EXHIBIT 10.85
OFFICE LEASE AGREEMENT
This Office Lease
Agreement (the “ Lease ”) is made and entered
into as of the 29 th day of September, 2008 (the “
Effective Date ”), by and between CORPORATE RIDGE,
L.L.C., a Delaware limited liability company, as Landlord, and
AMERICAN TELECONFERENCING SERVICES, LTD. d/b/a PREMIERE GLOBAL
SERVICES, as Tenant.
The
parties hereto acknowledge that the City of Olathe, Kansas (the
“ City ”) is the fee owner of the Land and
Building in connection with the issuance of certain industrial
revenue bonds (“ IRBs ”) in an amount not to
exceed $14,300,000.00 to accomplish tax abatement for this project.
In connection with the issuance of the IRBs, Landlord leases the
Land and Building from the City pursuant to a certain lease
agreement (the “ Prime Lease ”) in connection
therewith. Accordingly, this Lease will be a sublease and will be
subject to the terms and conditions of the Prime Lease and other
documents associated with the IRBs, and the parties hereto shall
execute such documentation reasonably thereunder.
BASIC TERMS
The
following Basic Terms are applied under and governed by the
particular section(s) in this Lease pertaining to the following
information:
|
|
|
|
1.
|
Premises: (See Section 1.1)
|
The entire
Building known as Corporate Ridge I located within Corporate Ridge
Office Park in the City of Olathe, Johnson County, Kansas,
consisting of 88,050 rentable square feet. The Premises is legally
described on EXHIBIT “B” and depicted on the
preliminary site plan attached hereto as EXHIBIT
“C.”
|
|
|
|
2.
|
Commencement
Date:
|
December 1,
2008
|
|
|
|
3.
|
Expiration
Date:
|
120 months
following the Commencement Date
|
|
|
|
4.
|
Lease
Term:
|
120 months (see
Section 1.2)
|
|
|
|
5.
|
Renewal
Term:
|
Two (2) options
of five (5) years each at then prevailing market rate (see Section
1.4)
|
|
|
|
6.
|
Basic
Rent: (See Section
2.1)
|
|
|
|
|
|
Months
|
Annual Basic Rent
|
Monthly
Installments
|
|
|
(per rentable square
foot)
|
|
|
1-12
|
|
|
|
(December 1, 2008 – November
30, 2009)
|
$23.14
|
$169,789.75
|
|
|
|
13-19
|
|
|
|
(December 1, 2009 – June 30,
2010)
|
$0.00
|
$0.00
|
|
|
|
20-60
|
|
|
|
(July 1, 2010 - November 30,
2013)
|
$23.14
|
$169,789.75
|
|
|
|
61-120
|
|
|
|
(December 1, 2013 - November 30,
2018)
|
$24.77
|
$181,749.88
|
|
|
|
|
7.
|
Initial
Tenant’s Share of Excess
Expenses Percentage:
|
100%
|
- 1 -
|
|
|
|
8.
|
Expense
Stop:
|
$6.80 per
rentable square foot.
|
|
|
|
9.
|
Allowances:
|
Tenant shall
receive an allowance in the amount of $42.76 per rentable square
foot of the Premises as its Improvement Allowance, plus any
mutually-agreed upon credits relating to lobby finish and Building
scope changes.
|
|
|
|
10.
|
Current
Property Manager/Rent
Payment Address:
|
Corporate
Ridge, L.L.C.
c/o Opus Northwest, L.L.C.
460 Nichols Road, Suite 300
Kansas City, Missouri 64112
Attn: Mr. Doug Grossenbacher
|
|
|
|
11.
|
Address of
Landlord for Notices:
|
Corporate
Ridge, L.L.C.
c/o Opus Northwest, L.L.C.
10350 Bren Road West
Minnetonka, Minnesota 55343
Attn: Mr. John Solberg
|
|
|
|
|
|
|
With a copy
to:
|
Corporate
Ridge, L.L.C.
10350 Bren Road West
Minnetonka, Minnesota 55343
Attn: Legal Department
|
|
|
|
|
|
|
With a copy
to:
|
Corporate
Ridge, L.L.C.
c/o Opus Northwest, L.L.C.
460 Nichols Road, Suite 300
Kansas City, Missouri 64112
Attn: Mr. David M. Harrison, Vice President
|
|
|
|
|
With a copy
to:
|
Property
Manager at the address described in Section 10 of the Basic
Terms.
|
|
|
|
12.
|
Address of
Tenant for Notices:
|
Premiere Global
Services, Inc.
3280 Peachtree Road; Suite 1000
Atlanta, GA 30305
Attention: Vice President – Corporate Real Estate
|
|
|
|
|
|
|
With a copy
to:
|
Premiere Global
Services, Inc.
3280 Peachtree Road; Suite 1000
Atlanta, GA 30305
Attention: Legal Services Department
|
|
|
|
|
|
Husch Blackwell
Sanders LLP
4801 Main Street, Suite 1000
Kansas City, MO 64112
Attn: John Crossley, Esq.
|
|
|
|
13.
|
Broker(s):
(See Section 18.11)
|
Landlord’s Broker: Colliers Turley Martin
Tucker
Tenant’s Broker: Kessinger/Hunter & Company,
L.C.
|
|
|
|
14.
|
Guarantor:
|
Premiere Global
Services, Inc., a Georgia corporation
|
|
|
|
15.
|
Security
Deposit:
|
Not
Applicable
|
- 2 -
|
|
|
|
16.
|
Expansion
Rights:
|
See EXHIBIT
“I” attached hereto.
|
|
|
|
17.
|
Exhibits:
|
Exhibit
“A” - Definitions
Exhibit “B” - Legal Description of the Land Exhibit
“C” - Preliminary Site Plan Exhibit
“D” - Commencement Date Memorandum Exhibit
“E” - Building Rules Exhibit
“F” - Landlord’s Improvements Exhibit
“F-1” - Landlord’s Outline Plans and
Specifications Exhibit
“G” - Lease Guaranty Exhibit
“H” - Tenant’s Improvements Exhibit
“H-1” - Tenant Improvement Guidelines Exhibit
“I” - Expansion Rights Exhibit
“J” - Form of Standby Generator License Exhibit
“K” - Form of Subordination, Non-Disturbance and
Attornment Agreement
|
- 3 -
DEFINITIONS
Capitalized terms
used in this Lease have the meanings ascribed to them on the
attached EXHIBIT “A.”
ARTICLE 1. LEASE
OF PREMISES, LEASE TERM AND ACCEPTANCE OF PREMISES
1.1 Premises and Landlord’s Improvements . In
consideration of the mutual covenants this Lease describes and
other good and valuable consideration, Landlord leases the Premises
to Tenant and Tenant leases the Premises from Landlord, upon and
subject to the terms, covenants and conditions set forth in this
Lease, but subject to the Prime Lease. The parties hereto
acknowledge and agree that the Lease Guaranty from the Guarantor
(as stated in the Basic Terms) is material to Landlord’s
agreement to enter into this Lease and must remain in full force
and effect during the entire Lease Term. The rentable area of the
Premises is the rentable area specified in the Basic Terms.
Landlord will provide, at no cost to Tenant, the Landlord’s
Improvements (as defined in EXHIBIT “A” below).
Further, Tenant shall have two (2) five-year renewal options in
accordance with Section 1.6 below.
1.2 Term, Delivery
and Commencement.
1.2.1. Landlord will use best efforts to substantially
complete the Landlord’s Improvements listed on the Outline
Plans and Specifications attached hereto as EXHIBIT
“F-1” , the additional Landlord’s
Improvements listed on EXHIBIT “F” and the
Tenant’s Improvements listed on EXHIBIT
“G” on or before December 1, 2008, but subject to
Force Majeure and Tenant Delay. Tenant shall be entitled to install
Tenant’s furniture, fixtures and equipment after the
Commencement Date. Any delay in the substantial completion of the
Landlord’s Improvements and/or the Tenant’s
Improvements shall not cause a delay in the Commencement Date,
which is fixed at December 1, 2008. If the Landlord’s
Improvements and/or the Tenant’s Improvements are not
substantially completed by the Commencement Date, then Landlord
shall use best efforts to substantially complete the same
immediately thereafter.
