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LEASE AGREEMENT
---------------
THIS LEASE, dated as of November 9, 2000, is by and between
DTC ASSOCIATES, LLC, a Virginia limited liability company ("Landlord")
and LIFEMINDERS.COM, INC., a Delaware corporation ("Tenant").
W I T N E S S E T H :
1. PRINCIPAL TERMS. Capitalized terms, first appearing in quotations in this
---------------
Section, elsewhere in the Lease or any Exhibits, are definitions of such terms
as used in the Lease and Exhibits and shall have the defined meaning whenever
used.
1.1 "BUILDING": Dulles Executive Plaza I, 13530 Dulles
Technology Drive, Herndon, Virginia,
consisting of approximately 189,701 rentable
square feet of space, as measured and
verified pursuant to Paragraph 1 of the
Addendum.
1.2 "PREMISES": Approximately 131,841 rentable square feet
consisting of floors 6, 5, 4 and 3, as
measured, confirmed, and adjusted if
necessary pursuant to Paragraph 1 of the
Addendum attached hereto. That portion of
the Premises consisting of 65,799 rentable
square feet of space consisting of floors 6
and 5 shall be referred herein and depicted
on Exhibit A as "Phase I" and the remaining
66,042 rentable square feet of space (floors
4 and 3) shall be referred herein and
depicted on Exhibit A as "Phase II".
Suite # 500
1.3 "INITIAL TERM": 10 years, 4 months from the
Anticipated Commencement Date*
Anticipated "Commencement Date":
September 18, 2000
Anticipated "Expiration Date":
January 31, 2011
*[SEE SECTION 3 & 5 OF LEASE]
1.4 "BASE RENT": Annually Per
Rentable
Period Monthly Square Foot
------ ------- ------------
First Lease Year $290,599.54** $26.45
Second Lease Year $299,828.41 $27.29
Third Lease Year $309,386.88 $28.16
Fourth Lease Year $319,165.09 $29.05
Fifth Lease Year $329,163.03 $29.96
Sixth Lease Year $339,600.44 $30.91
Seventh Lease Year $350,257.59 $31.88
Eighth Lease Year $361,354.21 $32.89
Ninth Lease Year $372,670.56 $33.92
Tenth Lease Year $384,316.52 $34.98
**[SEE SECTION 4 OF LEASE]
1.5 OPERATING EXPENSES: Base Year: 2001
Pro Rata Share: 69.499%
1.6 "DEPOSIT": None but see Addendum re Letter of Credit
1.7 "PERMITTED USE": Primary Use as General Business Offices,
and Ancillary Uses in accordance with
Section 10.1
1.8 "GUARANTOR": None
1.9 PARKING : 460 surface spaces
20 garage spaces
[based on a total of 4 per 1,000 usable]
------
1.10 LANDLORD'S NOTICE ADDRESS : DTC ASSOCIATES, LLC, c/o Miller Global
Properties, LLC, 4643 S. Ulster Street,
Suite 1500, Denver, CO 80237, Attn:
Donald E. Spiegleman, Esq. or Mr. Paul
Hogan
with a copy to Building Manager: [name, address and phone numbers
to be provided by Landlord]
_________________________________
Facsimile: ______________________
Telephone: ______________________
1.11 RENT PAYMENT ADDRESS : DTC ASSOCIATES, LLC, c/o Miller Global
Properties, LLC, 4643 S. Ulster Street,
Suite 1500, Denver, CO 80237
1.12 LANDLORD'S TAX I.D. : 84-1474242
----------
1.13 TENANT'S NOTICE ADDRESS :
Precommencement Address: 1110 Herndon Parkway
Suite 300
Herndon, Virginia 20170
Attention: Mr. David N. Mahoney, COO
Post Commencement Address: 13530 Dulles Technology Drive, Suite 500
Herndon, Virginia
With a copy to: Shaw Pittman
Attention: Craig Chason, Esq.
1676 International Drive
McLean, Virginia 22102-4835
1.14 TENANT'S TAX I.D. : 52-1990403
----------
1.15 LANDLORD'S BROKER : CB Richard Ellis, Inc.
1.16 COOPERATING BROKER : CB Richard Ellis, Inc.
1.17 ATTACHMENTS : [check if applicable]
x Addendum
---
x Exhibit A - The Premises
---
x Exhibit B - Real Property
---
x Exhibit C - Operating Expenses
---
2
x Exhibit D - Commencement
--- Certificate
x Exhibit E - Rules and Regulations
---
x Exhibit F - SNDA
---
x Exhibit G - Letter of Credit
---
x Exhibit H - Building Signage
---
x Exhibit I - Janitorial
--- Specifications
x Exhibit J - Work Letter
---
2. GENERAL COVENANTS. Tenant leases the Premises from Landlord for the
-----------------
term and upon the terms herein. Tenant covenants and agrees to pay Rent and
perform the obligations hereafter set forth and in consideration therefor
Landlord leases to Tenant the Premises as depicted on the plat attached as
Exhibit A, together with a non-exclusive right, subject to the provisions
hereof, to use plazas, common areas (including the Building's loading docks,
doors, platforms, staging areas and swing passenger/freight elevator), or other
areas on the real property legally described on Exhibit B (the "Real Property")
designated by Landlord for the exclusive or non-exclusive use of the tenants of
the Building ("Common Areas"). The Building, Real Property, Common Areas, and
appurtenances are hereinafter collectively sometimes called the "Building
Complex." The lease of the Premises also is subject to any covenants,
conditions and restrictions of record as of the date hereof and hereafter
recorded with the consent of Tenant. Prior to the date hereof, Landlord has
delivered to Tenant a copy of Landlord's current title policy.
3. TERM. The Initial Term of the Lease commences at 12:01 a.m. on the
----
Commencement Date as determined pursuant to and in accordance with the Work
Letter and terminates at 12:00 midnight on the last day (the "Expiration Date")
of the tenth Lease Year. The Initial Term together with any extensions thereof
is herein referred to as the "Term". The Initial Term shall be subject to
adjustment in accordance with Section 5.1. "Lease Year" means a period of one
year commencing on the first day of the month in which the Phase II Completion
Date (as determined in accordance with the Work Letter) occurs and each
successive one-year period, except that if the Phase II Completion Date is not
the first day of the month, then the first Lease Year shall commence on the
Phase II Completion Date and shall continue for the balance of the month in
which the Phase II Completion Date occurs and for a period ending on the last
day of the 12th full calendar month after the Phase II Completion Date, and each
Lease Year after the first Lease Year shall be the 12 full calendar months
thereafter.
4. RENT. Subject to the provisions below, commencing on the Commencement
----
Date and on the first day of each month thereafter, Tenant shall pay Base Rent
in the amount stated in Section 1.4, in advance without notice (all amounts,
including Base Rent, to be paid by Tenant pursuant to this Lease as the context
requires are sometimes referred to collectively as "Rent(s)"). Rents shall be
paid without set off, abatement, or diminution except as otherwise expressly set
forth herein, at the address set forth in Section 1.11 above, or at such other
place as Landlord from time to time designates in writing. Notwithstanding
anything to the contrary set forth in Section 1.4 above, Tenant shall only be
obligated to pay Base Rent attributable to Phase I ($145,031.96 per month,
calculated on the basis of prorating the Base Rent provided in Section 1.4)
during the period beginning with the Commencement Date as determined pursuant to
the Work Letter until the Phase II Completion Date as provided in Section 5.1;
Tenant shall have no obligation to pay Base Rent attributable to Phase II during
such period. If the Commencement Date is not the first day of a month, then on
the Commencement Date Tenant shall pay the Base Rent with respect to Phase I for
the month in which the Commencement Date occurs, calculated on a per diem basis
(based on the number of days in the relevant month) of the monthly installment
of the Base Rent payable during the first month of the Term of the Lease. If the
Phase II Completion Date is not the first day of a month, then on the Phase II
Completion Date Tenant shall pay the Base Rent with respect to Phase II for the
month in which the Phase II Completion Date occurs, calculated on a per diem
basis (based on the number of days in such month) of the monthly installment of
the Base Rent payable during such month.
3
5. COMPLETION OR REMODELING OF THE PREMISES.
----------------------------------------
5.1 Provisions regarding remodeling or tenant finish work (the "Tenant
Work") in the Premises, if any, are set forth in a work letter attached to this
Lease (the "Work Letter"). "Initial Tenant Finish" means the Premises in its
as-is condition as modified by all work, if any, performed by Landlord at its
expense prior to the Commencement Date in accordance with the Work Letter.
Except as provided in the Work Letter, Landlord has no obligation for the
completion or remodeling of the Premises, and Tenant accepts the Premises in its
"as is" condition upon delivery by Landlord in accordance with the Work Letter
(subject to punchlist items and latent defects, such items and defects to be
resolved pursuant to the Work Letter). If Landlord is delayed in delivering
Phase I of the Premises to Tenant in accordance with the Work Letter, then the
Commencement Date will be postponed to the date Landlord delivers Phase I to
Tenant. If delivery is on other than the first day of the month, then the
Commencement Date (for purposes of triggering the running of the Initial Term of
10 years and 4 months) will be the first day of the month following the delivery
date for Phase I but all provisions hereof, including Tenant's obligation to pay
Rent (prorated for a partial month), will be in effect as of the delivery date.
The postponement of Tenant's obligation to pay Rent is in full settlement of all
claims which Tenant may otherwise have by reason of such delay. If the Phase II
Completion Date is delayed beyond January 1, 2001, the Expiration Date shall be
extended so that the Initial Term expires at the end of the month 10 years
following the Phase II Completion Date. As soon as the Phase II Completion Date
occurs, Landlord and Tenant agree to execute a commencement agreement in the
form attached as Exhibit D setting forth the exact Commencement Date and
Expiration Date. Notwithstanding the foregoing or the Work Letter, if the
Commencement Date has not occurred by March 15, 2001 (the "Outside Date"), as
such date shall be extended on a day-for-day basis due to "Tenant Delay" as
defined in the Work Letter, or causes beyond Landlord's reasonable control (up
to a maximum of 30 days), Tenant, at its sole option, may terminate this Lease
upon notice to Landlord given no later than 10 days after the Outside Date. If
Tenant exercises its right to terminate hereunder, effective on the day such
notice is received by Landlord, this Lease will be null and void and of no
further force and effect. If Tenant fails to timely exercise its right to
terminate, this Lease will continue in full force and effect and the
Commencement Date will be established in accordance with the Work Letter.
