Exhibit 10.2
OFFICE LEASE AGREEMENT
Between
Landlord: V.V. GEORGIA, L.P., a
Delaware limited partnership
and
Tenant: TRIS SECURITY
CORPORATION, a Georgia corporation
Dated:
June 29, 2005
TABLE OF CONTENTS
LEASE AGREEMENT
i
ii
BASIC LEASE
PROVISIONS
The following sets forth some of the
Basic Provisions of the Lease. In the event of any conflict between
the terms of these Basic Lease Provisions and the referenced
Sections of the Lease, the referenced Sections of the Lease shall
control. In addition to the following Basic Lease Provisions, all
of the other terms and conditions and sections of the Office Lease
Agreement hereinafter set forth are hereby incorporated as an
integral part of this Summary.
|
1.
|
|
Building (See
Section 1):
|
|
11675 Great Oaks Way
Alpharetta, Georgia 30022
|
|
|
|
|
|
|
|
2.
|
|
Premises (See
Section 1):
|
|
|
|
|
|
|
|
|
|
|
|
Suite:
|
|
120
|
|
|
|
Floor:
|
|
1 st
|
|
|
|
Rentable Square Feet:
|
|
2,675
|
|
|
|
|
|
|
|
3.
|
|
Term (See
Section 2):
|
|
39 full calendar months
|
|
|
|
Target Commencement Date:
|
|
September 1, 2005 subject to
Section 2
|
|
|
|
Target Expiration Date:
|
|
November 30, 2008 subject to
Section 2
|
|
|
|
|
|
|
|
4.
|
|
Base Rent (See
Section 5):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rate Per Rentable
|
|
|
|
|
|
|
|
|
Square Foot of
|
|
Monthly
|
|
|
|
|
Lease Term
|
|
Premises
|
|
Installment
|
|
|
|
|
September 1, 2005 –
November 30, 2005
|
|
$
|
0.00
|
|
$
|
0.00
|
|
|
|
|
December 1, 2005 –
August 31, 2006
|
|
$
|
18.50
|
|
$
|
4,123.96
|
|
|
|
|
September 1, 2006 –
August 31, 2007
|
|
$
|
19.06
|
|
$
|
4,247.68
|
|
|
|
|
September 1, 2007 –
August 31, 2008
|
|
$
|
19.63
|
|
$
|
4,376.26
|
|
|
|
|
September 1, 2008 –
November 30, 2008
|
|
$
|
20.22
|
|
$
|
4,507.38
|
|
|
|
|
|
|
|
|
|
|
|
5.
|
|
Rent Payment Address (See
Section 5)
|
|
|
|
|
|
|
|
|
Jones Lang LaSalle as agent for
Royal Centre One
|
|
|
|
|
|
|
11675 Great Oaks Way,
Suite 144B
|
|
|
|
|
|
|
|
|
Alpharetta, Georgia 30022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6.
|
|
Base Year (See
Section 7)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax Base Year:
|
|
2005
|
|
|
|
|
|
|
|
|
Operating Expense Base
Year:
|
|
2005
|
|
|
|
|
|
|
|
|
Electricity Cost Base
Year:
|
|
2005
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7.
|
|
Tenant’s Share (See
Section 7):
|
|
1.759
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
iii
|
8.
|
|
Security Deposit (See
Section 10):
|
|
$8,247.92
|
|
|
|
|
|
|
|
|
|
9.
|
|
Parking Spaces (See
Section 18):
|
|
5.5 unreserved spaces per 1,000
rentable square feet of Premises
|
|
|
|
|
|
|
|
|
10.
|
|
Tenant Improvement Allowance (See
Section 20):
|
|
$8.00 per rentable square
foot
|
|
|
|
|
|
|
|
|
|
11.
|
|
Tenant’s Liability Insurance
(See Section 28):
|
|
$2,000,000.00
|
|
|
|
|
|
|
|
|
|
12.
|
|
Landlord’s Broker (See
Section 49):
|
|
Jones Lang LaSalle
Americas, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
Tenant’s Broker (See
Section 49):
|
|
Coldwell Banker Commercial
NRT
|
|
|
|
|
|
|
|
|
|
13.
|
|
Notice Address (See
Section 32)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Landlord
|
|
Tenant
|
|
|
|
|
|
|
|
|
|
|
|
VV Georgia, L.P.
c/o Invesco Real Estate
1166 Avenue of the Americas
26 th Floor
New York, New York 10036-2727
Attn: VV Asset Manager
|
|
Tri-S Security
11675 Great Oaks Way
Suite 120
Alpharetta, Georgia 30022
|
|
|
|
|
|
|
|
|
|
14.
|
|
Guarantor (See
Section 59):
|
|
INTENTIONALLY OMITTED
|
|
iv
IN WITNESS WHEREOF, Landlord and
Tenant have executed this instrument as of the date set forth on
the first page hereof.
|
|
LANDLORD:
|
|
|
|
|
|
V.V. GEORGIA, L.P., a Delaware
limited partnership
|
|
|
|
|
|
By: INVESCO
Real Estate
|
|
|
Germany, L.P - Asset
Manager
|
|
|
|
|
|
|
|
|
|
|
|
Witness
|
By:
|
/s/ Cavarly E.B. Garrett
|
|
|
|
Name:
|
Cavarly E.B. Garrett
|
|
|
Title:
|
Authorized Agent
|
|
|
|
|
|
|
|
|
TENANT:
|
|
|
|
|
|
TRIS SECURITY CORPORATION,
a
|
|
|
Georgia corporation
|
|
|
|
|
|
|
|
|
Witness
|
By:
|
/s/ Wayne Stallings
|
|
|
|
|
FTS: CFO
|
|
|
|
|
|
|
|
|
v
OFFICE LEASE
AGREEMENT
THIS OFFICE LEASE AGREEMENT
(hereinafter called the “Lease”) is made and entered
into as of the date appearing on the first page hereof by and
between the Landlord and Tenant identified above.
