord is entitled to receive
reimbursement from insurance, condemnation awards, other tenants or
any other source; |
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(xi) |
costs incurred in connection with the sale, financing,
refinancing, mortgaging, or other change of ownership of the
Building; |
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(xii) |
costs, fines, interest, penalties, legal fees or costs of
litigation incurred due to the late payment of taxes, utility bills
and other costs incurred as a result of Landlord’s failure to
make such payments when due, so long as Tenant has been timely in
the payment of its bills to Landlord; |
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(xiii) |
salaries and wages and other benefits paid to or on behalf of
employees above the level of Property Manager; |
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(xiv) |
legal and other expenses incurred in administering or enforcing
leases with third parties; |
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(xv) |
cost of window washing in excess of two (2) times per
year; |
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(xvi) |
costs of electricity used by other tenants or occupants of the
Building; and |
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(xvii) |
costs of repair to and replacement of the Building required
because of any casualty damage or eminent domain. |
(C) In order to provide for
payments on account of Ownership Taxes and Operating Expenses
payable for each calendar year during the Term of this Lease
commencing with the calendar year 2008, Tenant agrees, at
Landlord’s request, to pay, as additional Rent,
Tenant’s Proportionate Share of Ownership Taxes and Operating
Expenses due for any such calendar year, as reasonably estimated by
Landlord and set forth in a reasonably detailed budget delivered no
later than November 30 of the prior calendar year, in twelve
(12) monthly installments, each in an amount equal to 1/12th
of Tenant’s Proportionate Share commencing on the first day
of the succeeding January, commencing January 1, 2008. If, for
whatever reason, the detailed budget for any given year beginning
2009 is not forthcoming, Tenant shall continue to pay under the
previous year’s budget until such time as the applicable
budget has been prepared and delivered to Tenant. If, as finally
determined in the succeeding calendar year at the time of delivery
of the annual statements provided for in subparagraph
(D) hereof, Tenant’s Proportionate Share of Operating
Expenses or Ownership Taxes shall be greater than or be less than
the aggregate of all installments so paid on
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account to the Landlord
(and which are applicable to such calendar year) prior to receipt
of an invoice from Landlord, then Tenant within thirty
(30) days of such invoice shall pay to Landlord the amount of
such underpayment, or the Landlord shall credit Tenant for the
amount of such overpayment, or, in the case of the last calendar
year, pay to Tenant the amount of such overpayment within thirty
(30) days, as the case may be.
(D) Landlord shall deliver to
Tenant within ninety (90) days after the close of each
applicable calendar year (including the calendar year in which this
Lease terminates), a statement containing the amount of the
Operating Expenses for such calendar year. Landlord shall deliver
to Tenant within ten (10) days after Landlord’s receipt
for the final bill for Ownership Taxes for the prior calendar year
(including the year in which the Lease terminates) a statement
containing Ownership Taxes for such calendar year. Failure or delay
in delivering any such statement or invoice, or failure or delay in
computing the Rent adjustments pursuant to this Article 3,
shall not be deemed a waiver by Landlord of its right to deliver
such items nor shall any such failure or delay be deemed a release
of Tenant’s obligations with respect to any such statement or
invoice, or constitute a default hereunder. All Rent adjustments
payable hereunder shall be made without any deductions or set-offs
whatsoever except as expressly set forth herein.
(E) The obligation of the Tenant
with respect to the payment of Rent and Rent adjustments due
hereunder and the obligation of Landlord with respect to the
determination of Rent adjustments and refund of overpayments
thereof shall survive the expiration or termination of this Lease.
Any payment, refund, or credit made pursuant to this Article shall
be made without prejudice to any right of the Landlord to correct
any items as billed pursuant to the provisions hereof. In the event
that this Lease shall have been in effect for less than the full
calendar year immediately preceding Tenant’s receipt of the
invoices provided for in subparagraphs (C) and
(D) hereof, the Rent adjustment shall be pro rata. In no event
shall any Rent adjustment result in a decrease in the Rent payable
hereunder.
(F) Landlord shall maintain
books and records showing Ownership Taxes and Operating Expenses in
accordance with generally accepted accounting principles as applied
to the real estate industry, which are consistently applied
(including, without limitation, as to categories of expenses
incurred in the Base Year), and its customary management practices.