5.2 Except as provided in the Work Letter, taking possession of the
Premises by Tenant is conclusive evidence that the Premises are in the condition
agreed between Landlord and Tenant and acknowledgment by Tenant of satisfactory
completion of any work which Landlord has agreed to perform, subject to the
punchlist and latent defects provisions of the Work Letter.
6. OPERATING EXPENSES. Tenant shall pay additional Rent in accordance with
------------------
Exhibit C attached hereto.
4
7. SERVICES.
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7.1 Landlord shall manage, operate, maintain, and repair the Building in
accordance with standards customarily provided in first-class office buildings
in the Herndon-Dulles metropolitan area. Subject to the provisions below,
Landlord agrees, without charge, in accordance with standards reasonably
determined by Landlord from time to time for the Building (which standards shall
provide for services comparable to services provided by office buildings of
similar size and quality in the Herndon-Dulles metropolitan area): (1) to
furnish hot and cold running water at those points of supply for general use of
tenants of the Building (including for the separate men's and women's showers
provided in Landlord's Drawings as part of the ground floor restrooms) on a 24-
hours-a-day, seven-days-a-week basis; (2) to furnish to interior Common Areas
heated or cooled air (as applicable), electrical current on a 24-hours-a-day,
seven-days-a-week basis for lighting and safety purposes, janitorial services,
and maintenance; (3) during Ordinary Business Hours to furnish heated or cooled
air to the Premises for standard office use consistent with the design capacity
of the Building HVAC system in accordance with Building Improvements as
described in the Work Letter attached hereto as Exhibit J; (4) to furnish,
subject to availability and capacity of building systems in accordance with the
Building Improvements, unfiltered treated chilled water for use in Tenant's
packaged HVAC systems provided that such systems are approved by Landlord,
including strainers, pumping systems and controls (it being agreed that Tenant
may install supplemental HVAC units within the Premises consistent with its
design plans for the Tenant Work); (5) to provide, during Ordinary Business
Hours, the general use of passenger elevators for ingress and egress to and from
the Premises (at least one such elevator shall be available at all times except
in the case of emergencies or repair) and a card-key access control system for
the Building that will afford Tenant access to the Building on a 24-hours per
day, 7-days per week basis, subject to required repairs and maintenance or other
uncontrollable interruptions; (6) to provide janitorial services for the
Premises to the extent of the Initial Tenant Finish (including window washing of
the outside of exterior windows) after Ordinary Business Hours in accordance
with the specifications attached hereto as Exhibit I; and (7) on a 24-hours-a-
day, seven-days-a-week basis, to cause electric current to be supplied to the
Premises in accordance with the Building Improvements and hot and cold water
(items (1) through (7) are collectively called "Services"). "Ordinary Business
Hours" means 8:00 a.m. to 7:00 p.m. Monday through Friday and 9:00 a.m. to 2:00
p.m. on Saturdays, Legal Holidays excepted. "Legal Holidays" mean New Year's
Day, Martin Luther King Day, Inauguration Day, Presidents' Day, Memorial Day,
Independence Day, Labor Day, Columbus Day, Veterans Day, Thanksgiving Day,
Christmas Day, and such other national holidays hereafter established by the
United States Government that are recognized by similar first class office
buildings in the Herndon-Dulles metropolitan area. Any security system or other
security measures (collectively "Security") that Landlord may undertake are for
protection of the physical structures only and shall not be relied upon by
Tenant, its agents, employees, contractors or invitees, including subtenants or
assignees (collectively, "Invitees") to protect their person, or property,
including Tenant's Property. Tenant shall not knowingly do anything to
circumvent or allow others to circumvent security. Landlord shall not be liable
for any failure of any security to operate or for any breach or circumvention of
the security by others, and Landlord makes no representations or warranties
concerning the installation, performance and monitoring of the security or that
it will detect or avert occurrences which any such security is intended or
expected to detect or avert. Landlord shall, at its cost, provide an initial
set of security access cards to the Building in an amount up to 527 Building
access cards. Tenant shall have a right to install its own security system (the
"Tenant's System") in the Premises provided that such system is installed in
such a manner as to permit the continued operation of Landlord's security and
life safety systems. Tenant shall provide Landlord with keys, access cards or
access numbers for any security system installed by Tenant to permit Landlord to
have access to the Premises, provided that such access is in accordance with
Section 11.2 of this Lease. Subject to Section 12.3 of this Lease, if Tenant
does not elect to remove Tenant's System on or prior to the expiration or
earlier termination of the Lease, Tenant shall deliver to Landlord all manuals
and other equipment required for operation of the Tenant's System and leave in
place all cabling and related equipment installed in the Premises.
7.2 The electricity for the lighting, equipment and machinery in the
Premises shall be separately metered by a submeter or checkmeter (the cost of
installing and maintaining the meter shall be paid by Tenant); Tenant shall not
separately contract with the utility provider, but shall be billed by Landlord
based on the submeter or checkmeter and the actual costs paid by Landlord for
such electrical service, without markup and such amounts shall be in addition to
(and not duplicative of) any amounts required to be paid by Tenant as Operating
Expenses under the foregoing provisions or as charges for Excess Usage, as
hereinafter provided. In the event that all or any portion of such electricity
is not separately metered, Landlord shall make a reasonable determination of
Tenant's proportionate share of the cost of such utility and Tenant shall pay
such amount upon billing by Landlord. All amounts to be paid Landlord hereunder
shall be deemed Rents. In addition, Tenant shall be responsible for and shall
pay promptly, directly to the appropriate supplier, all charges for telephone,
interior landscape maintenance, and other materials and services furnished
directly to Tenant or the Premises, or used by Tenant in or about the Premises
during the Term, together with any taxes thereon. Electricity shall be provided
to the Premises 24 hours a day without notice being required and without
additional charges for after-hours usage of such facilities. Tenant shall also
pay the cost of replacing light bulbs and/or tubes and ballast used in all
lighting in the Premises other than that provided by Landlord to all tenants of
the Building. It is agreed that if Tenant requires HVAC services beyond
Ordinary Business Hours, Landlord will
5
furnish such HVAC services, provided Tenant gives Landlord's agent sufficient
advance notice of such requirement and Tenant pays for the cost of such extra
service in accordance with Landlord's then current schedule of costs and
assessments for such extra service. As of the date hereof, Landlord has
estimated that the per hour charge for air-conditioning outside Ordinary
Business Hours will be $35.00 per floor served (all or any portion); such charge
is subject to increase based on increases in costs of utilities included in such
costs and only after prior notice to Tenant. Sufficient notice for purposes of
the preceding sentence shall be deemed to include 1 hour notice if given between
the hours of 8:00 a.m. and 5:00 p.m. Monday - Friday, 1 hour notice if given
between the hours of 8:00 a.m. and noon on Saturday, and if such extra service
is required on Sundays or holidays then sufficient notice shall be given if
given on the day immediately preceding the Sunday or holiday within the notice
hours specified above for such day. Any electricity to be supplied to a
segregated computer room, including electricity for the separate self-contained
HVAC units servicing such area, if any, shall be included in the separate
metering of electricity for the Premises referred to above; Tenant shall pay the
cost of installing and maintaining any such separate self-contained HVAC units.
7.3 If Tenant requires janitorial services other than those included as
standard Services, Tenant shall separately pay for the direct, out-of-pocket,
third party costs of such services monthly within 30 days following receipt of
written billings by Landlord, or in any event (i.e., regardless if Tenant
requires other than standard Services), Tenant may, at Tenant's option,
separately contract for such services with the same company used by Landlord to
furnish janitorial services to the Building or another janitorial service
provider selected by Tenant and subject to Landlord's reasonable approval.
7.4 Upon prior notice to Tenant (except in the event of an emergency),
Landlord may temporarily discontinue, reduce, or curtail Services when necessary
due to accident, repairs, alterations, strikes, lockouts, Applicable Laws (as
defined in Section 10 below), or any other happening beyond Landlord's
reasonable control. Landlord is not liable for damages to Tenant or any other
party as a result of any interruption, reduction, or discontinuance of Services
(either temporary or permanent) nor shall the occurrence of any such event be
construed as an eviction of Tenant, cause or permit an abatement, reduction or
setoff of Rent, or operate to release Tenant from Tenant's obligations.
Notwithstanding the foregoing to the contrary, if (a) any interruption of the
Services described in Section 7.1 above resulting from Landlord's (or its
employee's agent's or contractor's) negligence or willful misconduct shall
continue for more than 4 consecutive business days, or (b) if any interruption
of Services not resulting from Landlord's (or its agent's or employee's)
negligence or willful misconduct nor from Tenant's (or its agents or employees)
negligence or willful misconduct shall continue for more than 8 consecutive
business days, and in either of the foregoing instances if (i) such interruption
is not the result of any willful misconduct or negligent act or breach of
obligations or omission of Tenant or Tenant's employees, contractors, or agents,
or any persons occupying the Premises under Tenant, and (ii) such interruption
renders more than 25% of the Premises untenantable or inaccessible by Tenant,
then, as Tenant's sole and exclusive remedy therefor, all Base Rent and
Additional Rent payable hereunder with respect to such portion of the Premises
shall be abated for the period beginning as of the first day of such
interruption and continuing until full use of the Premises is restored to
Tenant. Landlord will use its commercially reasonable efforts to cause the
restoration of any interrupted Services; further, should any equipment or
machinery in the Building break down so as to render the Premises unusable by
Tenant, Landlord shall promptly repair or replace it (subject to delays which
result from strikes, unavailability of parts or other materials, or other
matters beyond Landlord's reasonable control).
7.5 Tenant shall promptly notify Landlord of any accidents or defects in
the Building of which Tenant becomes aware, including defects in pipes, electric
wiring, and HVAC equipment, and of any condition which may cause injury or
damage to the Building or any person or property therein, but any failure on the
part of Tenant to so notify Landlord shall not abrogate Landlord's maintenance
and repair obligations hereunder.
7.6 Landlord agrees to competitively bid all contracts for service and
materials (including the property management contract) for the operation of the
Building to at least 3 service providers. Any selection made by Landlord shall
be made from among the 3 who provided bids for each particular service, in the
exercise of Landlord's commercially reasonable judgment.