1.2.2. Landlord will deliver to Tenant (within a reasonable
time after the Commencement Date) the Commencement Date Memorandum
with all blanks relating to dates completed with dates Landlord
derives in accordance with this Lease. Tenant, within twenty (20)
days after receipt from Landlord, will execute and deliver to
Landlord the Commencement Date Memorandum.
1.3 Acceptance of Premises . Except for the Warranty Terms
and as otherwise set forth in this Lease, Tenant acknowledges that
neither Landlord nor any agent, contractor or employee of Landlord
has made any representation or warranty of any kind with respect to
the Premises, the Building or the Property, specifically including,
but not limited to, any representation or warranty of suitability
or fitness of the Premises, Building or the Property for any
particular purpose. Other than for Landlord’s maintenance or
repair obligations under Section 7 of this Lease, Tenant’s
occupancy of the Premises establishes Tenant’s acceptance of
the Premises, the Building and the Property in an “ AS IS
- WHERE IS ” condition, subject to the Warranty Terms and
other terms and conditions set forth in Article 17 below. Tenant
must strictly comply with the provisions of this Section 1.3 and
Article 17 below. Based solely on the temporary certificate of
occupancy or permanent certificate of occupancy to be issued by the
City of Olathe, Kansas (the “ City ”) on or
about the Commencement Date, Landlord represents and warrants that,
as of the date that the permit was issued for the Building shell
based upon the final, approved development plan (and as interpreted
by the City), the Premises shall comply with all applicable Laws
(as hereinafter defined), including, without limitation the
Americans With Disabilities Act, other than zoning ordinances and
other Laws specific to Tenant’s use of the
Premises.
1.4 Extension of
Term .
1.4.1. Provided that as of the time of the giving of the
First Renewal Notice and the Commencement Date of the First Renewal
Term (as those terms are hereinafter defined), (x) Tenant or a
Related Assignee is the Tenant originally named herein, (y) Tenant
or its Related Assignee leases the entire Building and the Lease
Guaranty from Guarantor remains in full force and effect, and (z)
no uncured Event of Default exists, subject to available notice and
cure rights, then Tenant shall have the right to extend the Lease
Term for an additional term of five (5) years (such additional term
is hereinafter called the “ First Renewal Term
”) commencing on the day
- 4 -
following the expiration of the
Lease Term (hereinafter referred to as the “ Commencement
Date of the First Renewal Term ”). Tenant shall give
Landlord written notice (hereinafter called the “ First
Renewal Notice ”) of its election to extend the term of
the Lease Term at least twelve (12) months prior to the scheduled
expiration date of the Lease Term.
1.4.2. Provided that as of the time of the giving of the
Second Renewal Notice and the Commencement Date of the Second
Renewal Term (as those terms are hereinafter defined) (x) Tenant or
a Related Assignee is the Tenant originally named herein, (y)
Tenant or its Related Assignee leases the entire Building and the
Lease Guaranty from Guarantor remains in full force and effect, and
(z) no uncured Event of Default exists, subject to available notice
and cure rights, and provided Tenant has exercised its option for
the First Renewal Term, then Tenant shall have the right to extend
the Lease Term for an additional term of five (5) years (such
additional term is hereinafter called the “ Second Renewal
Term ”) commencing on the day following the expiration of
the First Renewal Term (hereinafter referred to as the “
Commencement Date of the Second Renewal Term ”).
Tenant shall give Landlord written notice (hereinafter called the
“ Second Renewal Notice ”) of its election to
extend the term of the Lease Term at least twelve (12) months prior
to the scheduled expiration date of the First Renewal Term. The
First Renewal Term and the Second Renewal Term shall be
collectively referred to hereinafter as the “ Renewal
Term .” The First Renewal Notice and the Second Renewal
Notice are collectively referred to herein as the “Renewal
Notice.”
1.4.3. The Basic Rent payable by Tenant to Landlord during
the First Renewal Term and the Second Renewal Term shall be equal
to ninety-five percent (95%) of the then-prevailing market rate for
comparable space in comparable buildings in the vicinity of the
Building (built after 2007 and of similar class and quality in the
South Johnson County submarket), taking into account the size of
the Lease, the length of the renewal term, credit of Tenant and
Guarantor, costs of any Tenant’s Improvements, all market
concessions, including allowances and free rent periods, and after
such comparable buildings are adjusted upward to reflect fully
assessed and fully taxed buildings (collectively defined herein as
the “ Fair Market Basic Rent ”); provided
in no event shall Landlord be required to accept a renewal of the
Lease if the calculation of 95% of Fair Market Basic Rent during
the Renewal Term is less than the then-current rental rate (unless
otherwise agreed to by Landlord in writing at Landlord’s sole
discretion).
1.4.4. Landlord shall provide Tenant with its determination
of Fair Market Basic Rent within the ten (10) days of
Tenant’s election to exercise a renewal option. If Tenant
disputes Landlord’s determination of Fair Market Basic Rent
for an extension of the Term, Tenant will deliver notice of such
dispute, together with Tenant’s proposed Fair Market Basic
Rent, to Landlord within twenty (20) days of Tenant’s receipt
of Landlord’s determination. The parties will then attempt in
good faith to agree upon the Fair Market Basic Rent. If the parties
fail to agree within twenty (20) days, then either party shall be
entitled to give notice (the “ Arbitration Notice
”) to the other electing to have the Fair Market Basic Rent
selected by an appraiser as provided in this section. Upon delivery
and receipt of such Arbitration Notice, the parties will within
seven (7) days thereafter mutually appoint an appraiser who will
select (in the manner set forth below) the Fair Market Basic Rent
(the “ Deciding Appraiser ”). The Deciding
Appraiser must have at least five years of full-time commercial
appraisal experience with Properties comparable to the Property and
be a member of the American Institute of Real Estate Appraisers or
a similar appraisal association. The Deciding Appraiser may not
have any material financial or business interest in common with
either of the parties. If Landlord and Tenant are not able to agree
upon a Deciding Appraiser within such seven (7) days, each party
will within five (5) days thereafter separately select an appraiser
meeting the criteria set forth above, which two appraisers will,
within seven (7) days of their selection, mutually appoint a third
appraiser meeting the criteria set forth above to be the Deciding
Appraiser. Within seven (7) days of the appointment (by either
method) of the Deciding Appraiser, Landlord and Tenant will submit
to the Deciding Appraiser their respective determinations of Fair
Market Basic Rent and any related information. Within twenty-one
(21) days of such appointment of the Deciding Appraiser, the
Deciding Appraiser will review each party’s submittal (and
such other information as the Deciding Appraiser deems necessary)
and will select, in total and without modification, the submittal
presented by either Landlord or Tenant as the Fair Market Basic
Rent. If the Deciding Appraiser timely receives one party’s
submittal, but not both, the Deciding Appraiser must designate the
submitted proposal as the Fair Market Basic Rent for the applicable
extension of the Term. Any determination of Fair Market Basic Rent
made by the Deciding Appraiser in violation of the provisions of
this section shall be beyond the scope of authority of the Deciding
Appraiser and shall be null and void. If the determination of Fair
Market Basic Rent is made by a Deciding Appraiser, Landlord and
Tenant will each pay, directly to the Deciding
Appraiser,
- 5 -
one-half (½) of all fees,
costs and expenses of the Deciding Appraiser. Landlord and Tenant
will each separately pay all costs, fees and expenses of their
respective additional appraiser (if any) used to determine the
Deciding Appraiser; provided in no event shall Landlord be
required to accept a renewal of the Lease if the calculation of 95%
of Fair Market Basic Rent during the Renewal Term is less than the
then-current rental rate (unless otherwise agreed to by Landlord in
writing at Landlord’s sole discretion).