A.
Premises/Term/Possession
1.
Premises . Landlord
does hereby rent and lease to Tenant and Tenant does hereby rent
and lease from Landlord, for general office purposes of a type
customary for first-class office buildings, the Premises located in
the Building identified in the Basic Lease Provisions, situated on
the real property described in Exhibit “A”
attached hereto (the “Property”), such Premises as all
further shown by diagonal lines on the drawing attached hereto as
Exhibit “A-1” and made a part hereof by
reference. The Premises shall be prepared for Tenant’s
occupancy in the manner and subject to the provisions of
Exhibit “B” attached hereto and made a part
hereof. Landlord and Tenant agree that the number of rentable
square feet described in Paragraph 2 of the Basic Lease Provisions
has been confirmed and conclusively agreed upon by the parties. No
easement for light, air or view is granted hereunder or included
within or appurtenant to the Premises.
2.
Lease Term .
Tenant shall have and hold the Premises for the term
(“Term”) identified in the Basic Lease Provisions
commencing on the date (the “Commencement Date”) which
is the earlier of (i) five (5) days after the date on
which Landlord notifies Tenant that the Premises are substantially
complete (or would have been substantially complete but for any
delays caused by Tenant, its agents and employees) or (ii) the
date Tenant first occupies all or any portion of the Premises for
the conduct of its business, and shall terminate at midnight on the
last day of the Term (the “Expiration Date”), unless
sooner terminated or extended as hereinafter provided. Promptly
following the Commencement Date, Landlord and Tenant shall enter
into a letter agreement in the form attached hereto as
Exhibit “C” , specifying and/or confirming
the Commencement Date and the Expiration Date (and the number of
rentable square feet contained within the Premises and the amount
of Base Rent payable hereunder for each Lease Year (as defined in
Section 5 below), if such numbers as finally determined differ
from those set forth in the Basic Lease Provisions).
3.
Landlord’s Failure to Give Possession.
Landlord shall not be liable for damages to Tenant for
failure to deliver possession of the Premises to Tenant if such
failure is due to any previous tenant’s failure to vacate the
Premises, except that the commencement of the Term shall be delayed
until Landlord delivers possession of the Premises to Tenant (so
long as Tenant is not responsible for such failure or delay).
Landlord will use all commercially reasonable efforts to deliver
possession of the Premises to Tenant by the Commencement Date of
the Term.
4.
Quiet
Enjoyment. Tenant, upon payment in full of the
required Rent and full performance of the terms, conditions,
covenants and agreements contained in this Lease, shall peaceably
and quietly have, hold and enjoy the Premises during the Term
hereof. Landlord shall not be responsible for the acts or omissions
of any other tenant, Tenant or third party that may interfere with
Tenant’s use and enjoyment of the Premises.
1
B.
Rent/Payment/Security Deposit.
5.
Base Rent .
Tenant shall pay to Landlord, at the address stated in the
Basic Lease Provisions or at such other place as Landlord shall
designate in writing to Tenant, annual base rent (“ Base
Rent ”) in the amounts set forth in the Basic Lease
Provisions. The term “Lease Year”, as used in the Basic
Lease Provisions and throughout this Lease, shall mean each and
every consecutive twelve (12) month period during the Term of this
Lease, with the first such twelve (12) month period commencing on
the Commencement Date; provided, however, if the Commencement Date
occurs other than on the first day of a calendar month, the first
Lease Year shall be that partial month plus the first full twelve
(12) months thereafter.
6.
Rent Payment.
The Base Rent for each Lease Year shall be payable in equal
monthly installments, due on the first day of each calendar month,
in advance, in legal tender of the United States of America,
without abatement, demand, deduction or offset whatsoever, except
as may be expressly provided in this Lease. One full monthly
installment of Base Rent shall be due and payable on the date of
execution of this Lease by Tenant and shall be applied to the first
month’s Base Rent, and a like monthly installment of Base
Rent shall be due and payable on or before the first day of each
calendar month following the Commencement Date during the Term
hereof (provided, that if the Commencement Date should be a date
other than the first day of a calendar month, the monthly Base Rent
installment paid on the date of execution of this Lease by Tenant
shall be prorated to that partial calendar month, and the excess
shall be applied as a credit against the next monthly Base Rent
installment). Tenant shall pay, as Additional Rent, all other sums
due from Tenant under this Lease (the term “Rent”, as
used herein, means all Base Rent, Additional Rent and all other
amounts payable hereunder from Tenant to Landlord).
7.
Operating Expenses/Taxes/Electricity
Costs.