8. QUIET ENJOYMENT. So long as an Event of Default has not occurred, Tenant
---------------
is entitled to the quiet enjoyment and peaceful possession of the Premises
subject to the provisions of this Lease. Landlord shall under no circumstances
be held responsible for restriction or disruption of access to the Building from
public streets caused by construction work or other actions taken by or on
behalf of governmental authorities, or for actions taken by other tenants (their
employees, agents, visitors, contractors or invitees), or any other cause not
entirely within Landlord's direct control, and same shall not constitute a
constructive eviction of Tenant nor give rise to any right or remedy of Tenant
against Landlord of any nature or kind; provided, however, that with respect to
construction work or other actions taken by other tenants, Landlord shall use
reasonable efforts to ensure that Tenant's access to, and use of, the Premises
is not materially adversely affected. This covenant of quiet enjoyment is in
lieu of any covenant of quiet enjoyment provided or implied by law, and Tenant
expressly waives any such other covenant of quiet enjoyment to the extent
broader than the covenant contained in this Section.
6
9. DEPOSIT. [INTENTIONALLY DELETED]
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10. CHARACTER OF OCCUPANCY.
----------------------
10.1 Tenant shall occupy the Premises for the Permitted Use and for no
other purpose, and use it in a careful, safe, and proper manner. The term
"Permitted Use" shall mean: general business office use (the "Primary Use")
and for activities ancillary thereto (the "Ancillary Uses") provided that
Ancillary Uses shall not be the primary use of the Premises, are permitted by
Applicable Laws (as hereinafter defined), and are expressly approved by
Landlord, which approval shall not be unreasonably withheld if such uses are
consistent with first class suburban general office building uses and so long as
in keeping with Building's first-class quality and allowed under zoning
applicable to the Building. Tenant shall be responsible for obtaining any
approvals or permits required for the Ancillary Uses under Applicable Laws and
the declaration of protective covenants applicable to the Real Property (the
"Declaration"). Subject to Landlord's obligations under Sections 10 and 11
hereof, Tenant, at Tenant's expense, shall comply with the Declaration and all
applicable federal, state, city, quasi-governmental and utility provider laws,
codes, rules, and regulations now or hereafter in effect ("Applicable Laws")
which impose any duty upon Landlord or Tenant with respect to the occupation or
alteration of the Premises. Tenant shall not commit or permit waste or any
nuisance on or in the Premises. Tenant agrees not to store, keep, use, sell,
dispose of or offer for sale in, upon or from the Premises any article or
substance prohibited by any insurance policy covering the Building Complex nor
shall Tenant keep, store, produce or dispose of on, in or from the Premises or
the Building Complex any Hazardous Materials, except customary office and
cleaning supplies customarily associated with the Permitted Use of the Premises
that are disclosed to Landlord and are stored and used in accordance with
Applicable Laws and applicable industry standards. At the expiration or earlier
termination of this Lease, Tenant shall surrender the Premises to Landlord free
of Hazardous Materials (except to the extent that any such Hazardous Materials
were brought into the Premises by Landlord, its employees, contractors, or
agents) and in compliance with all Environmental Laws (except to the extent any
such non-compliance was caused by Landlord or its agents, employees or
contractors). As used in this Lease, "Hazardous Materials" means (a) asbestos
and any asbestos containing material and any substance that is then defined or
listed in, or otherwise classified pursuant to, any Environmental Law or any
other applicable Law as a "hazardous substance," "hazardous material,"
"hazardous waste," "infectious waste," "toxic substance," "toxic pollutant" or
any other formulation intended to define, list, or classify substances by reason
of deleterious properties such as ignitability, corrosivity, reactivity,
carcinogenicity, toxicity, reproductive toxicity, or Toxicity Characteristic
Leaching Procedure (TCLP) toxicity, (b) any petroleum and drilling fluids,
produced waters, and other wastes associated with the exploration, development
or production of crude oil, natural gas, or geothermal resources, and (c) any
petroleum product, polychlorinated biphenyls, urea formaldehyde, radon gas,
radioactive material (including any source, special nuclear, or byproduct
material), medical waste, chlorofluorocarbon, lead or lead-based product, and
(d) any other substance whose presence could be detrimental to the Buildings,
Land or Complex or hazardous to health or the environment. "Environmental Law"
means any present and future law and any amendments (whether common law,
statute, rule, order, regulation or otherwise), permits and other requirements
or guidelines of governmental authorities applicable to the Buildings, Land, or
Complex and relating to the environment and environmental conditions or to any
Hazardous Material (including, without limitation, CERCLA, 42 U.S.C. (S) 9601 et
seq., the Resource Conservation and Recovery Act of 1976, 42 U.S.C. (S) 6901 et
seq., the Hazardous Materials Transportation Act, 49 U.S.C. (S) 1801 et seq.,
the Federal Water Pollution Control Act, 33 U.S.C. (S) 1251 et seq., the Clean
Air Act, 33 U.S.C. (S) 7401 et seq., the Toxic Substances Control Act, 15 U.S.C.
(S) 2601 et seq., the Safe Drinking Water Act, 42 U.S.C. (S) 300f et seq., the
Emergency Planning and Community Right-To-Know Act, 42 U.S.C. (S) 1101 et seq.,
the Occupational Safety and Health Act, 29 U.S.C. (S) 651 et seq., and any so-
called "Super Fund" or "Super Lien" law, any Law requiring the filing of
reports and notices relating to hazardous substances, environmental laws
administered by the Environmental Protection Agency, and any similar state and
local laws, all amendments thereto and all regulations, orders, decisions, and
decrees now or hereafter promulgated thereunder concerning the environment,
industrial hygiene or public health or safety).
10.2 In the event Landlord is advised, or it shall come to Landlord's
attention, that Hazardous Materials exist in the Premises in violation of any
Environmental Laws that were not introduced therein by Tenant or Tenant's
Invitees, Landlord shall take all commercially reasonable steps necessary to
promptly remove or remediate (or cause to be removed or remediated) all such
Hazardous Materials, and in doing so, Landlord shall use its reasonable efforts
not to interfere with the conduct of Tenant's business.
10.3 Notwithstanding anything to the contrary contained in this Lease, it
is agreed that Landlord shall be responsible for compliance with any present or
future Applicable Laws with respect to (a) those elements and components of the
Base Building Systems and structure that are situated outside the perimeter of
the Premises or are within vertical penetrations running through the Premises,
and (b) the common areas of the Buildings, unless such Applicable Laws are
imposed because of Tenant's particular use of the Premises (as opposed to office
use generally) or any improvements constructed by Tenant in the Premises or to
accommodate special needs of specific employees of Tenant. Notwithstanding
anything to the contrary in this Lease, all additions, replacements or
alterations to the
7
Building and Building Improvements (including those portions located within the
Premises) that are required due to the enactment of any future Applicable Laws
shall be performed by Landlord.
11. MAINTENANCE, ALTERATIONS AND REENTRY BY LANDLORD.
------------------------------------------------
11.1 Landlord shall keep, maintain, repair and replace as appropriate,
the foundation, roof, exterior walls, structural portions (including columns
within the Premises and the vertical sprinkler riser through the Buildings), and
exterior glass and windows of the Buildings (specifically excluding the interior
walls, doors, partitions, locks, and door jambs in the Premises), as well as all
building standard mechanical, plumbing, heating, air conditioning, sprinkler and
electrical systems and utility service lines therein (exclusive of telephone,
telecommunications or data lines), the plumbing system to and from the Premises
and core area restrooms within the Premises, and the driveways, parking areas
and grounds adjacent to the Buildings in good condition and repair, and the
costs incurred by Landlord in maintaining and repairing such items shall be
included in the Operating Expenses of the Buildings. All common or public areas
of the Buildings, land, and Building Complex shall be maintained by Landlord in
accordance with standards customarily maintained for comparable office buildings
of a similar class in the Herndon-Dulles metropolitan area. Tenant shall
promptly provide Landlord with notice of any defect or need for repairs in or
about the Building of which Tenant is aware; provided, however, Landlord's
obligation to repair hereunder shall not be limited to matters of which it has
been given notice by Tenant. Notwithstanding any of the foregoing to the
contrary: (a) maintenance and repair of special tenant areas, facilities,
finishes and equipment (including, but not limited to, any special fire
protection equipment, telecommunications and computer equipment, kitchen/galley
equipment, air-conditioning equipment serving the Premises only and all other
furniture, furnishings and equipment of Tenant and all Alterations) shall be the
sole responsibility of Tenant and shall be deemed not to be a part of the
Buildings' structure and systems; and (b) Landlord shall have no obligation to
make any repairs (i) within the Premises brought about by any willful misconduct
or negligence of Tenant or any Invitee, or (ii) to the Buildings brought about
by any willful misconduct or negligence of Tenant or its employees, contractors,
agents, subtenants, or assignees. If Landlord fails or is unable to comply with
its obligations under this Section 11.1 or Section 10.2 above, and if all or at
least twenty-five percent (25%) of the Premises is thereby rendered unusable by
Tenant for a continuous period of five (5) consecutive business days after
Tenant gives Landlord notice thereof as a result of a failure or inability of
Landlord to comply with Landlord's obligations under this Section 11.1 or
Section 10.2 above, then, so long as no Event of Default exists under this Lease
and provided such failure or inability was not caused by the negligence or
willful misconduct of Tenant or its Invitees, Tenant shall be entitled to an
abatement of the Base Rent payable hereunder with respect to the portion of the
Premises that is unusable for the period beginning on the day after such five
(5) business day period ends (or any such earlier date to the extent Landlord
receives rent loss insurance proceeds therefor) and continuing until the use of
the Premises is restored to Tenant.
