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LEASE AGREEMENT
BETWEEN
MARYLAND ECONOMIC DEVELOPMENT CORPORATION
AND
HUMAN GENOME SCIENCES, INC.
DATED DECEMBER 1, 1999
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LIST OF EXHIBITS
EXHIBIT A Description of Land
EXHIBIT B Description of Construction Contract
EXHIBIT C List of Tenant's Equipment
EXHIBIT D Schedule of Option Purchase Prices
EXHIBIT E Notice and Payment Addresses
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LEASE AGREEMENT
THIS LEASE AGREEMENT (this "Lease") is made as of December 1, 1999, by
and between MARYLAND ECONOMIC DEVELOPMENT CORPORATION, a body politic and
corporate and an instrumentality of the State of Maryland ("Landlord") and HUMAN
GENOME SCIENCES, INC., a Delaware corporation ("Tenant").
RECITALS
A. Landlord, at the request of Tenant, has acquired from
Montgomery County, Maryland a certain parcel of land located at the Johns
Hopkins Belward Research Campus in Montgomery County, Maryland, more
particularly described on Exhibit A attached hereto and made a part hereof (the
"Land") as further defined in Paragraph 2 hereof).
B. Landlord acquired the Land at the request of Tenant for the sole
purposes of
(a) constructing on the Land, a process development and manufacturing
plant consisting of approximately 84,000 square feet in accordance with plans
and specifications approved by Landlord and Tenant,
(b) leasing to Tenant, pursuant to that certain Lease Agreement dated as
of December 1, 1997 between Landlord and Tenant, the 1997 Leased Premises (as
that term is defined in Paragraph 2 hereof),
(c) constructing on the Land, an addition to such process development and
manufacturing plant consisting of approximately 43,000 square feet in accordance
with plans and specifications approved by Landlord and Tenant, and
(d) leasing to Tenant, pursuant to this Lease, the Leased Premises (as
that term is defined in Paragraph 2 hereof).
C. The parties desire to enter into this Lease defining their
respective rights, duties, obligations and liabilities relating to the Leased
Premises.
AGREEMENTS
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Landlord and Tenant hereby
covenant and agree as follows:
1. Demise of Leased Premises. In consideration of the rents and
covenants herein stipulated to be paid and performed, Landlord
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hereby demises and lets to Tenant, and Tenant hereby demises and lets from
Landlord, the Leased Premises.
2. Certain Definitions. The following terms shall have the
definitions provided below. Unless specifically provided otherwise, all
accounting terms have the definitions given them in accordance with GAAP
(hereinafter defined) as applied to the applicable Person on a consistent basis
by its accountants in the preparation of its previous annual financial
statements.
Act of Bankruptcy means with respect to any Person, the filing of a
petition in bankruptcy under the Bankruptcy Code, or the commencement of a
proceeding under any other applicable law concerning insolvency, reorganization
or bankruptcy, by or against such Person as debtor.
Accumulated Funding Deficiency means an "accumulated funding deficiency"
as defined in Section 302 of ERISA or Section 412(a) of the Code.
Additional Improvements means the buildings, structures and other
improvements, including "fit-outs", constituting an addition to the
Improvements, consisting of approximately 43,000 square feet, constructed on the
Land in accordance with Plans approved by Landlord and Tenant.
Additional Rent means Additional Rent as defined in Paragraph 7.
Affiliate means: (a) any Person in which Tenant legally or beneficially
owns or holds, directly or indirectly, any capital stock or other equity
interest; (b) any Person that is a partnership in which Tenant is a partner, or
a joint venturer in which Tenant is a joint venturer or a limited liability
company of which Tenant is a managing member; (c) any Person that is a director,
officer, employee, stockholder (legally or beneficially) or other affiliate of
any of the foregoing or of Tenant; and (d) any Person that directly or
indirectly controls, is under the control of, or is under common control with,
Tenant, including, without limitation, any Person that directly or indirectly
has the right or power to direct the management or policies of Tenant and any
Person whose management or policies Tenant directly or indirectly has the right
or power to direct.
Allfirst means Allfirst Bank, a Maryland state-chartered commercial bank
(formerly known as The First National Bank of Maryland, a national banking
association), its successors and assigns.
Allfirst Letter of Credit means that certain Letter of Credit to be
issued by Allfirst in the original stated amount of $4,446,918 for the account
of Landlord as security for the Series A Bonds, as the same may from time to
time be modified, amended, supplemented, renewed or replaced.
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Allfirst Letter of Credit Agreement means that certain Letter of Credit
Agreement between Allfirst and Landlord dated as of December 1, 1999, as the
same may from time to time be modified, amended, supplemented, renewed or
replaced.
Alterations means all changes, additions (including additional
Improvements on the Land), improvements or repairs to, all alterations,
reconstructions, renewals or removals of and all substitutions or replacements
for any of the Improvements, both interior and exterior, structural and
non-structural, and ordinary and extraordinary.
Assignment means the Assignment, Subordination and Non-Disturbance
Agreement by and among Landlord, Tenant and the Banks, dated as of December 1,
1999, together with all amendments thereto and modifications thereof.
Bankruptcy Code means Title 11 of the United States Code, as amended, and
all rules and regulations promulgated pursuant thereto.
Banks means, collectively, Allfirst and First Union.
Basic Rent means Basic Rent as defined in Paragraph 7.
Basic Rent Payment Date means any date on which an installment of Basic
Rent is due pursuant to Paragraph 7.
Beneficiary means, collectively, MIDFA, the Banks and any other Credit
Facility Provider, as Beneficiary under the Deed of Trust.
Bond Documents has the meaning given to such term in the Indenture.
Bond Purchase Drawing has the meaning given to such term in the
Indenture.
Bonds means, collectively, the Series A Bonds and the Series B Bonds.
Building Equipment means the equipment and fixtures to be installed in
the Additional Improvements which are integral to the occupancy of the Leased
Premises as a "tenantable shell" (e.g., all elevators, escalators, shades,
awnings, floor coverings, screens, landscaping and security systems and building
code required plumbing, heating, electrical, ventilation and fire-extinguishing
equipment) and financed with proceeds of the Bonds as evidenced through the
requisitions from the Facility Fund, but excluding therefrom the Tenant's
Equipment.
Change in Control means the occurrence of any of the following: (a) the
sale, lease, transfer, conveyance or other disposition (other than by way of
merger or consolidation) in one or a series of related transactions, of all or
substantially all of
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the assets of Tenant and its Subsidiaries taken as a whole to any "person" (as
such term is used in Section 13(d)(3) of the Exchange Act), (b) the adoption of
a plan relating to the liquidation or dissolution of Tenant, (c) the
consummation of any transaction (including, without limitation, any merger or
consolidation) the result of which is that any "person" (as defined above),
becomes the "beneficial owner" (as such term is defined in Rule 13d-3 and Rule
13d-5 under the Exchange Act), directly or indirectly, of more than 51% of the
voting stock of Tenant.
Closing Date means the date on which fully executed and authenticated
Bonds are issued and initially delivered.
Code means the Internal Revenue Code of 1986, or any applicable
predecessor statutory provision. Each reference to a section of the Code herein
shall be deemed to include the United States Treasury Regulations in effect or
proposed from time to time with respect thereto.
Collateral Pledge Agreement means the Amended and Restated Collateral
Pledge Agreement dated as of December 1, 1999 from Tenant to Landlord, together
with all amendments thereto and modifications thereof.
Commonly Controlled Entity means any trade or business (whether or not
incorporated) which is a member of a "controlled group of corporations" (as such
phrase is used and defined in Section 414(b) of the Code) or which is under
"common control" (as such phrase is used and defined in Section 414(c) of the
Code), and of which Tenant or any Subsidiary of Tenant is a part.
Construction Contract means that certain Construction Contract between
Contractor and Landlord described on Exhibit B hereto.
Contractor means the contractor named in the Construction Contract.
Credit Facilities has the meaning given to such term in the Indenture.
The initial Credit Facilities are the Letters of Credit.
Credit Facility Agreements has the meaning given to such term in the
Indenture. The initial Credit Facility Agreements are the Letter of Credit
Agreements.
Credit Facility Documents has the meaning given to such term in the
Indenture. The initial Credit Facility Documents are the Letter of Credit
Documents.
Credit Facility Providers has the meaning given to such term in the
Indenture. The initial Credit Facility Providers are the Banks.
Deed of Trust means the Deed of Trust dated as of December 1, 1999,
encumbering the Land, the Improvements and the Leased
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Premises, from Landlord to certain individual trustees for the benefit of the
Beneficiary, together with all amendments thereto and modifications thereof.
Default Rate means the Default Rate as defined in Paragraph 7(e).
Encumbrances means Encumbrances as defined in Paragraph 30.
ERISA means the Employee Retirement Income Security Act of 1974, as
amended, and all Laws promulgated pursuant thereto or in connection therewith.
Event of Default means an Event of Default as defined in Paragraph 19.
Exchange Act means the Securities Exchange Act of 1934, as amended.
Facility Fund means the "Facility Fund", as such term is defined in the
Indenture.
First Union means First Union National Bank, a national banking
association, its successors and assigns.
First Union Letter of Credit means that certain Letter of Credit to be
issued by First Union in the original stated amount of $13,340,754 for the
account of Landlord as security for the Series B Bonds, as the same may from
time to time be modified, amended, supplemented, renewed or replaced.
First Union Letter of Credit Agreement means that certain Letter of
Credit Agreement between First Union and Landlord dated as of December 1, 1999,
as the same may from time to time be modified, amended, supplemented, renewed or
replaced.
GAAP means generally accepted accounting principles in the United States
of America in effect from time to time, consistently applied. In the event of a
change in GAAP affecting the covenants contained in Paragraphs 26 or 27 of this
Lease or definitions contained in Paragraph 2 of this Lease relating to such
covenants, such covenants and definitions shall continue to be applied as though
such change in GAAP had not occurred unless and until Landlord, the Credit
Facility Providers, MIDFA, and Tenant shall agree in writing to amend or adjust
such covenants or definitions as deemed necessary as a result of such change in
GAAP.
Hedge means any interest rate swap or similar hedge arrangement in
existence at any time or from time to time between Landlord and any Hedge
Counterparty.
Hedge Agreement means any agreement between Landlord and any Hedge
Counterparty in existence at any time or from time to time, executed in
connection with any Hedge, including (without limitation) the Swap Agreement (as
defined in the Letter of Credit
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Agreements), together with all amendments thereto and modifications thereof.
Hedge Counterparty means any Person, in its capacity as counterparty to
any Hedge Agreement, with which Landlord has entered into any Hedge or may
hereafter at any time or from time to time enter into any Hedge, including
(without limitation) either or both of the Banks and any other Credit Facility
Provider.
Hedge Documents means, collectively, any Hedge Agreement and all other
documents in existence at any time or from time to time, executed and delivered
to evidence, secure, or in connection with, any Hedge.
Impositions means all taxes, including, without limitation, sales and use
taxes (but excluding, except as hereinafter provided, income, franchise, profits
and gross receipt taxes), assessments (including, without limitation, all
assessments for public improvements or benefits), water and sewer rents, rates
and charges, excises, levies, license fees, permit fees, inspection fees and
other authorization fees and other charges or costs of any nature whatsoever, in
each case whether general or special, ordinary or extraordinary, foreseen or
unforeseen, of every character (including all interest and penalties thereon),
which at any time during or in respect of the term hereof may be assessed
against, levied upon, confirmed or imposed on, or in respect of, or be a lien
upon (a) the Leased Premises or any part thereof or any estate, right or
interest therein, (b) any occupancy, use or possession of, or activity conducted
on, the Leased Premises or any part thereof, (c) any Basic Rent or Additional
Rent or other sum reserved or payable by Tenant hereunder, or (d) this Lease or
Landlord. Notwithstanding the foregoing provisions, the term "Impositions" shall
exclude (i) franchise, capital stock or similar taxes, if any, of Landlord and
assessments, levies and liens arising therefrom; (ii) transfer, income, profits
or other taxes, if any, of Landlord, determined on the basis of its net income
or net revenues, and assessments, levies and liens arising therefrom; (iii)
excise, gross receipts or gross income taxes imposed upon or measured by Basic
Rent, Additional Rent or other sums payable by Tenant pursuant to this Lease,
unless the taxes referred to in clauses (i) and (ii) above are in lieu of or a
substitute for any other tax or assessment upon or with respect to the Leased
Premises or any increases therein which, if such other tax or assessment were in
effect, would be payable by Tenant.