Tenant or its representative shall have the right to examine
Landlord’s books and records showing Ownership Taxes and
Operating Expenses upon reasonable prior notice provided to
Landlord, during Landlord’s normal business hours at
Landlord’s normal place of business at any time within ninety
(90) days following the furnishing by Landlord to Tenant of
Landlord’s statement provided for in Section 3(D) above.
Unless, within ninety (90) days of receipt of any such
Landlord’s statement, Tenant shall provide Landlord with
notice of its intention to inspect Landlord’s books and
records pursuant to this Section and provide Landlord with a
written statement of its objection to any item in such
Landlord’s statement, Landlord’s statement shall be
considered as final and conclusively binding on Tenant.
ARTICLE
4
USE
7
(A) Tenant may use and occupy
the Premises for general office use and equipment and appliance
repair and testing and any other similar lawful purposes, provided,
however, such equipment and appliance repair shall be conducted
only on the first floor of the Building and such equipment and
appliances shall be delivered to the Building only by
Tenant’s employees or commercial delivery service through the
existing docks servicing the Building. Tenant may also use the
Premises for any other similar lawful purposes to those stated
above with the prior written approval of Landlord. Tenant shall not
use or permit upon the Premises any retail sales or retail warranty
service operation or anything that will invalidate any policies of
insurance now or hereafter carried on the Building, materially
impair the value of the Building and Premises or any part thereof
or materially increase the dangers, or pose unreasonable risk of
harm, to third parties (on or off of the Premises) arising from
activities thereon. Tenant will pay all extra insurance premiums
which may be caused by the use which Tenant shall make of the
Premises. Tenant will not in any manner deface or injure the
Building or any part thereof or overload the floors of the
Premises. Tenant will not do anything or permit anything to be done
upon the Premises in any way tending to create a public or private
nuisance, or tending to disturb any other tenant in the Building or
the occupants of neighboring property or tending to injure the
reputation of the Building or commit waste thereon. Tenant will
promptly and fully comply with all governmental, health and police
requirements and regulations respecting its use of the Premises.
Tenant will not use the Premises for lodging or sleeping purposes
or for any immoral or illegal purposes. Tenant shall not conduct
nor permit to be conducted on the Premises any business which is
contrary to any of the laws of the United States of America or of
the State of Illinois or which is contrary to the ordinances of the
City of Elgin. Tenant shall not at any time manufacture, sell, or
give away, and shall not at any time permit the manufacture, sale,
or gift of any spirituous, fermented, intoxicating or alcoholic
liquors or controlled substances on the Premises, except that the
foregoing shall not be deemed to prohibit the occasional use of
alcoholic beverages for entertainment purposes, so long as Tenant
has in full force and effect (and delivered to Landlord a
certificate of insurance therefor) a policy of host liquor
liability or dram-shop insurance in form and amounts at all times
reasonably satisfactory to Landlord. Tenant shall not at any time
sell, purchase or give away, or permit the sale, purchase or gift
of, food in any form on the Premises, except for coffee service and
vending machines for its employees or as otherwise permitted by
rules and regulations. The foregoing use prohibitions shall be
deemed to apply to any subtenant or assignee of Tenant without
requirement of further or additional notice.
(B) Tenant agrees that it will
not use, handle, generate, treat, store or dispose of, or permit
the handling, generation, treatment, storage or disposal of any
Hazardous Materials in, on, under, around or above the Premises now
or at any future time during the Term of the Lease in violation of
applicable laws and will indemnify, defend and save Landlord
harmless from any and all actions, proceedings, claims, costs,
expenses and losses of any kind, including, but not limited to,
those arising from injury to any person, including death, damage to
or loss of use or value of real or personal property, and costs of
investigation and cleanup arising as a result of the use of
Hazardous Materials on the Premises by Tenant or its subtenants and
assigns during the Term hereof. The term “Hazardous
Materials”, when used herein, shall include, but shall not be
limited to, any substances, materials or wastes to the extent
quantities thereof are regulated by the City of Elgin or any other
local governmental authority, the State of Illinois, or the United
States of America because of toxic, flammable, explosive,
corrosive, reactive, radioactive or other properties that may be
hazardous to human health or the environment, including asbestos
and including any materials or substances that
8
are listed in the United
States Department of Transportation Hazardous Materials Table, as
amended, 49 C.F.R. 172.101, or in the Comprehensive Environmental
Response, Compensation and Liability Act, as amended, 42 U.S.C.
