<PAGE>
Exhibit 10.74
OFFICE LEASE AGREEMENT
BASIC LEASE INFORMATION
1. Date:
October 29, 2003
2. Landlord:
Old Gettysburg Associates
3. Tenant:
Select Medical Corporation
4. Guarantor:
None
5. Building:
Executive Park West I, 4718 Old Gettysburg Road,
Mechanicsburg, PA 17055
6. Premises:
Suite 205, back left
side of building
7. Commencement Date:
November
1, 2003
8. Expiration Date:
October 31, 2008 (a
five year term)
9. Rentable Area of the
Building:
36,168
Rentable square feet
10. Rentable Area of the Premises:
3,008
Rentable square feet
11. Useable Area of the Building:
30,803
Useable square feet
12. Useable Area of the Premises:
2,616
Useable square feet
13. Tenant's Proportionate Share:
8.5%
(Item 12 divided by Item 11)
14. Initial Annual Base Rental:
$52,339.20.00
15. Initial Annual Base Rental Rate:
$17.40 per
Rentable square foot
16. Annual Base Rental Increase
(cumulative) 3.5
%
17. Initial Annual Operating Expense
Allowance:
$19,311.36
18. Initial Annual Operating Expense
Allowance Rate: $6.42
for Rentable square
foot for Fiscal
Year 2003.
19. Annual Operating Expense Allowance
Increase (cumulative): 3 %
20. Fiscal Year:
21. Security Deposit: None payable at the time
the Lease is signed.
(Article
#26)
22. First Rent Check of $4,361.60 payable at the time the Lease is
signed.
(Article
#26)
23. Broker:
None
24. Additional Terms and Conditions:
Landlord shall pay $5/SF per rentable
area of the Premise or $15,040 toward
tenant improvement
<PAGE>
Exhibit 10.74
25. Landlord's Address for Notices:
Old Gettysburg Associates I, c/o Select
Capital Corp
4718 Old Gettysburg Road
Mechanicsburg, PA 17055
Attention:
Laura Martin
26. Tenant's Address for Notices:
Select Medical
Corporation
4718 Old Gettysburg Rd.
Mechanicsburg, PA 17055
Attention: Legal
Counsel
Exhibits A-F are part of this Lease,
identified as follows:
Exhibit A,
Description of Premises
Exhibit B,
Description of Real Property
(1) Exhibit C, Description of Leasehold Improvements
Exhibit D,
Description of Parking Rights
Exhibit E,
Security Card/Key Access
Exhibit F,
Rules and Regulations
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 I
a Pennsylvania general partnership
WITNESS:
By: /s/ John M. Ortenzio
----------------------
-----------------------------------------
John M. Ortenzio, General Partner
Tenant:
ATTEST:
By:/s/ Scott A. Romberger
-----------------------
-----------------------------------------
Scott A. Romberger, Vice President
<PAGE>
Exhibit 10.74
TABLE OF CONTENTS
<TABLE>
<S>
<C>
ARTICLE 1 -
PREMISE...............................................................
4
ARTICLE 2 -
TERM..................................................................
4
ARTICLE 3 - DELIVERY OF THE PREMISES TO
TENANT....................................
5
ARTICLE 4 - ACCEPTANCE OF THE PREMISESES
AND BUILDING BY TENANT...................
5
ARTICLE 5 -
RENTAL................................................................
5
ARTICLE 6 - OPERATING
EXPENSES....................................................
6
ARTICLE 7 - SERVICES BY
LANDLORD..................................................
8
ARTICLE 8 -
UTILITIES.............................................................
8
ARTICLE 9 -
USE...................................................................
9
ARTICLE 10 - LAWS, ORDINANCES AND
REQUIREMENTS OF PUBLIC AUTHORITIES............... 10
ARTICLE 11 - OBSERVANCE OF RULES AND
REGULATIONS................................... 10
ARTICLE 12 -
ALTERATIONS...........................................................
11
ARTICLE 13 -
LIENS.................................................................
11
ARTICLE 14 - ORDINARY
REPAIRS......................................................
11
ARTICLE 15 -
INSURANCE.............................................................
12
ARTICLE 16 - DAMAGE BY FIRE OR OTHER
CAUSES........................................ 13
ARTICLE 17 -
CONDEMNATION..........................................................
14
ARTICLE 18 - ASSIGNMENT AND SUBLETTING
............................................ 15
ARTICLE 19 -
INDEMNIFICATION.......................................................