Improvements means the buildings, structures and other improvements,
constituting a process, development and manufacturing plant consisting of
approximately 84,000 square feet constructed on the Land in accordance with
plans and specifications approved by Landlord and Tenant.
Indenture means the Trust Indenture dated as of December 1, 1999 between
Landlord and the Trustee, together with all amendments thereto and modifications
thereof.
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Insurance and Award Trustee has the meaning given to that term in
Paragraph 15.
Intercreditor Agreement means the Intercreditor Agreement dated as of
December 1, 1999 among the Banks and MIDFA, together with all amendments thereto
and modifications thereof.
Land means that parcel of land described in Exhibit A attached hereto,
together with the easements, rights and appurtenances thereunto belonging or
appertaining.
Landlord means Maryland Economic Development Corporation, a body politic
and corporate and a public instrumentality of the State of Maryland.
Landlord's Bond Obligations means the "Issuer's Bond Obligations," as
such term is defined in the Indenture.
Landlord's Credit Facility Obligations means the "Issuer's Credit
Facility Obligations", as such term is defined in the Indenture.
Law means the Constitution of the United States and of the State of
Maryland and any statute or rule of law of the United States and of the State of
Maryland.
Lease Documents has the meaning given to such term in Paragraph 25.
Leased Premises means the Additional Improvements and the Building
Equipment.
Legal Requirements means all laws, statutes, codes, acts, ordinances,
orders, judgments, decrees, injunctions, rules, regulations, permits, licenses,
authorizations, directions, requirements and agreements with all governments,
departments, commissions, boards, courts, authorities, agencies, officials and
officers, foreseen or unforeseen, ordinary or extraordinary, which now or at any
time hereafter may be applicable to the use, occupancy, possession, maintenance,
alteration, repair or reconstruction of any of the Leased Premises.
Letters of Credit means, collectively, the Allfirst Letter of Credit and
the First Union Letter of Credit.
Letter of Credit Agreements means, collectively, the Allfirst Letter of
Credit Agreement and the First Union Letter of Credit Agreement.
Letter of Credit Documents has the meaning given to such term in the
Letter of Credit Agreements.
LIBOR Rate means the fluctuating annual rate of interest which shall at
all times equal the interest rate which Allfirst announces and declares from
time to time to be its one month London Interbank
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Offered Rate, adjusted for any Federal Reserve Board requirements imposed on
Allfirst from time to time. All interest at the LIBOR Rate or computed thereon
shall be calculated on the basis of a 360-day year factor applied to actual days
elapsed and shall be adjusted on any date on which a change occurs in the LIBOR
Rate.
Liquidity Covenant means the covenant described in Paragraph 26(j).
MIDFA means the Maryland Industrial Development Financing Authority.
MIDFA Insurance Agreement means the Amended and Restated Insurance
Agreement dated as of December 1, 1999, by and among MIDFA, the Banks and
Landlord, together with all amendments thereto and modifications thereof.
Multiemployer Plan means a multiemployer plan (as defined in ERISA) to
which Tenant, or any Commonly Controlled Entity, as appropriate, has or had an
obligation to contribute.
Net Award has the meaning given to such term in Paragraph 14.
Net Proceeds has the meaning given to such term in Paragraph 15.
Paying Agent has the meaning given to such term in the Indenture.
Permitted Equipment Lien means any encumbrance or other lien upon, or
security interest in, or any equipment lease of, any Tenant's Equipment, or
interest therein, provided that the acquisition to which any such encumbrance,
lien, security interest or lease relates shall not result in a default under any
other provisions of this Lease.
Permitted Use means the Permitted Use as defined in Paragraph 5.
Person means any natural person, firm, association, corporation, company,
trust, partnership, public body or other entity.
Plan means any pension, profit sharing, savings, stock bonus or other
deferred compensation plan which is intended to qualify under Code '401 and is
subject to the requirements of ERISA, together with any related trusts.
Plans means the Plans and Specifications for the Additional Improvements
which have been approved, and which will be approved from time to time, in
writing by Landlord and Tenant, as the same may be modified or amended in
accordance with Paragraph 4.
Prohibited Transaction means a "prohibited transaction" as defined in
Section 406 of ERISA or Section 4975 of the Code.
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Rating Agency means any rating agency which at any time or from time to
times provides or furnishes a rating with respect to the Bonds.
Registrar has the meaning given to such term in the Indenture.
Remarketing Agent has the meaning given to such term in the Indenture.
Remarketing Agreement means the "Placement and Remarketing Agreement" as
such term is defined in the Indenture.
Rent Commencement Date means the Rent Commencement Date as defined in
Paragraph 7(a).
Reportable Event means a "reportable event" as defined by Title IV of
ERISA.
Restrictive Covenants means the covenants and restrictions set forth in
(a) the Declaration of Covenants, Easements and Restrictions (Protective
Covenants) made the 24th day of September, 1997, by The Johns Hopkins
University, and recorded among the Land Records of Montgomery County, Maryland,
in Liber 15181 at folio 074, and (b) The Johns Hopkins University Belward
Research Campus Declaration of Covenants, Conditions, Easements and Restrictions
made the 24th day of September, 1997, by The Johns Hopkins University, and
recorded among the Land Records of Montgomery County, Maryland, in Liber 15181
at folio 084.
Series A Bonds means the $4,375,000 Taxable Variable Rate Demand/Fixed
Rate Revenue Bonds (Human Genome Sciences, Inc. Facility), Series 1999A, being
issued by the Landlord to finance a portion of the costs of the acquisition,
construction and equipping of the Leased Premises.
Series B Bonds means the $13,125,000 Taxable Variable Rate Demand/Fixed
Rate Revenue Bonds (Human Genome Sciences, Inc. Facility), Series 1999B, being
issued by the Landlord to finance a portion of the costs of the acquisition,
construction and equipping of the Leased Premises.
State means the State of Maryland, acting through the Maryland Department
of Business and Economic Development and any other department or agency of the
State of Maryland which makes any of the State Loans to Landlord.
State Loans means, collectively, the following loans made by the State to
Landlord for the purpose of financing a portion of the costs of the acquisition
and construction of the 1997 Leased Premises:
(a) Loan in the principal amount of $2,000,000, from the
Maryland Department of Business and Economic Development
under the Maryland Industrial Land Act;
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(b) Loan in the principal amount of $3,000,000, made by the
Maryland Department of Business and Economic Development
from the Maryland Industrial and Commercial Redevelopment
Fund; and
(c) Loan in the principal amount of $2,000,000, made by the
Maryland Department of Business and Economic Development
from the Maryland Economic Development Opportunities
Program Fund.
State Loan Assignment means the Assignment, Subordination and
Non-Disturbance Agreement by and among Landlord, the Tenant and the State, dated
December 31, 1997, together with all amendments thereto and modifications
thereof.
State Loan Beneficiary means the Beneficiary as such term is defined in
the State Loan Deed of Trust.
State Loan Deed of Trust means the Second Deed of Trust dated December 1,
1997, encumbering the 1997 Leased Premises, from Landlord to certain individual
trustees for the benefit of the State Loan Beneficiary, together with all
amendments thereto and modifications thereof.
State Loan Documents means, collectively, any and all documents executed
and delivered by Landlord as evidence of, as security for, or in connection
with, the State Loans, including (without limitation) the State Loan Deed of
Trust and the State Loan Assignment.
Subsidiary or Subsidiaries means, with respect to any Person (including
Tenant), any present or future Person at least a majority of whose outstanding
Voting Stock shall at the time be owned by such Person (including Tenant) or by
one or more Subsidiaries of such Person, or by such Person (including Tenant)
and one or more Subsidiaries of such Person (including Tenant).
Substantial Completion means the date on which the Additional
Improvements are in such condition that Tenant may commence its final fit out of
the Additional Improvements and move in and a Certificate of Occupancy of a
tenantable shell either has been issued or would be issued except for work to be
performed by Tenant.
Tenant's Equipment means that certain equipment described on Exhibit C
attached hereto (as such Exhibit C may from time to time be updated by the
Tenant to include equipment to be used for the Permitted Use), together with all
replacements thereof. It is anticipated that some or all of Tenant's Equipment
will be leased by Tenant.
Tenant's Subordinated Notes means Tenant's $125,000,000 Human Genome
Sciences, Inc. 5 1/2% Convertible Subordinated Notes Due 2006.
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Term means the Term as defined in Paragraph 6.
Trustee means Allfirst Trust Company, National Association (formerly FMB
Trust Company, National Association), its successors and assigns.
Voting Stock means the shares of any class of capital stock of a Person
having ordinary voting power to elect the directors, managers or trustees
thereof (irrespective of whether or not at the time stock of any class or
classes of such Person shall have or might have voting power by reason of the
happening of any contingencies).
1997 Bond Beneficiary means, collectively, MIDFA, Allfirst and any other
Credit Facility Provider (as defined in the 1997 Lease), as Beneficiary under
the 1997 Bond Deed of Trust.
1997 Bond Deed of Trust means the Deed of Trust dated as of December 1,
1997, encumbering the 1997 Leased Premises, from Landlord to certain individual
trustees for the benefit of the 1997 Bond Beneficiary, together with all
amendments thereto and modifications thereof.
1997 Deeds of Trust means, collectively, the 1997 Bond Deed of Trust and
the State Loan Deed of Trust.
1997 Lease means the Lease Agreement dated as of December 1, 1997,
between Landlord and Tenant, together with all amendments thereto and
modifications thereof
1997 Leased Premises means the Land, the Improvements and the Building
Equipment (as defined in the 1997 Lease).
3. Title.
(a) The Leased Premises are demised and let subject to (i) the
Deed of Trust and the 1997 Deeds of Trust and any Encumbrances executed in
connection therewith and all of the terms and provisions thereof, including but
not limited to the provisions governing disbursement of insurance proceeds and
condemnation awards, (ii) the existing state of the title of the Land as of the
date hereof and any other exceptions or encumbrances of record as of the date
hereof and any other restrictions, exceptions and Encumbrances entered into
subsequent to the date hereof with Tenant's knowledge and written consent, which
consent shall not be unreasonably withheld or delayed provided Tenant's rights
hereunder are not adversely affected in a material manner (including Tenant's
option to purchase the Leased Premises, together with the Land and the
Improvements pursuant to the 1997 Lease, as hereinafter provided), (iii) any
state of facts which an accurate survey or physical inspection of the Leased
Premises might show, and (iv) the condition of the Leased Premises, as of the
Rent Commencement Date, without representation or warranty by Landlord, and
without liability or obligation of Landlord for patent or latent defects (except
that Landlord shall assign the benefit of all warranties
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written and implied to Tenant and Tenant shall be a third party beneficiary of
such warranties under the Construction Contract).
(b) Tenant has made its own investigation as to the existing
state of the title of the Land and has made arrangements for its own survey.
4. Plans and Specifications; Construction.
(a) Landlord will cause the Additional Improvements to be
constructed on the Land in accordance with the Plans by the
execution and delivery of the Construction Contract.
Landlord has entered into the Construction Contract
described on Exhibit B attached hereto.
(b) Landlord will not agree to any modifications of the Plans
without Tenant's consent thereto, and any modifications to
the Plans will be made and approved in accordance with the
requirements of the Bond Documents and the Credit Facility
Documents.
(c) Any change orders with respect to the Construction Contract
will be entered into and approved in accordance with the
requirements of the Bond Documents and the Credit Facility
Documents.