subsections 9601 et seq., or the Resources Conservation and
Recovery Act, as amended, 42 U.S.C. subsections 6901 et seq., or
any other applicable governmental regulation imposing liability or
standards of conduct concerning any hazardous, toxic or dangerous
substances, waste or material, now or hereafter in effect. Tenant
does hereby indemnify, defend and hold harmless the Landlord and
its agents and their respective officers, directors, beneficiaries,
shareholders, partners, agents and employees and Landlord’s
lender or lenders holding a mortgage on the Property from all
fines, suits, procedures, claims and actions of every kind, and all
costs associated therewith (including reasonable attorneys’
and consultants’ fees) arising by, through or under Tenant,
its agents, subtenants, assigns, employees, contractors, servants
and invitees and out of or in any way connected with any deposit,
spill, discharge or other release of Hazardous Materials that
occurs during the Term of this Lease, at or from the Premises, or
which arises at any time from Tenant’s use or occupancy of
the Premises, or from Tenant’s failure to provide all
information, make all submissions, and take all steps required by
all applicable governmental authorities. Landlord agrees and
acknowledges that the foregoing indemnity by Tenant does not apply
to any liability arising from the acts or omissions of Landlord or
other Tenants or occupants of the Building or the agents or
employees of any of the foregoing. Tenant’s obligations and
liabilities under this paragraph shall survive the expiration of
the Term of this Lease. Tenant acknowledges that it has had ample
opportunity to inspect the Premises and perform any environmental
assessments it considers appropriate to determine the environmental
condition of the Premises, that Tenant has not relied on any
representation of the Landlord regarding such condition, and that
Tenant has consulted its own experts and independently satisfied
itself regarding the environmental condition of the Premises.
ARTICLE
5
SERVICES
Landlord shall provide, except as
otherwise provided herein and subject to applicable government
codes, rules, regulations, and guidelines applicable thereto, and
further subject to Landlord’s inability to provide due to
circumstances beyond Landlord’s reasonable control whether
mandatory or voluntary, the following services:
(A) Air-cooling and heat to
provide a temperature condition consistent with office buildings in
the northwest suburban Chicago area, daily from 7:00 A.M. to 6:00
P.M. (Saturdays to 1:00 P.M.), Sundays and holidays excepted.
Whenever heat-generating machines or equipment installed by Tenant
affect the temperature otherwise maintained by Landlord in the
Premises, Landlord shall be relieved of responsibility for
maintaining the air conditioning standards applicable to the
Building, and in such event Tenant shall (1) discontinue use
of such heat-generating machines or equipment, or (2) install
supplementary air conditioning units in the Premises, the cost,
installation, operation and maintenance of which shall be paid by
Tenant. Tenant agrees that at all times it will cooperate with
Landlord and abide by all reasonable regulations and requirements
which Landlord may prescribe for the proper functioning of the
ventilating and air conditioning systems.
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(B) Water for drinking, lavatory
and toilet purposes drawn through fixtures installed by the
Landlord, or by Tenant with Landlord’s written consent, from
regular Building supply at the prevailing temperature. Tenant shall
pay Landlord at rates fixed by Landlord for water furnished for any
other purpose. Tenant shall not waste or permit the waste of
water.
(C) Janitor service in and about
the Premises, Saturdays, Sundays and holidays excepted. Tenant
shall not provide any janitor services without Landlord’s
written consent and then only subject to supervision of Landlord
and at Tenant’s sole responsibility and by a janitor,
contractor or employees at all times reasonably satisfactory to
Landlord, but not as agent or servant of Landlord.
(D) Adequate operatorless
passenger elevator service at all times and freight elevator
service subject to reasonable scheduling by Landlord.