Notwithstanding
anything to the contrary set forth above, the final determination
of Fair Market Basic Rent determined in connection with this
Section 1.4.4 (the “ Arbitrated Rental Rate ”)
must be completed within ninety (90) days after receipt of the
Arbitration Notice (but in no event less than eight (8) months
prior to the expiration date of the Lease). Tenant shall have the
right to terminate its option to renew hereunder in the event
Tenant is not satisfied with the Arbitrated Rental Rate (as
determined by Tenant in its sole discretion); provided: (i) Tenant
must elect not to renew within thirty (30) days after receipt of
the Arbitrated Rental Rate as provided in this Section 1.4 and (ii)
the Lease shall be automatically extended by one hundred eighty
(180) days at the greater of: (i) the Basic Rent applicable to the
last year of the immediately preceding Lease Term and (ii) the
Arbitrated Rental Rate (the “ Interim Rental Rate
”) in order to provide Tenant with time to relocate - in
which event Landlord and Tenant shall execute an amendment to the
Lease which evidences the 180-day extension and the Interim Rental
Rate through such 180-day extended term.
1.4.5. The determination of Basic Rent does not reduce the
Tenant’s obligation to pay or reimburse Landlord for
operating expenses and other reimbursable items as set forth in the
Lease, and Tenant shall reimburse and pay Landlord as set forth in
the Lease with respect to such operating expenses and other items
with respect to the Premises during each Renewal Term; provided,
however, the Expense Stop should be taken into consideration by the
appraiser(s) in determining the Fair Market Basic Rent under
Section 1.4.4 above).
1.4.6. Except for the Basic Rent as determined above,
Tenant’s occupancy of the Premises during each Renewal Term
shall be on the same terms and conditions as are in effect
immediately prior to the expiration of the initial Lease Term or
the First Renewal Term, as applicable, and such renewal must be for
the entire Building (which includes any space added to the
Premises); provided, however, Tenant shall have no further right to
any allowances, credits or abatements or any options to renew or
extend the Lease.
1.4.7. If Tenant does not give a particular Renewal Notice
within the periods set forth above or if Tenant fails to satisfy
the conditions precedent to exercise any of its Renewal Options,
Tenant’s right to extend the Lease Term shall automatically
terminate. Time is of the essence as to the giving of each Renewal
Notice.
1.4.8. Landlord shall have no obligation to refurbish or
otherwise improve the Premises for any of the Renewal Terms. The
Premises shall be tendered on the Commencement Date of each Renewal
Term in “as is” condition.
1.4.9. If the Lease is extended for a Renewal Term, then
Landlord shall prepare and Tenant shall execute an amendment to the
Lease confirming the extension of the Lease Term for the applicable
Renewal Term and the other provisions applicable thereto (the
“ Amendment ”).
1.4.10. If Tenant exercises its right to extend the term of
the Lease for the Renewal Terms pursuant to this Section, the term
“Lease Term” as used in the Lease, shall be construed
to include, when practicable, the applicable Renewal Term except as
provided in Section 1.4.8 above.
ARTICLE 2. RENTAL AND OTHER
PAYMENTS
2.1 Basic Rent . Tenant will pay Basic Rent in monthly
installments to Landlord, in advance, without offset or deduction,
except as otherwise specifically set forth herein, commencing on
the Commencement Date and continuing on the first day of each and
every calendar month after the Commencement Date during the Term
through and including the Expiration Date. Notwithstanding the
above, Tenant shall pay Landlord an amount equal to the first
month’s Basic Rent on or before December 1, 2008. Tenant will
make all Basic Rent payments to Landlord in care of Property
Manager at the address specified in the Basic Terms or at such
other place or in such
- 6 -
other manner as Landlord may from
time to time designate in writing no later than ten (10) days prior
to the date such payment is due. Tenant will make all Basic Rent
payments without Landlord’s previous demand, invoice or
notice for payment. Landlord and Tenant will prorate, on a per diem
basis, Basic Rent for any partial month within the Term.
2.2 Additional Rent . Article 3 of this Lease requires
Tenant to pay certain Additional Rent pursuant to estimates
Landlord delivers to Tenant. Tenant will make all payments of
estimated Additional Rent in accordance with Section 3.3 without
deduction or offset and without Landlord’s previous demand or
notice for payment. Except as specifically set forth in this Lease,
Tenant will pay all other Additional Rent described in this Lease
that is not estimated under Section 3.3 within thirty (30) days
after receiving Landlord’s invoice for such Additional Rent.
Tenant will make all Additional Rent payments to the same location
and, except as described in the previous sentence, in the same
manner as Tenant’s Basic Rent payments.
2.3 Delinquent Rental Payments . If Tenant does not pay any
installment of Basic Rent, Additional Rent or any other payment due
under this Lease within three (3) Business Days after the date such
payment is due, Tenant will pay Landlord an additional amount equal
to (a) interest on the delinquent payment calculated at the Maximum
Rate from the date when the payment is due through the date the
payment is made, and (b) a late payment charge equal to five
percent (5%) of the amount of the delinquent payment;
provided that Tenant shall be entitled to written notice
from Landlord and a three (3) Business Day grace period once each
calendar year prior to the imposition of any such default interest
or late payment charge. Landlord’s right to such compensation
for the delinquency is in addition to all of Landlord’s
rights and remedies under this Lease, at law or in
equity.
2.4 Independent Obligations . Notwithstanding any contrary
term or provision of this Lease, Tenant’s covenant and
obligation to pay Rent is independent from any of Landlord’
covenants, obligations, warranties or representations in this
Lease. Tenant will pay Rent without any right of offset or
deduction, except as otherwise set forth herein.
2.5 Security
Deposit . Intentionally
Deleted.
ARTICLE 3. OPERATING EXPENSES AND PROPERTY
TAXES
3.1 Payment of Excess Expenses . Tenant will pay, as
Additional Rent and in the manner this Article 3 describes,
Tenant’s Share of Excess Expenses for each and every calendar
year of the Term. Landlord will prorate Tenant’s Share of
Excess Expenses for the calendar year in which the Lease commences
or terminates as of the Commencement Date or termination date, as
applicable, on a per diem basis based on the number of days of the
Term within such calendar year.
3.2 Estimation of Tenant’s Share of Excess Expenses .
Landlord will deliver to Tenant a written estimate of the following
for each calendar year of the Term: (a) Property Taxes, (b)
Operating Expenses, (c) Excess Expenses, (d) Tenant’s Share
of Excess Expenses Percentage and (e) the annual and monthly
Additional Rent attributable to Tenant’s Share of Excess
Expenses.
3.3 Payment of Estimated Tenant’s Share of Excess
Expenses . Tenant will pay the amount Landlord estimates as
Tenant’s Share of Excess Expenses under Section 3.2 for each
and every calendar year of the Term in equal monthly installments,
in advance, commencing on the Commencement Date and continuing on
the first day of each and every month during the Term through and
including the Expiration Date. If Landlord has not delivered the
estimates to Tenant by the first day of January of the applicable
calendar year, Tenant will continue paying Tenant’s Share of
Excess Expenses based on Landlord’s estimates for the
previous calendar year. When Tenant receives Landlord’s
estimates for the current calendar year, Tenant will pay the
estimated amount (less amounts Tenant paid to Landlord in
accordance with the immediately preceding sentence) in equal
monthly installments over the balance of such calendar year, with
the number of installments being equal to the number of full
calendar months remaining in such calendar year. Notwithstanding
anything to the contrary contained in this Article 3 ,
beginning in the second calendar year of the Lease Term,
Tenant’s Share of Operating Expenses which are not considered
“Non-Controllable Operating Expenses” (as defined
below), shall not increase by more than five percent (5%) per annum
on a cumulative, compounded basis from the first calendar year
during the Lease Term, which cap shall specifically exclude
all charges and costs for Property Taxes, insurance premiums for
Landlord’s
- 7 -
property insurance, utility
costs, snow removal and non-routine repairs and maintenance which
are not the result of Landlord’s negligence (but which are
recoverable under the definition of “Operating
Expenses”) (collectively, “ Non-controllable
Operating Expenses ”), for which there shall be no cap at
any time during the Lease Term. For purposes of the foregoing cap,
all categories of Operating Expenses shall be determined on an
aggregate basis and not on an individual basis.