(a)
Tenant agrees to reimburse Landlord throughout the Term, as
Additional Rent hereunder, for Tenant’s Share (as defined
below) of: (i) the annual Operating Expenses (as defined
below) in excess of the Operating Expenses for the Operating
Expense Base Year set forth in the Basic Lease Provisions
(hereinafter called the “Base Year Expense Amount”);
(ii) the annual Taxes (as defined below) in excess of the
Taxes for the Tax Base Year set forth in the Basic Lease Provisions
(hereinafter called the “Base Year Tax Amount”); and
(iii) the annual Electricity Costs (as defined below) in
excess of the Electricity Costs for the Electricity Cost Base Year
set forth in the Basic Lease Provisions (hereinafter called the
“Base Year Electricity Costs”). The term
“Tenant’s Share” as used in this Lease shall mean
the percentage determined by dividing the rentable square footage
of the Premises by the rentable square footage of the Building.
Landlord and Tenant hereby agree that Tenant’s Share with
respect to the Premises initially demised by this Lease is the
percentage amount set forth in the Basic Lease Provisions.
Tenant’s Share of excess Operating Expenses, excess Taxes and
excess Electricity Costs for any calendar year shall be
appropriately prorated for any partial year occurring during the
Term.
(b)
“Operating Expenses” shall mean all of those expenses
of operating, servicing, managing, maintaining and repairing the
Property, Building, and all parking areas and all related common
areas (as well as the reasonable allocation by Landlord of any
expenses incurred and
2
related to facilities located on other property
but serving the Property, if the Property is part of a project
involving more than one building and/or property). Operating
Expenses shall include, without limitation, the following:
(1) insurance premiums and deductible amounts, including,
without limitation, for commercial general liability, “all
risks” property, rent loss and other coverages carried by
Landlord on the Building and Property; (2) all costs related
to the providing of water, heating, lighting, ventilation, sanitary
sewer, air conditioning and other utilities in the Building, but
specifically excluding the costs of electricity or power charges
incurred in connection with such services or the costs of providing
electricity or power throughout the Building, and further excluding
those utility charges actually paid separately by Tenant or any
other tenants of the Building; (3) janitorial and maintenance
expenses, including: (a) janitorial services and janitorial
supplies and other materials used in the operation and maintenance
of the Building; and (b) the cost of maintenance and service
agreements on equipment, window cleaning, grounds maintenance, pest
control, security, trash and snow removal, and other similar
services or agreements; (4) management fees (or a charge equal
to fair market management fees if Landlord provides its own
management services) and the market rental value of a management
office; (5) the costs, including interest, amortized over the
applicable useful life, of any capital improvement made to the
Building by or on behalf of Landlord which is required under any
governmental law or regulation (or any judicial interpretation
thereof) that was not applicable to the Building as of the date of
this Lease, and of the acquisition and installation of any device
or equipment designed to improve the operating efficiency of any
system within the Building which is reasonably intended to reduce
Operating Expenses or which is acquired to improve the safety of
the Building or Property; (6) all services, supplies, repairs,
replacements or other expenses directly and reasonably associated
with servicing, maintaining, managing and operating the Building,
including, but not limited to the lobby, vehicular and pedestrian
traffic areas and other common use areas; (7) wages and
salaries of Landlord’s employees (not above the level of
Building or Property Manager or whatever title represents the
on-site management representative primarily responsible for
management of the Building) engaged in the maintenance, operation,
repair and services of the Building, including taxes, insurance and
customary fringe benefits; (8) legal and accounting costs (but
not including legal costs incurred in collecting delinquent rent
from any occupants of the Property); (9) costs to maintain and
repair the Building and Property; (10) landscaping and
security costs unless Landlord hires a third party to provide such
services pursuant to a service contract and the cost of that
service contract is already included in Operating Expenses as
described above; (11) if the Building is part of a multi-building
project, the Building’s allocated share (as reasonably
determined by Landlord) of those expenses incurred on a
project-wide basis benefiting the Building and/or Property
including, without limitation, costs in connection with
(i) landscaping, (ii) utility and road repairs,
(iii) security, and (iv) signage installation,
replacement and repair; (12) costs and expenses of repair or
replacement of common area finishes.
Operating Expenses shall
specifically further exclude, however, the following:
(1) costs of alterations of tenant spaces (including all
tenant improvements to such spaces); (2) costs of capital
improvements, except as provided in the preceding paragraph;
(3) depreciation, interest and principal payments on
mortgages, and other debt costs, if any; (4) real estate
brokers’ leasing commissions or compensation and advertising
and other marketing expenses; (5) 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; (6) costs or other
3
services or work performed for the singular
benefit of another tenant or occupant (other than for common areas
of the Building); (7) legal, space planning, construction, and
other expenses incurred in procuring tenants for the Building or
renewing or amending leases with existing tenants or occupants of
the Building; (8) costs of advertising and public relations
and promotional costs and attorneys’ fees associated with the
leasing of the Building; (9) any expense for which Landlord
actually receives reimbursement from insurance, condemnation
awards, other tenants or any other source; (10) costs incurred
in connection with the sale, financing, refinancing, mortgaging, or
other change of ownership of the Building; (11) all expenses in
connection with the installation, operation and maintenance of any
observatory, broadcasting facilities, luncheon club, athletic or
recreation club, cafeteria, dining facility, or other facility not
generally available to all office tenants of the Building,
including Tenant; (12) Taxes; and (13) rental under any ground or
underlying lease or leases.
