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OFFICE LEASE AGREEMENT BASIC LEASE INFORMATION

Office Lease Agreement

OFFICE LEASE AGREEMENT BASIC LEASE INFORMATION | Document Parties: SELECT MEDICAL CORP | Old Gettysburg Associates II You are currently viewing:
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SELECT MEDICAL CORP | Old Gettysburg Associates II

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Title: OFFICE LEASE AGREEMENT BASIC LEASE INFORMATION
Governing Law: Pennsylvania     Date: 8/16/2005
Industry: Healthcare Facilities     Sector: Healthcare

OFFICE LEASE AGREEMENT BASIC LEASE INFORMATION, Parties: select medical corp , old gettysburg associates ii
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<PAGE>

 

                                                                    Exhibit 10.1

 

                             OFFICE LEASE AGREEMENT

                             BASIC LEASE INFORMATION

 

1. Date: August 10, 2005

 

2. Landlord: Old Gettysburg Associates II

 

3. Tenant: Select Medical Corporation

 

4. Guarantor: None

 

5. Building: 4720 Old Gettysburg Road

 

6. Premises: Suites 103-104-201B-202

 

7. Commencement Date: See 21

 

8. Expiration Date: 60 months after commencement date

 

9. Rentable Area of the Building: Approx. 42,987 Rentable square feet

 

10. Rentable Area of the Premises: Approx. 8,615 Rentable square feet

 

11. Tenant's Proportionate Share 20%

 

12. Initial Annual Base Rental: Suite 103/104 - $86,617.37

                                Suite 201B - $23,610.44 Suite 202 - $58,712.34

 

13. Initial Annual Base Rental Rate: $19.61 per Rentable square foot

 

14. Annual Base Rental Increase (cumulative) 3 %

 

15. Fiscal Year: Twelve Months ending December 31

 

16. Security Deposit: none payable at the time the Lease is signed. (Article

     #26)

 

17. First Rent Check ________ payable at the time the Lease is signed. (Article

      #26) Suite 103/104 - $7,218.11 Suite 201B - $1,967.54 Suite - $4,892.70

 

18. Broker: None

 

19. Landlord's Address for Notices: Old Gettysburg Associates II

                                    c/o Select Capital Commercial Properties

                                    4718 Old Gettysburg Road, Suite 405

                                    Mechanicsburg, PA 17055

                                     Attention: John M. Ortenzio

 

                                                                               1

<PAGE>

 

                                                                    Exhibit 10.1

 

20. Tenant's Address for Notices: Select Medical Corporation

                                  4720 Old Gettysburg Road

                                  Mechanicsburg, PA 17055

                                  Attention: General Counsel

 

21. Other Terms and Conditions:

 

                  Suite 103-104    Commencement date August 1, 2005

 

                  Suite 201B       Commencement date August 1, 2005

 

                  Suite 202        Commencement date August 1, 2005

 

                                                                                2

<PAGE>

 

                                                                    Exhibit 10.1

 

Exhibits A-F are part of this Lease, identified as follows:

 

Exhibit A,      Description of Premises

 

Exhibit B,      Description of Leasehold Improvements/Finish Schedule

 

Exhibit C,      Description of Parking Rights

 

Exhibit D,      Security Card/Key Access

 

Exhibit E,      Rules and Regulations

 

Exhibit F,      Deleted

 

The foregoing Basic Lease Information is hereby incorporated into and made a

part of the Office Lease Agreement which is described herein and attached. Each

reference in the Lease to any information and definitions contained in the Basic

Lease Information shall mean and refer to the information and definitions

hereinabove set forth. In the event of any conflict between any Basic Lease

Information and the Lease, the Lease shall control.

 

                                  LANDLORD:

 

                                  OLD GETTYSBURG ASSOCIATES II

 

                                  By: SELECT CAPITAL COMMERCIAL PROPERTIES, INC.