3.3.1. Re-Estimation and Adjustment . Landlord may
re-estimate Excess Expenses from time to time during the Term;
however, such re-estimate may occur no more than once every
calendar year. In such event, Landlord will re-estimate the monthly
Additional Rent attributable to Tenant’s Share of Excess
Expenses to an amount sufficient for Tenant to pay the re-estimated
monthly amount over the balance of the calendar year. Landlord will
notify Tenant of the re-estimate and Tenant will pay the
re-estimated amount in the manner provided in the last sentence of
Section 3.3.
3.4 Confirmation of Tenant’s Share of Excess Expenses
. Within one hundred twenty (120) days after the end of each
calendar year within the Term, Landlord will determine the actual
amount of Excess Expenses and Tenant’s Share of Excess
Expenses for the expired calendar year and deliver to Tenant a
written statement of such amounts. If Tenant paid less than the
actual amount of Tenant’s Share of Excess Expenses specified
in the statement, Tenant will pay the difference to Landlord as
Additional Rent in the manner Section 2.2 describes. If Tenant paid
more than the actual amount of Tenant’s Share of Excess
Expenses specified in the statement, Landlord, at Landlord’s
option, will either (a) refund the excess amount to Tenant, within
thirty (30) days after the date of such determination, or (b)
credit the excess amount against Tenant’s next due monthly
installment or installments of Rent. Landlord shall maintain books
and records of Operating Expenses for a period of two (2) years
following the end of each calendar year.
3.5 Tenant’s Right to Audit. If (a) no uncured Event
of Default exists under this Lease, (b) Tenant disputes
Landlord’s determination of the actual amount of Excess
Expenses or Tenant’s Share of Excess Expenses for any
calendar year and (c) Tenant delivers to Landlord written notice of
the dispute within one (1) year after Landlord’s delivery of
the statement of such amount under this Article 3, then Tenant (but
not any subtenant or assignee, other than an Affiliate), at its
sole cost and expense, upon prior written notice and during regular
business hours at a time and place reasonably acceptable to
Landlord (which may be the location where Landlord or Property
Manager maintains the applicable records), may audit, or cause an
auditor to audit, Landlord’s records relating to the disputed
amounts and produce a report detailing the results of the audit. No
auditor retained by Tenant to conduct an audit under this Section
3.5 shall be paid on a contingency fee basis. Tenant’s
objection to Landlord’s determination of Excess Expenses or
Tenant’s Share of Excess Expenses is deemed withdrawn unless
Tenant completes and delivers a copy of the audit report to
Landlord within 90 days after the date Landlord makes the records
available to Tenant. If the audit report shows that the amount
Landlord charged Tenant for Tenant’s Share of Excess Expenses
was greater than the amount this Article 3 obligates Tenant to pay,
then, unless Landlord contests the results of the audit report,
Landlord will refund the excess amount to Tenant within 10 Business
Days after Landlord receives a copy of the audit report. If the
audit report shows that the amount Landlord charged Tenant for
Tenant’s Share of Excess Expenses was less than the amount
this Article 3 obligates Tenant to pay, Tenant, within 10 Business
Days after receiving the audit report, will pay to Landlord, as
Additional Rent, the difference between the amount Tenant paid and
the amount stated in the audit report. If Landlord contests the
results of Tenant’s audit report, a final determination shall
be made by an independent certified public accountant, who shall
have no material business or financial interest in common with
either of the parties, selected by Landlord, but reasonably
acceptable to Tenant, and said accountant shall take into
consideration (but not be bound by) the findings of Tenant’s
audit report. Pending resolution of any audit under this section,
Tenant will continue to pay to Landlord the estimated amounts of
Tenant’s Share of Excess Expenses in accordance with this
Article 3. If the final audit shows that the amount Tenant paid for
Tenant’s Share of the Excess Expenses exceeded the amount
this Article 3 obligates Tenant to pay by more than 10%, then
Landlord shall be responsible for the reasonable cost of the audit,
provided the cost of such audit shall not exceed $3,000 (otherwise
Tenant shall be responsible for such audit cost). Tenant must keep
all information it obtains in any audit strictly confidential and
may only use such information for the limited purpose this section
describes and for Tenant’s own account.
3.6 Personal Property Taxes . Tenant, prior to delinquency,
will pay all taxes charged against Tenant’s trade fixtures
and other personal property. Tenant will use all reasonable efforts
to have such trade fixtures and other personal property taxed
separately from the Property. If any of Tenant’s trade
fixtures and other personal
- 8 -
property are taxed with the
Property, Tenant will pay the taxes attributable to Tenant’s
trade fixtures and other personal property to Landlord as
Additional Rent.
3.7 Landlord’s Right to Contest Property Taxes .
Landlord shall also have the right, but not the obligation, to
contest the amount or validity, in whole or in part, of any
Property Taxes not contested by Tenant, by appropriate proceedings
conducted in the name of Landlord or in the name of Landlord and
Tenant. If Landlord elects to contest the amount or validity, in
whole or in part, of any Property Taxes, such contests by Landlord
shall be at Landlord’s expense, provided, however, that if
the amounts payable by Tenant for Property Taxes are reduced (or if
a proposed increase in such amounts is avoided or reduced) by
reason of Landlord’s contest of Property Taxes, Tenant shall
reimburse Landlord for costs incurred by Landlord in contesting
Property Taxes, but such reimbursements shall not be in excess of
the amount saved by Tenant by reason of Landlord’s actions in
contesting such Property Taxes.
3.8 IRBs and Tax Abatement. As stated above, this Lease is
subject to that certain Prime Lease entered into with the City in
connection with the tax abatement which affects the Property. The
real estate taxes have been approved by the City to be abated by
fifty-five percent (55%) of the current tax base and Tenant’s
Pro Rata Share of Property Taxes will accordingly decrease.
Notwithstanding the above, in the event such tax abatement does not
occur or ceases for any reason not related to Landlord’s
default under the Prime Lease, Tenant shall be responsible for the
payment of its share of Property Taxes in accordance with the terms
of the Lease. Landlord acknowledges that Tenant has informed it
that Tenant has been granted abatement of sales taxes with respect
to Tenant’s leasehold improvements to be made to the Premises
and Landlord agrees to cooperate with Tenant in assisting Tenant in
its ability to obtain such abatement, including execution of
applicable forms to the State of Kansas.
ARTICLE 4. USE
4.1 Permitted Use and Parking . Tenant will not use the
Premises for any purpose other than general office purposes. Tenant
shall be entitled to use all parking in the Site Facilities which
shall be at least a parking ratio of 4.75 cars per 1,000 rentable
square feet of office space. Tenant shall be provided access to the
Premises on a 24 hour per day, seven day per week basis (but
subject to the Landlord services provided in Section 6.1 below and
otherwise subject to the terms and conditions of this Lease). There
will be no separate charge (other than costs included in Operating
Expenses paid by Tenant hereunder) for parking throughout the Term
and any extensions. Landlord may not grant any other party a right
to use parking at the Property for any purpose without
Tenant’s consent. Although Landlord shall not be responsible
for enforcing Tenant’s parking rights against third parties,
Landlord shall reasonably cooperate with Tenant in Tenant’s
efforts to enforce such parking rights. Tenant shall have the
right, at Tenant’s cost, to designate certain parking spaces
as reserved or visitor spaces; provided any such designation will
require Landlord’s approval in the event Tenant ever leases
less than the entire Building.
Tenant will not
knowingly use the Property or knowingly permit the Premises to be
used in violation of any Laws or in any manner that would (a)
violate any certificate of occupancy affecting the Property; (b)
make void or voidable any insurance now or after the Effective Date
in force with respect to the Property; (c) cause injury or damage
to the Property or to the person or property of any other tenant on
the Property; (d) cause substantial diminution in the value or
usefulness of all or any part of the Property (reasonable wear and
tear excepted); or (e) constitute a public or private nuisance or
waste. Other than the permits required by Landlord to construct the
Building and perform the Tenant’s Improvements hereunder (and
the subsequent issuance of a certificate of occupancy), Tenant will
obtain and maintain, at Tenant’s sole cost and expense, all
permits and approvals required under the Laws for Tenant’s
use of the Premises.