(E) Electrical service to the
Premises. Tenant agrees that if it purchases any lamps, bulbs,
ballasts and starters used in the Premises from anyone other than
Landlord, all such items shall be of the same type as those used in
the Building. Landlord agrees that it shall provide Tenant use of
the existing supplemental electrical generator serving the Building
reasonably adequate to operate life safety systems such as, but not
limited to, emergency lighting and security/fire prevention
controls, in the event standard electrical service to the Building
becomes unavailable, but Tenant acknowledges and agrees that
Landlord shall not be responsible for repairing, replacing or
installing any new generator equipment except to the extent
required to comply with any applicable ordinances, codes or
government regulations.
(F) Security service including,
without limitation, manned security desk in the Building from 6:30
am. to 6:30 p.m. Monday through Saturday, with key card or similar
secured entry system at all other times, with Tenant being
responsible for the cost of any keys or identification cards
necessary for Tenant’s use of such system in excess of four
hundred fifty (450) keys or cards (including the keys or cards
furnished to Tenant pursuant to the Lease of the Industrial
Building by and between Landlord and Tenant).
(G) Access to (1) the
rooftop of the Building and such other parts thereof as may be
necessary for the installation and use, at Tenant’s sole cost
and expense, of a satellite dish and/or antenna at locations to be
agreed upon by the parties, such agreement not to be unreasonably
withheld, delayed or conditioned, (2) the Property and the
Building as may be necessary for the installation of a cable
communications distribution system, at Tenant’s sole cost and
expense, at locations to be agreed upon by the parties, such
agreement not to be unreasonably withheld, delayed or conditioned,
and (3) cabling and conduit and rooftop satellite dishes and
antennae now or hereafter installed as may be reasonably necessary
in connection with Tenant’s use and occupancy of the
Premises, including, without limitation, such reasonable access to
all of the foregoing as may be necessary for the repair,
maintenance or replacement thereof by Tenant or its agents. Tenant
hereby indemnifies and holds Landlord harmless for any and all work
conducted pursuant to this subparagraph (G) and agrees to
promptly repair the Building to the extent it is damaged by any
such work. Tenant shall provide to Landlord the names of the
contractors that it employs to conduct such work and shall provide
any other information reasonably requested by Landlord including,
but not limited to, insurance from the contractors naming Landlord
as additional insured
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(H) Life safety systems,
telecommunications equipment and cabling, and natural gas
distribution system, all as currently installed on the Building and
the Property or upgraded by Landlord.
(I) Such additional services on
such terms and conditions as may be mutually agreed upon by
Landlord and Tenant.
So long as Landlord or any other
entity operates a cafeteria, health club, conference center,
central mail/package receiving room or other similar amenity in the
Building for use by employees of Landlord or any affiliate of
Landlord or other tenants of the Building, Landlord agrees that
Tenant’s employees shall have full access to such facilities
and, if a cost is charged therefor, at the lowest cost offered to
any other users thereof. In the event Landlord elects not to
operate a cafeteria in the Building, Landlord agrees that Tenant
may operate a cafeteria at Tenant’s sole cost and expense and
at no additional rent in such location as it is currently located
pursuant to an agreement reasonably acceptable to Landlord. If
Tenant operates the cafeteria in the Building, Tenant agrees that
Landlord’s employees or any other tenant of the Building
shall have full access to such facilities and, if a cost is charged
therefor, at the lowest cost offered to any other users
thereof.
Tenant agrees that neither Landlord
nor any company, firm, or individual operating, maintaining,
repairing, managing or supervising the plant or facilities
furnishing any of the above services, nor any of their respective
agents or employees shall be liable to Tenant, or any of
Tenant’s subtenants, assigns, 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 of the above
services, except solely if caused by the gross negligence or
recklessness of Landlord or its agents; nor shall any such
interruption, diminution, delay or discontinuance relieve Tenant
from full performance of Tenant’s obligations under this
Lease. Notwithstanding the foregoing, in the event that any
interruption or discontinuance is caused by the gross negligence or
recklessness of Landlord or its agents and such interruption or
discontinuance continues beyond ten (10) consecutive business
days in the Premises, or any portion thereof, and on account of
such interruption or disturbance the Premises becomes substantially
untenantable, Rent and additional charges shall abate
proportionately for so long as Tenant remains unable to conduct its
business in the Premises or such portion thereof. Landlord agrees
to use reasonable efforts to restore any such interrupted or
discontinued service as soon as reasonably practicable. Landlord
shall not be responsible for any interruption or discontinuance
described above caused by third parties (other than its agents as
set forth above) or by an act of God.