                                      Its general partner

 

WITNESS: /s/ Molly Fidler          By: /s/ John M. Ortenzio   

        _______________________       _________________________________

                                         John M. Ortenzio,

                                         President

 

                                  TENANT:

 

                                  SELECT MEDICAL CORPORATION

 

WITNESS: /s/ Molly Fidler          By: /s/ Michael E. Tarvin

        ________________________      _________________________________

                                         Michael E. Tarvin,

                                         Senior Vice President

 

                                                                               3

<PAGE>

 

                                                                    Exhibit 10.1

 

                                TABLE OF CONTENTS

 

<TABLE>

<CAPTION>

                                                                                                       Page

<S>                                                                                                    <C>

ARTICLE 1 PREMISES.............................................................................          5

ARTICLE 2 TERM.................................................................................          5

ARTICLE 3 DELIVERY OF THE PREMISES TO TENANT...................................................          6

ARTICLE 4 ACCEPTANCE OF THE PREMISES AND BUILDING BY TENANT....................................          6

ARTICLE 5 RENTAL...............................................................................          6

ARTICLE 6 OPERATING EXPENSES...................................................................          7

ARTICLE 7 SERVICES BY LANDLORD.................................................................          7

ARTICLE 8 UTILITIES............................................................................          8

ARTICLE 9 USE..................................................................................          9

ARTICLE 10 LAWS, ORDINANCES AND REQUIREMENTS OF PUBLIC AUTHORITIES.............................          9

ARTICLE 11 OBERVANCE OF RULES AND REGULATIONS..................................................         10

ARTICLE 12 ALTERATIONS.........................................................................         10

ARTICLE 13 LIENS...............................................................................         10

ARTICLE 14 ORDINARY REPAIRS....................................................................         11

ARTICLE 15 INSURANCE...........................................................................         11

ARTICLE 16 DAMAGE BY FIRE......................................................................         13

ARTICLE 17 CONDEMNATION........................................................................         14

ARTICLE 18 ASSIGNMENT AND SUBLETTING...........................................................         14

ARTICLE 19 INDEMNIFICATION.....................................................................         15

ARTICLE 20 SURRENDER OF PREMISES...............................................................         15

ARTICLE 21 ESTOPPEL CERTIFICATES...............................................................         16

ARTICLE 22 SUBORDINATION.......................................................................         16

ARTICLE 23 PARKING.............................................................................         17

ARTICLE 24 DEFAULT AND REMEDIES................................................................         17

ARTICLE 25 WAIVER..............................................................................         19

ARTICLE 26 SECURITY DEPOSIT....................................................................         19

ARTICLE 27 ATTORNEYS FEES AND LEGAL EXPENSES...................................................         19

ARTICLE 28 NOTICES.............................................................................         20

ARTICLE 29 MISCELLANEOUS.......................................................................         20

EXHIBIT "A" FLOOR PLAN.........................................................................         24

EXHIBIT "B" LEASEHOLD IMPROVEMENTS/FINISH SCHEDULE.............................................         25

EXHIBIT "C" PARKING RIGHTS.....................................................................         26

EXHIBIT "D" SECURITY CARD/KEY ACCESS...........................................................         27

EXHIBIT "E" RULES AND REGULATIONS..............................................................         28

EXHIBIT "F" INTENTIONALLY LEFT BLANK...........................................................         31

</TABLE>

 

                                                                                4

<PAGE>

 

                                                                    Exhibit 10.1

 

                             OFFICE LEASE AGREEMENT

 

THIS Lease, dated as of the date specified in the Basic Lease Information which

is attached hereto and incorporated herein for all purposes, is made between

Landlord and Tenant.

 

                                    ARTICLE 1

 

                                    PREMISES

 

Landlord leases to Tenant, and Tenant leases from Landlord for the Term (as

defined below) and subject to the provisions hereof, to each of which Landlord

and Tenant mutually agree, the Premises, which Premises is more particularly

described in the floor plans in EXHIBIT A hereto, together with its

appurtenances, including the right to use, in common with others, the lobbies,

entrances, stairs, elevators, off-street parking and loading areas (for loading

and unloading of materials and supplies), and other public portions of the

Building. The Premises shall constitute part of the "Rentable Area," which shall

be determined and defined by Landlord using standards adopted by Building Owners

and Managers Association (BOMA). For purposes of this Lease, the Rentable Area

of the Building and the Rentable Area of the Premises are as provided in the

foregoing Basic Lease Information. The term "Common Areas" shall mean all of the

common facilities now or hereafter under, over, in or adjacent to the Building

designed and intended for use by all Tenants in the Building in common

facilities now or hereafter under, over, in or adjacent to the Building designed

and intended for use by all Tenants in the Building in common with Landlord and

each other.