4.2 Increased Insurance . Tenant will not knowingly do on
the Property or permit to be done on the Premises anything that
will (a) increase the premium of any insurance policy Landlord
carries covering the Premises or the Property; (b) cause a
cancellation of or be in conflict with any such insurance policy;
(c) result in any insurance company’s refusal to issue or
continue any such insurance in amounts satisfactory to Landlord; or
(d) subject Landlord to any liability or responsibility for injury
to any person or property by reason of Tenant’s operations in
the Premises or use of the Property. Tenant, at Tenant’s sole
cost and expense, will comply with all rules, orders, regulations
and requirements or insurers and of the American Insurance
Association or any other organization performing a similar
function, provided that such rules and regulations are made
available to Tenant by
- 9 -
Landlord, in advance. Tenant will
reimburse Landlord, as Additional Rent, for any additional premium
charges for such policy or policies resulting from Tenant’s
failure to comply with the provisions of this section.
4.3 Laws/Building Rules . This Lease is subject and
subordinate to all Laws. A copy of the current Building Rules is
attached to this Lease as EXHIBIT “E.” Landlord
may not amend the Building Rules without Tenant’s consent
which shall not be unreasonably withheld; provided such consent is
not necessary in connection with changes in the Building Rules for
life safety purposes and to comply with Laws or if Tenant occupies
less than 100% of the Building. This Lease is also subject to the
terms and conditions of the Prime Lease.
4.4 Site Facilities . So long as Tenant leases the entire
Building, Landlord grants Tenant the exclusive right, to use the
Site Facilities during the Term, subject to all Laws.
Notwithstanding the above, Landlord may (a) access the Site
Facilities for purposes of performing its obligations hereunder
(such as snow removal, landscaping, lawn maintenance and other
maintenance and repair obligations to the extent specifically set
forth herein); (b) temporarily close any portion of the Site
Facilities (after reasonable advance notice to Tenant) (i) for
repairs or improvements or Alterations, (ii) to discourage
unauthorized use, or (iii) to prevent dedication or prescriptive
rights; (c) impose and revise reasonable Building Rules which do
not impair Tenant’s rights under this Lease concerning use of
the Site Facilities, including, but not limited to, any parking
facilities comprising a portion of the Site Facilities subject to
the terms of Section 4.3 above; and (d) to grant utility easements
or similar rights over the Site Facilities and reasonable access to
Landlord for any other reason Landlord deems necessary in
Landlord’s reasonable judgment so long as Tenant’s
right to access and use the Site Facilities are not unreasonably
disturbed or impeded.
ARTICLE 5. HAZARDOUS MATERIALS
5.1 Compliance with Hazardous Materials Laws . Tenant will
not cause any Hazardous Material to be brought upon, kept or used
on the Property in a manner or for a purpose prohibited by or that
could reasonably result in liability under any Hazardous Materials
Law. Tenant, at its sole cost and expense, will comply with all
Hazardous Materials Laws and prudent industry practice relating to
the presence, treatment, storage, transportation, disposal, release
or management of Hazardous Materials in, on, under or about the
Property that Tenant brings upon, keeps or uses on the Property and
will notify Landlord of any and all Hazardous Materials Tenant
brings upon, keeps or uses on the Property (other than small
quantities of office cleaning or other office supplies and similar
materials as are customarily used by a tenant in the ordinary
course for the permitted use). On or before the Expiration Date or
earlier termination of this Lease, Tenant, at its sole cost and
expense, will completely remove from the Property (regardless
whether any Hazardous Materials Law requires removal), in
compliance with all Hazardous Materials Laws, all Hazardous
Materials Tenant causes to be present in, on, under or about the
Property. Tenant will not take any remedial action in response to
the presence of any Hazardous Materials in on, under or about the
Property, nor enter into any settlement agreement, consent decree
or other compromise with respect to any Claims relating to or in
any way connected with Hazardous Materials in, on, under or about
the Property, without first notifying Landlord of Tenant’s
intention to do so and affording Landlord reasonable opportunity to
investigate, appear, intervene and otherwise assert and protect
Landlord’s interest in the Property. Landlord, at its sole
cost and expense, will comply with all Hazardous Materials Laws and
prudent industry practice relating to the presence, treatment,
storage, transportation, disposal, release or management of
Hazardous Materials in, on, under or about the Property that
Landlord brings upon, keeps or uses on the Property and will notify
Tenant of any and all Hazardous Materials Landlord brings upon,
keeps or uses on the Property (other than small quantities of
office cleaning or other office supplies as are customarily used by
a landlord in the ordinary course of operating and maintaining
office buildings and site facilities).
5.2 Notice of Actions . Tenant will notify Landlord of any
of the following actions affecting Landlord, Tenant or the Property
that result from or in any way relate to Tenant’s use of the
Property immediately after receiving notice of the same: (a) any
enforcement, clean-up, removal or other governmental or regulatory
action instituted, completed or threatened under any Hazardous
Materials Law; (b) any Claim made or threatened by any person
relating to damage, contribution, liability, cost recovery,
compensation, loss or injury resulting from or claimed to result
from any Hazardous Material; and (c) any reports made by any
person, including Tenant, to any environmental agency relating to
any Hazardous Material, including any complaints, notices, warnings
or asserted violations. Tenant will also deliver to Landlord, as
promptly as possible and in any event within five (5) Business Days
after Tenant first receives or sends the same, copies of all
Claims, reports, complaints, notices, warnings or
- 10 -
asserted violations relating in
any way to the Premises or Tenant’s use of the Premises. Upon
Landlord’s written request, Tenant will promptly deliver to
Landlord documentation acceptable to Landlord reflecting the legal
and proper disposal of all Hazardous Materials removed or to be
removed from the Premises by Tenant. Any such documentation will
list Tenant or its agent as a responsible party and will not
attribute responsibility for any such Hazardous Materials to
Landlord or Property Manager.
5.3 Disclosure and Warning Obligations . Tenant acknowledges
and agrees that all reporting and warning obligations required
under Hazardous Materials Laws resulting from or in any way
relating to Tenant’s use of the Premises or Property are
Tenant’s sole responsibility, regardless whether the
Hazardous Materials Laws permit or require Landlord to report or
warn.
5.4 Tenant Indemnification . Tenant releases and will
indemnify, defend (with counsel reasonably acceptable to Landlord),
protect and hold harmless the Landlord Parties from and against any
and all Claims whatsoever arising or resulting, in whole or in
part, directly or indirectly, from the presence, treatment,
storage, transportation, disposal, release or management of
Hazardous Materials in, on, under, upon or from the Property
(including water tables and atmosphere) that Tenant brings upon,
keeps or uses on the Premises or Property. Tenant’s
obligations under this section include, without limitation and
whether foreseeable or unforeseeable, (a) the costs of any required
or necessary repair, clean-up, detoxification or decontamination of
the Property; (b) the costs of implementing any closure,
remediation or other required action in connection therewith as
stated above; (c) the value of any loss of use and any diminution
in value of the Property; and (d) consultants’ fees,
experts’ fees and response costs. Tenant’s obligations
under this section survive the expiration or earlier termination of
this Lease.
5.5 Landlord Indemnification. Landlord represents and
warrants to Tenant that, except as otherwise set forth on that
certain Phase I environmental site assessment report performed on
the Land, to the best of Landlord’s knowledge, as of the
effective date of this Lease, no Hazardous Materials are present
on, in or under the land on which the Building is located. Landlord
releases and will indemnify, defend (with counsel reasonably
acceptable to Tenant), protect and hold harmless the Tenant Parties
from and against any and all Claims whatsoever arising or
resulting, in whole or in part, directly or indirectly, from the
presence, treatment, storage, transportation, disposal, release or
management of Hazardous Materials in, on, under, upon or from the
Property (including water tables and atmosphere) other than matters
for which Tenant has agreed to indemnify Landlord pursuant to
Section 5.4 hereof. Landlord’s obligations under this section
include, without limitation and whether foreseeable or
unforeseeable, (a) the costs of any required or necessary repair,
clean-up, detoxification or decontamination of the Property; (b)
the costs of implementing any closure, remediation or other
required action in connection therewith as stated above; (c) the
value of any loss of use and any diminution in Tenant’s
leasehold interest in the Premises but only if caused by Landlord;
and (d) consultants’ fees, experts’ fees and response
costs. Landlord’s obligations under this section survive the
expiration or earlier termination of this Lease.