(c)
“Taxes” shall mean all taxes and assessments of every
kind and nature which Landlord shall become obligated to pay with
respect to each calendar year of the Term or portion thereof
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 Taxes shall be the amount required to be paid for
any calendar year, notwithstanding that such Taxes are assessed for
a different calendar year (the amount of any tax refunds received
by Landlord during the Term of this Lease shall be deducted from
Taxes for the calendar year to which such refunds are
attributable); (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
for the calendar year in respect of which Taxes are being
determined; (iii) the amount of any tax or excise levied by
the State or the City where the Building is located; 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 Taxes are being determined had
the income received by Landlord from the Building [excluding
amounts payable under this subparagraph (iii)] been the sole
taxable income of Landlord for such calendar year; (iv) there
shall be excluded from Taxes all income taxes [except those which
may be included pursuant to the preceding subparagraph
(iii) above], excess profits taxes, franchise, capital stock,
and inheritance or estate taxes; (v) if any portion of the
Taxes in the Tax Base Year includes an assessment which is no
longer payable in a subsequent calendar year, the Taxes for the Tax
Base Year shall be adjusted to eliminate the amount of the annual
assessment originally included therein; and (vi) Taxes shall
also include Landlord’s reasonable costs and expenses
(including reasonable attorneys’ fees) in contesting or
attempting to reduce any Taxes assessed for a different calendar
year. Landlord agrees to consult with a real estate tax consultant
or advisor engaged by it from time to time and in the exercise of
reasonable and prudent ownership judgment contest any unreasonable
tax assessment to the extent such tax counsel advises Landlord that
a reasonable basis exists therefor.
(d)
“Electricity Costs” shall mean all of those costs and
expenses of every kind and nature whatsoever which Landlord shall
incur in connection with providing various electricity and power
services to the Building, or any portion thereof, or to the tenant
spaces located therein,
4
including the Premises, with respect to each
calendar year of the Term or portion thereof, but specifically
excluding electricity or power charges actually paid by Tenant or
other tenants of the Building directly to the provider of such
services or paid to Landlord on account of excess usage or overtime
charges.
(e)
Landlord shall, on or before the Commencement Date and as soon as
reasonably possible after the commencement of each calendar year
thereafter, provide Tenant with a statement of the estimated
monthly installments of Tenant’s Share of excess Operating
Expenses, excess Taxes and excess Electricity Costs which will be
due for the remainder of the calendar year in which the
Commencement Date occurs or for the next ensuing calendar year, as
the case may be. Landlord agrees to keep books and records showing
the Operating Expenses in accordance with generally accepted
accounting principles (as modified for office buildings in a manner
comparable to other similar buildings in the commercial area where
the Building is located) and practices consistently maintained on a
year-to-year basis in compliance with such provisions of this Lease
as may affect such accounts, and Landlord shall deliver to Tenant
within one hundred twenty (120) days after the close of each
calendar year (subject to any delays beyond the reasonable control
of Landlord to prevent) (including the calendar year in which this
Lease terminates), a statement (“Landlord’s
Statement”) containing the following: (1) a statement
that the books and records covering the operation of the Building
have been maintained in accordance with the requirements in this
subparagraph (e); (2) the amount of any increases in the
Operating Expenses for such calendar year in excess of the
Operating Expenses for the Operating Expense Base Year;
(3) the amount of any increases in the Taxes for such calendar
year in excess of the Taxes for the Tax Base Year; and (4) the
amount of any increases in the Electricity Costs for such calendar
year in excess of the Electricity Costs for the Electricity Cost
Base Year. Upon reasonable prior written request given not later
than thirty (30) days following the date Landlord’s Statement
is delivered to Tenant, Landlord will provide Tenant detailed
documentation to support such Landlord’s Statement or provide
Tenant with the opportunity to review such supporting information.
If Tenant does not notify Landlord of any objection to
Landlord’s Statement within ninety (90) days after the later
of delivery of Landlord’s Statement or such requested
supporting documentation, Tenant shall be deemed to have accepted
Landlord’s Statement as true and correct and shall be deemed
to have waived any right to dispute the excess Operating Expenses,
Taxes and/or Electricity Costs due pursuant to that
Landlord’s Statement.
(i)
Tenant shall pay to Landlord, together with its monthly payment of
Base Rent as provided in Section 5 above, as Additional Rent
hereunder, the estimated monthly installment of Tenant’s
Share of the excess Operating Expenses, Taxes and Electricity Costs
for the calendar year in question. At the end of any calendar year,
if Tenant has paid to Landlord an amount in excess of
Tenant’s Share of excess Operating Expenses, Taxes and
Electricity Costs for such calendar year, Landlord shall reimburse
to Tenant any such excess amount (or shall apply any such excess
amount to any amount then owing to Landlord hereunder, and if none,
to the next due installment or installments of Additional Rent due
hereunder, at the option of Landlord). At the end of any calendar
year if Tenant has paid to Landlord less than Tenant’s Share
of excess Operating Expenses, Taxes and Electricity Costs for such
calendar year, Tenant shall pay to Landlord any such deficiency
within thirty (30) days after Tenant receives the annual
statement.