 

                                    ARTICLE 2

 

                                      TERM

 

Section 2.01. The term of this Lease (the "Term") shall begin on the

Commencement Date. The Commencement Date shall be the earlier of the date:

 

      (a)    specified in the Basic Lease Information provided Landlord has

            delivered the Premises with the Building Standard Leasehold

            Improvements as set forth on EXHIBIT A AND B substantially

            completed: or

 

      (b)    of Tenant's occupancy of the Premises for the conduct of Tenant's

            business (i.e. not occupancy for construction purposes) (the

            "Commencement Date").

 

Unless sooner terminated, the Term shall end at midnight on the Expiration Date

specified in the Basic Lease Information.

 

Section 2.02 Provided Tenant performs all of Tenant's obligations under this

Lease, including Tenant's covenant for the payment of Rental as defined below,

Tenant shall, during the Term, peaceably and quietly enjoy the Premises without

disturbance from Landlord; subject, however, to the terms of this Lease and any

deeds of trust, restrictive covenants, ground leases, easements, and other

encumbrances to which this Lease now or may become subject and subordinate.

 

                                                                                5

<PAGE>

 

                                                                    Exhibit 10.1

 

                                    ARTICLE 3

 

                       DELIVERY OF THE PREMISES TO TENANT

 

Before the Commencement Date, Landlord shall substantially complete the floor(s)

or portions thereof on which the Premises are located and shall construct the

Leasehold Improvements, if any, to be constructed or installed by Landlord

pursuant to the provisions of EXHIBIT A AND B hereto. If for any reason Landlord

cannot deliver the Premises to Tenant by the Commencement Date, this Lease shall

not be void or voidable, nor shall Landlord be liable for any loss or damage

resulting therefrom, except that the Rental shall be waived for the period

between the Commencement Date and the date when Landlord can deliver possession

and Landlord shall extend the Term. Tenant may not enter or occupy the Premises

until it is tendered by Landlord, unless Tenant's entry relates to construction

work in the Premises. The Premises shall be deemed completed and possession

delivered when the Premises is completed to accommodate Tenants use. The terms

of EXHIBIT A AND B hereto shall govern the construction and installation of all

Leasehold Improvements. The term "Building Standard Leasehold Improvements" as

used herein shall mean those Leasehold Improvements which conform to Building

Standard. The term "Non-Building Standard Leasehold Improvements" as used herein

shall mean all Leasehold Improvements which exceed or deviate from Building

Standard. The terms "Building Standard" and "Non-Building Standard" as used

herein shall have the meanings specified and or indicated in EXHIBIT B hereto.

 

                                    ARTICLE 4

 

                ACCEPTANCE OF THE PREMISES AND BUILDING BY TENANT

 

Taking possession of the Premises by Tenant shall be conclusive evidence that

Tenant:

 

      (a)    accepts the Premises as suitable for the purposes for which they are

            leased

 

      (b)    accepts the Building and every part and appurtenance thereof as

            being in a good and satisfactory condition; and

 

      (c)    waives any defects in the Premises and its appurtenances, except for

            the completion of those items, if any, on any punch list remaining

             on EXHIBIT A AND B attached hereto.

 

Landlord shall not be liable, except for negligence or willful misconduct, to

Tenant or any of its agents, employees, licensees, or invitees for any injury or

damage to person or property due to the condition or design of or any defect in

the Building or its mechanical systems and equipment which may exist or occur,

and Tenant, for itself and its agents, employees, licensees, and invitees,

expressly assumes all risks of injury or damage to person or property, either

proximate or remote, resulting from the condition of the Premises or the

Building.

 

                                    ARTICLE 5

 

                                     RENTAL

 

Section 5.01 Tenant covenants and agrees to pay to Landlord as Rental for the

Premises, in lawful money of the United States, 1/12 of the Annual Base Rental

specified in the Basic Lease Information, payable monthly in advance, without

notice or demand, on the first day of each calendar month. In the event of any

late payments, Tenant agrees to pay a late charge for special handling equal to

5% of the Rental due Rental

 

                                                                               6

<PAGE>

 

                                                                    Exhibit 10.1

 

shall be paid to Landlord, without deduction or offset, at the address of

Landlord specified in the Basic Lease Information or such other place as

Landlord may designate in writing. The first monthly installment of Rental shall

be paid on the Commencement Date, except that if Commencement Date is a date

other than the first day of a calendar month, then the monthly Rental for the

first and last fractional months of the Term shall be appropriately prorated.