15
ARTICLE 20 - SURRENDER OF THE
PREMISES............................................. 16
ARTICLE 21 - ESTOPPEL
CERTIFICATES.................................................
16
ARTICLE 22 -
SUBORDINATION.........................................................
17
ARTICLE 23 -
PARKING...............................................................
17
ARTICLE 24 - DEFAULT AND
REMEDIES..................................................
18
ARTICLE 25 - WAIVER BY
TENANT......................................................
20
ARTICLE 26 - SECURITY
DEPOSIT......................................................
20
ARTICLE 27 - ATTORNEY'S FEES AND LEGAL
EXPENSES.................................... 20
ARTICLE 28 -
NOTICES...............................................................
21
ARTICLE 29 -
MISCELLANEOUS.........................................................
21
EXHIBIT "A" - DESCRIPTION OF
PREMISES.............................................. 25
EXHIBIT "B" - DESCRIPTION OF
BUILDING.............................................. 26
EXHIBIT "C" - DISCRIPTION OF PARKING
RIGHTS........................................ 27
EXHIBIT "D" -
PARKING..............................................................
28
EXHIBIT "E" - SECURITY CARD
ACCESS.................................................
29
EXHIBIT "F" - RULES AND
REGULATIONS................................................
30
</TABLE>
<PAGE>
Exhibit 10.74
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, which Building is situated on the
real property described in Exhibit B
hereto. 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 C 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.
2
<PAGE>
Exhibit 10.74
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 C
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 C 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 in
Exhibit C 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
punchlist and on Exhibit C 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 shall be paid
to Landlord, without deduction or
offset, at the address of Landlord
specified in the
3
<PAGE>
Exhibit 10.74
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, Proportionate Share of
Operating Expense Excess (as defined in
Section 6.01), Parking Rental (as
defined in Exhibit D 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
Section 6.01. From the Commencement Date
until the Fiscal Year End following the
Commencement Date, Tenant shall pay on a
monthly basis in advance, without
demand, on the first day of each calendar
month, as part of the Annual Base
Rental, Tenant's Proportionate Share of
Operating Expenses (as defined in
article 6 and 7) in excess of the Initial
Operating Expense Allowance
("Operating Expense Excess"). Such payments
shall be calculated and made as
follows:
(a) Before the
beginning of each Fiscal Year during the Term,
Landlord shall furnish Tenant with Landlord's reasonable
estimate of the Operating Expenses and any anticipated
Operating Expense Excess for such Fiscal Year. On the first
day of each month during such Fiscal Year, Tenant shall pay
Tenant's Proportionate Share of such Fiscal Year's estimated
Operating Expense Excess in monthly installments of 1/12th of
Tenant's Proportionate Share of the estimated annual Operating
Expense Excess for such Fiscal Year.
(b) By the
first day of March of each Fiscal Year during Tenant's
occupancy (beginning with the Fiscal Year following the
Commencement Date), or as soon thereafter as possible,
Landlord shall furnish to Tenant a statement of Landlord's
actual Operating Expense Excess for the previous Fiscal Year
or fraction thereof if the Commencement Date occurred after
the first day of the previous Fiscal Year. If the actual
Operating Expense Excess is greater than Landlord's estimate,
a lump sum payment, considered Rental for all purposes, shall
be made by Tenant, within 30 days of the delivery of that
statement, equal to Tenant's Proportionate Share of the actual
Operating Expense Excess over the Landlord's estimate for the
previous Fiscal Year. If the actual Operating Expense Excess
is less than Landlord's estimate, a lump sum payment shall be
made by Landlord, within 30 days of delivery of that
statement, equal to Tenant's Proportionate Share of the actual
Operating Expense Excess under Landlord's estimate. The effect
of this reconciliation payment or adjustment
4
<PAGE>
Exhibit 10.74
is that the Tenant shall pay during each Fiscal Year during
the Term, in addition to the Annual Base Rental, Tenant's
Proportionate Share of Operating Expenses in excess of an
amount equal to that Fixed years allowance. Said amount is
based upon 12 months of building operation with all tenants
utilizing all services provided by Landlord pursuant to
Article 7 and Article 8.
(c) The Annual
Operating Expense Allowance shall be increased each
fiscal year by the Annual Operating Expense Allowance Increase
(cumulative) as specified in the Basic Lease Information.
(d) With
respect to the last Fiscal Year or partial Fiscal Year,
as the case may be, during the Term, an adjustment will be
made between Landlord and Tenant pursuant to Section 6.02, at
the appropriate time after the Expiration Date. The provisions
of the paragraph (d) shall survive termination of this Lease
with respect to such adjustment and any payments owing by
either party to the other after termination hereof.