5. Use of Leased Premises.
Tenant shall occupy and use the Leased Premises only as a
biological research, product development and manufacturing and related
administrative use facility (the "Permitted Use"), or for such other lawful
purpose as may be approved by Landlord, the Credit Facility Providers, MIDFA and
the State in their sole discretion (except that Landlord, the Credit Facility
Providers, MIDFA and the State will not unreasonably withhold consent to
additional uses which are related to the Permitted Use), subject, in addition,
to the terms and provisions of any covenants, easements, conditions or
restrictions of record now or hereafter recorded with the written consent of
Tenant, including but not limited to the Deed of Trust and the 1997 Deeds of
Trust and the Restrictive Covenants, and for no other purpose. Tenant shall not
abandon the Leased Premises. Tenant shall not permit any unlawful occupation,
business or trade to be conducted on any of the Leased Premises or any use to be
made thereof contrary to applicable Legal Requirements. Tenant shall not use or
occupy or permit any of the Leased Premises to be used or occupied, nor do or
permit anything to be done in or on any of the Leased Premises, in a manner
which would or might (i) make void or voidable any insurance then in force with
respect to any of the Leased Premises, (ii) make it difficult or impossible to
obtain fire or other insurance which Tenant is required to furnish hereunder,
(iii) cause structural injury to any of the Improvements or the Additional
Improvements, or (iv) constitute a public or private nuisance or waste.
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6. Term; Purchase Option.
(a) This Lease shall be effective from and after the date of
its execution and delivery by Landlord and Tenant, December 30, 1999. Subject to
the terms, covenants, agreements and conditions contained herein, Tenant shall
have and hold the Leased Premises for a term (the "Term") commencing on the Rent
Commencement Date and ending at midnight on January 1, 2019.
From the effective date of this Lease, as set forth above, to and
including the Rent Commencement Date, Tenant shall have the right to enter the
Leased Premises for the purpose of performing, or causing to be performed,
"tenant improvement work" for the purpose of installing, or causing to be
installed, Tenant's Equipment and for the purpose of monitoring the construction
of the Additional Improvements.
Landlord shall have the right during the last twelve months of the
Term of this Lease to (i) advertise the availability of the Leased Premises for
sale or for reletting and to erect upon the Leased Premises signs indicating
such availability (provided that such signs do not unreasonably interfere with
the use of the Leased Premises by Tenant), and (ii) show the Leased Premises to
prospective purchasers or tenants at such reasonable times and on reasonable
prior notice during normal business hours as Landlord may select, subject to
Tenant's customary access restrictions.
(b) Provided that, at the time of exercise of the following
purchase option and at the time of closing of the purchase of the Leased
Premises pursuant to such option, (i) no Event of Default or event which, with
the giving of notice or the lapse of time, or both, would constitute an Event of
Default which would entitle Landlord to terminate this Lease or the 1997 Lease
or evict Tenant from possession of the Leased Premises or of the Land or the
Improvements, shall exist, (ii) all payments of Basic Rent and Additional Rent
under this Lease and all payments of Basic Rent (as defined in the 1997 Lease)
and Additional Rent (as defined in the 1997 Lease) under the 1997 Lease shall
have been paid through the date of the exercise of such purchase option, and
(iii) this Lease and the 1997 Lease shall be in full force and effect (unless
this Lease or the 1997 Lease is not in full force and effect due to Landlord's
default), then Tenant shall have the right and option, by giving notice as set
forth below, to acquire the Leased Premises from Landlord as provided below.
Tenant may not exercise such purchase option unless it simultaneously exercises
its option to purchase the Leased Premises (as defined in the 1997 Lease) under
the 1997 Lease, and Tenant may not exercise its option to purchase the Leased
Premises (as defined in the 1997 Lease) under the 1997 Lease unless it
simultaneously exercises the purchase option described in this subparagraph
6(b). Tenant may not exercise such purchase option during any period in which
the Bonds are not subject to redemption pursuant to Section 3.1(c) or Section
3.1(e) of the Indenture, unless the Bonds are to remain outstanding after the
closing of such purchase option.
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From and after January 1, 2004, Tenant may exercise such purchase
option by written notice to Landlord, with a copy of such written notice to
MIDFA, and the Credit Facility Providers; provided that, in the event that
Landlord is in default under the provisions of the Bond Documents or the Credit
Facility Documents and such default is not the result of an Event of Default
under this Lease, Tenant may also exercise such purchase option prior to such
date by written notice to Landlord, with a copy of such written notice to MIDFA
and the Credit Facility Providers. If Tenant exercises such purchase option by
giving such written notice, and (i) the Bonds have been previously redeemed, the
closing of such purchase option shall occur no later than the 90th day following
such notice (or the next business day if such 90th day is not a business day),
or (ii) the Bonds then bear interest at a variable rate, the closing of such
purchase option shall occur no later than the 180th day following such notice
(or the next business day if the 180th day is not a business day), or (iii) the
Bonds then bear interest at a fixed rate, the closing of such purchase option
shall occur no later than the later of (A) the first day on which the Bonds may
be redeemed pursuant to Section 3.1(e) of the Indenture, and (B) the 180th day
following such notice (or the next business day if the 180th day is not a
business day), PROVIDED THAT, in the case of (ii) or (iii) above, unless the
Bonds are to remain outstanding after the closing of such purchase option, the
closing of such purchase option shall not take place unless all Bonds shall have
been redeemed on or before the date of the closing of such purchase option.
Not later than 50 days prior to the date of the closing of such
purchase option, Tenant shall pay to Landlord, in immediately available funds,
the sum of the following (the "Basic Purchase Price"), which sum shall be held,
in trust, by Landlord and used by Landlord solely for the purposes hereinafter
set forth:
(A) the applicable option purchase price set forth on the
Schedule of Option Purchase Prices attached hereto as Exhibit D and made
a part hereof, plus
(B) if Tenant exercises such purchase option during a
period in which the Bonds bear interest at a fixed rate, an amount of
money equal to any redemption premium payable upon redemption of the
Bonds on the next optional redemption date as set forth in Section 3.1(e)
of the Indenture, unless the Bonds are to remain outstanding after the
closing of such purchase option.
Any portion of the Basic Purchase Price which is not paid to the Trustee, as
provided below, will be held by Landlord, in trust, upon terms and conditions
mutually acceptable to Landlord and Tenant, in an interest bearing account at a
commercial bank mutually acceptable to Landlord and Tenant, pending the closing
of such purchase option.
Upon receipt by Landlord of the Basic Purchase Price, Landlord
shall pay to the Trustee from the Basic Purchase Price, to
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be held in an irrevocable escrow for the redemption of the Bonds, in immediately
available funds, an amount sufficient, when added to moneys then held by the
Trustee and available for the redemption of Bonds, to redeem all of the Bonds in
full on the next date on which the Bonds may be redeemed pursuant to Section
3.1(c) or 3.1(e) of the Indenture, unless the Bonds are to remain outstanding
after the closing of such purchase option.
In addition, at the closing of such purchase option, Tenant shall
pay to Landlord, in immediately available funds, the sum of the following:
(A) all Basic Rent and Additional Rent through the date of
the closing of such purchase option, plus
(B) all actual third party costs and expenses (including
reasonable attorneys fees and expenses) of the Credit Facility Providers,
Landlord, MIDFA and the State (excluding Landlord's internal overhead)
incurred in connection with such purchase, including (without limitation)
any costs incurred by Landlord in connection with "unwinding" any Hedge,
but deducting any benefits accruing to Landlord in connection with
"unwinding" any Hedge, plus
(C) all transfer and recordation taxes, brokerage fees, if
any, and other costs and expenses required or necessary to be paid in
connection with the transfer of the Leased Premises from Landlord to
Tenant.
If, at the time Tenant exercises such purchase option, any of the
Bonds shall have been redeemed or paid prior to maturity, the Basic Purchase
Price shall be reduced by an amount equal to the total amount of Bonds so
redeemed or paid.
If, at the time Tenant exercises such purchase option, there shall
be on deposit with the Trustee any moneys which are available for the redemption
of the Bonds upon the closing of such purchase option, and the outstanding Bonds
are to be redeemed upon the closing of such purchase option, the Basic Purchase
Price shall be reduced by an amount equal to the amount of moneys so on deposit
with the Trustee.
Upon Tenant's exercise of such purchase option, Tenant may advise
Landlord that Tenant will purchase the Leased Premises pursuant to such purchase
option, subject to the Bond Documents and the Credit Facility Documents, and
that Tenant either will assume all of the obligations of Landlord under the Bond
Documents and the Credit Facility Documents or, in the alternative, pay the
portion of the Basic Purchase Price attributable to the outstanding Bonds by the
delivery of a loan agreement, or similar document, evidencing Tenant's agreement
to pay Landlord amounts which are sufficient to enable Landlord to pay its
monetary obligations under the Bond Documents and the Credit Facility Documents,
in which event (i) the Basic Purchase Price will be reduced by the principal
amount of the Bonds which would have been redeemed upon the closing
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of such purchase option, (ii) at or prior to the closing of such purchase
option, Tenant and Landlord will execute and deliver such documents, and take
such actions, as Landlord, the Credit Facility Provider and MIDFA may require,
in their sole discretion, to provide for the assumption by Tenant of Landlord's
obligations under the Bond Documents and the Credit Facility Documents, and
(iii) the Bonds will not be redeemed but will remain outstanding after the
closing of such purchase option.
At the closing of such purchase option, Landlord shall pay, from
the moneys paid to Landlord by Tenant as set forth above, (1) to the Trustee,
the Paying Agent, the Registrar, the Remarketing Agent, the Rating Agency, the
Credit Facility Providers, MIDFA, and any Hedge Counterparty, all accrued fees,
costs and expenses then payable to the Trustee, the Paying Agent, the Registrar,
the Remarketing Agent, the Rating Agency, the Credit Facility Provider, MIDFA,
and any Hedge Counterparty, (2) to the Credit Facility Providers, and MIDFA, all
actual third party costs and expenses (including reasonable attorneys fees and
expenses) incurred by them in connection with such purchase of the Leased
Premises by Tenant and, if applicable, in connection with the assumption by
Tenant of the obligations of Landlord under the Bond Documents and the Credit
Facility Documents.
In consideration of the payment by Tenant to Landlord of the Basic
Purchase Price and the other amounts of money set forth above, Landlord, by
special warranty deed, will transfer its interest in the Leased Premises, as
well as incidental personal property relating to the Leased Premises, to Tenant
as of the date of the closing of such purchase option, free of all Encumbrances,
other than (1) Encumbrances in existence on the date of this Lease, (2)
Encumbrances assumed by Tenant, (3) Encumbrances approved by Tenant, and (4) the
Bond Documents and the Credit Facility Documents in the event that in connection
with the purchase of the Leased Premises by Tenant pursuant to such purchase
option Tenant assumes all of Landlord's obligations under the Bond Documents and
the Credit Facility Documents; and Landlord will assign to Tenant all contracts
and warranties (to the extent assignable) relating to the Leased Premises and/or
incidental to any and all personal property relating to the Leased Premises.
Notwithstanding any other provision of this Lease, Landlord will
not accept the Basic Purchase Price and the other amounts of money set forth
above, and will not close such purchase option, unless the amount of the Basic
Purchase Price is sufficient to enable Landlord to redeem all of the Bonds at
the then applicable redemption price, and to pay all of Landlord's Bond
Obligations and Landlord's Credit Facility Obligations in connection therewith,
unless, in connection with the purchase of the Leased Premises by Tenant
pursuant to such purchase option, Tenant assumes all of the obligations of
Landlord under the Bond Documents and the Credit Facility Documents, or, in the
alternative, delivers a loan agreement, or similar document, in payment of a
portion of the Basic Purchase Price as set forth above.
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Concurrently with the closing of such purchase option, Landlord
shall cause the Deed of Trust (if not previously satisfied) to be released upon
the payment by Landlord to the Trustee of the amounts set forth above, unless
Tenant shall have assumed all of the obligations of Landlord under the Bond
Documents and the Credit Facility Documents as set forth above, in which event
the Deed of Trust will not be so released.
Upon the closing of such purchase option and the payment of all
amounts set forth above, Tenant shall be released of all of its obligations
under this Lease; provided, however that any and all obligations and liabilities
of Tenant under this Lease that survive the Term of this Lease (such as
indemnification obligations) shall survive the closing of such purchase option.
(c) In the event Tenant exercises its option to purchase the
Leased Premises from Landlord as set forth above, but fails to close as and when
required as set forth above, such failure shall constitute an Event of Default
under this Lease.