ARTICLE 6. SERVICES
6.1 Landlord’s Obligations . Except as otherwise
requested by Tenant and agreed to by Landlord, Landlord will
provide the following services during Business Hours, the costs of
which are included as Operating Expenses (except to the extent
excluded in the definition set forth in Exhibit A ), in a
manner consistent with buildings of similar class and quality in
the South Johnson County submarket:
6.1.1.
Janitorial service in the Premises
five (5) times per week.
6.1.2. Electrical energy to the Premises sufficient, in
Landlord’s reasonable judgment, for lighting and for
operating personal computers and other office machines and
equipment for Permitted Use; provided the demand load for such
electrical energy will be a minimum of 6 watts per rentable square
foot of demand load for the Premises. Tenant will not use any
equipment requiring electrical energy in excess of wattages
supplied by Landlord without receiving Landlord’s prior
written consent, which consent Landlord will not unreasonably
withhold but may condition on Tenant paying all costs of installing
the equipment and facilities necessary to furnish such excess
energy and an amount equal to the average cost per unit of
electricity for the Building applied to the excess use as
reasonably determined either by an engineer selected by Landlord or
by submeter installed at Tenant’s expense. Any electrical
energy used for the Tenant Specified Areas (as defined in Section
6.1.3 below) shall be charged to and shall be paid as Additional
Rent by Tenant. Landlord will replace all
- 11 -
lighting bulbs, tubes, ballasts
and starters within the Premises at Tenant’s sole cost and
expense unless the costs of such replacement are included in
Operating Expenses. If such costs are not included in Operating
Expenses, Tenant will pay such costs as Additional Rent. Landlord
agrees not to charge a mark-up, profit or overhead on utility
charges or excess utility charges paid by Tenant
hereunder.
6.1.3. During Business Hours, heating, ventilation and air
conditioning (“ HVAC ”) to the Premises
sufficient to maintain in Landlord’s reasonable judgment,
comfortable temperatures in the Premises; provided such
temperatures are subject to the conditions and requirements of
state and federal energy regulatory bodies for non-residential
buildings (including any Kansas energy conservation standards) and
the indoor air quality shall comply with the ASHRAE standards
62-89. During non-Business Hours, Landlord will provide HVAC
service upon Tenant’s reasonable advance notice. Tenant will
pay Landlord, as Additional Rent, for such extended service on an
hourly basis at the Landlord’s actual cost (with no
additional mark-up, profit or overhead charged by Landlord).
Notwithstanding the above, Tenant will require such HVAC service to
be provided on a 24 hours per day and 7 days a week basis for the
following two (2) spaces within the Building (referred to herein as
the “Tenant Specified Areas”); provided the additional
cost of which shall be charged to and paid by Tenant as Additional
Rent: (1) The space consisting of the approximately 3,000 to 5,000
square foot raised floor telecom area located on the first floor of
the Building (as designated by Tenant); and (2) the space within
the Building identified by Tenant as its operations center
(consisting of approximately 30,000 rentable square feet).
Notwithstanding the above, Tenant shall be solely responsible for
the cost, ownership and maintenance of any supplemental HVAC
service to the Premises beyond the HVAC units provided as part of
the Building shell improvements.
6.1.4. Hot and cold water from standard building outlets for
lavatory, restroom and drinking purposes.
6.1.5. Landlord may limit the number of elevators in
operation at times other than Business Hours provided at least one
(1) elevator shall be operational at all times.
6.1.6. The Building parking area shall be available for use
twenty-four (24) hours a day, every day of the year during the Term
and shall be illuminated when necessary. Further, Landlord shall
keep and maintain the Building parking area and all other Site
Facilities in manner consistent with buildings of similar class and
quality in the South Johnson County submarket.
6.1.7.
Removing of ice and snow from the
Site Facilities as necessary.
6.1.8.
Pest control in the Building and
Site Facilities as necessary.
6.2 Tenant’s Obligations . All utility bills will be
included in Operating Expenses and, unless specifically excluded
therefrom, Tenant shall pay all costs in connection therewith as
Operating Expenses pursuant to the terms and conditions of this
Lease (and such utilities shall be considered
“Non-Controllable Operating Expenses”
hereunder).
6.3 Other Provisions Relating to Services . No interruption
in, or temporary stoppage of, any of the services this Article 6
describes is to be deemed an eviction or disturbance of
Tenant’s use and possession of the Premises, nor does any
interruption or stoppage relieve Tenant from any obligation this
Lease describes, render Landlord liable for damages or entitle
Tenant to any Rent abatement, except as otherwise provided herein.
Landlord has the right to select the provider of any utility or
service to the Property, which shall be subject to the reasonable
approval of Tenant; provided Tenant shall specifically have the
right to select the telecommunications provider to the Building,
which selection shall be provided to Landlord in sufficient time as
to not cause any delays in connection with the construction of the
Building and Site Facilities. In the event such service is within
Landlord’s exclusive control or if such service is
interrupted based upon the negligence of Landlord or Landlord
Parties, and thereafter Landlord is unable to provide any service
mentioned above (unless caused by Tenant or Tenant Parties), and
further, in the event such inability renders the whole or a portion
of the Premises untenantable or unsuitable for the purposes
intended hereunder for a period of five (5) consecutive business
days, Basic Rent and payments of Additional Rent for the portion of
the Premises rendered untenantable or unsuitable for the purposes
intended hereunder shall abate pro rata until such service is
restored to such a condition that the portion of the Premises
affected is again rendered tenantable or suitable.
- 12 -
ARTICLE 7. MAINTENANCE AND REPAIR
7.1 Landlord’s Obligations . Except as otherwise
provided in this Lease, Landlord will repair and maintain the
following in good order, condition and repair and in a manner
consistent with buildings of similar class and quality in the South
Johnson County submarket: (a) the foundations, exterior walls,
structural systems, bearing walls, support beams, floor slabs,
support columns, window frames and roof of the Building; (b) the
elevator, electrical, mechanical, plumbing, heating and air
conditioning systems, facilities and components, electrical risers,
telephone risers, plumbing risers, sprinkler systems, air
distribution systems, air handling systems, including VAV boxes,
electrical and mechanical lines and equipment associated therewith,
elevators and boilers; utility and trunk lines, tanks and
transformers; (c) Site Facilities, including the common entrances,
corridors, loading docks, and the parking area and access ways
therefore; (d) exterior windows, doors, plate glass and exterior
wall surfaces of the Building; and (e) improvements to the Land,
including ditches, shrubbery, landscaping and fencing
(collectively, the “ Landlord Obligations ”).
Neither Basic Rent nor Additional Rent will be reduced, nor,
subject to Section 10.5 below, will Landlord be liable, for loss or
injury to or interference with Tenant’s property, profits or
business arising from or in connection with Landlord’s
performance of its obligations under this section. Landlord
acknowledges and agrees that the making and performance of
Landlord’s covenants and agreements in this Section 7.1 is a
material inducement to Tenant entering into this Lease. Landlord
will maintain the Building and Site Facilities in a condition
comparable to buildings of similar class and quality in the South
Johnson County submarket and any repairs to the Building shall be
in compliance with Laws. Such maintenance and repair costs incurred
by Landlord in connection with the Landlord Obligations and
otherwise under this Section 7.1 shall be included as part of the
Operating Expenses, unless caused by the gross negligence or
willful misconduct of Landlord and unless excluded from the
definition of “Operating Expenses” as set forth
herein.
7.2 Tenant’s
Obligations.