11
ARTICLE
6
POSSESSION
Landlord shall deliver possession of
the Premises on the Commencement Date. If Tenant shall enter
possession of all or any part of the Premises prior to the date
fixed above for the first day of the Term, all of the covenants and
conditions of this Lease shall be binding upon the parties hereto
in respect of such possession the same as if the first day of the
Term had been fixed as of the date when Tenant entered such
possession except that Tenant shall not pay Rent for the period
prior to the first day of the Term of this Lease.
ARTICLE
7
CONDITION OF
PREMISES
Tenant’s taking possession of
any portion of the Premises shall be conclusive evidence as against
Tenant that such portion of the Premises were in good order and
satisfactory condition when the Tenant took possession. Tenant
acknowledges that it owned the Building prior to the commencement
of the Term of this Lease, that Tenant has had ample opportunity to
inspect the Premises and perform any inspections or assessments it
considers appropriate to determine the condition of the Premises,
that Tenant has not relied on any representation of Landlord
regarding such condition, that Tenant has consulted its own experts
and independently satisfied itself regarding the condition of the
Premises, and that Tenant has accepted the Premises “ AS-IS,
WHERE-IS” with all faults. No promise of the Landlord to
alter, remodel, repair or improve the Premises or the Building and
no representations respecting the condition of the Premises or the
Building have been made by Landlord to Tenant.
12
ARTICLE
8
REPAIRS
Except as may otherwise be provided
in Article 11 of this Lease, and subject to the provisions of
Article 9 of this Lease, Tenant shall, at its sole cost and
expense, keep the Premises in good order, repair and tenantable
condition at all times during the Term, ordinary wear and tear
excepted, provided, however, that Tenant shall not be required to
repair or replace broken or damaged exterior window glass unless
such replacement or repair is necessitated by the act, failure to
act, or neglect of Tenant, its subtenants, assigns, servants,
employees, agents, invitees or guests. If Tenant does not make such
repairs and replacements as described above within a reasonable
time, Landlord may, but need not, make such repairs and
replacements and the costs paid or incurred by Landlord for such
repairs and replacements (including Landlord’s overhead and
profit, and the cost of general conditions) shall be deemed
additional Rent reserved under this Lease due and payable within
thirty (30) days after Tenant’s receipt of an itemized
invoice and supporting documentation. Landlord may, but shall not
be required so to do, enter the Premises at all reasonable times
upon prior written notice to Tenant (except in the event of any
emergency) to make any repairs, alterations, improvements or
additions, including, but not limited to, ducts and all other
facilities for heating and air conditioning service, as Landlord
shall desire or deem necessary for the safety, maintenance, repair,
preservation or improvement of the Building, or as Landlord may be
required or requested to do by the City of Elgin or by the order or
decree of any court or by any other proper authority.
In the event Landlord or its agents
or contractors shall elect or be required to make repairs,
alterations, improvements or additions to the Premises or the
Building, Landlord shall be allowed to take into and upon the
Premises all material that may be required to make such repairs,
alterations, improvements or additions and, during the continuance
of any of said work, to temporarily close doors, entryways, public
space and corridors in the Building and to interrupt or temporarily
suspend any services and facilities without being deemed or held
guilty of an eviction of Tenant or for damages to Tenant’s
property, business or person, and the Rent reserved herein shall in
no way abate while said repairs, alterations, improvements or
additions are being made, and Tenant shall not be entitled to
maintain any set-off or counterclaim for damages of any kind
against Landlord by reason thereof. Landlord may, at its option,
make all such repairs, alterations, improvements or additions in
and about the Building and the Premises during ordinary business
hours, but if Tenant desires to have the same done at any other
time, Tenant shall pay for all overtime and additional expenses
resulting therefrom. Landlord agrees to use all reasonable efforts
to minimize any interference with Tenant’s business
operations in the Premises and shall remain liable for its or its
agents’ gross negligence.