7. Rent.
(a) As used herein, the term "Rent Commencement Date" means the
earlier to occur of (i) the first day of the first month following the date on
which Tenant gives written notice to Landlord, with a copy of such written
notice to the Credit Facility Providers and MIDFA, that Tenant's beneficial use
of the Leased Premises has begun, and (ii) January 1, 2001.
(b) Tenant covenants to pay to Landlord, on the first day of
each and every calendar month, beginning on the Rent Commencement Date, basic
rent in the amount of $127,400 per month, subject to adjustment as set forth in
subparagraph (c) below (such basic rent, as so adjusted from time to time, is
hereinafter referred to as "Basic Rent"). Basic Rent shall be payable to
Landlord by separate check or wire transfer at Landlord's payment addresses set
forth in Exhibit E attached hereto and made a part hereof or at such other place
or bank account within the continental United States or to such other Person as
Landlord from time to time may designate to Tenant in writing, in lawful money
of the United States of America.
(c) Landlord and Tenant acknowledge and agree that the Basic
Rent has been determined based upon a number of factors, which include the
amount of debt service payable by Landlord with respect to the Bonds and other
costs which may fluctuate from time to time. Accordingly, the Basic Rent shall
be adjusted from time to time by Landlord and Tenant to reflect (i) any
redemption of the Bonds prior to maturity, and (ii) the expiration of any Hedge
or any default by any Hedge Counterparty in the performance of its obligations
under any Hedge Documents.
(d) Tenant covenants to pay and discharge, as additional rent,
the following (collectively, the "Additional Rent"):
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(i) the amount of any cost or expense required to be paid
by Landlord with respect to or in connection with the acquisition,
construction and financing of the Additional Improvements and the
ownership of the Leased Premises and the leasing of the Leased Premises
to Tenant, including (without limitation), consultants' fees, accounting
fees, legal fees and other expenses relating to any litigation involving
the Leased Premises (except to the extent that Landlord is otherwise
indemnified therefor pursuant to another provision of this Lease), costs
of maintenance, upkeep and repair of the Leased Premises paid for by
Landlord, costs of permits, charges by governmental authorities, and
amounts paid pursuant to any declaration or covenants including the
Restrictive Covenants, and all indemnification obligations of Landlord to
any Person or Persons resulting from or growing out of such acquisition,
construction, financing, ownership and leasing, and any sales taxes, plus
(ii) all fees and amounts payable by Landlord to any Person
or Persons in connection with the acquisition, construction and financing
of the Additional Improvements, to the extent not otherwise payable
pursuant to the 1997 Lease, including (without limitation) all credit
facility fees, remarketing fees, insurance premiums payable to MIDFA,
common area maintenance fees or rents or other similar charges relating
to the maintenance of the Leased Premises or any roads or other
improvements related thereto, monthly deposits on account of Impositions
and insurance premiums, in the event that Landlord is required to make
such monthly deposits on account of Impositions and insurance premiums,
and amounts representing increases in fees payable to the Rating Agency
or to the Trustee or the Registrar or the Paying Agent pursuant to the
Indenture or increases in the negotiation fees payable to the Credit
Facility Providers, and amounts representing changes in costs resulting
from any conversion of the interest rate payable on the Bonds from a
variable rate to one or more fixed rates or from one or more fixed rates
to one or more other fixed rates or to a variable rate, plus
(iii) to the extent not paid on the Closing Date from the
proceeds of the Bonds, the amounts determined by Landlord to be
sufficient to enable Landlord to make payments of all other monetary
obligations of Landlord under the Bond Documents, the Credit Facility
Documents, and any Hedge Documents.
Landlord, as promptly as practicable after obtaining knowledge that any
Additional Rent will be payable under this Lease, will advise Tenant, by written
notice, of the amount of any Additional Rent payable hereunder and the date on
which any Additional Rent is due and payable by Tenant in order for Landlord to
meet its obligations with respect to payments by Landlord to other Persons.
Additional Rent shall be paid to Landlord's payment addresses set forth in
Exhibit E attached hereto. In the event of any failure by Tenant to pay or
discharge any Additional Rent, Landlord shall have all
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rights, powers and remedies provided herein or by Law in the case of non-payment
of Basic Rent. Unless otherwise provided herein, all payments of Additional Rent
shall be due on the date specified by Landlord in such written notice as the
date on which such Additional Rent is due and payable.
(e) In the event that any payment of Basic Rent or Additional
Rent is not made within 15 days after the date on which the same is due and
payable, any such payment in default and the entire unpaid balance of all
amounts owing to Landlord shall bear interest, from the date on which the
payment was due until such payment in default is paid in full, at the
fluctuating rate which is at all times equal to the LIBOR Rate plus 3% per annum
(the "Default Rate"). In addition, Tenant shall pay (i) a late charge equal to
2% of the payment in default as set forth above (except for any payment with
respect to a Bond Purchase Principal Drawing, as defined in the Indenture) which
is made more than 15 days after the date on which the same is due and payable,
and (ii) all costs of collection, including attorneys' fees, if collection of
amounts due to Landlord is referred to an attorney after default by Tenant.
8. Net Lease; Non-Terminability.
(a) This Lease is a net lease, and Basic Rent, Additional Rent
and all other sums payable by Tenant shall be paid without notice (except as
specifically provided herein) or demand.
(b) Except as expressly provided in this Lease, Tenant shall
not be entitled to any set-off, counterclaim, recoupment, abatement, suspension,
deferment, diminution, deduction, reduction or defense of or to Basic Rent or
Additional Rent or any other sums payable hereunder and the obligations of
Tenant under this Lease shall not be affected, for any reason, including the
following: (i) any damage to or the destruction of all or any part of the Leased
Premises from whatever cause, (ii) the taking of the Leased Premises or any
portion thereof or interest therein by condemnation, requisition or otherwise
for any reason, (iii) the prohibition, limitation or restriction of Tenant's use
of all or any part of the Leased Premises, or any interference with such use,
(iv) any title defect or encumbrance, or any eviction from the Leased Premises
by paramount title or otherwise, (v) Tenant's acquisition or ownership of any
interest in all or any part of the Leased Premises otherwise than pursuant to an
express provision of this Lease, (vi) any failure on the part of Landlord to
observe any provision of this Lease, or any default by Landlord under any other
agreement to which Landlord and Tenant may be parties, (vii) any claim which
Tenant has or might have against Landlord, or (viii) any other cause whether
similar or dissimilar to the foregoing, any present or future Law to the
contrary notwithstanding except by agreement by and among Landlord, Tenant, and
the Credit Facility Providers. It is the intention of the parties hereto that
the obligations of Tenant hereunder shall be separate and independent covenants
and agreements, that Basic Rent, Additional Rent and all other sums payable by
Tenant hereunder shall continue to and be payable in all events, and that the
obligations of Tenant hereunder shall continue unaffected, unless the
requirement to pay or perform
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the same shall have been terminated pursuant to an express provision of this
Lease.
(c) Tenant agrees that it will remain obligated under this
Lease in accordance with its terms, and that it will not take any action to
terminate, rescind or avoid this Lease or abate the rent required hereby,
notwithstanding (i) the bankruptcy, insolvency, reorganization, composition,
readjustment, liquidation, dissolution, winding-up or other proceeding affecting
Landlord or any assignee of Landlord in any such proceeding or/and (ii) any
other action (including rejection) with respect to this Lease which may be taken
by any trustee or receiver of Landlord or of any assignee of Landlord in any
such proceeding or by any court in any such proceeding; and, in any such event,
so long as Tenant pays and performs its obligations under this Lease and does
not take any action to terminate, rescind or avoid this Lease or abate the rent
required hereby, Tenant shall be entitled to the benefits of Tenant set forth in
this Lease.
(d) Except as otherwise provided in this Lease, Tenant waives
all rights which may now or hereafter be conferred by law (i) to quit, terminate
or surrender this Lease or (ii) to any abatement, suspension, deferment or
reduction of Basic Rent, Additional Rent or any other sums payable under this
Lease, except as expressly approved by the Credit Facility Providers or as
otherwise expressly provided herein.
(e) Subject to Paragraph 35(f), Tenant and Landlord agree that
the Credit Facility Providers are and shall be third-party beneficiaries of this
Lease and that, as such, the Credit Facility Providers shall have the right to
pursue any right, remedy or performance to which Landlord shall be entitled
pursuant hereto notwithstanding that but for the provisions of this subparagraph
(e), the Credit Facility Providers may not have had the right to pursue any such
right, remedy or performance.
9. Payment of Impositions; Compliance with Law and Restrictive
Covenants.
(a) Subject to the provisions of Paragraph 18 relating to
contests, Tenant shall pay all Impositions before any fine, penalty, interest or
cost may be added for non-payment. Tenant agrees to furnish to Landlord, within
30 days after written demand therefor, proof of the payment of all Impositions
payable by Tenant as provided in this Paragraph 9. In the event that any
Imposition becomes due and payable during the Term and may be legally paid in
installments, Tenant shall have the option to pay such Imposition in
installments; and in such event, Tenant shall be liable only for those
installments which become due and payable during the Term, with appropriate
proration in the case of fractional years. Any Impositions which are
attributable in part to the Term and in part to a period preceding or following
the Term, as the case may be, shall be equitably apportioned between Landlord
and Tenant. If Landlord is required pursuant to the Bond Documents or the Credit
Facility Documents or the State Loan Documents to make monthly deposits on
account of Impositions and insurance premiums, and
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Landlord informs Tenant in writing thereof specifying the amount of such
deposits, Tenant shall pay such monthly deposits to Landlord, as Additional Rent
hereunder as provided in Paragraph 7 (d).
(b) Tenant shall promptly comply with and conform to all Legal
Requirements concerning the use, occupancy and conditions of the Leased Premises
and all machinery, equipment, furnishings, fixtures and improvements therein. If
any such Legal Requirement requires an occupancy or use permit, license, special
exception, or other local, state or federal agency certification, then Tenant
shall promptly obtain and keep current the same.
(c) Tenant shall comply with all of the Restrictive Covenants.
10. Liens; Recording and Title; Easements.
(a) Tenant will not, directly or indirectly, create or permit
to remain, and will promptly discharge, at its expense, any mortgage, lien,
encumbrance or charge on, pledge of, or conditional sale or other title
retention agreement with respect to, the Leased Premises or any part thereof or
Tenant's interest therein or Basic Rent, Additional Rent or other sums payable
by Tenant under this Lease, other than Permitted Equipment Liens. The existence
of any mechanic's, laborer's, materialman's, supplier's or vendor's lien, or any
right in respect thereof, shall not constitute a violation of this Paragraph 10
if payment is not yet due upon the contract or for the goods or services in
respect of which any such lien has arisen so long as such payment is made or
bonded off within 30 days after the later to occur of the completion of the work
which gave rise to the imposition of said liens or the rendering of the invoice,
statement or demand for such payment. Nothing contained in this Lease shall be
construed as constituting the consent or request of Landlord, expressed or
implied, of any contractor, subcontractor, laborer, materialman or vendor to or
for the performance of any labor or services or other furnishing of any
materials for any construction, alteration, addition, repair or demolition of or
to the Leased Premises or any part thereof.
(b) At Tenant's request and at Tenant's sole cost and expense,
Landlord and Tenant will execute and deliver a memorandum evidencing Tenant's
option to purchase set forth in Paragraph 6, and shall cause such memorandum to
be recorded, filed or registered in such manner and in such places as may be
required by any present or future Law in order to publish notices and protect
the validity of such option to purchase.
(c) Subject to the terms and conditions of Paragraph 30,
Landlord shall have the right to encumber the Leased Premises, provided that any
such encumbrance (except for the Deed of Trust and other Credit Facility
Documents) shall be made expressly subject to Tenant's rights under this Lease
including the purchase option.