5
(ii)
For the calendar year in which this Lease terminates and is not
extended or renewed, the provisions of this Section shall
apply, but Tenant’s Share for such calendar year shall be
subject to a pro rata adjustment based upon the number of days
prior to the expiration of the Term of this Lease. Tenant shall
make monthly estimated payments of the pro rata portion of
Tenant’s Share for such calendar year (in the manner provided
above) and when the actual prorated Tenant’s Share for such
calendar year is determined, Landlord shall send Landlord’s
Statement to Tenant for such year and if such Statement reveals
that Tenant’s estimated payments for the prorated
Tenant’s Share for such calendar year exceeded the actual
prorated Tenant’s Share for such calendar year, Landlord
shall include a refund for that amount along with the Statement
(subject to offset in the event Tenant is in default hereunder). If
Landlord’s Statement reveals that Tenant’s estimated
payments for the prorated Tenant’s Share for such calendar
year were less than the actual prorated Tenant’s Share for
such calendar year, Tenant shall pay the shortfall to Landlord
within thirty (30) days after the date of receipt of
Landlord’s Statement.
(iii)
If the Building is less than ninety-five percent (95%) occupied
throughout any calendar year of the Term, then the actual Operating
Expenses for the calendar year in question (as well as the
Operating Expenses for the Operating Expense Base Year) which vary
with occupancy levels in the Building (e.g. elevator maintenance,
management fees) shall be increased to the amount of Operating
Expenses which Landlord reasonably determines would have been
incurred during that calendar year if the Building had been at
least 95% occupied throughout such calendar year. If the provisions
of this subsection are applied in any calendar year, the Base
Expense Amount shall likewise be adjusted to reflect such level of
occupancy.
8.
Late Charge.
Other remedies for non-payment of Rent notwithstanding, if
any monthly installment of Base Rent or Additional Rent is not
received by Landlord on or before the date due, or if any payment
due Landlord by Tenant which does not have a scheduled due date is
not received by Landlord on or before the tenth (10th) day
following the date Tenant was invoiced, a late charge of five
percent (5%) of such past due amount shall be immediately due and
payable as Additional Rent and interest shall accrue on all
delinquent amounts from the date past due until paid at the lower
of a rate of one and one-half (1-1/2%) percent per month or
fraction thereof from the date such payment is due until paid
(Annual Percentage Rate = 18%), or the highest rate permitted by
applicable law.
9.
Partial
Payment. No payment by Tenant or acceptance by
Landlord of an amount less than the Rent herein stipulated shall be
deemed a waiver of any other Rent due. No partial payment or
endorsement on any check or any letter accompanying such payment of
Rent shall be deemed an accord and satisfaction, but Landlord may
accept such payment without prejudice to Landlord’s right to
collect the balance of any Rent due under the terms of this Lease
or any late charge assessed against Tenant hereunder.
10.
Security Deposit
. Tenant shall pay Landlord the amount identified as the
Security Deposit in the Basic Lease Provisions (hereinafter
referred to as “Security Deposit”) as evidence of good
faith on the part of Tenant in the fulfillment of the terms of this
Lease, which shall be held by the Landlord during the Term of this
Lease, or any renewal thereof. Under no circumstances will Tenant
be entitled to any interest on the Security Deposit. The
Security
6
Deposit may be used by Landlord, at
its discretion, to apply to any amount owing to Landlord hereunder,
or to pay the expenses of repairing any damage to the Premises,
except natural wear and tear occurring from normal use of the
Premises, which exists on the day Tenant vacates the Premises, but
this right shall not be construed to limit Landlord’s right
to recover additional sums from Tenant for damages to the Premises.
In addition to any other rights available to Landlord hereunder,
the Security Deposit shall be forfeited in any event if Tenant
fails to occupy the Premises for the full Term of this Lease, or if
this Lease should for any reason whatsoever be terminated prior to
the Expiration Date of the Term, or of any renewal thereof. If
there are no payments to be made from the Security Deposit as set
out in this paragraph, or if there is any balance of the Security
Deposit remaining after all payments have been made, the Security
Deposit, or such balance thereof remaining, will be refunded to the
Tenant within thirty (30) days after fulfillment by Tenant of all
obligations hereunder (including payment of the balance of any
year-end reconciliation). In no event shall Tenant be entitled to
apply the Security Deposit to any Rent due hereunder. In the event
of an act of bankruptcy by or insolvency of Tenant, or the
appointment of a receiver for Tenant or a general assignment for
the benefit of Tenant’s creditors, then the Security Deposit
shall be deemed immediately assigned to Landlord. The right to
retain the Security Deposit shall be in addition and not
alternative to Landlord’s other remedies under this Lease or
as may be provided by law and shall not be affected by summary
proceedings or other proceedings to recover possession of the
Premises. Upon sale or conveyance of the Building, Landlord may
transfer or assign the Security Deposit to any new owner of the
Premises, and upon such transfer all liability of Landlord for the
Security Deposit shall terminate. Landlord shall be entitled to
commingle the Security Deposit with its other funds.
C.
Use/Laws/Rules.
11.
Use of
Premises.