11.2 Landlord or Landlord's agents may at any time enter the Premises
after reasonable prior notice to Tenant (except in an emergency and during
regularly scheduled janitorial or cleaning, repairs or maintenance, when no
notice is required) for examination and inspection, or to perform, if Landlord
elects and only if Tenant has been given no less than ten (10) days prior notice
(except in an emergency, when no notice is required) and an opportunity to
perform for itself, any obligations of Tenant which Tenant fails to perform or
such cleaning, maintenance, janitorial services, repairs, replacements,
additions, or alterations as Landlord deems reasonably necessary for the safety,
improvement, or preservation of the Premises or other portions of the Building
Complex or as required by Applicable Laws. Upon reasonable prior notice,
Landlord or Landlord's agents may also show the Premises to prospective
purchasers and Mortgagees at any time and to prospective tenants during the last
12 months of the Term. In connection with any above-mentioned entry, Landlord
shall endeavor to minimize the disruption to Tenant's use of the Premises. Any
such reentry does not constitute an eviction or entitle Tenant to abatement of
Rent. Notwithstanding anything to the contrary set forth in this Lease, except
in the event of an emergency, Landlord shall not be permitted access to limited
portions of the Premises previously designated by notice from Tenant to Landlord
as security areas, unless Landlord or its representatives are accompanied by an
agent of Tenant designated and made available by Tenant for such purpose;
Landlord shall have a right in the event of a casualty or other life-threatening
emergency and if an agent of Tenant is unavailable to escort Landlord or
Landlord's representative into the security area, to break down the doors to
such secured areas for the purpose of dealing with the emergency and Tenant
shall be responsible for any damage caused by such entrance. Landlord shall have
no obligation to provide janitorial services to such secured areas unless
expressly requested by Tenant and Tenant pays for any added janitorial costs
arising from Tenant's security arrangements (it being agreed that if the
security area is substantially similar in functionality and layout to non-
security areas of the Premises and if Tenant provides access during normal
janitorial hours, then there shall be no such additional janitorial costs).
Landlord may make such alterations or changes in other portions of the Building
Complex as Landlord desires so long as such alterations and changes do not
unreasonably interfere with Tenant's use and occupancy of, or access to, the
Premises or materially increase Tenant's obligations and subject to the
following provisions: (i) unless required by Applicable Laws, if Landlord
changes the street address, then Landlord shall pay Tenant's reasonable costs of
replacing a reasonable stock of its stationery that references the old address
and (ii) if Landlord erects or changes pipes and conduits in and through the
Premises such alterations and changes shall not materially interfere with
Tenant's use or occupancy of, or access to, the Premises and shall be installed
behind the
8
walls, under the floors, or above the ceilings. Landlord may use the Common
Areas and one or more street entrances to the Building Complex as may be
necessary in Landlord's judgment to complete such work in accordance with
Section 27.12.
11.3 If any damage (other than normal wear and tear) to the permanent
improvements in Premises (exclusive of Tenant's personal property or Tenant's
trade fixtures) is caused by the negligence or willful misconduct of Landlord or
Landlord's employees, agents or contractors, Landlord shall, at its sole
expense, repair promptly such damage or cause such damage to be repaired
promptly.
12. ALTERATIONS AND REPAIRS BY TENANT.
---------------------------------
12.1 After completion of the Tenant Work, Tenant shall not make any
alterations to the Premises during the Term, including installation of equipment
or machinery which requires modifications to existing electrical outlets or
increases Tenant's usage of electricity beyond the capacity of the Building
systems (collectively "Alterations") without in each instance first obtaining
the written consent of Landlord, which consent shall not be unreasonably
withheld, conditioned or delayed. Landlord's consent or approval of the plans,
specifications and working drawings for any Alterations shall not constitute any
warranty or representation by Landlord (and shall not impose any liability on
Landlord) as to their completeness, design sufficiency, or compliance with
Applicable Laws; provided, however, Tenant may, without Landlord's consent (but
with notice of the nature of the changes, as reflected in record or as-built
drawings promptly delivered to Landlord following completion of Alterations)
perform interior non-structural Alterations not involving modifications to the
Base Building plumbing, electrical, mechanical or life safety systems (as
distinguished from the portions of such systems located within the Premises that
are installed by Tenant as Initial Tenant Finish, if any) provided the cost of
any particular Alterations (taking into account together all Alterations being
made as part of a common or phased plan) does not exceed One Hundred Twenty Five
Thousand Dollars ($125,000). Tenant shall at its cost: pay all reasonable third
party engineering costs incurred by Landlord as to all Alterations for which
Landlord's consent is required, obtain all governmental permits and approvals
required (except if the Tenant Work or Alterations are performed by Landlord, in
which event Landlord shall obtain the necessary governmental permits and
approvals), cause all Alterations to be completed in compliance with Applicable
Laws and reasonable requirements of Landlord's insurance, and provide Landlord
with record or as-built drawings promptly following completion of Alterations.
All such work relating to Alterations shall be performed in a good and
workmanlike manner, using new or like-new materials and equipment at least equal
in quality to the Initial Tenant Finish. All Alterations, repair and
maintenance work performed by Tenant shall be done at Tenant's expense using
contractors licensed to perform the applicable work in the Commonwealth of
Virginia who are reasonably approved by Landlord, which contractors shall
complete the Alterations in accordance with Landlord's reasonable contractor
rules attached as Exhibit 2 to the Work Letter. If such work is not performed
by Landlord's employees and such work is performed subsequent to the Tenant Work
contemplated in the Work Letter, involves the Building systems and/or structural
portions of the Building and Landlord reasonably determines that supervision of
such work is required, Tenant shall pay Landlord, upon receipt of an invoice, a
supervisory fee based on actual costs paid to third parties. If Landlord
authorizes such persons to perform work, Tenant shall deliver to Landlord prior
to commencement of work, certificates issued by insurance companies qualified to
do business in the state in which the Premises are located, evidencing that
worker's compensation, public liability insurance, and property damage insurance
(in amounts, with companies and on forms satisfactory to Landlord) are in force
and maintained by all contractors and subcontractors engaged to perform such
work. All liability policies shall name Landlord, Building Manager, and
Mortgagee as additional insureds. Each certificate shall provide that the
insurance may not be cancelled or modified without 10 days' prior notice to
Landlord and Mortgagee. Landlord also has the right to post notices in the
Premises in locations designated by Landlord stating that Landlord is not
responsible for payment for such work and containing such other information as
Landlord deems necessary. All such work shall be performed in a manner which
does not unreasonably interfere with Landlord or other tenants of the Building,
or impose additional expense upon Landlord in the operation of the Building
Complex.
12.2 Tenant shall keep the Premises in as good order, condition, and
repair and in an orderly state, as on the Commencement Date, loss by fire or
other casualty or ordinary wear excepted, and damage due to the negligence or
willful misconduct of Landlord or Landlord's agents, contractors, or employees.
The liability of Tenant for the costs and expenses of repairs shall be reduced
by the amount of any insurance proceeds for which Landlord is entitled (or for
which Landlord would have been entitled had Landlord obtained and maintained the
insurance required pursuant to the terms of this Lease).
12.3 All Alterations, including partitions, paneling, carpeting, drapes
or other window coverings, and light fixtures (but not including movable office
furniture not attached to the Building), are deemed a part of the real estate
and the property of Landlord and remain upon and be surrendered with the
Premises at the end of the Term, whether by lapse of time or otherwise, unless
(a) Tenant requests, when it submits its plans and specifications for such
Alteration to Landlord for Landlord's approval, Landlord's consent to Tenant's
removal of such Alterations upon the expiration or earlier termination of the
Lease Term and Landlord so consents, or (b) Landlord specifies in its approval
of the plans and specifications for such Alterations that Tenant must remove the
Alterations upon the expiration or
9
earlier termination of the Term of the Lease, except that if Tenant is not in
default under this Lease beyond any applicable notice and cure period, then
Tenant shall have the right to remove, prior to the expiration or earlier
termination of the Term of the Lease, movable furniture, Tenant's System
(excluding mechanical door locks), movable furnishings and movable trade
fixtures installed in the Premises by Tenant solely at Tenant's expense;
provided, however, that Landlord may only require that an Alteration be removed
upon the expiration or earlier termination of the Term of the Lease if in
Landlord's reasonably professional judgment such Alteration would, as a result
of the unique nature of such items or the anticipated difficulty or expense
required to remove such items, expose Landlord to greater expense and effort in
order to remove such items than the standard demolition of such space would have
otherwise involved. If Tenant is required to remove all or part of any
Alterations, Tenant shall at Tenant's expense promptly remove the Alterations
specified and restore the Premises to its prior condition, reasonable wear and
tear and damage due to casualty excepted. In lieu of requiring Tenant to restore
or alter the ceiling of the Premises upon expiration or earlier termination of
the Lease, Landlord and Tenant have agreed on compensation to Landlord in the
form of a Ceiling Reimbursement fee as described in greater detail in the Letter
of Credit provision of the Addendum.
13. CONSTRUCTION LIENS. Tenant shall pay for all work done on the Premises
------------------
by Tenant or at its request (other than the Initial Tenant Finish) of a
character which may result in liens on Landlord's or Tenant's interest and
Tenant will keep the Premises free of all construction liens, and other liens on
account of such work. Tenant indemnifies, defends, and saves Landlord and all
Mortgagees harmless from all liability, loss, damage, or expenses, including
attorneys' fees, on account of any claims of laborers, materialmen or others for
work performed or for materials or supplies furnished to Tenant or persons
claiming under Tenant. If any lien is recorded against the Premises or Building
or any suit affecting title thereto is commenced as a result of such work, or
supplying of materials, Tenant shall cause such lien to be removed of record
within 10 days after notice from Landlord. If Tenant desires to contest any
claim, Tenant must furnish Landlord adequate security or a bond of at least 150%
of the amount of the claim, plus estimated reasonable costs and, if a final
judgment establishing the validity of any lien is entered, Tenant shall
immediately pay and satisfy the same. If Tenant fails to proceed as aforesaid,
Landlord may pay such amount and any costs, and the amount paid, together with
reasonable attorneys' fees incurred, shall be due to Landlord within 10 days
following notice therefor.