11. Indemnification. Tenant shall pay, protect, indemnify and save
harmless Landlord from and against any and all
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liabilities, losses, damages, costs, expenses (including all reasonable
attorneys' fees and expenses), penalties, causes of action, suits, claims,
demands or judgments of any nature whatsoever arising from (i) any injury to, or
the death of, any person or any damage to property on the Leased Premises or
upon adjoining sidewalks, streets or ways, if caused by the negligence of Tenant
or its agents or employees, or in any manner growing out of or connected with
the use, failure of use, condition or occupancy of the Leased Premises or any
part thereof or resulting from the condition thereof, (ii) any violation by
Tenant of any covenant, agreement or condition of this Lease, and (iii) any
violation by Tenant of the terms of any contract or agreement to which Tenant is
a party and which affects the Leased Premises; provided, however, that if any
such liability, loss, damage, penalty, cost or expense, cause of action, suit,
claim, demand or judgment results from the negligence of Landlord, its agents or
employees, or if any such act or omission is determined to be a failure by
Landlord to observe any provision of this Lease (if observance is required of
Landlord), the foregoing indemnity by Tenant shall apply with respect to
Landlord only to the extent of the insurance coverage maintained (or required to
be maintained, if greater) by Tenant pursuant to the provisions of Paragraph 15
of this Lease. In case any action or proceeding is brought against Landlord by
reason of any such claim, Tenant covenants, upon notice from Landlord, to resist
or defend such action or proceeding by counsel reasonably satisfactory to
Landlord, and, at the expense of Tenant, Landlord will cooperate and assist in
the defense of such action or proceeding if reasonably requested so to do by
Tenant.
Tenant also shall pay, protect, indemnify and save harmless Landlord for
all amounts, liabilities, indemnities and obligations which Tenant assumes or
agrees to pay or discharge pursuant to this Lease, as well as any payments or
indemnification made or required to be made by Landlord under the Credit
Facility Documents, the Bond Documents, the State Loan Documents or any Hedge
Documents as a result of Tenant's default hereunder, together with every fine,
penalty, interest and cost which may be added for nonpayment or late payment
thereof.
The obligation of Tenant under this Paragraph 11 shall survive any
termination of this Lease as to any right of indemnity which shall have accrued
prior to such termination.
12. Tenant's Equipment; Building Equipment; Maintenance and Repair.
(a) Tenant, at its expense, shall install all specialized
machinery, apparatus and equipment which Tenant, in its sole and absolute
discretion, deems necessary to permit the Leased Premises to be used for the
Permitted Use including, without limitation, the Tenant's Equipment described on
Exhibit C attached hereto. All Tenant's Equipment shall remain the property of
the lessor thereof or the property of the Tenant, as applicable, notwithstanding
its attachment to the Leased Premises. At the expiration of the Term, all of
Tenant's Equipment shall remain the property of the lessor thereof or the
property of the Tenant (as
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applicable) and shall be removed by Tenant or such lessor in accordance with
subparagraph (c) below.
(b) Tenant, at its sole cost and expense, will keep and
maintain the Leased Premises, including any altered, rebuilt, additional or
substituted buildings, structures and parts of the Additional Improvements, in
good repair and appearance, except for ordinary wear and tear, and will with
reasonable promptness make all structural and nonstructural, foreseen and
unforeseen, and ordinary and extraordinary changes and repairs of every kind and
nature which may be required to be made upon or in connection with the Leased
Premises, the Building Equipment, or any part thereof; in order to keep and
maintain the Leased Premises and the Building Equipment in such good repair and
appearance. All repairs, replacements and renewals shall be at least equal in
quality to the original work and all replacements shall have a value and useful
life at least equal to the value and remaining estimated useful life of the item
being replaced, and be suitable for a use which is the same or similar to that
of the item being replaced. Landlord shall not be required to maintain, repair
or rebuild, or to make any Alteration to the Leased Premises, the Building
Equipment, or Tenant's Equipment, or any part thereof, whether ordinary or
extraordinary, structural or non-structural, foreseen or unforeseen, or to
maintain the Leased Premises, the Building Equipment, or Tenant's Equipment, or
any part thereof, in any way, and Tenant hereby expressly waives the right to
make repairs at the expense of Landlord, notwithstanding the fact that such
right may be provided for in any Law in effect at the time of the execution and
delivery of this Lease or which may thereafter be enacted.
(c) Upon the expiration or earlier termination of this Lease,
Tenant shall surrender the Leased Premises in good condition, reasonable wear
and tear and damage by casualty excepted, with all Building Equipment in good
working condition, and all Tenant's Equipment removed. Any Tenant's Equipment
required to be removed but not removed by Tenant within 30 days after the
expiration or earlier termination of this Lease shall be considered abandoned by
Tenant and may be appropriated, sold, destroyed or otherwise disposed of by
Landlord without first giving notice thereof and without obligation to account
therefor to either Tenant or any lessor of such Tenant's Equipment. Tenant
agrees to pay all costs and expenses incurred in removing, storing and disposing
of Tenant's Equipment required to be removed but not removed. Tenant shall
repair (i.e., replace, restore or repair to a sightly and usable condition), at
its expense, any damage to the Leased Premises caused by removal of Tenant's
Equipment, whether effected by Landlord, Tenant, or Tenant's lessor or any of
their agents or employees. Landlord shall not be responsible for any loss or
damage to Tenant's Equipment under any circumstances. The provisions of this
subparagraph (c) are not applicable in the event that Tenant purchases the
Leased Premises as provided in Paragraph 6.
(d) Landlord shall, from time to time upon Tenant's written
request, execute appropriate documents for the benefit of Tenant's lenders or
equipment lessors confirming the provisions of
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this Paragraph 12 and containing such further undertakings of Landlord
concerning the right of any such lender or lessor to enter the Leased Premises
following termination of this Lease for the purpose of exercising its rights
with respect to the collateral of such lender or lessor, including removing the
same, provided such further undertakings are on commercially reasonable terms
and conditions and require such lender or lessor to repair any damage to the
Leased Premises caused by the removal of Tenant's Equipment.
(e) Notwithstanding anything herein to the contrary, Tenant
shall not be required to replace any Building Equipment during the last 3 years
of the Term, but Tenant, at Tenant's expense, shall keep all Building Equipment
in good working condition throughout the Term.
13. Alterations.
(a) So long as no Event of Default or event which, with the
giving of notice, the lapse of time, or both, would constitute an Event of
Default shall have occurred and be continuing, Tenant may, at its expense, make
Alterations, subject to the advance written consent of Landlord and subject to
the Deed of Trust and the 1997 Deeds of Trust provided that the consent of
Landlord shall not be required for non-structural Alterations which do not
involve the exterior of the building or changes in utilities, electrical,
mechanical or other existing systems and which in each separate Alteration do
not exceed $500,000 in cost. Landlord agrees not to withhold, delay or condition
its consent provided that (i) all such Alterations, construction and
installations shall be performed in a good and workmanlike manner; (ii) all such
Alterations, construction and installations shall be expeditiously completed in
compliance with all Legal Requirements; (iii) all work done in connection with
any such Alterations, construction or installation shall comply with the
requirements of any insurance policy required to be maintained by Tenant
hereunder; (iv) Tenant shall promptly pay all costs and expenses of any such
Alteration, construction or installation and shall discharge all liens filed
against any of the Leased Premises arising, out of the same; (v) Tenant shall
procure and pay for all permits and licenses required in connection with any
such Alteration, construction or installation; (vi) all such Alterations,
construction and installations (except as provided in subparagraph 13(c) below)
shall be the property of Landlord and shall be subject to this Lease; (vii) the
design of any Alterations visible from the exterior of the Leased Premises shall
comply with the terms of the Restrictive Covenants (including obtaining any
consents required thereunder); (viii) the contractor performing such alterations
shall be reputable, licensed and insured and shall, if required by Landlord, be
required to obtain performance and payment bonds; and (ix) Landlord shall incur
no expense or cost whatsoever in connection with such Alterations, including
without limitation, costs for reviewing and approving plans, additional common
area maintenance fees, tap fees or other utility fees, and costs incurred by
Landlord in obtaining the approval of the Credit Facility Providers and the
State. Landlord may require, as a condition to its consent to any Alterations,
reasonable appropriate payments, assurances and undertakings from Tenant to
ensure that
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all such conditions are satisfied. Notwithstanding the foregoing, it shall not
be unreasonable for Landlord to withhold its consent, or to condition its
consent, if either of the Beneficiaries withholds its consent to any of the
foregoing, or requires that certain conditions or requirements be satisfied or
observed.
(b) In the event that any Alterations shall encroach upon any
property, street or right-of-way adjoining or adjacent to the Leased Premises,
or shall violate the agreements or conditions contained in any restrictive
covenant affecting the Leased Premises or any part thereof, or shall hinder or
obstruct any easement or right-of-way to which the Leased Premises are subject
or shall impair the rights of others under any such easement or right-of-way,
then promptly after written request of Landlord or of any Person affected by any
such encroachment, violation, hindrance, obstruction or impairment, Tenant
shall, at its expense, either (i) obtain valid and effective waivers or
settlements of all claims, liabilities and damages resulting from each such
encroachment, violation, hindrance, obstruction or impairment, whether the same
shall affect Landlord, Tenant or both, or (ii) take such other action as shall
be necessary to remove such encroachments, hindrances or obstructions and to end
such violations or impairments.
(c) All Tenant improvements that can be removed without damage
to the structural integrity of the Leased Premises or the normal functions of
the Leased Premises or that are not necessary for the normal use of a building
as a tenantable shell building, and which were not financed with the proceeds of
the Bonds or the State Loans, shall, on termination of this Lease, become the
property of the Tenant.
14. Condemnation.
(a) Tenant, immediately upon obtaining knowledge of the
institution of any proceeding for any condemnation of the Leased Premises or the
Land or the Improvements, shall notify Landlord thereof and Landlord shall be
entitled to participate with Tenant in any condemnation proceeding at Tenant's
expense. Tenant hereby irrevocably assigns to Landlord any condemnation award or
condemnation payment to which Tenant may be or become entitled (except as set
forth in subparagraph (b) below) by reason of any taking of the Leased Premises
or any part thereof, in or by condemnation or other eminent domain proceedings
pursuant to any Law, or by reason of the temporary requisition of the use or
occupancy of the Leased Premises, or the Land or the Improvements or any part
thereof, by any governmental authority, civil or military, whether the same
shall be paid or payable in respect of Tenant's leasehold interest hereunder or
otherwise. The proceeds of the condemnation award shall be made available for
restoration if permitted by the Deed of Trust and the 1997 Deeds of Trust and if
this Lease is not terminated. As used herein, the term "Net Award" means any
condemnation award received by Landlord, less Landlord's expenses and Tenant's
expenses, if any, in collecting same.
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(b) The foregoing notwithstanding, nothing in this Lease shall
impair Tenant's right to any award or payment on account of Tenant's trade
fixtures, Tenant's Equipment, and other tangible property, moving expenses, loss
of business and the like, if available, to the extent Tenant shall have a right
to make a separate claim therefor against the appropriate governmental
authority, but in no event shall any such separate claim be based upon the value
of Tenant's leasehold interest in the Leased Premises or result in a reduction
of the award or payment which would have been payable to Landlord absent such
separate claim by Tenant.
(c) If there shall be taken by condemnation or other eminent
domain proceedings pursuant to any Law, general or special, (i) the entire
Leased Premises or (ii) any substantial portion of the Leased Premises which is
sufficient to render the remaining portion thereof, in the reasonable judgment
of Landlord or Tenant, unsuitable for restoration for the continued use and
occupancy of Tenant's business, or (iii) if the Credit Facility Providers or the
State shall retain any Net Award pursuant to the Deed of Trust and the 1997
Deeds of Trust (it being recognized that as a result thereof, either of the
Beneficiaries may refuse to allow the award to be disbursed for restoration
under certain circumstances, as provided in the Deed of Trust and the 1997 Deeds
of Trust), then Landlord and Tenant may each, not later than 90 days after any
such taking, give notice to the other of its intention to terminate this Lease
on any Basic Rent Payment Date specified in such notice, which date shall not be
prior to the date of the vesting of title to the Leased Premises or portion
thereof in the condemning authority. In the event Landlord elects to terminate
this Lease in the case of (ii) or (iii) above, if Tenant elects to provide funds
which, together with the Net Award, are sufficient to restore the Leased
Premises and pay Basic Rent and Additional Rent during such restoration and
provides evidence satisfactory to Landlord, the State and the Credit Facility
Providers (in the Credit Facility Providers and the State's sole and absolute
subjective judgment) of its ability to do so within 30 days of Landlord's
election, Landlord's election to terminate shall be rescinded, this Lease shall
continue in full force and effect pursuant to subsection (d) below, and
restoration of the Leased Premises shall proceed in accordance with Paragraph
16(b). In the event either Landlord or Tenant elects to terminate this Lease
under the provisions of this Paragraph 14(c), Landlord shall be entitled to
recover from Tenant, and Tenant will pay to Landlord, on or prior to the
effective date of termination, an amount equal to the Basic Rent, Additional
Rent and other sums which are then due and payable to the effective date of
termination; provided that in the event of such termination, Tenant may exercise
its purchase option under Paragraph 6(b) within 20 days after notice of
termination.