The term "Rental" as used herein means the sum of Annual Base Rental, Parking

Rental (as defined in EXHIBIT C hereof) and all other sums, whether or not

expressly denominated as rent, shall constitute Rental for the purposes of

Section 502(b)(7) of the Bankruptcy Code U.S.C. 502(b)(7). A service charge of

10% of the amount of any checks returned stamped "NSF" will be due and payable,

in addition to the overdue installments to cover Landlord's extra cost and

expense in handling and processing. No payment by Tenant or receipt by Landlord

of a lesser amount than the monthly installment due under this Lease shall be

deemed to be other than on account of the earliest Rental due hereunder, nor

shall any endorsement or statement on any check or payment as Rental be deemed

an accord and satisfaction, and Landlord may accept such check or payment

without prejudice to Landlord's right to recover the balance of such Rental or

pursue any other remedy provided in this Lease or by law.

 

Section 5.02 Upon the first anniversary of the Commencement Date of this Lease,

and upon each and every anniversary date thereafter, the then current Annual

Base Rental shall be increased by the Annual Base Rental Rate Increase

(cumulative) as specified in the Basic Lease Information.

 

                                    ARTICLE 6

 

                               OPERATING EXPENSES

 

                            Intentionally left blank

 

                                    ARTICLE 7

 

                              SERVICES BY LANDLORD

 

While Tenant is occupying the Premises and is not in default under this Lease,

Landlord shall, at its expense, but subject to the provisions of Articles 6 and

8 hereof, furnish the Premises with:

 

      (a)    passenger elevator service (where applicable) in common with other

            Tenants for access to and from the Premises, reasonably limited

            after normal business hours and on Saturdays, Sundays, and holidays;

 

      (b)    janitorial cleaning services will be provided 5 nights a week to

            Tenants as is customary in comparable office buildings in the

            greater Harrisburg area; and

 

      (c)    utility services provided for in Article 8 below.

 

                                                                               7

<PAGE>

 

                                                                     Exhibit 10.1

 

                                    ARTICLE 8

 

                                    UTILITIES

 

Section 8.01 While Tenant is occupying the Premises and is not in default under

this Lease, Landlord shall furnish Tenant with the following services:

 

      (a)    potable water

 

      (b)    heating, ventilating, and/or air conditioning in season on business

            days from 7:00 a.m. to 6:00 p.m.

 

      (c)    electric lighting for public areas and special Services Areas of the

            Building

 

all of which services shall be provided to Tenant by Landlord and paid for by

Landlord. If Tenant requires air conditioning or heating outside the hours and

days specified above, Landlord shall furnish it only at Tenant's request, and

Tenant will bear the entire charge therefore which will be an amount equal to

the rate charged to Landlord, at that time, plus a reasonable fee to cover

Landlord's overhead costs, with a two-hour minimum. Whenever machines or

equipment that generate abnormal heat are used in the Premises by Tenant which

affect the temperature or humidity otherwise maintained by the central air

conditioning system, Landlord will have the right to install supplemental air

conditioning units in the Premises, and the full total cost thereof, will be

paid by Tenant to Landlord on demand. Notwithstanding anything in this Lease to

the contrary, Tenant shall be responsible for the cost of special lighting

relamping and ballasts within the Premises after initial installation of such

items.

 

Section 8.02 While Tenant is occupying the Premises and is not in default under

this Lease, Landlord will furnish sufficient power for lighting, personal

computers, and other normal office machines of similar low electrical

consumption, all of which power shall be paid for by Landlord . Tenant agrees

that Landlord's aforesaid obligation does not include the provision of power

for:

 

      (a)    special mainframe type computers and/or electronic data processing

            equipment,

 

      (b)    special lighting which has electrical consumption in excess of the

            Building Standard lighting, or

 

      (c)    any item that consumes more than 0.5 kilowatts at rated capacity or

            requires a voltage other than 120 volt single phase

 

and such consumption by Tenant shall be deemed excessive usage for which Tenant

shall pay Landlord upon receipt of an invoice for the cost to Landlord of such

usage. Notwithstanding the aforementioned, Tenant acknowledges that the Building

electrical feeders have normal design limitations, such that

 

      (i)    in no event shall lighting have a design load greater than an

            average of 2.00 watts per Usable square foot, and

 

      (ii)   collectively, Tenant's equipment and lighting shall not have an

            electrical design load greater than an average of 3.75 watts per

            Usable square foot.