14. SUBLETTING AND ASSIGNMENT.
-------------------------
14.1 Tenant shall not sublet any part of the Premises nor assign or
otherwise transfer this Lease or any interest herein (sometimes referred to as
"Transfer," and the subtenant or assignee may be referred to as "Transferee")
without the consent of Landlord first being obtained, which consent will not be
unreasonably withheld, conditioned or delayed, provided that: (1) Tenant
complies with the provisions of Section 14.4; (2) Landlord declines to exercise
its rights under Section 14.3; (3) the Transferee is engaged in a business and
the portion of the Premises will be used for the Permitted Use in a manner which
is in keeping with the then standards of similar first class office buildings in
the Herndon-Dulles metropolitan area and does not conflict with any exclusive
use rights granted to any other tenant of the Building Complex; (4) the
Transferee has reasonable financial worth in light of the responsibilities
involved (taking into account Tenant's obligations under this Lease and the net
worth and creditworthiness of Tenant and other parties responsible for Tenant's
obligations under this Lease); (5) an Event of Default does not exist hereunder
at the time Tenant makes its request; (6) the Transferee is not a governmental
or quasi-governmental agency (if such quasi-governmental agency leases space
under contracting requirements of the General Services Administration of the
U.S. Government); and (7) the Transferee is not a tenant or currently
negotiating a lease with Landlord in the Dulles Executive Plaza Complex
(including the Building Complex) for space similar in size to the space proposed
to be Transferred by Tenant. Transfer includes a sale by Tenant of
substantially all of its assets or stock if Tenant is a publicly traded
corporation, a merger of Tenant with another corporation, the transfer of 49% or
more of the stock in a corporate tenant whose stock is not publicly traded, or
transfer of 49% or more of the beneficial ownership interests in a partnership
or limited liability company tenant. If any Alterations to the Premises or the
Common Areas are required by Applicable Laws in connection with such Transfer or
the particular business of such Transferee, such Alterations shall be subject to
the prior approval of Landlord (which approval shall not be unreasonably
withheld, conditioned or delayed) and Tenant shall bear the cost of such
Alterations.
14.2 Following any Transfer in accordance with this Section 14, Landlord
may, after the occurrence of an Event of Default by Tenant and until such Event
of Default is cured, collect rent from the Transferee or occupant and apply the
net amount collected to the Rent, but no Transfer or collection will be deemed
an acceptance of the Transferee or occupant as Tenant or release Tenant from its
obligations. Consent to a Transfer shall not relieve Tenant from obtaining
Landlord's consent to any other Transfer. Notwithstanding Landlord's consent to
a Transfer, Tenant shall continue to be primarily liable for its obligations.
Solely with respect to subleases and assignments for which Landlord's consent is
required, if Tenant collects any rent or other amounts from a Transferee in
excess of the Rent and other amounts due under this Lease for any monthly
period, Tenant shall pay Landlord 50% of the excess monthly, as and when
received; provided, however, that all expenses incident to any assignment or
subletting, including brokerage fees, down time pending consummation of the
Transfer, reasonable attorneys' fees, abatements, the unamortized costs of the
Tenant Work in excess of the Allowance to the extent completed for such
subtenant in such
10
space (with interest at Tenant's cost of funds or, if the improvement is not
financed, at the prime rate reported in the Wall Street Journal on the date of
-------------------
such expenditure) and similar inducements or expenses, shall be calculated and
amortized over the term of such sublease or assignment, and be reimbursed
monthly to Tenant out of the rent received by Tenant based on such amortization
prior to such division of any excess rent.
14.3 Notwithstanding the above (and except for a Transfer permitted
under Section 14.7), if Tenant requests Landlord's consent to sublet 49% or more
of the Premises for all or substantially all of the remainder of the then-
current Term of the Lease or assign Tenant's interest in the Lease, Landlord may
refuse to grant such consent in its sole discretion and terminate this Lease as
to the portion of the Premises with respect to which such consent was requested;
provided, however, if Landlord does not consent and elects to terminate the
Lease as to such portion, Tenant may within 15 days after notice from Landlord
to this effect withdraw Tenant's request for consent. If such termination
occurs, it shall be effective on the date designated in a notice from Landlord
and shall not be more than 30 days following such notice.
14.4 Tenant must notify Landlord at least 30 days prior to the desired
date of the Transfer ("Tenant's Notice"), excluding a Transfer permitted under
Section 14.7. Tenant's Notice shall describe the portion of the Premises to be
transferred and the terms and conditions. Landlord has, without obligation, 15
days following receipt of Tenant's Notice to (i) propose a subtenant for such
space (which subtenant shall be subject to reasonable approval of Tenant) or
(ii) exercise its rights pursuant to Section 14.3 if Tenant's Notice discloses
that 49% or more of the Premises is involved for all or substantially all of the
remainder of the then-current Term of the Lease. If the space covered by
Tenant's Notice is subleased to a sublessee proposed by Landlord, rent and other
sums due from the subtenant will be paid to Tenant directly and Landlord has no
responsibility for the performance by such subtenant of its obligations under
its sublease with Tenant. If Landlord does not exercise its rights under clause
(i) or clause (ii) within 15 days after receipt of Tenant's Notice, Landlord
shall be deemed to have waived its rights under those clauses with respect to
the proposed transaction and Tenant shall be free to sublet the specified
portion of the Premises to any third party on terms substantially identical to
those described in Tenant's Notice, subject to Landlord's consent as set forth
above. If Tenant does not sublet such portion of the Premises within 180 days
following Landlord's notice to Tenant, Tenant must reoffer the Premises to
Landlord in accordance with the provisions hereof prior to subleasing to a third
party.
14.5 Tenant shall deliver to Landlord a fully-executed copy of each
agreement evidencing a sublease, assignment or mortgage within 10 business days
after the full execution thereof. Each sublease is subject to the condition
that if the Term of this Lease is terminated or Landlord succeeds to Tenant's
interest in the 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. Solely with respect to subleases and
assignments for which Landlord's consent is required, Tenant shall pay
Landlord's reasonable expenses, including reasonable attorneys' fees, of
determining whether to consent and in reviewing and approving the documents (up
to a maximum of $1,500). Solely with respect to subleases and assignments for
which Landlord's consent is required, Tenant shall provide Landlord with such
information as is reasonably necessary to make its determination pursuant to
Section 14.1.
14.6 If a trustee or debtor in possession in bankruptcy is entitled to
assume control over Tenant's rights under this Lease and assigns such rights to
any third party notwithstanding the provisions hereof, the rent to be paid by
such party shall be increased to the current Base Rent (if greater than that
being paid for the Premises) which Landlord charges for comparable space in the
Building as of the date of such third party's occupancy. If Landlord is
entitled under the Bankruptcy Code to "Adequate Assurance" of future
performance of this Lease, the parties agree that such term includes the
following:
(1) Any assignee must pay to Landlord at the time the next monthly
installment of Base Rent is due under this Lease, in addition to such
installment of Base Rent, an amount equal to the monthly installments of Base
Rent and additional rent due under this Lease for the next six months under this
Lease, said amount to be held by Landlord in escrow, with interest, until either
such assignee defaults in its payment of rent or other obligations under this
Lease (whereupon Landlord shall have the right to draw on such escrowed funds)
or until the expiration of this Lease (whereupon the funds shall be returned to
the Assignee within 30 days of the expiration of the Term of this Lease).
(2) The assignee must assume and agree to be bound by the
provisions of this Lease.
14.7. Notwithstanding anything to the contrary herein, Tenant may,
without obtaining Landlord's consent, make a Transfer to the following parties
(each a "Permitted Transferee") on the following conditions (a "Permitted
Transfer"): (1) any Affiliate of Tenant (as hereinafter defined) of which
Tenant owns more than a 25% interest; (2) any Parent of Tenant (as hereinafter
defined); (3) any Affiliate of Tenant's Parent; or (4) any entity into which
Tenant merges or consolidates or which purchases all or substantially all of the
assets or stock or ownership interests of Tenant; provided that the resulting
corporation has a net worth at least equal to Tenant's net worth as of the date
11
hereof; provided that: (i) Tenant remains primarily liable on its obligations
hereunder; (ii) the Transferee assumes and is bound by all obligations of Tenant
for payment of all amounts of Rent and other sums and the performance of all
covenants required by Tenant pursuant to this Lease; (iii) the Transferee
complies with the usage restrictions of this Lease; and (iv) not less than 15
days prior to the effective date of the Transfer, Tenant provides Landlord with
such evidence as Landlord may reasonably require to establish that the Transfer
meets the requirements of a Permitted Transfer (without such notice requiring
disclosure of the name of the entity with which Tenant is contemplating a merger
until such merger becomes effective). An "Affiliate of Tenant" or "Affiliate of
Tenant's Parent" shall mean any corporation, association, trust or partnership
(I) that Controls (as herein defined) Tenant or Tenant's Parent, or (II) that is
under the Control of Tenant or Tenant's Parent through stock ownership or
otherwise or (III) that is under common Control with Tenant or Tenant's Parent.
A "Parent of Tenant" shall mean any corporation, association, trust or
partnership (x) that Controls Tenant or (y) that owns more than fifty percent
(50%) of the issued and outstanding voting securities of Tenant. The terms
"Control" or "Controls" shall mean the power directly or indirectly to direct
the management or policies of Tenant or such other entity. Furthermore, Tenant
may allow employees of companies to whom Tenant is providing products or with
which Tenant is collaborating in the development or provision of products or
services (collectively referred to as "Collocation Services") to work in the
Premises without Landlord's consent and without being deemed to have sublet any
portion of the Premises, so long as such employees do not occupy space which is
separated from that occupied by Tenant by demising walls and the number of such
employees whose primary place of employment is the Premises does not exceed ten
percent (10%) of the total number of persons regularly occupying the Premises.
15. DAMAGE TO PROPERTY. Tenant agrees Landlord is not liable for any
------------------
injury or damage, either proximate or remote, occurring through or caused by
fire, water, steam, or any repairs, alterations, injury, accident, or any other
cause to the Premises, to any furniture, fixtures, Tenant improvements, or other
personal property of Tenant kept or stored in the Premises, or in other parts of
the Building Complex, whether by reason of the negligence or default of
Landlord, other occupants, any other person, or otherwise; and the keeping or
storing of all property of Tenant in the Premises and Building Complex is at the
sole risk of Tenant.
16. INDEMNITY.
---------
16.1 Tenant agrees to indemnify, defend, and hold Landlord and Building
Manager harmless from all liability, costs, or expenses, including reasonable
attorneys' fees and costs of litigation, on account of damage to the person or
property of any third party, including any other tenant in the Building Complex,
to the extent caused by the negligence or breach of this Lease by the Tenant,
Tenant's agents or employees, or any other person entering upon the Premises
under express or implied invitation of Tenant (collectively, "Tenant's
Agents").