7.2.1. Except as otherwise specifically provided in this
Lease, Landlord is not required to furnish any services or
facilities, or to make any repairs or Alterations, in, about or to
the Premises or the Property. Except as specifically described in
Section 7.1 and Articles 11 and 12, Tenant assumes the full and
sole responsibility for the condition, operation, repair,
replacement, maintenance and management of the Premises. Except as
specifically described in Section 7.1 and Articles 11 and 12,
Tenant, at Tenant’s sole cost and expense, will keep and
maintain the Premises (including, but not limited to, all
non-structural interior portions, systems and equipment; interior
surfaces of exterior walls; interior moldings, partitions and
ceilings; and interior electrical, lighting and plumbing fixtures,
which plumbing fixtures are part of the Tenant’s Improvements
and not part of the Landlord’s Improvements) in good order,
condition and repair, reasonable wear and tear and damage from
insured casualties excepted. Tenant will keep the Premises in a
neat and sanitary condition and will not commit any nuisance or
waste in, on or about the Premises or the Property. If Tenant
damages or injures the Site Facilities or any part of the Property
other than the Premises, Landlord will repair the damage and Tenant
will pay Landlord for all reasonable uninsured costs and expenses
of Landlord in connection with the repair as Additional Rent.
Tenant is solely responsible for and, to the fullest extent
allowable under the Laws, releases and will indemnify, protect and
defend Landlord against (with counsel reasonably acceptable to
Landlord) and hold Landlord harmless from, the cost of repairing,
and any Claims resulting from, any penetrations or perforations of
the roof or exterior walls of the Building by Tenant (exclusive of
the initial Tenant’s Improvements performed by Landlord).
Tenant will maintain the Premises in a condition comparable to
buildings of similar class and quality in the South Johnson County
submarket. Tenant’s repairs will be at least equal in quality
and workmanship to the original work and Tenant will make the
repairs and perform maintenance in accordance with all
Laws.
7.2.2. If any governmental authority requires any
non-structural Alteration to Premises as a result of Tenant’s
particular use of the Premises or as a result of any Alteration to
the Premises made by or on behalf of Tenant, or if Tenant’s
particular use of the Premises subjects Landlord or the Property to
any obligation under any Laws, Tenant will pay the cost of all such
non-structural Alterations or the cost of compliance, as the case
may be. If any governmental authority requires any structural
Alteration to Premises; Landlord shall perform such structural
Alteration (“Structural Alteration”). If the Structural
Alteration is a result of a specific action, employee or other
specific element of Tenant’s particular use of the Premises
(as opposed to items particular to office use in general) or as a
result of any Alteration to the Premises made by or on behalf of
Tenant, the cost thereof (including, without limitation, reasonable
overhead and administrative costs) shall be paid by Tenant within
thirty (30) days after receiving Landlord’s invoice for such
work; provided, Tenant may request Landlord, at Landlord’s
option, to
- 13 -
amortize the cost of such
Alteration over the remaining Term of the Lease and, if agreed to
by Landlord, the parties hereto shall execute an amendment to the
Lease which incorporates the amortization of such Structural
Alterations into the Lease. If any Structural Alteration to the
Premises related to a zoning or use requirements applicable to
Tenant’s particular use which were not in effect on the
Commencement Date, then Landlord shall perform such Structural
Alteration and the cost thereof shall be included as
“Operating Expenses” on an amortized basis over its
useful life on a straight line basis, such that the annual
amortized amount is included in Operating Expenses in each year
during the remainder of the Term as more fully provided herein. If
the Alterations referenced above are not structural, Tenant, at
Tenant’s option, will either make the Alterations at
Tenant’s sole cost and expense in accordance with Article 8
or request Landlord to make the Alterations at Tenant’s sole
cost and expense. Notwithstanding the above, based solely on the
temporary certificate of occupancy or permanent certificate of
occupancy to be issued by the City on or about the Commencement
Date, Landlord represents and warrants that, as of the date that
the permit was issued for the Building shell based upon the final,
approved development plan (and as interpreted by the City), the
Premises shall comply with all applicable Laws (as hereinafter
defined) including, without limitation the Americans With
Disabilities Act, other than zoning ordinances and other Laws
specific to Tenant’s use of the Premises.
ARTICLE 8. CHANGES AND
ALTERATIONS
8.1 Alterations; Access System . Tenant will not make any
Structural Alterations to the Premises or any Alterations to the
Site Facilities without Landlord’s approval which shall not
be unreasonably withheld, conditioned or delayed so long as (i) the
purposed Alteration is non-structural in nature, (ii) the purposed
Alteration does not materially diminish the value of the Building,
and (iii) the purposed Alteration otherwise complies with the
requirements of this Article 8. Tenant will not make any other
Alterations without Landlord’s prior written consent, which
consent Landlord will not unreasonably withhold or delay; provided,
however, that Landlord may require, as a condition of its consent,
that Tenant remove the Alterations at the end of the Term and
repair all damage caused by such removal; however, Alterations
related to the initial Tenant’s Improvements (including all
wiring and cabling) shall not be removed and Landlord shall not
require such removal. If Tenant properly notifies Landlord
hereunder and Landlord fails to respond within thirty (30) days
after such written notice, then Landlord shall be deemed to consent
to the proposed Alterations. Along with any request for
Landlord’s consent, Tenant will deliver to Landlord plans and
specifications for the Alterations and names and addresses of all
prospective contractors for the Alterations. If Landlord approves
the proposed Alterations, Tenant, before commencing the Alterations
or delivering (or accepting delivery of) any materials to be used
in connection with the Alterations, will deliver to Landlord for
Landlord’s reasonable approval copies of all contracts, proof
of insurance required by Section 8.2, copies of any contractor
safety programs, copies of all necessary permits and licenses and
such other information relating to the Alterations as Landlord
reasonably requests. Tenant will construct all approved Alterations
or cause all approved Alterations to be constructed (a) promptly by
a contractor Landlord approves in writing in Landlord’s
reasonable discretion, (b) in a good and workmanlike manner, (c) in
compliance with all Laws, (d) in accordance with all orders, rules
and regulations of the Board of Fire Underwriters having
jurisdiction over the Premises and any other body exercising
similar functions, and (e) in full compliance with all of
Landlord’s rules and regulations applicable to third party
contractors, subcontractors and suppliers performing work at the
Property. Notwithstanding the above, Tenant shall be entitled to
make non-structural alterations and improvements to the interior
portion of the Premises without Landlord’s consent (“
Minor Alterations ”) so long as: (i) the aggregate
cost of such non-structural alterations and improvements do not
exceed $10,000 per calendar year; (ii) the Minor Alterations are
constructed subject to all the other terms of this Article 8 and
(iii) Tenant provides Landlord with prior written notice of any
such Minor Alterations which exceed $2,500 per
occurrence.
The
parties acknowledge that Tenant shall operate the Building’s
access system as determined by Tenant (and reasonably approved by
Landlord), which access system shall be installed at Tenant’s
sole cost and expense; provided Tenant may use its Improvement
Allowance for such access system. Landlord shall be provided access
to the Building under Tenant’s access system (at no cost to
Landlord) for all purposes under this Lease. Tenant shall be
permitted to tie such system into Tenant’s standard access
system on a national basis.
8.2 Tenant’s Responsibility for Cost and Insurance .
Tenant will pay the cost and expense of all Alterations by or on
behalf of Tenant, including, without limitation, a reasonable
charge for Landlord’s review, inspection and engineering
time, and for any painting, restoring or repairing of the Premises
or the Building such Alterations occasion. Prior to commencing any
Alterations, Tenant will deliver the following to Landlord in
form
- 14 -
and amount reasonably
satisfactory to Landlord: (a) demolition (if applicable) and
payment and performance bonds, (b) builder’s “all
risk” insurance in an amount at least equal to the value of
the Alteration; (c) evidence that Tenant has in force commercial
general liability insurance insuring against construction related
risks, in at least the form, amounts and coverages required of
Tenant under Article 10 and (d) copies of all applicable contracts
and of all necessary permits and licenses. The insurance policies
described in clauses (b) and (c) of this section must name
Landlord, Landlord’s lender (if any) and Property Manager as
additional insureds.