(d) If a portion of the Leased Premises shall be taken in or by
condemnation or other eminent domain proceedings pursuant to any Law, general or
special, which does not result in a termination of this Lease, then this Lease
shall continue in full force and effect, and there shall be no abatement or
reduction of rent payable hereunder, except to the extent that any portion of
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the Net Award is used to redeem Bonds or to prepay the State Loans prior to
maturity. Unless Tenant immediately elects to exercise its purchase option under
Paragraph 6 above, subject to the provisions of the Deed of Trust and the 1997
Deeds of Trust, the Net Award of such condemnation shall be paid to Landlord
and, promptly after such condemnation and payment to Landlord of the Net Award,
Landlord shall make the Net Award available to Tenant for restoration, in
accordance with Paragraph 16.
(e) For the purposes of this Lease, all amounts payable
pursuant to any agreement with any condemning authority which has been made in
settlement of or under threat of any condemnation or other eminent domain
proceeding affecting the Leased Premises shall be deemed to constitute an award
made in such proceeding.
(f) The terms and provisions of this Paragraph 14 are subject
to the terms and provisions of the Deed of Trust, the 1997 Deeds of Trust, the
1997 Lease and the State Loan Documents.
15. Insurance.
(a) Tenant will maintain at its expense (i) such fire,
casualty, extended coverage and all risk insurance on the Improvements, the
Additional Improvements, the Building Equipment (as defined in the 1997 Lease)
and Building Equipment as is required to be maintained by Landlord, as Grantor
under the Deed of Trust and the 1997 Deeds of Trust, provided that the amount of
any casualty insurance shall be in no event less than the actual replacement
value of the Additional Improvements and Building Equipment, less footings,
foundations and other non-insurable portions, (ii) commercial general public
liability insurance with a single limit of not less than $10,000,000, including
contractual liability coverage insuring the obligations assumed by Tenant under
this Lease, premises and operations coverage, broad form property damage
coverage and independent contractors coverage, (iii) worker's compensation
insurance as required by Law, (iv) business interruption insurance in the amount
of $6,000,000, and (v) employer's liability insurance in an amount not less than
$2,000,000 for each accident, $2,000,000 disease-policy limit and $2,000,000
disease-each employee.
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(b) The insurance referred to in Paragraph 15(a) shall be
written by companies of recognized financial standing which are authorized to
conduct an insurance business in the State of Maryland and which are reasonably
acceptable to Landlord, the Credit Facility Providers, MIDFA and the State. All
commercial public liability insurance shall name as the insured parties
thereunder Landlord, Tenant, MIDFA, the State and each of the Credit Facility
Providers, as their interests may appear. Landlord shall not be required to
prosecute any claim against, or to contest any settlement proposed by, any
insurer, provided that Tenant may, at its expense, prosecute any such claim or
contest any such settlement. In such event, Tenant may bring such prosecution or
contest in the name of Landlord, Tenant, or both, and Landlord will join therein
at Tenant's written request upon the receipt by Landlord of a satisfactory
indemnity from Tenant against all costs, liabilities and expenses in connection
with such prosecution or contest.
(c) So long as no Event of Default exists hereunder, insurance
claims by reason of damage to or destruction of any portion of the Leased
Premises shall be adjusted by Tenant, but Landlord, the State and the Credit
Facility Providers shall have the right to join with Tenant in adjusting any
such loss. In furtherance of Tenant's right to adjust, collect and compromise,
in its discretion, all claims under any of the insurance policies required by
this Paragraph 15, Tenant is authorized to execute and deliver all necessary
proofs of loss, receipts, vouchers and releases required by the insurers.
(d) Every fire, casualty, extended coverage or all risk
insurance policy required above (other than on Tenant's Equipment) shall contain
a non-contributory mortgagee endorsement in favor of Landlord, the Credit
Facility Providers, the State and MIDFA. Every policy which Tenant is obligated
to carry under the terms of Paragraph 15(a) shall contain an agreement by the
insurer that it will not cancel such policy except after 30 days' prior written
notice to Landlord, the Credit Facility Providers, the State and MIDFA, and that
any loss otherwise payable thereunder shall be payable notwithstanding any act
or negligence of Landlord or Tenant which might, absent such agreement, result
in a forfeiture of all or a part of such insurance payment and notwithstanding
any foreclosure or other action or proceeding taken by either of the
Beneficiaries pursuant to any provision of the Deed of Trust or the 1997 Deeds
of Trust upon the happening of an Event of Default, as defined therein, or any
change in title or ownership of the Leased Premises.
(e) Any and all insurance which Tenant is obligated to carry
pursuant to Paragraph 15(a) may be carried under a "blanket" policy or policies
covering other properties or liabilities of Tenant and may be effected by a
combination of basic and excess or umbrella policies, provided, that such
"blanket" policy or policies otherwise comply with the provisions of this
Paragraph 15. The amount of total insurance allocated to the Leased Premises,
which amount shall not be less than the amounts required pursuant to this
Paragraph 15, shall be specified either (i) in each such "blanket" policy or
(ii) in a written statement, which Tenant shall deliver to Landlord from the
insurer thereunder.
(f) Tenant shall promptly comply with and conform to (i) all
provisions of each insurance policy and (ii) all requirements of the insurers
thereunder, applicable to Landlord, MIDFA, the Credit Facility Providers, the
State, Tenant or the Leased Premises or to the use, manner of use, occupancy,
possession, operation, maintenance, alteration or repair of the Leased Premises,
even if such compliance necessitates structural changes or improvements or
results in interference with the use or enjoyment of any of the Leased Premises.
Tenant shall not use the Leased Premises in any manner which would permit the
insurer to cancel any insurance policy unless Tenant obtains, prior to such
cancellation,
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substitute insurance in accordance with the provisions of this Paragraph 15
which permits such use of the Leased Premises.
(g) Any loss under any policy of casualty insurance required to
be carried by Landlord or Tenant hereunder (other than on Tenant's Equipment)
shall be made payable to the Credit Facility Providers or, if references to the
Credit Facility Providers shall be ineffective as provided in Paragraph 35(f),
to the State as long as the State Loans are outstanding, and then to such other
party as the Landlord may designate (in any such case, the "Insurance and Award
Trustee") and each casualty insurer shall be authorized and directed to make
payment under said policies directly to the Insurance and Award Trustee for
disbursement in accordance with the provisions of first, the Deed of Trust,
second, the 1997 Deeds of Trust (in the order of priority set forth in the 1997
Lease), and third, this Lease. As used herein, the term "Net Proceeds" means any
casualty insurance proceeds received by Landlord, less Landlord's expenses and
Tenant's expenses, if any, in collecting same. The term "Net Proceeds" shall not
include proceeds of insurance on Tenant's Equipment, which proceeds shall be
paid directly to Tenant or the lessor of such Tenant's Equipment.
(h) Tenant shall not carry separate insurance concurrent in
form or continuing in the event of loss with that required in this Paragraph 15
unless (i) Landlord, MIDFA, the State and the Credit Facility Providers are
included therein as named insureds, with lender's loss payable endorsements as
provided herein, and (ii) such separate insurance complies with the other
provisions of this Paragraph 15. Tenant shall immediately notify Landlord,
MIDFA, the State and the Credit Facility Providers of such separate insurance
and shall deliver to Landlord, MIDFA, the State and the Credit Facility
Providers duplicate original policies therefor. Notwithstanding the foregoing,
Tenant may maintain insurance to compensate Tenant for loss of use of the
Additional Improvements.
(i) The terms and provisions of this Paragraph 15 are subject
to the terms and provisions of the Deed of Trust, the 1997 Deeds of Trust, the
1997 Lease and the State Loan Documents.
16. Casualty and Restoration.
(a) In the event of any casualty resulting in damage to the
Leased Premises, including any casualty which renders the entire Leased Premises
or a substantial portion thereof unsuitable for continued use, this Lease shall
continue in full force and effect and there shall be no abatement or reduction
of rent payable hereunder.
(b) Until such time as the Deed of Trust and the 1997 Deeds of
Trust shall have been released and discharged, any Net Proceeds and any Net
Award shall be applied either to the restoration or replacement of the property
that was lost or to the redemption of Bonds and payment of the State Loans, as
provided in the Deed of Trust and the 1997 Deeds of Trust.
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(c) Unless there shall have occurred and be continuing an Event
of Default hereunder pursuant to which Landlord is taking action to take
possession of the Leased Premises or to terminate this Lease, or the Net
Proceeds or the Net Award are to be used as directed by the Beneficiary as
provided in the Deed of Trust or either of the Beneficiaries as provided in the
1997 Deeds of Trust, Landlord shall cause the Net Proceeds or Net Award to be
held by the Insurance and Award Trustee in a restoration fund which shall be
disbursed as follows:
(i) If the estimated cost of restoration is less than
$100,000, and if prior to commencement of restoration, no Event of Default or
event which would constitute an Event of Default pursuant to which Landlord is
taking action to take possession of the Leased Premises or to terminate this
Lease shall exist and no mechanics' or materialmen's liens shall have been filed
and remain undischarged, and if the architects, contracts, contractors, plans
and specifications for the restoration shall have been approved by Landlord
(which approval shall not be unreasonably withheld or delayed), and Landlord
shall be provided with reasonable assurance against mechanics' liens, accrued or
incurred, as Landlord may reasonably require, and acceptable performance and
payment bonds reasonably acceptable to Landlord in an amount and form having a
surety reasonably acceptable to Landlord, and naming Landlord, each of the
Credit Facility Providers, MIDFA and the State each as additional obligees; then
such proceeds shall be payable to Landlord and made available to Tenant for
application to pay the costs of restoration incurred by Tenant and Tenant shall
promptly complete such restoration.
(ii) If the estimated cost of restoration is equal to or
exceeds $100,000, and if the conditions set forth in subparagraph (i) above
shall have been satisfied, and if Tenant provides evidence satisfactory to
Landlord, the Credit Facility Providers, MIDFA and the State that sufficient
funds are available to restore the Leased Premises, disbursements shall be made
from time to time in an amount not exceeding the cost of the work completed
since the date covered by the last disbursement, upon receipt of (A)
satisfactory evidence, including architect's certificates, of the stage of
completion, of the estimated cost of completion and of performance of the work
to date in a good and workmanlike manner in accordance with the contracts, plans
and specifications, (B) waivers of liens, (C) contractors' and subcontractors'
sworn statements, (D) a satisfactory bring-to-date of title insurance, and (E)
other evidence of cost and payment so that Landlord can verify that the amounts
disbursed from time to time are represented by work that is completed, in place
and free and clear of mechanics' lien claims.
(iii) Each request for disbursement shall be accompanied by
a certificate of Tenant, signed by the President or any Vice President of
Tenant, describing the work for which payment is requested, stating the cost
incurred in connection therewith and stating that Tenant has not previously
received payment for such work; the certificate to be delivered by Tenant upon
completion of
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the work shall, in addition, state that the work has been completed and complies
with the applicable requirements of this Lease.