16.2 Tenant shall maintain throughout the Term a commercial general
liability policy, including protection against death, personal injury and
property damage, issued by an insurance company qualified to do business in the
state in which the Premises are located, with a single limit of not less than
$1,000,000.00. Such policy shall name Landlord, Building Manager, and Mortgagee
as additional insureds, be primary to any other similar insurance of such
additional insureds, and provide that it may not be cancelled or modified
without at least 20 days' prior notice to Landlord and Mortgagee. The minimum
limits of such insurance do not limit the liability of Tenant hereunder. Prior
to occupancy of the Premises, and prior to expiration of the then-current
policy, Tenant shall deliver certificates evidencing that insurance required
under this Lease is in effect.
16.3 Landlord agrees to indemnify, defend, and hold Tenant harmless from
all liability, costs, or expenses, including reasonable attorneys' fees and
costs of litigation, on account of damage to the person or property of any third
party (excluding Tenant's Agents), including any other tenant in the Building
Complex, to the extent caused by the negligence or breach of this Lease by
Landlord or Landlord's agents or employees.
17. SURRENDER AND NOTICE. Upon the expiration or other termination of this
--------------------
Lease, Tenant shall immediately quit and surrender to Landlord the Premises
broom clean, in good order and condition, ordinary wear and tear and loss by
fire or other casualty excepted, and Tenant shall remove: (i) all of its
movable furniture and other effects; (ii) all telephone cable within the
vertical risers and related equipment in the Building or Building Complex; (iii)
HVAC equipment, Communications Equipment, Backup System and Related Equipment
outside the Premises; and (iv) those Alterations required to be removed pursuant
to Section 12.3. If Tenant fails to timely vacate the Premises as required,
Tenant is responsible to Landlord for all resulting costs and damages of
Landlord, including any amounts paid to third parties who are delayed in
occupying the Premises.
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18. INSURANCE, CASUALTY, AND RESTORATION OF PREMISES.
------------------------------------------------
18.1 Throughout the Term of the Lease, Landlord shall maintain standard
extended coverage property insurance for the Building Complex, the shell and
core of the Building and the Premises in an amount equal to the replacement cost
thereof (exclusive of the foundations). Throughout the Lease Term, Landlord
also shall maintain (a) commercial general liability insurance covering the
common areas of the Building in amounts at least as high as the greater of (i)
that required of Tenant in this Lease, and (ii) that required by Landlord's
lender, and (b) insurance for loss of Rent. The foregoing insurance policies
shall be from such companies, and on such terms and conditions as Landlord deems
appropriate, from time to time.
18.2 Tenant shall maintain throughout the Term insurance coverage at
least as broad as ISO Special Form Coverage against risks of direct physical
loss or damage (commonly known as "all risk") for the full replacement cost of
Tenant's property and betterments in the Premises, including tenant finish in
excess of the Initial Tenant Finish.
18.3 If the Building or Premises is damaged by fire or other casualty
which renders the Premises wholly or partially untenantable and the damage is so
extensive that an independent architect selected by Landlord certifies in
writing to Landlord and Tenant within 45 days of said casualty that the Premises
cannot, with the exercise of reasonable diligence, be made fit for occupancy
within the time period (the "Repair Period") that is the lesser of (a) 180
working days from the happening thereof and (b) one-fourth of the time remaining
in the Term of the Lease, then, at the option of Landlord or Tenant exercised in
writing to the other within 30 days of such determination, this Lease shall
terminate as of the occurrence of such damage. In the event of termination,
Tenant shall pay Rent duly apportioned up to the time of such casualty and
forthwith surrender the Premises and all interest. If Tenant fails to do so,
Landlord may reenter and take possession of the Premises and remove Tenant. If,
however, the damage is such that the architect certifies that the Premises can
be made tenantable within such Repair Period or neither Landlord or Tenant
elects to terminate the Lease despite the extent of damage, then the provisions
below apply.
18.4 If the Premises are damaged by fire or other casualty that does not
render it untenantable or require a repair period in excess of the Repair
Period, Landlord shall with reasonable promptness except as hereafter provided
repair the Premises to the extent of the Initial Tenant Finish.
18.5 If the Building is damaged (though the Premises may not be affected,
or if affected, can be repaired within the Repair Period) and within 60 days
after the damage Landlord decides not to reconstruct or rebuild the Building,
then, notwithstanding anything contained herein, upon notice to that effect from
Landlord within said 60 days, Tenant shall pay the Rent apportioned to such
date, this Lease shall terminate from the date of such notice, and both parties
discharged from further obligations except as otherwise expressly provided;
provided the leases of all other similarly affected tenants in the Building are
terminated and Landlord in fact does not repair or restore the damaged or
destroyed portions of the Building within the six (6)-month period following the
date of termination.
18.6 Landlord and Tenant waive all rights of recovery against the other
and its respective officers, partners, members, agents, representatives, and
employees for loss or damage to its real and personal property kept in the
Building Complex which is capable of being insured against under ISO Special
Form Coverage, or for loss of business revenue or extra expense arising out of
or related to the use and occupancy of the Premises. Tenant also waives all such
rights of recovery against Building Manager. Each party shall notify their
insurance carrier that the foregoing waiver is contained in this Lease and
obtain an appropriate waiver of subrogation provision in their policies.
18.7 Rent shall abate during any period of repair and restoration in the
same proportion that the part of the Premises rendered untenantable bears to the
whole; provided, however, if the casualty is caused by the willful misconduct or
negligence of Tenant or Tenant's Invitees, then the Rent will abate during any
such period of repair and restoration but only to the extent of any recovery by
Landlord under its rental insurance related to the Premises.
19. CONDEMNATION. If the Premises or substantially all of it or any
------------
portion of the Building Complex which renders the Premises untenantable is taken
by right of eminent domain, or by condemnation (which includes a conveyance in
lieu of a taking), this Lease, at the option of either Landlord or Tenant
exercised by notice to the other within 30 days after the taking, shall
terminate and Rent shall be apportioned as of the date of the taking. Tenant
shall forthwith surrender the Premises and all interest in this Lease, and, if
Tenant fails to do so, Landlord may reenter and take possession of the Premises.
If less than all the Premises is taken, Landlord shall promptly repair the
Premises as nearly as possible to its condition immediately prior to the taking,
unless Landlord elects not to rebuild under Section 18.5. Landlord shall
receive the entire award or consideration for the taking. Nothing contained
herein, however, shall prevent Tenant from pursuing a separate claim against the
condemning authority for the value of (i) Tenant's Alterations and improvements
to the extent paid for by Tenant and not paid for from the Finish Allowance,
(ii) Tenant's furnishings, equipment and trade fixtures installed in the
Premises at Tenant's expense, and (iii) for relocation
13
expenses, provided that such claim does not in any way diminish the award or
compensation payable to or recoverable by Landlord in connection with such
taking or condemnation.
20. DEFAULT BY TENANT.
-----------------
20.1 Each of the following events is an "Event of Default":
(1) Any failure by Tenant to pay Rent on the due date unless such
failure is cured within 5 business days after notice by Landlord; however,
Tenant is not entitled to more than 2 notices of delinquent payments during any
calendar year and, if thereafter during such calendar year any Rent is not paid
when due, an Event of Default shall automatically occur;
(2) Tenant abandons the Premises (as evidenced by vacating the
Premises with the intent by Tenant not to be bound by the terms of the Lease, as
evidenced by a breach of any of its other obligations under the Lease, including
the payment of Rent);
(3) This Lease or Tenant's interest is transferred whether
voluntarily or by operation of law except as permitted in Section 14;
(4) This Lease or any part of the Premises is taken by process of
law and is not released within 15 days after a levy;
(5) Commencement by Tenant of a proceeding under any provision of
federal or state law relating to insolvency, bankruptcy, or reorganization
("Bankruptcy Proceeding");
(6) Commencement of a Bankruptcy Proceeding against Tenant, unless
dismissed within 60 days after commencement;
(7) The insolvency of Tenant or execution by Tenant of an
assignment for the benefit of creditors; the convening by Tenant of a meeting of
its creditors or any significant class thereof for purposes of effecting a
moratorium upon or extension or composition of its debts; or the failure of
Tenant generally to pay its debts as they mature, or the occurrence of any of
the foregoing with respect to any Guarantor, if any, of Tenant's obligations;
(8) The admission in writing by Tenant (or any general partner of
Tenant if Tenant is a partnership), that it is unable to pay its debts as they
mature or it is generally not paying its debts as they mature;
(9) Tenant fails to take possession of the Premises by the 9th day
following the Commencement Date (which deadline shall be extended by delays
beyond the reasonable control of Tenant, provided that Tenant is proceeding with
due diligence to complete the Tenant Work and move into the Premises);
(10) Tenant fails to perform any of its other obligations and non-
performance continues for 30 days after notice by Landlord or, if such
performance cannot be reasonably had within such 30 day period, Tenant does not
in good faith commence performance within such 30 day period and diligently
proceed to completion; provided, however, Tenant's right to cure shall not
exceed the period provided by Applicable Law;
(11) Any event which is expressly defined as or deemed an Event of
Default under this Lease.
20.2 Remedies of Landlord. If an Event of Default occurs, Landlord may
--------------------
then or at any time thereafter, either:
(1) (a) Without further notice except as required by Applicable
Laws, reenter and repossess the Premises or any part and expel Tenant and those
claiming through or under Tenant and remove the effects of both without being
deemed guilty of any manner of trespass and without prejudice to any remedies
for arrears of Rent or preceding breach of this Lease. Should Landlord reenter
or take possession pursuant to legal proceedings or any notice provided for by
Applicable Law, Landlord shall, from time to time, without terminating this
Lease, use commercially reasonable efforts to relet the Premises or any part,
either alone or in conjunction with other portions of the Building Complex, in
Landlord's or Tenant's name but for the account of Tenant, for such periods
(which may be greater or less than the period which would otherwise have
constituted the balance of the Term) and on such conditions and upon such other
terms (which may include concessions of free rent and alteration and repair of
the Premises) as Landlord, in its sole discretion, determines and Landlord may
collect the rents therefor. Landlord is not in any way responsible or liable
for failure to relet the Premises, or any part thereof, or for any failure to
collect any rent due upon such reletting, but Landlord shall use commercially
reasonable efforts to mitigate its damages. If there is other unleased space in
the Dulles Executive Plaza complex (consisting of the Dulles Executive Plaza I
and Dulles Executive Plaza II; collectively, the "Dulles Executive Plaza
Complex"), Landlord may lease such other space without prejudice to its
remedies against
14
Tenant. No such reentry or repossession or notice from Landlord shall be
construed as an election by Landlord to terminate this Lease unless specific
notice of such intention is given Tenant. Acts of maintenance or preservation or
efforts to relet the Premises or the appointment of a receiver upon initiative
of Landlord to protect Landlord's interest under this Lease shall not constitute
a termination of Tenant's contractual liability under this Lease unless written
release of liability is given by Landlord to Tenant. Landlord reserves the right
following any reentry and/or reletting to exercise its right to terminate this
Lease by giving Tenant notice, in which event this Lease will terminate as
specified in the notice.