Section 6.02. As used herein, "Operating
Expense" means all expenses, costs, and
disbursements of every kind which Landlord
pays or incurs in connection with the
ownership, operation (including, without
limitation, the costs of utilities),
and maintenance of the Building, Parking
Areas, and exterior areas contained
within the boundaries described in Exhibit
B upon which the Building is
situated. All Operating Expenses shall be
determined according to generally
accepted accrual accounting principles
which shall be consistently applied.
Operating Expenses shall include, but are
not limited to, the following:
(a) Wages,
salaries, and fees of all personnel or entities (exclusive of
Landlord's executive personnel) directly engaged in the
operation,
maintenance, repair, or security of the Building, including
taxes,
insurance, and benefits relating thereto. As to personnel not
involved
exclusively with the administration and operation of the Building,
only
those portions of such expenses reasonably allocable to the
Building
shall be included.
(b) All
supplies and materials used in the operation and maintenance of
the
Building, except for special lighting, relamping and ballasts
within
any Tenant space.
(c) Expenses
of all maintenance, janitorial, security, and service
agreements for the Building and the equipment therein,
including,
without limitation, alarm service, janitorial services, exterior
window
cleaning, elevator maintenance, landscaping, parking facility
maintenance, roadway and utility maintenance and cleaning, etc.
(d) Expenses
of all insurance relating to the Building for which Landlord
is responsible hereunder, or which Landlord considers
reasonably
necessary for the operation of the Building, including, without
limitation, the cost of property, casualty and liability
insurance
applicable to the Building and Landlord's personal property used
in
connection therewith, and the cost of business interruption or
rental
insurance.
(e) All taxes,
assessments, and other governmental charges, now or
hereafter applicable to the Building, or any portion thereof, or
to
Landlord's personal property used in connection therewith, and
dues
(including those levied by any Association managing all common
areas
and easements) attributable to the Building or its operation,
exclusive
of any inheritance, gift, franchise, income, corporate, or profit
taxes
which may be assessed against Landlord.
5
<PAGE>
Exhibit 10.74
(f) Expenses
of repairs and general maintenance (excluding repairs and
general maintenance paid by proceeds of insurance or by Tenant or
other
third parties, and alterations attributable solely to Tenants of
the
Building).
(g) Landlord's
Costs related to fees paid to individuals or companies
engaged in rendering legal, accounting or technical services
including
efforts to reduce Building Ad Valorem Tax expenses.
(h) All
utility costs to Landlord of the Building (exclusive, however,
of
such special utility services as are provided in Section 8.02
hereof),
including, without limitation, water, power, fuel, heating,
lighting,
air conditioning, and ventilation.
Operating Expenses shall not include
specific costs especially billed to and
paid by specific Tenants such as above
Building Standard janitor service, above
Building Standard utility service, or other
services above Building Standard.
Tenant shall be liable for all taxes levied
or assessed against personal
property, furniture, fixtures, or Tenant
finish placed by Tenant in the
Premises. If any such taxes for which
Tenant is liable are levied or assessed
against Landlord or Landlord's property,
and Landlord elects to pay the taxes
based on such increase, Tenant shall pay to
Landlord upon demand that part of
such taxes for which Tenant is liable
hereunder; provided that Tenant shall have
the right to contest such taxes if Tenant
shall have furnished Landlord with
security sufficient in Landlord's
reasonable determination.
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 as are customarily provided to
Tenants in comparable office buildings in the greater
Harrisburg area; and
(c) the
utility services provided for in Article 8 below.
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
6
<PAGE>
Exhibit 10.74
all of which services shall be provided to
Tenant by Landlord and paid for by
Landlord as part of the Operating Expense
Allowance. 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 therefor 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. With respect to such
after hours costs, Landlord acknowledges
that the current after hours charge is
$35.00 per hour. 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 and for
typewriters, dictaphones, personal
computers, calculating machines, and other
normal office machines of similar low
electrical consumption, all of which power
shall be paid for by Landlord as a part of
the Operating Expense Allowance.
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.
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 typewriters,
dictaphones, calculating machines and
other normal office machines of similar low
consumption, then the usage of such
additional consumption shall be determined,
at Landlord's election, either
7
<PAGE>
Exhibit 10.74
(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 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 F). Landlord shall at all
times have the right to make reasonable
exchanges 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
8
<PAGE>
Exhibit 10.74
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 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
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Exhibit 10.74
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 C), 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.
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
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