(a)
Tenant shall use and occupy the Premises for general office
purposes of a type customary for office buildings of the same type
and quality as the Building and for no other purpose. The Premises
shall not be used for any illegal purpose, nor in violation of any
valid regulation of any governmental body, nor in any manner to
create any nuisance or trespass, nor in any manner which will void
the insurance or increase the rate of insurance on the Premises or
the Building, nor in any manner inconsistent with the first-class
nature of the Building.
(b)
Tenant shall not cause or permit the receipt, storage, use,
location or handling on the Property (including the Building and
Premises) of any product, material or merchandise which is
explosive, highly inflammable, or a “hazardous or toxic
material,” as that term is hereafter defined.
“Hazardous or toxic material” shall include all
materials or substances which have been determined to be hazardous
to health or the environment and are regulated or subject to all
applicable laws, rules and regulations from time to time,
including, without limitation hazardous waste (as defined in the
Resource Conservation and Recovery Act); hazardous substances (as
defined in the Comprehensive Emergency Response, Compensation and
Liability Act, as amended by the Superfund Amendments and
Reauthorization Act); gasoline or any other petroleum product or
by-product or other hydrocarbon derivative; toxic substances, (as
defined by the Toxic Substances Control Act); insecticides,
fungicides or rodenticide, (as defined in the Federal Insecticide,
Fungicide, and Rodenticide Act); asbestos and radon and
7
substances determined to be hazardous under the
Occupational Safety and Health Act or regulations promulgated
thereunder. Notwithstanding the foregoing, Tenant shall not be in
breach of this provision as a result of the presence in the
Premises of minor amounts of hazardous or toxic materials which are
in compliance with all applicable laws, ordinances and regulations
and are customarily present in a general office use (e.g., copying
machine chemicals and kitchen cleansers).
(c)
Without limiting in any way Tenant’s obligations under any
other provision of this Lease, Tenant and its successors and
assigns shall indemnify, protect, defend (with counsel approved by
Landlord) and hold Landlord, its partners, officers, directors,
shareholders, employees, agents, lenders, contractors and each of
their respective successors and assigns (the “Indemnified
Parties”) harmless from any and all claims, damages,
liabilities, losses, costs and expenses of any nature whatsoever,
known or unknown, contingent or otherwise (including, without
limitation, attorneys’ fees, litigation, arbitration and
administrative proceedings costs, expert and consultant fees and
laboratory costs, as well as damages arising out of the diminution
in the value of the Premises or any portion thereof, damages for
the loss of the Premises, damages arising from any adverse impact
on the marketing of space in the Premises, and sums paid in
settlement of claims), which arise during or after the Term in
whole or in part as a result of the presence or suspected presence
of any hazardous or toxic materials, in, on, under, from or about
the Premises due to Tenant’s acts or omissions, on or about
the Premises, unless such claims, damages, liabilities, losses,
costs and expenses arise out of or are caused by the negligence or
willful misconduct of any of the Indemnified Parties. Landlord and
its successors and assigns shall indemnify and hold Tenant and its
successors and assigns harmless against all such claims or damages
if arising out of or caused by the negligence or willful misconduct
of Landlord, its agents or employees. The indemnities contained
herein shall survive the expiration or earlier termination of this
Lease.
12.
Compliance with
Laws. Tenant and Landlord shall operate the Premises
and Building respectively in compliance with all applicable
federal, state, and municipal laws, ordinances and regulations
(including, without limitation, the Americans with Disabilities
Act) and shall not knowingly, directly or indirectly, make any use
of the Premises or Building which is prohibited by any such laws,
ordinances or regulations.
13.
Waste
Disposal.
(a)
All normal trash and waste (i.e., waste that does not require
special handling pursuant to subparagraph (b) below) shall be
disposed of through the janitorial service.
(b)
Tenant shall be responsible for the removal and disposal of any
waste deemed by any governmental authority having jurisdiction over
the matter to be hazardous or infectious waste or waste requiring
special handling, such removal and disposal to be in accordance
with any and all applicable governmental rules, regulations, codes,
orders or requirements. Tenant agrees to separate and mark
appropriately all waste to be removed and disposed of through the
janitorial service pursuant to (a) above and hazardous,
infectious or special waste to be removed and disposed of by Tenant
pursuant to this subparagraph (b). Tenant hereby indemnifies and
holds harmless Landlord from and against any loss,
claims,
8
demands, damage or injury Landlord may suffer or
sustain as a result of Tenant's failure to comply with the
provisions of this subparagraph (b).
14.
Rules and
Regulations . The rules and regulations in
regard to the Building, a copy of which is attached hereto as
Exhibit “D,” and all reasonable
rules and regulations and modifications thereto which Landlord
may hereafter from time to time adopt and promulgate after notice
thereof to Tenant, for the government and management of the
Building, are hereby made a part of this Lease and shall during the
Term be observed and performed by Tenant, its agents, employees and
invitees.
D.
Services/Tenant Buildout.
15.
Services .