(b) If Landlord takes possession of the Premises without
terminating this Lease, Tenant shall pay Landlord (i) the Rent which would be
payable if repossession had not occurred, less (ii) the net proceeds, if any, of
any reletting of the Premises after deducting all of Landlord's expenses
incurred in connection with such reletting, including all repossession costs,
brokerage commissions, attorneys' fees, expenses of employees, alteration, and
repair costs (collectively "Reletting Expenses"). If, in connection with any
reletting, the new lease term extends beyond the Term or the premises covered
thereby include other premises not part of the Premises, a fair apportionment of
the rent received from such reletting and the Reletting Expenses, will be made
in determining the net proceeds received from the reletting (i.e., if the
----
Premises are relet for a period that is longer than the then remaining balance
of the Term of this Lease, then with respect to such costs incurred in reletting
the Premises, the costs for which Tenant shall be responsible shall be only a
fraction thereof, the numerator of which is the number of months then remaining
in the balance of the Term of the Lease, and the denominator of which is the
total number of months in the initial term of the replacement tenant's lease,
and/or if the Premises is relet as part of a larger premises, then with respect
to such costs incurred in reletting the Premises, the costs for which Tenant
shall be responsible shall be only a fraction thereof, the numerator of which is
the number of rentable square feet in the Premises, and the denominator of which
is the total number of rentable square feet being leased pursuant to the terms
of the replacement tenant's lease). In determining such net proceeds, rent
concessions will also be apportioned over the term of the new lease. Tenant
shall pay such amounts to Landlord monthly on the days on which the Rent would
have been payable if possession had not been retaken, and Landlord is entitled
to receive the same from Tenant on each such day; or
(2) Give Tenant notice of termination of this Lease on the date
specified and, on such date, Tenant's right to possession of the Premises shall
cease and the Lease will terminate except as to Tenant's liability as hereafter
provided as if the expiration of the term fixed in such notice were the end of
the Term. If this Lease terminates pursuant to this Section, Tenant remains
liable to Landlord for damages in an amount equal to the Rent which would have
been owing by Tenant for the balance of the Term had this Lease not terminated,
less the net proceeds, if any, of reletting of the Premises by Landlord
subsequent to termination after deducting Reletting Expenses. Landlord may
collect such damages from Tenant monthly on the days on which the Rent would
have been payable if this Lease had not terminated and Landlord shall be
entitled to receive the same from Tenant on each such day. Alternatively, if
this Lease is terminated, Landlord at its option may recover forthwith against
Tenant as damages for loss of the bargain and not as a penalty an amount equal
to the worth at the time of termination of the excess, if any, of the Rent
reserved in this Lease for the balance of the Term over the then Reasonable
Rental Value of the Premises for the same period plus all Reletting Expenses
(the worth at the time being based on discounting to the net present value using
a discount factor equal to the then-applicable discount rate of the Federal
Reserve Bank). "Reasonable Rental Value" is the amount of rent Landlord can
obtain for the remaining balance of the Term.
20.3 Cumulative Remedies. Suits to recover Rent and damages may be
-------------------
brought by Landlord, from time to time, and nothing herein requires Landlord to
await the date the Term would expire had there been no Event of Default or
termination, as the case may be. Each right and remedy provided for in this
Lease is cumulative and non-exclusive and in addition to every other right or
remedy now or hereafter existing at law or equity, including suits for
injunctive relief and specific performance. The exercise or beginning of the
exercise by Landlord of one or more rights or remedies shall not preclude the
simultaneous or later exercise by Landlord of other rights or remedies. All
costs incurred by Landlord to collect any Rent and damages or to enforce this
Lease are also recoverable from Tenant. If any suit is brought because of an
alleged breach of this Lease, the prevailing party is also entitled to recover
from the other party all reasonable attorneys' fees and costs incurred in
connection therewith.
20.4 No Waiver. No failure by Landlord or Tenant to insist upon strict
---------
performance of any provision or to exercise any right or remedy upon a breach
thereof, and no acceptance of full or partial Rent or any payment due during the
continuance of any breach constitutes a waiver of any such breach or such
provision, except by written instrument executed by Landlord and Tenant. No
waiver shall affect or alter this Lease but each provision hereof continues in
effect with respect to any other then existing or subsequent breach thereof.
20.5 Bankruptcy. Nothing contained in this Lease limits Landlord's right
----------
to obtain as liquidated damages in any bankruptcy or similar proceeding the
maximum amount allowed by law at the time such damages are to be proven, whether
such amount is greater, equal to, or less than the amounts recoverable, either
as damages or Rent, referred to in any of the preceding provisions of this
Section. Notwithstanding anything in this Section to the contrary, any
15
proceeding described in Section 20.1(5),(6),(7) and (8) is an Event of Default
only when such proceeding is brought by or against the then holder of the
leasehold estate under this Lease.
20.6 Late Payment Charge. Any Rent not paid within 5 days after the due
-------------------
date shall thereafter bear interest at 5 percentage points above the Prime Rate
or the highest rate permitted by law, whichever is lower, until paid. Further,
if such Rent is not paid within 5 days after notice, Tenant agrees Landlord will
incur additional administrative expenses, the amount of which will be difficult
to determine; Tenant therefore shall also pay Landlord a late charge of 5% of
such payment for each late payment that remains unpaid for 5 days following
notice to Tenant. Any amounts paid by Landlord to cure an Event of Default of
Tenant which Landlord has the right but not the obligation to do, shall, if not
repaid by Tenant within 5 days of demand by Landlord, thereafter bear interest
at 5 percentage points above the Prime Rate until paid. "Prime Rate" means
that rate published from time to time in the Wall Street Journal as the prime
rate on the date closest to the date interest commences.
20.7 Waiver of Jury Trial. Tenant and Landlord waive any right to a
--------------------
trial by jury in suits arising out of or concerning the provisions of this
Lease.
21. DEFAULT BY LANDLORD. In the event of any alleged default on the part
-------------------
of Landlord, Tenant shall give notice to Landlord and afford Landlord a
reasonable opportunity to cure such default. Such notice shall be ineffective
unless a copy is simultaneously also delivered in the manner required in this
Lease to any holder of a mortgage and/or deed of trust affecting all or any
portion of the Building Complex (collectively, "Mortgagee"), provided that
prior to such notice Tenant has been notified (by way of notice of Assignment of
Rents and Leases, or otherwise), of the address of a Mortgagee. If Landlord
fails to cure such default within the time provided, then Mortgagee shall have
an additional 30 days following a second notice from Tenant or, if such default
cannot be cured within that time, such additional time as may be necessary
provided within such 30 days, Mortgagee commences and diligently pursues a cure
(including commencement of foreclosure proceedings if necessary to effect such
cure). If such default is in Landlord's failure to make repairs, provide
essential services or pay utility bills as are required under this Lease, then
following such applicable cure period, Tenant may (but shall not be obligated
to) make such repairs (in such manner as to not to void applicable warranties),
provide services or pay such bills as are reasonably required to cure such
default on behalf of Landlord and Landlord shall reimburse Tenant within 30 days
of receipt of Tenant's invoice the full amount of such reasonable out-of-pocket
cost and expense incurred by Tenant; provided, however, that if Landlord
disputes that such default exists or disputes the reasonableness of the amount
to be paid, by notice to Tenant prior to the expiration of the 30 day period,
then Landlord shall have no obligation to pay such amount until Tenant has
obtained a final non-appealable court judgment that such sum was due and payable
to Tenant under the terms of this Section 21 and wrongfully withheld by
Landlord. If any such repairs will affect the HVAC, plumbing, electrical or
mechanical systems of the Building (the "Building Systems"), the structural
integrity of the Building, or the exterior appearance of the Building, Tenant
shall use only those contractors used by Landlord in the Building for work on
the Building Systems, or its structure, and Landlord shall provide Tenant (upon
Tenant's request) with notice identifying such contractors and any changes to
the list of such contractors, unless such contractors are unwilling or unable to
perform such work or the cost of such work is not competitive, in which event
Tenant may utilize the services of any other qualified contractors which
normally and regularly performs similar work on comparable buildings. To the
extent any sum thus reimbursed to Tenant by Landlord represents an amount that
would have been included in the Operating Expenses of the Building if paid by
Landlord to perform the obligation in question, Landlord shall be entitled to
include in Operating Expenses the sum reimbursed to Tenant. Tenant's sole
additional remedy will be equitable relief or actual damages but in no event is
Landlord or any Mortgagee responsible for consequential damages or lost profit
incurred by Tenant as a result of any default by Landlord. If a Mortgagee, or
transferee under such Mortgage (hereafter defined), succeeds to Landlord's
interest as a result of foreclosure or otherwise, such party shall not be: (i)
liable for any default, nor subject to any setoff or defenses that Tenant may
have against Landlord (but such limitation shall not relieve such party from the
responsibility to perform the obligations as successor to Landlord ongoing
during its period of ownership); (ii) bound by any amendment (including an
agreement for early termination) without its consent made at any time after
notice to Tenant that such Mortgage requires such consent; and (iii) bound by
payment of Rent in advance for more than 30 days. Tenant agrees to pay Rent
(and will receive credit under this Lease) as directed in any Mortgagee's notice
of Landlord's default under the Mortgage reciting that Mortgagee is entitled to
collect Rent.
22. SUBORDINATION AND ATTORNMENT.
----------------------------
22.1 This Lease at Landlord's option will be subordinate to any mortgage,
deed of trust and related documents now or hereafter placed upon the Building
Complex (including all advances made thereunder), and to all amendments,
renewals, replacements, or restatements thereof (collectively, "Mortgage").
Tenant agrees that no documentation other than this Lease is required to
evidence such subordination.
22.2 If any Mortgagee elects to have this Lease superior to the lien of
its Mortgage and gives notice to Tenant, this Lease will be deemed prior to such
Mortgage whether this Lease is dated prior or subsequent to the date of such
Mortgage or the date of recording thereof.