ARTICLE
9
ALTERATIONS
13
Tenant shall not, without the prior
written consent of Landlord in each instance obtained, which
consent shall not be unreasonably withheld, delayed or conditioned,
make any repairs, replacements, alterations, improvements or
additions to the Premises, provided, however, no such consent shall
be required with respect to cosmetic alterations or any separate
security system for the Premises installed by Tenant, in which case
Tenant shall deliver to Landlord all system codes, contact
information for the applicable security company, and a copy of any
keys to such system. In the event Tenant desires to make any
alterations, improvements or additions pursuant to this
Article 9, or any repairs or replacements pursuant to
Article 8 of this Lease, Tenant shall prior to commencing any
such work:
(a) In the event such work is
structural or affects mechanical systems, submit to Landlord for
review plans and specifications showing such work in reasonable
detail;
(b) Furnish Landlord with the names
and addresses of all contractors and copies of all contracts with
such contractors;
(c) Furnish commercially reasonable
certificates of insurance from all contractors performing such work
evidencing commercial general liability, automobile liability,
employer’s liability and worker’s compensation
insurance, the last in statutory amounts; and
(d) Provide Landlord with copies of
all necessary permits evidencing compliance with all ordinances and
regulations of the City of Elgin or any department or agency
thereof, and with the requirements of all statutes and regulations
of the State of Illinois or any department or agency thereof.
Tenant hereby agrees to protect,
defend, indemnify and hold Landlord, the Building and the Property
harmless from and against any and all liabilities of every kind and
description which may arise out of or in connection with such
repairs, replacements, alterations, improvements or additions by
Tenant or any subtenant or assign of Tenant.
Upon completing any of such repairs,
replacements, alterations, improvements or additions, Tenant shall
furnish Landlord with contractors’ affidavits, sworn
statements, full and final waivers of lien and receipted bills
covering all labor and material expended and used and, in the event
such work is structural or affects mechanical systems or is of a
type for which such plans and specifications are customarily
prepared, two (2) sets of final as-built plans and
specifications. All repairs, replacements, alterations,
improvements and additions shall comply with all reasonable
insurance requirements and with all ordinances and regulations of
the City of Elgin or any department or agency thereof and with the
requirements of all statutes and regulations of the State of
Illinois or of any department or agency thereof. All repairs,
replacements, alterations, improvements and additions shall be
constructed in a good and workmanlike manner and only good grades
of material shall be used.
Landlord agrees to inform Tenant at
the time any such alterations are approved or, if such approval is
not required, upon the request of Tenant, if such alterations will
be required to be
14
removed upon expiration or
early termination hereof. All alterations, improvements, additions,
repairs, or replacements, whether temporary or permanent in
character, including, without limitation, wall coverings, carpeting
and other floor coverings, special lighting installations, built-in
or attached shelving, cabinetry, and mirrors, made by Landlord or
Tenant in or upon the Premises and not required to the removed as
aforesaid shall become Landlord’s property and shall remain
upon the Premises at the termination of this Lease by lapse of time
or otherwise without compensation to Tenant (excepting only
Tenant’s movable office furniture, trade fixtures, office
equipment and the equipment listed on Schedule I attached
hereto).
ARTICLE
10
COVENANT AGAINST
LIENS
Nothing contained in this Lease shall
authorize or empower Tenant to do any act which shall in any way
encumber Landlord’s title to the Building, Property or
Premises, nor in any way subject Landlord’s title to any
claims by way of lien or encumbrance whether claimed by operation
of law or by virtue of any expressed or implied contract of Tenant,
and any claim to a lien upon the Building, Property or Premises
arising from any act or omission of Tenant shall attach only
against Tenant’s interest and shall in all respects be
subordinate to Landlord’s title to the Building, Property and
Premises. If Tenant has not removed or bonded over any such lien or
encumbrance within thirty (30) days after written notice to
Tenant by Landlord, Landlord may, but shall not be obligated to,
pay the amount necessary to remove such lien or encumbrance,
without being responsible for making any investigation as to the
validity or accuracy thereof, and the amount so paid, together with
all costs and expenses (including attorneys’ fees) incurred
by Landlord in connection therewith, shall be deemed additional
Rent reserved under this Lease due and payable within thirty
(30) days after Tenant’s receipt of notice of such
payment by Landlord and supporting documentation.