 

                                                                               8

<PAGE>

 

                                                                     Exhibit 10.1

 

Upon the existence of Tenant's excess electrical requirements, Landlord may, at

its option, upon not less than 30 days prior written notice to Tenant,

discontinue electric services to the Premises until Tenant reduces its power

consumption to the permissible limits. Landlord will not be liable in any way to

Tenant for failure or defect in the supply or character of electric energy or

any other utility service furnished to the Premises because of any requirement,

act, or omission of the public utility servicing the Building. All installations

of electrical fixtures, appliances, and equipment within the Premises shall be

subject to Landlord's prior approval. Landlord's obligation to furnish utility

services shall be subject to the rules and regulations of any municipal or other

governmental authority regulating the business of providing utility services.

When Tenant's use of the Premises consumes power in excess of the Building

Standard lighting and for normal office machines of similar low consumption,

then the usage of such additional consumption shall be determined, at Landlord's

election, either

 

      (i)    by a survey performed by a reputable consultant selected by Landlord

            (and paid for by Tenant when such additional consumption is proven),

            or

 

      (ii)   by separate meter in the Premises to be installed, maintained and

            read by Landlord at Tenant's sole expense.

 

Section 8.03 Failure to furnish, or any stoppage of, the services provided for

in Article 7 above and in this Article 8 resulting from any cause will not make

Landlord liable in any respect for damages to either person, property, or

business, nor be construed as an eviction of Tenant, nor entitle Tenant to any

abatement of Rental, nor relieve Tenant from its obligations under this Lease.

Landlord will, with reasonable diligence, repair any malfunction of the Building

Improvements or facilities, but Tenant will have no claim for rebate, abatement

of Rental, or damages because of any malfunctions or interruptions in service.

 

                                    ARTICLE 9

 

                                       USE

 

The Premises shall be used for general office purposes, and for no other purpose

and Tenant agrees to use and maintain the Premises in a clean, careful, safe,

lawful, and proper manner.

 

                                   ARTICLE 10

 

             LAWS, ORDINANCES AND REQUIREMENTS OF PUBLIC AUTHORITIES

 

Tenant shall, at its sole expense,

 

      (i)    comply with all laws, orders, ordinances, and regulations of

            federal, state, county, and municipal authorities having

            jurisdiction over the Premises,

 

      (ii)   comply with any direction made pursuant to law of any public officer

            or officers requiring abatement of any nuisance, or imposing any

            obligation, order, or duty upon Landlord or Tenant arising from

            Tenant's use of the Premises or from conditions which have been

            created by or at the insistence of Tenant or required by reason of a

            breach of any of Tenant's obligations hereunder, and

 

      (iii) indemnify Landlord and hold Landlord harmless from any loss, cost,

            claim, or expense which Landlord may incur or suffer by reason of

             Tenant's failure to comply with its

 

                                                                               9

<PAGE>

 

                                                                    Exhibit 10.1

 

            obligations under clauses (i) or (ii) above. If Tenant receives

            written notice of violation of any such law, order, ordinance, or

            regulation, it shall promptly notify Landlord thereof.

 

                                   ARTICLE 11

 

                       OBSERVANCE OF RULES AND REGULATIONS

 

Tenant and its employees, agents, visitors, and licensees shall observe

faithfully and comply strictly with all Rules and Regulations attached to this

Lease (EXHIBIT E). Landlord shall at all times have the right to make reasonable

changes in and additions to such Rules and Regulation. Any failure by Landlord

to enforce any of the Rules and Regulations now or hereafter in effect, either

against Tenant or any other Tenant in the Building, shall not constitute a

waiver of any such Rules and Regulations. Landlord shall not be liable to Tenant

for the failure or refusal by any other Tenant, guest, invitee, visitor, or

occupant of the Building to comply with any of the Rules and Regulations, but

Landlord shall, after receipt of notice, take reasonable action to assure

compliance.