(iv) Landlord may retain 10% of each requisition against
the restoration fund until the restoration is fully completed subject to
reduction of the retained amount upon approval by the Credit Facility Providers
in accordance with local custom;
(v) The restoration fund shall be invested in an interest
bearing account of the Insurance and Award Trustee;
(vi) At all times the undisbursed balance of the
restoration fund shall be not less than the cost of completing the restoration
work free and clear of all liens; and
(vii) Landlord may impose other reasonable conditions
provided the same are consistent with those imposed upon such disbursements by
the Beneficiary under the Deed of Trust or either of the Beneficiaries under the
1997 Deeds of Trust. In addition, prior to commencement of restoration and at
any time during restoration, if the estimated cost of restoration, as determined
by the evaluation of an independent engineer acceptable to Landlord, exceeds the
amount of the Net Proceeds or the Net Award available for such restoration,
Tenant will provide evidence satisfactory to Landlord that the amount of such
excess will be available to restore the Leased Premises. Any sum which remains
in the restoration fund upon completion of restoration shall be refunded to
Tenant up to the amount of Tenant's deposits pursuant to the immediately
preceding sentence. If no such refund is required or any sum remains in the
restoration fund after such refund, such sum remaining in the restoration fund
(including the residue of any Net Award in a condemnation remaining after
restoration) upon completion of restoration shall be applied (x) during any
period in which either of the Credit Facilities is in effect, to the Landlord's
reimbursement obligations to the Credit Facility Providers to the extent of any
drawings honored by either of the Credit Facility Providers to pay the
redemption price of Bonds redeemed in accordance with Section 3.1(b) of the
Indenture or to pay the purchase price of Bonds purchased pursuant to Section
4.4 of the Indenture or (y) during any period in which any Bonds are
outstanding, to the redemption of Bonds in accordance with Section 3.1(b) of the
Indenture or to the purchase of Bonds as set forth in Section 4.4 of the
Indenture. During any period in which any Bonds are outstanding, any sums
remaining in an amount less than the minimum Authorized Denomination (as defined
in the Indenture) shall be deposited in the Principal Account (as defined in the
Indenture). If no Bonds are outstanding, and either of the Credit Facility
Agreements is still in effect, such remaining sum shall be applied to the
Landlord's Credit Facility Obligations under the Credit Facility Documents. If
no Bonds are outstanding and neither of the Credit Facility Agreements is in
effect, such remaining sum shall be distributed to the State for repayment of
the State Loans and then to Landlord and Tenant in proportion to the value of
each party's interest in the Leased Premises as determined by mutual agreement.
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(d) Tenant shall be solely responsible for the replacement
and/or repair of any of Tenant's Equipment damaged by casualty.
(e) The terms and provisions of this Paragraph 16 are subject
to the terms and provisions of the Deed of Trust, the 1997 Deeds of Trust, the
1997 Lease and the State Loan Documents.
17. Assignment and Subletting.
(a) Provided no Event of Default or event which, with the
giving of notice or the lapse of time or both, would constitute an Event of
Default, shall have occurred and be continuing, with prior notice to Landlord,
Tenant may sublet all or any part of the Leased Premises to an Affiliate, or
assign this Lease to an Affiliate, which Affiliate will use the Leased Premises
for the Permitted Use. Provided no Event of Default or event which, with the
giving of notice or the lapse of time or both, would constitute an Event of
Default, shall have occurred and be continuing, with the consent of Landlord
(which consent shall not be unreasonably withheld), Tenant may sublet all or any
part of the Leased Premises to a Person which is not an Affiliate, or assign
this Lease to a Person which is not a Affiliate, which Person will use the
Leased Premises for the Permitted Use. Notwithstanding the foregoing, in any
instance in which Landlord may not unreasonably withhold its consent, it shall
not be unreasonable for Landlord to withhold its consent, or to condition its
consent, if either of the Credit Facility Providers, the State or MIDFA
withholds its consent to any assignment or subletting, or requires that certain
conditions or requirements be satisfied or observed. Tenant shall give Landlord
at least 30 days' advance written notice of its intention to enter into any
transaction governed by this Paragraph 17, together with such information as
Landlord, the Credit Facility Providers, the State or MIDFA may reasonably
request concerning the business and financial background of the proposed
subtenant or assignee. Within 10 days after the execution and delivery of any
assignment or sublease permitted pursuant to this Paragraph 17, Tenant shall
deliver a conformed copy thereof to Landlord, and within 10 days after the
execution and delivery of any permitted sublease, Tenant shall give notice to
Landlord of the existence and term thereof, and of the name and address of the
sublessee thereunder.
(b) If Tenant assigns all its rights and interests under this
Lease, the assignee under such assignment shall expressly assume all the
obligations of Tenant hereunder in a written instrument delivered to Landlord at
the time of such assignment. No assignment or sublease shall affect or reduce
any of the obligations of Tenant hereunder, and all such obligations shall
continue in full effect as obligations of a principal and not as obligations of
a guarantor or surety, to the same extent as though no assignment or subletting
had been made. No assignment or sublease shall impose any obligations on
Landlord beyond those of Landlord under this Lease or otherwise affect any of
the rights of Landlord under this Lease. Any assignment or subletting,
Landlord's consent thereto, or Landlord's collection or acceptance of rent from
any assignee or subtenant shall not be construed
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either as waiving or releasing Tenant from any of its liabilities or obligations
under this Lease, or as relieving Tenant or any assignee or subtenant from the
obligation of obtaining Landlord's prior written consent to any subsequent
assignment or subletting.
(c) Upon the occurrence of an Event of Default under this
Lease, Landlord shall have the right to collect and enjoy all rents and other
sums of money payable under any sublease of any of the Leased Premises, and
Tenant hereby irrevocably and unconditionally assigns such rents and money to
Landlord, which assignment may be exercised upon and after (but not before) the
occurrence of an Event of Default. From and after the date, if any, that such
Event of Default is cured, such rents shall again become payable to Tenant and
the excess, if any, of the sublease rents collected by Landlord over the amount
thereof applied toward Tenant's obligations under this Lease shall be paid to
Tenant.
(d) All restrictions and obligations imposed pursuant to this
Lease on Tenant shall be deemed to extend to any subtenant or assignee, and
Tenant shall cause such Person to comply with such restrictions and obligations.
Each sublease is subject to the condition that if the Term is terminated or
Landlord succeeds to Tenant's interest in the Leased Premises by voluntary
surrender or otherwise, at Landlord's option the subtenant shall be bound to
Landlord for the balance of the term of such sublease and shall attorn to and
recognize Landlord as its landlord under the then executory terms of such
sublease.
18. Permitted Contests. Notwithstanding any other provision of this
Lease to the contrary, Tenant shall not be required to (i) pay any Imposition,
or (ii) discharge or remove any lien, encumbrance or charge referred to in
Paragraph 10 or 12, so long as Tenant shall contest, in good faith and at its
expense, the existence, the amount or the validity thereof, the amount of the
damages caused thereby, or the extent of its liability therefor, by appropriate
proceedings, provided that such contest shall operate at all times during the
pendency thereof to prevent (i) the collection of, or other realization upon,
the sums payable to satisfy any Imposition or lien, encumbrance or other charge
so contested, (ii) the sale, forfeiture or loss of the Leased Premises, or any
part thereof, or any interest therein or Basic Rent or any Additional Rent, or
any portion thereof, (iii) any interference with the use or occupancy of the
Leased Premises or any part thereof, (iv) any interference with the payment of
Basic Rent or any Additional Rent, or any portion thereof, (v) the cancellation
of any fire or other insurance policy, unless such policy is replaced prior to
its cancellation by another policy complying with the provisions of this Lease,
and (vi) the imposition of any civil or criminal liability upon Landlord. While
any such proceedings are pending, Landlord shall not have the right to pay,
remove or cause to be discharged the tax, assessment, levy, fee, rent or charge
or lien, encumbrance or charge thereby being contested, provided that Landlord
shall have the right to require Tenant to establish reasonable reserves for such
liabilities being contested if the Landlord reasonably determines such reserves
to be necessary. Tenant further agrees to give Landlord prompt notice of
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Tenant's intention to contest any Imposition and that each such contest shall be
promptly prosecuted to a final conclusion. Tenant will pay, and save Landlord
harmless against, any and all losses, judgments, decrees and costs (including
all reasonable attorneys' fees and expenses) in connection with any such contest
and will, promptly after the final settlement, compromise or determination of
such contest, fully pay and discharge the amounts which shall be levied,
assessed, charged or imposed or be determined to be payable therein or in
connection therewith, together with all penalties, fines, interests, costs and
expenses thereof or in connection therewith, and perform all acts the
performance of which shall be ordered or decreed as a result thereof.
19. Default Provisions.
(a) Any of the following occurrences or acts shall constitute
an Event of Default under this Lease:
(i) Tenant fails to pay, within 5 days after notice from
Landlord or any of its assignees to Tenant, any installment of Basic Rent.
(ii) Tenant fails to pay any payment of Additional Rent, or
any other payment required to be paid by Tenant hereunder, including, without
limitation, payment of Impositions and insurance premiums, and such failure
continues for 30 days after written notice thereof shall have been given to
Tenant by Landlord.
(iii) Tenant fails to observe or perform any other
provision hereof for 30 days (or such shorter period of time as Landlord may
reasonably determine if such default endangers life or property) after Landlord
shall have delivered to Tenant written notice (except in the case of an
emergency) of such failure (provided that, in the case of any default referred
to in this clause (iii) which does not endanger life or property and which
cannot with diligence be cured within such 30 day period, if Tenant shall
proceed promptly to cure the same and thereafter shall prosecute the curing of
such default with diligence, then upon receipt by Landlord of a certificate from
an authorized officer of Tenant stating the reason that such default cannot be
cured within 30 days and stating that Tenant is proceeding with diligence to
cure such default, the time within which such failure may be cured shall be
extended for such additional period as may be necessary to complete the curing
of the same with diligence.
(iv) An Act of Bankruptcy occurs with respect to Tenant, or
Tenant becomes generally unable to pay its debts as they become due; provided,
however, if a proceeding with respect to an Act of Bankruptcy is filed or
commenced against Tenant, the same shall not constitute an Event of Default if
such proceeding is dismissed within 90 days from the date of such Act of
Bankruptcy.
(v) Default is made (A) with respect to any evidence of
indebtedness of liability for borrowed money of Tenant to either of the Credit
Facility Providers, or (B) with respect to any evidence of indebtedness or
liability of Tenant to any other
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Person for borrowed money or pursuant to a lease obligation, if the effect of
such default described in clause (A) or (B) above is to accelerate the maturity
of such evidence of indebtedness or liability prior to its stated maturity
(whether automatically, following an election by the holder or obligee thereof
to accelerate, or otherwise) or any such indebtedness is not paid as and when
due and payable; provided, however, that it shall not constitute an Event of
Default if the outstanding principal balance of such indebtedness or liability
of Tenant to any Person other than either of the Credit Facility Providers or
the State is not in excess of $1,000,000 or Tenant certifies to the Credit
Facility Providers, the State and MIDFA that it is contesting such default in
good faith and by appropriate and diligent proceedings.
(vi) Any amendment to this Lease shall have been made
without the prior written consent of the Credit Facility Providers, the State
and MIDFA, which consent shall not be unreasonably withheld, conditioned or
delayed, and, except for material changes which would require the consent or
approval of the State Board of Public Works or the State Legislative Policy
Committee, which consent shall be deemed given by the Credit Facility Providers,
the State or MIDFA if the Credit Facility Providers, the State or MIDFA does not
object to any proposed amendment within 15 business days after the receipt
thereof by the Credit Facility Providers, the State or MIDFA.
(vii) Tenant abandons the Leased Premises.
(viii) The interest of Tenant in the Leased Premises or any
part thereof shall be assigned or subleased in violation of Paragraph 17, or
shall be levied upon or attached in any proceeding involving a claim in excess
of $1,000,000 and such proceeding is not vacated, discharged or bonded against
to the reasonable satisfaction of Landlord, the Credit Facility Providers, the
State and MIDFA within 30 days thereafter.
(ix) Any representation or warranty made by Tenant or its
representatives in this Lease or any of the Lease Documents executed and
delivered by Tenant or any statement or representation made by Tenant or its
representatives in any certificate, report or opinion (including legal opinions)
financial statement or other instrument furnished in connection with this Lease
or any of the Lease Documents executed and delivered by Tenant proves to have
been incorrect, false or misleading in any material respect when made.
(x) Any judgment against Tenant or any attachment or other
levy against the property of Tenant with respect to a claim for an amount in
excess of $1,000,000 remains unpaid, unstayed on appeal, undischarged, unbonded
or undismissed for a period of 60 days.