ARTICLE
11
DAMAGE OR DESTRUCTION
BY FIRE OR CASUALTY
(A) If the Premises or any part
of 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, then, except as expressly
hereinafter set forth, Landlord shall proceed to repair and restore
the same to its prior existing condition with reasonable
promptness, subject to reasonable delays for insurance adjustments
and delays caused by matters beyond Landlord’s control. 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 and in
good faith, estimate the length of time that will be required to
substantially complete the repair and restoration of 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 one hundred eighty
(180) days from the date such damage occurred, then Tenant
shall have the right to terminate this Lease as of the date of such
damage upon giving notice to Landlord at any time within twenty
(20) days after Landlord gives Tenant the notice containing
said estimate. Unless this Lease
15
is terminated as provided
in the preceding sentence, except as expressly hereinafter set
forth, Landlord shall proceed with reasonable promptness and all
due diligence to repair and restore the Premises, subject to
reasonable delays for insurance adjustments and delays caused by
matters beyond Landlord’s 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 herein provided) if such repairs and
restoration are not in fact completed within the time period
estimated by Landlord, as aforesaid, or within said one hundred
eighty (180) days, so long as Landlord shall proceed with
reasonable promptness and due diligence to complete the same. In
addition to the foregoing, Landlord shall have the right to
terminate this Lease if a material casualty damages the Premises
during the last twelve (12) months of the Term, as it may have
been extended, by delivering notice thereof to Tenant within ten
(10) days after such casualty, provided, however, in any such
event, Tenant shall have the right, in addition to the rights of
Tenant under Section 38 below, to elect to extend the Term, or
any extension thereof, for the next available Initial Extension
Term or the Final Extension Term by delivering written notice of
such election to Landlord within twenty (20) days after
receipt of Landlord’s notice of termination as described in
this sentence, in which event said notice shall be of no force and
effect and Landlord shall restore the Premises as set forth herein.
Notwithstanding anything to the contrary herein set forth, Tenant
shall also have the right to complete the restoration of the
Premises or to terminate this Lease in the event the Premises are
not substantially restored within two hundred ten (210) days after
the date of casualty, except that Tenant shall not have the right
to terminate this Lease pursuant to this Article 11 if the
damage or destruction was caused by the intentional or negligent
act of Tenant, its subtenants, assigns, agents or employees. In the
event Tenant elects to complete the restoration of the Premises as
set forth above, Landlord agrees to make available to Tenant all
insurance proceeds payable in connection therewith.
(B) In the event any such fire
or casualty damage not caused by the intentional or negligent act
of Tenant, its agents or employees, renders the Premises
substantially untenantable and Tenant is not occupying the Premises
and if this Lease shall not be terminated pursuant to the foregoing
provisions of this Article 11 by reason of such damage, then
Rent shall abate during the period beginning with the date of such
damage and ending with the date when Landlord substantially
completes its repair and restoration work. 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 Premises being repaired and
restored by Landlord and not heretofore delivered to Tenant from
time to time bears to the entire Premises. In the event of
termination of this Lease pursuant to this Article 11, Rent
shall be apportioned on a per diem basis and be paid to the date of
such fire or other casualty.
(C) In the event of any such
fire or other casualty, and if this Lease is not terminated
pursuant to the foregoing provisions of this Lease, Tenant shall
repair and restore any portion of alterations, additions or
improvements made by or on behalf of Tenant in the Premises.
ARTICLE
12
INSURANCE
In consideration of the leasing of
the Premises at the rental stated in Article 2, Landlord and
Tenant agree to provide insurance and allocate the risk of loss as
follows:
16
(a) Tenant,
at its sole cost and expense but for the mutual benefit of Landlord
and Tenant (when used in this Article the term
“Landlord” shall include Landlord and its officers,
agents, servants and employees, lenders holding a mortgage on
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