 

                                   ARTICLE 12

 

                                   ALTERATIONS

 

Section 12.01 Tenant may not, at any time during the Term, without Landlord's

prior written consent (which consent shall not be unreasonably withheld), make

any alterations to the Premises. All alterations shall be made at Tenant's

expense, either by Tenant's contractors which have been approved in writing by

Landlord, or at Landlord's option, by Landlord's contractors on terms reasonably

satisfactory to Tenant, including a fee of 15% of the actual costs to Landlord

for performing such work to cover Landlord's overhead.

 

Section 12.02 All Leasehold Improvements (whether Building Standard or

Non-Building Standard), alterations, and other physical additions made or

installed by or for Tenant in or to the Premises shall be and remain Landlord's

property, except Tenant's furniture, furnishings, personal property, and

moveable trade fixtures and shall not be removed without Landlord's written

consent.

 

                                   ARTICLE 13

 

                                      LIENS

 

Tenant shall keep the Premises, the Building, and the property on which the

Building is located, free from any liens arising from any work performed,

materials furnished, or obligations incurred by or at the request of Tenant.

Nothing contained in this Lease shall be construed as Landlord's consent to any

performance of labor or furnishing of any materials for any specific

improvements, alteration, or repair of, or to, the Premises, that would result

in any liens against the Premises or liability of the Landlord. If, based upon

acts of Tenant, any lien is filed against the Premises, the Building, the

Property on which the Building is located, or Tenant's Leasehold interests

therein, Tenant shall discharge same within 10 days after its filing. If Tenant

fails to discharge such lien within such period, then, in addition to any other

right or remedy of Landlord, Landlord may, at its election, discharge the lien

by either paying the amount claimed to be due, obtaining the discharge by

deposit with a court or a title company, or by bonding. Tenant shall pay on

demand any amount paid by Landlord for reasonable attorneys' fees and other

legal expenses of Landlord incurred in defending any such action or in obtaining

the discharge of such lien, together with all necessary

 

                                                                              10

<PAGE>

 

                                                                     Exhibit 10.1

 

disbursements in connection therewith, to double the amount of the lien claim

plus a sufficient amount to cover any penalties, interest, attorneys' fees,

court costs, and other legal expenses resulting from such contest. This bond

shall name Landlord and such other parties as Landlord may direct as

beneficiaries thereunder.

 

                                   ARTICLE 14

 

                                ORDINARY REPAIRS

 

Tenant shall, at all times during the Term hereof and at Tenant's sole cost and

expense, keep the Premises and every part thereof in good condition and repair,

ordinary wear and tear, fire and other casualty excepted. Subject to Article 20,

section 20.02 herein, Tenant shall, at the end of the term hereof, surrender the

Premises, as repaired, to Landlord in the same condition as when received,

ordinary wear and tear excepted. If Tenant fails to make such repairs promptly,

Landlord may, at its option, make such repairs, and Tenant shall pay Landlord on

demand Landlord's actual costs in making repairs plus a fee of (15%) to cover

Landlord's overhead.

 

                                   ARTICLE 15

 

                                    INSURANCE

 

Section 15.01 Tenant shall, during the Term, at its sole expense, keep in force,

with Tenant, Landlord, and the mortgagees and ground lessors of Landlord named

as additional insured thereunder (except with respect to Worker's Compensation

coverage) all as their respective interests may appear, the following insurance:

 

      (a)    All Risk Insurance (including fire, extended coverage, vandalism,

            malicious mischief, extended perils, sprinkler leakage and debris

            removal) upon property of every description and kind owned by Tenant

             and located in the Building or for which Tenant is legally liable or

            installed by or on behalf of Tenant including, without limitation,

            fittings, installations, fixtures, removable trade fixtures,

            Non-Building Standard Leasehold Improvements (as defined in EXHIBIT

            B), and alterations, in an amount not less than the full replacement

            cost thereof. If there is a dispute as to the amount which comprises

            full replacement cost, the decision of Landlord or the mortgagees of

            Landlord shall be conclusive and binding.

 

      (b)    Commercial liability insurance coverage to include death, personal

            injury, bodily injury (not less that $1,000,000 limits), broad form

             property damage (not less than $1,000,000 limits), fire sprinkler

            hazard, operations hazard, owner's protective coverage, contractual

            liability, and products and completed operations liability, with

            combined single liability limits not less than $1,000,000. Such

            coverage shall insure against all liability of Tenant and its

            authorized representatives and visitors arising out of, and in

            connection with, Tenant's use or occupancy of the Premises.