(a)
The normal business hours of the Building shall be from 8:00 A. M.
to 6:00 P.M. on Monday through Friday, and at such other hours
and times as determined by Landlord to be required for the majority
of the occupants of the Building, exclusive of Building holidays as
reasonably designated by Landlord (“Building
Holidays”). Initially and until further notice by Landlord to
Tenant, the Building Holidays shall be: New Year’s Day,
Memorial Day, Independence Day, Labor Day, Thanksgiving (and the
day after Thanksgiving) and Christmas. Landlord shall furnish the
following services during the normal business hours of the Building
except as noted:
(i)
Elevator service for passenger needs at all times, and for delivery
needs during normal business hours;
(ii)
Air conditioning reasonably adequate to cool the Premises and heat
reasonably adequate to warm the Premises in accordance with the
standards set forth on the HVAC Specifications shown on
Exhibit “E” attached hereto and made a part
hereof, subject to governmental regulations (so long as the
occupancy level of the Premises and the heat generated by
electrical lighting and fixtures do not exceed the thresholds set
forth on Exhibit “E” ).
(iii)
Hot and cold running water for all restrooms and
lavatories;
(iv)
Soap, paper towels, and toilet tissue for public
restrooms;
(v)
Janitorial service Monday through Friday, in keeping with the
standards generally maintained in similar office buildings in the
city where the Building is located;
(vi)
Custodial, electrical and mechanical maintenance services in the
Building;
(vii)
Electric power for lighting and outlets not in excess of the total
watts per rentable square foot of the Premises set forth on
Exhibit ”E” at 100% connected load (Tenant
shall pay for any electrical service in excess of such
amount);
9
(viii)
Replacement of Building standard lamps and ballasts as needed from
time to time;
(ix)
Repairs and maintenance as described in Section 22 of this
Lease; and
(x)
General Building management, including supervision, inspections,
recordkeppeing, accounting, leasing and related management
functions.
(b)
Tenant shall have no right to any services in excess of those
provided herein. If Tenant uses services in an amount or for a
period in excess of that provided for herein, then Landlord
reserves the right to charge Tenant as Additional Rent hereunder a
reasonable sum as reimbursement for the direct cost of such added
services, and to charge Tenant for the cost of any additional
equipment or facilities or modifications thereto which are
necessary to provide the additional services, and/or to discontinue
providing such excess services to Tenant.
(c)
Landlord shall not be liable for any damages directly or indirectly
resulting from the interruption in any of the services described
above, nor shall any such interruption entitle Tenant to any
abatement of Rent or any right to terminate this Lease. Landlord
shall use all reasonable efforts to furnish uninterrupted services
as required above. Notwithstanding the foregoing, in the event that
any interruption or discontinuance of services provided pursuant to
this Section 15 was within the reasonable control of Landlord
to prevent and such interruption or discontinuance continues beyond
three (3) business days after written notice to Landlord and
materially and adversely affects Tenant’s ability to conduct
business in the Premises, or any portion thereof, and on account of
such interruption or disturbance Tenant ceases doing business in
the Premises, Base Rent and Additional Rent shall thereafter abate
proportionately for so long as Tenant remains unable to conduct its
business in the Premises or such portion thereof. To the extent
within Landlord’s reasonable control, Landlord agrees to use
reasonable efforts to restore such interrupted or discontinued
service as soon as reasonably practicable.
16.
Telephone
and Data Equipment. Landlord shall have no
responsibility for providing to Tenant any telephone equipment,
including wiring, within the Premises or for providing telephone
service or connections from the utility to the Premises, except as
required by law. Tenant shall not alter, modify, add to or disturb
any telephone or data wiring in the Premises or elsewhere in the
Building without the Landlord’s prior written consent. Tenant
shall be liable to Landlord for any damage to the telephone or data
wiring in the Building due to the act, negligent or otherwise, of
Tenant or any employee, contractor or other agent of Tenant. Tenant
shall have no access to the telephone closets within the Building,
except in the manner and under procedures established by Landlord.
Tenant shall promptly notify Landlord of any actual or suspected
failure of telephone or data service to the Premises. All costs
incurred by Landlord for the installation, maintenance, repair and
replacement of telephone wiring within the Building shall be an
Operating Expense unless Landlord is reimbursed for such costs by
other tenants of the Building. Landlord shall not be liable to
Tenant and Tenant waives all claims against Landlord whatsoever,
whether for personal injury, property damage, loss of use of the
Premises, or otherwise, due to the interruption or failure of
telephone services to the Premises.
10
Tenant hereby holds Landlord harmless and agrees
to indemnify, protect and defend Landlord from and against any
liability for any damage, loss or expense due to any failure or
interruption of telephone or data service to the Premises for any
reason. Tenant agrees to obtain loss of rental insurance adequate
to cover any damage, loss or expense occasioned by the interruption
of telephone or data service.
17.
Signs. A Building
standard suite entry shall be installed on the door to the Premises
or adjacent to the entry to the Premises as part of the Work
described in Section 20 below, and the cost thereof shall be
paid out of the Tenant Improvement Allowance described in
Section 20 below. Otherwise, Tenant shall not paint or place
any signs, placards, or other advertisements of any character upon
the windows or inside walls of the Premises (except with the prior
consent of Landlord, which consent may be withheld by Landlord in
its absolute discretion), and Tenant shall place no signs upon the
outside walls, common areas or the roof of the Building.
18.