8.3 Construction Obligations and Ownership . Landlord may
inspect construction of the Alterations. Immediately after
completing the Alterations, Tenant will furnish Landlord with
contractor affidavits, full and final lien waivers and receipted
bills covering all labor and materials expended and used in
connection with the Alterations. Tenant will remove any Alterations
Tenant constructs in violation of this Article 8 within ten (10)
days after Landlord’s written request and in any event prior
to the expiration or earlier termination of this Lease. All
Alterations Tenant makes or installs (including all telephone,
computer and other wiring and cabling located within the walls of
and outside the Premises, but excluding all Tenant Personalty as
defined in Section 16.1), shall become the property of Landlord and
a part of the Building immediately upon installation and, unless
Landlord requires Tenant to remove the Alterations and repair any
damage caused by such removal by notifying Tenant at the time
Landlord consents to the Alterations, Tenant will surrender the
Alterations to Landlord upon the expiration or earlier termination
of this Lease at no cost to Landlord. In no event shall Tenant be
required to remove the initial Tenant’s Improvements at the
expiration or earlier termination of the Lease.
8.4 Liens . Tenant will keep the Property free from any
mechanics’, materialmen’s, designers’ or other
liens arising out of any work performed, materials furnished or
obligations incurred by or for Tenant or any person or entity
claiming by, through or under Tenant. Tenant will notify Landlord
in writing thirty (30) days prior to commencing any Alterations in
order to provide Landlord the opportunity to record and post
notices of non-responsibility or such other protective notices
available to Landlord under the Laws. If any such liens are filed
and Tenant, within fifteen (15) days after such filing, does not
release the same of record or provide Landlord with a bond or other
security satisfactory to Landlord protecting Landlord and the
Property against such liens, Landlord, without waiving its rights
and remedies based upon such breach by Tenant and without releasing
Tenant from any obligation under this Lease, may cause such liens
to be released by any means Landlord deems proper, including, but
not limited to, paying the claim giving rise to the lien or posting
security to cause the discharge of the lien. In such event, Tenant
will reimburse Landlord, as Additional Rent, for all amounts
Landlord pays (including, without limitation, reasonable
attorneys’ fees and costs).
8.5 Indemnification . To the fullest extent allowable under
the Laws, Tenant releases and will indemnify, protect, defend (with
counsel reasonably acceptable to Landlord) and hold harmless the
Landlord Parties and the Property from and against any Claims in
any manner relating to or arising out of any Alterations by Tenant
or any other work performed, materials furnished or obligations
incurred by or for Tenant or any person or entity claiming by,
through or under Tenant.
ARTICLE 9. RIGHTS RESERVED BY
LANDLORD
9.1 Landlord’s Entry . Subject to the provisions of
the last sentence of this Section 9.1, Landlord and its authorized
representatives may during Business Hours and upon reasonable
notice to Tenant enter the Premises to: (a) inspect the Premises;
(b) show the Premises to prospective purchasers and mortgagees; (c)
show the Premises to prospective tenants (but only during the last
twelve (12) months of the Term except in the case of emergency or
at any time following an Event of Default after any applicable
notice and cure period to the extent permitted by law); (d) post
notices of non-responsibility or other protective notices available
under the Laws; or (e) exercise and perform Landlord’s rights
and obligations under this Lease. Landlord, in the event of any
emergency, may enter the Premises without notice to Tenant.
Landlord’s entry into the Premises is not to be construed as
a forcible or unlawful entry into, or detainer of, the Premises or
as an eviction of Tenant from all or any part of the Premises.
Tenant will also permit Landlord (or its designees) to erect,
install, use, maintain, replace and repair pipes, cables, conduits,
plumbing and vents, and telephone, electric and other wires or
other items, in, to and through the Premises if Landlord determines
that such activities are necessary or appropriate for properly
operating and maintaining the Building, to the extent reasonably
required by Landlord, provided Landlord shall use commercially
reasonable efforts not to disturb Tenant’s use and occupancy
of the Building (and will coordinate with Tenant if during Business
Hours) and Landlord shall use good faith efforts to coordinate any
such activities with Tenant to minimize
- 15 -
any impact on Tenant’s use
and occupancy of the Building. Landlord shall exercise commercially
reasonable efforts to minimize interference with Tenant’s
business operation in connection with its rights under Section 9.1.
Landlord acknowledges that certain information and documentation at
the Premises is deemed confidential by Tenant and Landlord will
refrain from disclosing the contents of such information and
documentation to any other party and shall use commercially
reasonable efforts to cause its employees, agents and contractors
to keep such information and documentation confidential. This
provision shall not apply to any information which Landlord can
demonstrate it knew prior to the date hereof or which Landlord
receives independently from a third party who is not precluded by
law, contract or duty of confidentiality from disclosing
it.
9.2 Control of Property . Landlord reserves all rights
respecting the Property and Premises not specifically granted to
Tenant under this Lease, including, without limitation, the right
to: (a) designate and approve all types of signs, window coverings,
internal lighting and other aspects of the Premises and its
contents that may be visible from the exterior of the Premises
which approval shall not be unreasonably withheld, conditioned,
delayed or denied; (b) close the Building after Business Hours,
except that Tenant and its employees and invitees may access the
Premises after Business Hours in accordance with such rules and
regulations as Landlord and Tenant may mutually prescribe from time
to time for security purposes; (c) install and maintain pipes,
ducts, conduits, wires and structural elements within the Building;
provided Landlord shall use commercially reasonable efforts not to
disturb Tenant’s use and occupancy of the Building and
Landlord shall use good faith efforts to coordinate any such
activities with Tenant to minimize any impact on Tenant’s use
and occupancy of the Building, and (d) retain and receive master
keys or pass keys to the Premises and all doors in the Premises.
Landlord will hire a service to conduct a drive-by patrol from time
to time, which may include an exterior door check. Notwithstanding
the foregoing, or the provision of any security-related services by
Landlord, Landlord is not responsible for the security of persons
or property on the Property and Landlord is not and will not be
liable in any way whatsoever for any breach of security not solely
caused by the willful misconduct or gross negligence of Landlord,
its agents or employees.
9.3 Lock Box Agent/Rent Collection Agent; ACH Payments .
Landlord, from time to time, may designate a lock box collection
agent or other person to collect Rent. In such event,
Tenant’s payment of Rent to the lock box collection agent or
other person is deemed to have been made (a) as of the date the
lock box collection agent or other person receives Tenant’s
payment (if the payment is not dishonored for any reason); or (b)
if Tenant’s payment is dishonored for any reason, the date
Landlord or Landlord’s agent collects the payment. Neither
Tenant’s payment of any amount of Rent to the lock box
collection agent or other person nor Landlord’s or
Landlord’s agent’s collection of such amount if the
payment is dishonored constitutes Landlord’s waiver of any
default by Tenant in the performance of Tenant’s obligations
under this Lease or Landlord’s waiver of any of
Landlord’s rights or remedies under this Lease. If Tenant
pays any amount to the lock box collection agent or other person
other than the actual amount due Landlord, then Landlord’s or
Landlord’s agent’s receipt or collection of such amount
does not constitute an accord and satisfaction, Landlord is not
prejudiced in collecting the proper amount due Landlord (or in
pursuing any rights or remedies available under this Lease, at law
or in equity as a result of Tenant’s failure to pay the full
amount when due) and Landlord may retain the proceeds of any such
payment, whether restrictively endorsed or otherwise, and apply the
same toward amounts due and payable by Tenant under this Lease.
Further, if mutually agreed upon by Landlord and Tenant, Tenant
hereby agrees to pay Rent via electronic funds transfer payments
(ACH payments) upon written direction and instructions from
Landlord.
9.4 Relocation of
Tenant . Intentionally
deleted.
ARTICLE 10. INSURANCE AND CERTAIN WAIVERS AND
INDEMNIFICATIONS
10.1 Tenant’s Insurance Obligations . Tenant, at all
times during the Term and during any early occupancy period, at
Tenant’s sole cost and expense, will maintain the insurance
this Section 10.1 describes.
10.1.1. Commercial general
liability insurance (providing coverage at least as broad as the
current ISO form) with respect to the Premises and Tenant’s
activities in the Premises and upon and about the Property, on an
“occurrence” basis, with single limit coverage of
$5,000,000. Such insurance must include specific coverage
provisions or endorsements (a) for broad f