(xi) Tenant fails to comply with any material requirement
of any governmental authority having jurisdiction over the Leased Premises
within the time required by such governmental authority; or any proceeding is
commenced or action taken to
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enforce any remedy for a violation of any material requirement of a governmental
authority or any restrictive covenant affecting the Leased Premises or any part
thereof; provided, however, it shall not constitute an Event of Default if
Tenant is contesting the validity or applicability of any such requirement or
covenant, at its sole cost and expense, in good faith and by appropriate and
diligent proceedings.
(xii) If any material provision of this Lease at any time
for any reason ceases to be valid and binding on Tenant, or is declared to be
null and void, or the validity or enforceability thereof is contested by Tenant
or any governmental agency or authority, or Tenant denies that it has any
further liability or obligation under this Lease or any of the Lease Documents
executed and delivered by Tenant.
(xiii) Landlord, the Credit Facility Providers, the State
or MIDFA, or any of their respective representatives are not permitted, at all
reasonable times (after at least 48 hours prior written notice to Tenant, unless
an Event of Default shall have occurred and be continuing in which event notice
will not be required), to enter upon the Leased Premises, to inspect the Leased
Premises and all materials, equipment, fixtures and other items used or to be
used in the construction thereof, and to examine all detailed plans, shop
drawings and specifications which relate to or the appurtenances thereto or to
be used in the operation thereof, provided, however, any person conducting such
inspection shall comply with Tenant's safety and operating policies and
procedures.
(xiv) An Event of Default (as defined in the 1997 Lease)
occurs under the 1997 Lease.
(b) If an Event of Default shall have happened and be
continuing, Landlord shall have the right at its election, then or at any time
thereafter while such Event of Default shall continue, to give Tenant written
notice of Landlord's intention to terminate this Lease on a date specified in
such notice (such termination being hereinafter referred to as a "Default
Termination" and such notice being hereinafter referred to as a "Default
Termination Notice"). Upon giving a Default Termination Notice, the Term and the
estate hereby granted shall terminate on the date specified in the Default
Termination Notice as fully and completely and with the same effect as if such
date were the date hereinbefore fixed for the expiration of the Term, and all
rights of Tenant hereunder shall terminate, but Tenant shall remain liable as
hereinafter provided. Notwithstanding the foregoing, no Default Termination
Notice shall be effective unless it is also executed by the Credit Facility
Providers and MIDFA.
(c) If an Event of Default shall have happened and be
continuing, Landlord shall have the immediate right, whether or not the Term
shall have been terminated pursuant to Paragraph 19(b), to re-enter and
repossess the Leased Premises or any part thereof by force (if legally permitted
in the State of Maryland), summary proceedings, ejectment or otherwise and the
right (subject to the rights and interests of equipment lessors) to remove all
Persons
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and property therefrom. Landlord shall be under no liability for or by reason of
any such entry, repossession or removal. No such re-entry or taking of
possession of the Leased Premises by Landlord shall be construed as an election
on Landlord's part to terminate this Lease unless a Default Termination Notice
shall have been given to Tenant, or unless the termination of this Lease be
finally decreed by a court of competent jurisdiction.
(d) At any time or from time to time after the repossession of
the Leased Premises or any part thereof pursuant to Paragraph 19(c), whether or
not this Lease shall have been terminated pursuant to Paragraph 19(b), Landlord
shall use reasonable efforts to relet the Leased Premises or any part thereof
for the account of Tenant or Landlord or otherwise, without notice to Tenant,
for such term or terms and on such conditions (which may include concessions of
free rent) and for such uses as Landlord, in its absolute discretion, may
determine, and Landlord may collect and receive any rents payable by reason of
such reletting. Landlord shall not be responsible or liable for any failure to
relet the Leased Premises or any part thereof or for any failure to collect any
rent due upon any such reletting.
(e) In the event of the termination of this Lease upon an Event
of Default or repossession of the Leased Premises or any part thereof pursuant
to Paragraph 19(c) or otherwise, or the reletting of the Leased Premises or any
part thereof pursuant to Paragraph 19(d), Tenant shall remain liable as
hereinafter provided.
(f) In the event of any Default Termination or repossession of
the Leased Premises or any part thereof by reason of the occurrence of an Event
of Default, Tenant will pay to Landlord Basic Rent, Additional Rent and other
sums required to be paid by Tenant to and including the date of such termination
or repossession (including, without limitation, the amount of all sums which
have become due and payable by Landlord under the Credit Facility Documents and
the Bond Documents and the State Loan Documents); and, thereafter, Tenant shall,
until the end of what would have been the Term in the absence of such
termination or repossession, and whether or not the Leased Premises or any part
thereof shall have been relet, be liable to Landlord for, and shall pay to
Landlord, as liquidated and agreed current damages on each Basic Rent Payment
Date and on any other date when due and payable: (i) Basic Rent, Additional Rent
and other sums which would be payable under this Lease by Tenant in the absence
of such termination or repossession, less (ii) the net proceeds, if any, of any
reletting effected for the account of Tenant pursuant to Paragraph 19(d), after
deducting from such proceeds all Landlord's expenses in connection with such
reletting (including, without limitation, all repossession costs, brokerage
commissions, legal expenses, attorneys' fees, employees' expenses, alteration
costs and expenses of preparation for such reletting). Tenant will pay such
current damages on the days on which Basic Rent would have been payable under
this Lease in the absence of such termination or repossession, and Landlord
shall be entitled to recover the same from Tenant on each such day.
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(g) At any time after a Default Termination, Landlord shall be
entitled to recover from Tenant, and Tenant will pay to Landlord within 120 days
of demand therefor, an amount equal to Basic Rent, Additional Rent and other
sums which would be payable under this Lease, from the date to which Tenant
shall have satisfied in full its obligations under Paragraph 19(f) to pay
current damages, to the end of the remaining Term of this Lease in the absence
of such termination (assuming, in computing the amount of Basic Rent that would
have been due under Paragraph 7, an interest rate which is equal to the rate
applicable to such obligations on the date the Default Termination Notice is
issued "the "Assumed Rate"), discounted at the Assumed Rate, or such lower rate
as shall be necessary to provide that the sum payable by Tenant hereunder shall
satisfy in full the sum of (I) all Landlord's Credit Facility Obligations" and
"Landlord's Bond Obligations" accrued through the date of the payment due under
this Paragraph 19(g), including without limitation, all accrued fees, costs and
expenses payable to the Trustee, the Remarketing Agent, the Rating Agency and
the Credit Facility Providers, plus (II) all costs and expenses (including
reasonable attorneys fees and expenses) of the Credit Facility Providers,
Landlord and MIDFA in connection with such Default Termination.
(h) The words "enter", "re-enter" or "re-entry", as used in
this Paragraph 19, are not restricted to their technical meaning.
(i) An Event of Default (as defined in this Lease) under this
Lease shall constitute an Event of Default (as defined in the 1997 Lease) under
the 1997 Lease; and an Event of Default (as defined in the 1997 Lease) under the
1997 Lease shall constitute an Event of Default (as defined in this Lease) under
this Lease.
20. Additional Rights of Landlord.
(a) No right or remedy herein conferred upon or reserved to
Landlord is intended to be exclusive of any other right or remedy given
hereunder or now or hereafter existing at Law or in equity. The failure of
either party to insist at any time upon the strict performance of any covenant
or agreement or to exercise any option, right, power or remedy contained in this
Lease shall not be construed as a waiver or a relinquishment thereof for the
future. A receipt by Landlord of any Basic Rent, Additional Rent or any other
sum payable hereunder with knowledge of the breach of any covenant or agreement
contained in this Lease shall not be deemed a waiver of such breach, and no
waiver of any provision of this Lease shall be deemed to have been made unless
expressed in writing and signed by the waiving party. In addition to other
remedies provided in this Lease, Landlord shall be entitled, to the extent
permitted by applicable law, to injunctive relief in case of the violation, or
attempted or threatened violation, of any of the covenants, agreements,
conditions or provisions of this Lease, or to a decree compelling performance of
any of the covenants, agreements, conditions or provisions of this Lease, or to
any other remedy allowed to Landlord at Law or in equity.
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(b) Tenant hereby waives and surrenders, to the extent not
prohibited by Law, for itself and all those claiming under it, including
creditors of all kinds, (i) any right and privilege which it or any of them may
have under any present or future Law to redeem the Leased Premises or to have a
continuance of this Lease for the Term after termination of Tenant's right of
occupancy by order or judgment of any court or by any legal process or writ, or
under the terms of this Lease, or after the termination of the Term as herein
provided, and (ii) the benefits of any present or future law which exempts
property from liability for debt or for distress for rent.
(c) In the event Tenant shall be in default in the performance
of any of its obligations under this Lease, and an action shall be brought for
the enforcement thereof in which it shall be determined that Tenant was in
default, Tenant shall pay to Landlord all the expenses incurred in connection
therewith including reasonable attorney's fees. In the event Landlord shall,
without fault on its part, be made a party to any litigation commenced against
Tenant, and if Tenant, at its expense, shall fail to provide Landlord with
counsel reasonably approved by Landlord, Tenant shall pay all costs and
reasonable attorney's fees incurred or paid by Landlord in connection with such
litigation.
(d) If an Event of Default has happened and is continuing,
Landlord may, but shall not be obligated to, make any payment or perform any act
required hereunder to be made or performed by Tenant which has not been
performed within the time period specified herein for such performance, with the
same effect as if made or performed by Tenant, provided that no entry by
Landlord upon the Leased Premises for such purpose shall create any liability to
Tenant on the part of Landlord or shall constitute or shall be deemed to be an
eviction of Tenant, and no such entry shall waive or release Tenant from any
obligation or default hereunder. All sums so paid by Landlord and all costs and
expenses (including reasonable attorney's fees and expenses) incurred by
Landlord in connection with the performance of any such act, together with
interest at the Default Rate, shall constitute Additional Rent payable by Tenant
hereunder.
21. Inspection. Tenant shall permit Landlord, the Credit Facility
Providers, the State, MIDFA, and the holder of any Encumbrance, and its and
their representatives and agents to enter the Leased Premises, with notice to
Tenant and with an escort provided by Tenant, unless (i) an Event of Default
shall have occurred and be continuing, or (ii) an emergency threatening life or
property exists, in either of which cases, no advance notice shall be required,
without charge therefor and without diminution of the rent payable by Tenant, in
order to examine, inspect and protect the Leased Premises, or, during the last
year of the Term, to exhibit the same to brokers, prospective tenants, lenders,
purchasers and others. In connection with any such entry, Landlord shall
endeavor to minimize the disruption to Tenant's normal business operations in
the Leased Premises.
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22. Notices, Demands and Other Instruments. All notices, demands,
requests, consents, approvals, certificates or other communications required
under this Lease shall be in writing, and shall be sufficiently given and shall
be deemed to have been properly given (i) if delivered by hand, when written
confirmation of delivery is received by the sender, (ii) three days after the
same is mailed by certified mail, postage prepaid, return receipt requested, or
(iii) if sent by overnight courier, 24 hours (plus 24 hours for any intervening
day that is not a business day) after delivery to such overnight courier
addressed to the Person to whom any such notice, demand, request, consent,
approval, certificate or other communication is to be given, at the appropriate
address designated on Exhibit E attached hereto. Any party listed on Exhibit E
shall each have the right from time to time to specify as its address for
purposes of this Lease any other address in the United States of America upon
giving 15 days' written notice hereunder.
23. Estoppel Certificates. Landlord or Tenant, as the case may be,
shall, at any time and from time to time, upon not less than 20 days' prior
written notice by the other (but neither shall be required to do so more than
twice in any calendar year), execute, acknowledge and deliver to the requesting
party a statement in writing, executed by an authorized representative of
Landlord or by the President or a Vice President of Tenant, as the case may be,
certifying (i) that this Lease is unmodified and in full effect (or, if there
have been modifications, that this Lease is in full effect as modified, and
setting forth such modifications), (ii) the dates to which Basic Rent,
Additional Rent and all other sums payable hereunder have been paid, (iii) that
to the knowledge of the signer of such certificate no default by either Landlord
or Tenant exists hereunder or specifying each |