Parking . No
rights to specific parking spaces are granted under this Lease;
however, subject to Landlord’s rights pursuant to the last
sentence of this Section 18, Tenant shall be entitled to use
up to the total number of parking spaces set forth in the Basic
Lease Provisions in the parking facilities located on the Property.
All parking spaces provided to Tenant shall be unreserved (unless
otherwise specified on Exhibit “H” attached
hereto) and are to be used by Tenant, its employees and invitees in
common with the other tenants of the Building and their employees
and invitees. Landlord reserves the right to build improvements
upon, reduce the size of, relocate, reconfigure, eliminate, and/or
make alterations or additions to such parking facilities at any
time. The use of the parking spaces is provided by Landlord to
Tenant at the published rates charged by Landlord to third parties
from time to time. Such payments for parking shall be considered
Additional Rent. Tenant shall not have the right to surrender or
return parking spaces and shall be obligated to pay for all of the
allocated parking spaces throughout the Term.
19.
Storage . If
Landlord makes available to Tenant any storage space outside the
Premises, anything stored therein shall be wholly at the risk of
Tenant, and Landlord shall have no responsibility or liability for
the items stored therein.
20.
Buildout Allowance and Tenant Finishes.
(a)
Landlord will provide to Tenant an allowance (“Tenant
Improvement Allowance”) per rentable square foot contained
within the Premises as set forth in the Basic Lease Provisions to
be applied to the cost of the Work and Additional Work described in
Exhibit “B” . Tenant and Landlord agree
that all costs of the Work and Additional Work in excess of such
Tenant Improvement Allowance which are requested by Tenant and
approved by Landlord shall be paid by Tenant to Landlord as
follows: twenty-five (25%) percent of such excess costs prior to
the commencement of the Work, fifty percent (50%) of such excess
costs within five (5) business days of Landlord’s notice
that fifty percent (50%) of the Work is complete and the balance
(i.e. 25%) of actual costs upon substantial completion and prior to
occupancy. The amount due for each installment shall be set forth
in a written invoice from Landlord. Should Tenant fail to pay for
such excess costs when due as herein provided, such amount due
shall
11
accrue interest at the lesser of a rate of one
and one-half (1-1/2%) percent per month or fraction thereof from
the date such payment is due until paid (Annual Percentage Rate =
18%), or the highest rate permitted by applicable law, and the
failure to pay such amount when due shall be a default, subject to
the provisions of Section 34 below.
(b)
The Work Letter attached hereto as
Exhibit “B” and executed by Landlord and
Tenant, is hereby made a part of this Lease, and its provisions
shall control in the event of a conflict with the provisions
contained in this Lease.
21.
Force Majeure .
In the event of a strike, lockout, labor trouble, civil
commotion, an act of God, or any other event beyond
Landlord’s control (a “force majeure event”)
which results in the Landlord being unable to timely perform its
obligations hereunder to repair the Premises, provide services, or
complete Work (as provided in Exhibit “B”
), so long as Landlord diligently proceeds to perform such
obligations after the end of such force majeure event, Landlord
shall not be in breach hereunder, this Lease shall not terminate,
and Tenant’s obligation to pay any Base Rent, additional
rent, or any other charges and sums due and payable shall not be
excused.
E.
Repairs/Alterations/Casualty/Condemnation.
22.
Repairs By
Landlord . Tenant, by taking possession of the
Premises, shall accept and shall be held to have accepted the
Premises as suitable for the use intended by this Lease. In no
event shall Tenant be entitled to compensation or any other damages
or any other remedy against Landlord in the event the Premises are
not deemed suitable for Tenant’s use. Landlord shall not be
required, after possession of the Premises has been delivered to
Tenant, to make any repairs or improvements to the Premises, except
as set forth in this Lease. Except for damage caused by casualty
and condemnation (which shall be governed by Section 25 and 26
below), and subject to normal wear and tear, Landlord shall
maintain in good repair the exterior walls, roof, common areas,
foundation, structural portions and the Building’s
mechanical, electrical, plumbing and HVAC systems, provided such
repairs are not occasioned by Tenant, Tenant’s invitees or
anyone in the employ or control of Tenant.
23.
Repairs By
Tenant. Except as described in Section 22 above,
Tenant shall, at its own cost and expense, maintain the Premises in
good repair and in a neat and clean, first-class condition,
including making all necessary repairs and replacements. Tenant
shall further, at its own cost and expense, repair or restore any
damage or injury to all or any part of the Building caused by
Tenant or Tenant’s agents, employees, invitees, licensees,
visitors or contractors, including but not limited to any repairs
or replacements necessitated by (i) the construction or
installation of improvements to the Premises by or on behalf of
Tenant, and (ii) the moving of any property into or out of the
Premises. If Tenant fails to make such repairs or replacements
promptly, Landlord may, at its option, upon prior reasonable notice
to Tenant (except in an emergency) make the required repairs and
replacements and the costs of such repair or replacements shall be
charged to Tenant as Additional Rent and shall become due and
payable by Tenant with the monthly installment of Base Rent next
due hereunder.
12
24.
Alterations and Improvements/Liens.
(a)
Except for minor, decorative alterations which do not affect the
Building structure or systems, are not visible from outside the
Premises and do not cost in excess of $10,000.00 in the aggregate,
Tenant shall not make or allow to be made any alterations, physical
additions or improvements in or to the Premise