 

      (c)    Worker's Compensation and Employer's Liability Insurance, with a

            waiver of subrogation endorsement, in form and amount satisfactory

            to Landlord.

 

      (d)    Any other form or forms of insurance as Tenant or Landlord or the

            mortgagees of Landlord may reasonably require from time to time in

            form, in amounts, and for insurance risks against which a prudent

            Tenant of a comparable size and in a comparable business would

             protect itself.

 

                                                                              11

<PAGE>

 

                                                                    Exhibit 10.1

 

All policies shall be issued by insurers with a Best's Insurance Reports rating

of A or better and shall be in form satisfactory to Landlord. Tenant agrees that

certificates of insurance on the Landlord's standard form, or certified copies

of each such insurance policy, naming Landlord and its mortgagees as additional

insured, will be delivered to Landlord not later than 5 days prior to the date

that Tenant takes possession of any part of the Premises. All policies shall

contain an undertaking by the insurers to notify Landlord and the mortgagees of

Landlord in writing, by Registered U.S. Mail, not less than 30 days before any

material change, reduction in coverage, cancellation, or other termination

thereof. All insurance shall be primarily as to Landlord and not participating

with any other available insurance. So long as Tenant is not in default,

proceeds of Tenant's insurance shall be available to repair or replace the

insured fixtures and equipment.

 

Section 15.02 During the Term, Landlord shall insure the Building (but excluding

Non-Building Standard Leasehold Improvements and any other property which Tenant

is obligated to insure under Section 15.01 hereof) against damage by fire and

standard extended coverage perils in an amount equal to the full replacement

cost thereof, and shall provide public liability insurance in such amounts and

with such deductions as Landlord considers appropriate. Landlord may, but shall

not be obligated to, take out and carry any other form or forms of insurance as

it or Landlord's mortgagees may reasonably determine appropriate.

Notwithstanding any contribution by Tenant to the cost of insurance premiums, as

provided herein, Tenant acknowledges that it has no right to receive any

proceeds from any insurance policies carried by Landlord. Landlord will not be

required to carry insurance of any kind on any Non-Building Standard Leasehold

Improvements, on Tenant's furniture or furnishings, or on any of Tenant's

fixtures, equipment, improvements, or appurtenances under this Lease; and

Landlord shall not be obligated to repair or replace same.

 

Section 15.03 Tenant shall not keep in the Premises any article which may be

prohibited by any reasonable insurance policy periodically in force covering the

Building. If Tenant's occupancy results in any increase in premiums for the

insurance carried by Landlord, Tenant shall pay any such increase in premiums as

additional Rental within 10 days after being billed therefore. Tenant shall

promptly comply with all reasonable requirements of the insurance authority or

any present or future insurer relating to the Premises and the Building.

 

Section 15.04 If any of Landlord's insurance policies shall be cancelled or

cancellation shall be threatened or the coverage hereunder reduced or threatened

to be reduced, or if the premiums on any of Landlord's insurance policies are

increased or threatened to be increased, in any way because of Tenant's use of

the Premises and, if Tenant fails to remedy the cause thereof within 48 hours

after notice, Landlord may, at its option, either terminate this Lease or enter

upon the Premises and attempt to remedy such condition, and Tenant shall

promptly pay the cost thereof to Landlord as additional Rental. Landlord shall

not be liable for any damage or injury caused to any property of Tenant or of

others located on the Premises resulting from such entry. If Landlord is unable

to remedy such condition, then Landlord shall have all of the remedies provided

for in this Lease in the event of a default by Tenant.

 

Section 15.05 All policies covering real or personal property which either party

obtains affecting the Premises shall include a clause or endorsement denying the

insurer any rights of subrogation against the other party to the extent rights

have been waived by the insured before the occurrence of injury or loss.

Landlord and Tenant hereby mutually waive any rights of recovery against the

other for injury or loss due to hazards covered by insurance containing such a

waiver of subrogation clause or endorsement to the extent of the injury or loss

covered thereby.

 

                                                                               12

<PAGE>

 

                                                                    Exhibit 10.1

 

                                   ARTICLE 16

 

                          DAMAGE BY FI


 
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