16
22.3 In confirmation of subordination or superior position, as the case
may be, Tenant will execute such documents as may be required by Mortgagee
(provided that such documents only confirm such subordination and do not in any
way modify the terms of this Lease) and if it fails to do so within 10 days
after demand, such failure shall be deemed an Event of Default hereunder.
22.4 Tenant hereby attorns to all successor owners of the Building,
whether such ownership is acquired by sale, foreclosure of a Mortgage, or
otherwise; provided, however, that after succeeding to Landlord's interest under
this Lease, any such successor owner assumes in accordance with the terms of
this Lease and during its period of ownership all obligations of Landlord
arising after the date such successor owner acquires title to the Buildings.
22.5 Within 30 days following the effective date of this Lease (full
execution of the Lease) and execution of a non-disturbance agreement by Tenant
in the form attached hereto as Exhibit F, Landlord will obtain a non-disturbance
agreement from Landlord's present Mortgagee in the form attached hereto as
Exhibit F; Tenant's agreement to subordinate under Section 22.1 above as to any
future Mortgagee is conditioned upon Tenant obtaining a non-disturbance
agreement from any such future Mortgagee of the Real Property and/or the
Building on such Mortgagee's standard form for such purposes substantially in
the form attached hereto as Exhibit F, with changes as such future Mortgagee may
reasonably require so long as such changes do not in any way modify the terms of
this Lease.
23. REMOVAL OF TENANT'S PROPERTY.
----------------------------
23.1 All movable personal property of Tenant not removed from the
Premises upon vacation, abandonment, or termination of this Lease shall be
conclusively deemed abandoned and may be sold, or otherwise disposed of by
Landlord upon 10 days prior notice to Tenant therefor; Tenant shall pay
Landlord's reasonable expenses in connection with such disposition, provided
that Landlord delivers to Tenant a reasonably detailed statement of such
expenses.
23.2 Landlord expressly waives all contractual and statutory rights of
distraint, liens, and security interests in Tenant's property, but such waiver
shall not preclude Landlord from obtaining a judgment lien.
24. HOLDING OVER: TENANCY MONTH-TO-MONTH. If, after the expiration or
------------------------------------
termination of this Lease, Tenant remains in possession of the Premises without
a written agreement as to such holding over and continues to pay rent and
Landlord accepts such rent, such possession is a tenancy from month-to-month,
subject to all provisions hereof but at a monthly rent equivalent to 150% of
the monthly Rent paid by Tenant immediately prior to such expiration or
termination. Rent shall continue to be payable in advance on the first day of
each calendar month. Such tenancy may be terminated by either party upon 10
days' notice prior to the end of any monthly period. Nothing contained herein
obligates Landlord to accept rent tendered after the expiration of the Term or
relieves Tenant of its liability under Section 17.
25. PAYMENTS AFTER TERMINATION. No payments by Tenant after expiration or
--------------------------
termination of this Lease or after any notice (other than a demand for payment
of money) by Landlord to Tenant reinstates, continues, extends the Term, or
affects any notice given to Tenant prior to such payments. After notice,
commencement of a suit, or final judgment granting Landlord possession of the
Premises, Landlord may collect any amounts due or otherwise exercise Landlord's
remedies without waiving any notice or affecting any suit or judgment.
26. STATEMENT OF PERFORMANCE. Tenant agrees at any time upon not less
------------------------
than 10 days' notice to execute and deliver to Landlord a written statement (a)
stating that this Lease is unmodified and in full force and effect (or, if there
have been modifications, that the same is in full force and effect as modified
and stating the modifications); (b) stating whether or not, to the best
knowledge of Tenant (but without the requirement of an independent
investigation), there have been any defaults by Landlord or Tenant and any event
which with the giving of notice or passage of time, or both, would constitute
such a default (or, if there have been defaults, setting forth the nature
thereof); (c) stating the date to which Rent has been paid in advance; and (d)
such other information as Landlord reasonably requests, none of which shall
modify the Lease. Such statement may be relied upon by a prospective purchaser
of Landlord's interest or Mortgagee. If Tenant fails to respond to Landlord
within such 10 day period and Tenant also fails to respond to Landlord within 5
days after Tenant's receipt of a second written request for Tenant's approval,
which second request states in bold capital letters that Tenant's failure to
respond as required by Section 26 of the Lease shall be deemed an Event of
Default under the Lease if Tenant fails to respond in 5 days, then an Event of
Default shall be deemed to have occurred hereunder. Upon request, Tenant will
furnish Landlord an appropriate resolution confirming that the party signing the
statement is authorized to do so. Landlord agrees, upon not less than 15 days
prior notice by Tenant, to execute, acknowledge and deliver to Tenant a
statement in writing (i) certifying that this Lease has been unmodified since
its execution and is in full force and effect (or if there have been
modifications, that the Lease is in full force and effect, as modified, and
stating the modifications), (ii) stating the dates, if any, to which the rent
and sums hereunder have been paid by Tenant, and (iii) stating whether or not to
the actual knowledge of Landlord, without independent
17
investigation or inquiry, there are then existing any defaults under this Lease
(and, if so, specifying the same). Such statement may be relied upon by any
approved, prospective assignee or subtenant.
27. MISCELLANEOUS.
-------------
27.1 Transfer by Landlord. The term "Landlord" means so far as
--------------------
obligations of Landlord are concerned, only the owner of the Building at the
time in question and, if any transfer of the title occurs, Landlord herein named
(and in the case of any subsequent transfers, the then grantor) is automatically
released from and after the date of such transfer of all liability as respects
performance of any obligations of Landlord thereafter to be performed. Any
funds in Landlord's possession at the time of transfer in which Tenant has an
interest will be turned over to the grantee and any amount then due Tenant under
this Lease will be paid to Tenant.
27.2 No Merger. The termination or mutual cancellation of this Lease
---------
will not work a merger, and such termination or cancellation will at the option
of Landlord either terminate all subleases or operate as an automatic assignment
to Landlord of such subleases.
27.3 Common Area Use. Landlord may use any of the Common Areas for the
---------------
purposes of completing or making repairs or alterations in any portion of the
Building Complex; provided, however, that in the exercise of such right Landlord
shall not unreasonably interfere with Tenant's use and occupancy of, or access
to, the Premises.
27.4 Independent Covenants. This Lease is to be construed as though the
---------------------
covenants between Landlord and Tenant are independent and not dependent and
Tenant is not entitled to any setoff of the Rent against Landlord if Landlord
fails to perform its obligations except as otherwise expressly set forth herein;
provided, however, the foregoing does not impair Tenant's right to commence a
separate suit against Landlord for any default by Landlord so long as Tenant
complies with Section 21.
27.5 Validity of Provisions. If any provision is invalid under present
----------------------
or future laws, then it is agreed that the remainder of this Lease is not
affected and that in lieu of each provision that is invalid, there will be added
as part of this Lease a provision as similar to such invalid provision as may be
possible and is valid and enforceable.
27.6 Captions. The caption of each Section is added for convenience
--------
only and has no effect in the construction of any provision of this Lease.
27.7 Construction. The parties waive any rule of construction that
------------
ambiguities are to be resolved against the drafting party. Any words following
the words "include," "including," "such as," "for example," or similar words or
phrases shall be illustrative only and are not intended to be exclusive, whether
or not language of non-limitation is used.
27.8 Applicability. Except as otherwise provided, the provisions of
-------------
this Lease are applicable to and binding upon Landlord's and Tenant's respective
heirs, successors and assigns. Such provisions are also considered to be
covenants running with the land to the fullest extent permitted by law.
27.9 Authority. Tenant and Landlord and the party executing this Lease
---------
on behalf of each of Tenant and Landlord represent to the other party that such
party is authorized to do so by requisite action of Tenant or Landlord, as
applicable, and agree, upon request, to deliver a resolution, similar document,
or opinion of counsel to that effect.
27.10 Severability. If there is more than one party which is the Tenant
------------
or Landlord, the obligations imposed upon such party are joint and several.
27.11 Acceptance of Keys, Rent or Surrender. No act of Landlord or its
-------------------------------------
representatives during the Term, including any agreement to accept a surrender
of the Premises or amend this Lease, is binding on Landlord unless such act is
by a partner, member or officer of Landlord, as the case may be, or other party
designated in writing by Landlord as authorized to act. The delivery of keys to
Landlord or its representatives will not operate as a termination of this Lease
or a surrender of the Premises. No payment by Tenant of a lesser amount than
the entire Rent owing is other than on account of such Rent nor is any
endorsement or statement on any check or letter accompanying payment an accord
and satisfaction. Landlord may accept payment without prejudice to Landlord's
right to recover the balance or pursue any other remedy available to Landlord.
27.12 Building Name and Size. Landlord may as it relates to the Building
----------------------
and Building Complex: change the name, increase the size by adding additional
real property, construct other buildings or improvements, change the location
and/or character, or make alterations or additions provided that such changes do
not result in more than a de minimus reduction in the rentable square footage of
the Premises or materially and adversely interfere with Tenant's use or
occupancy of or access to the Premises or cause the level of service required
under Section 7 to be reduced other than on a temporary basis. If additional
buildings are constructed or the size is increased, Landlord and Tenant shall
18
execute an amendment which incorporates any necessary modifications to Tenant's
Pro Rata Share. Tenant may not use the Building's name for any purpose other
than as part of its business address.
27.13 Diminution of View. Tenant agrees that no diminution of light,
------------------
air, or view from the Building entitles Tenant to any reduction of Rent under
this Lease, results in any liability of Landlord, or in any way affects Tenant's
obligations.
27.14 Limitation of Liability. Notwithstanding anything to the contrary
-----------------------
contained in this Lease, Landlord's liability is limited to Landlord's interest
in the Building (including Landlord's interest in any undistributed rents) and
any undistributed insurance or condemnation proceeds that were not applied as
required by this Lease, or any proceeds resulting from a sale of the Building if
such sale is made while a lawsuit is pending against Landlord by Tenant (and
only to the extent of any judgment resulting from such lawsuit), and Landlord
shall never be personally liable for recovery of any judgment. In the event
Tenant institutes an independent action against Landlord and is awarded a money
judgment for which a lien is of record, and provided that such judgment is
either affirmed on appeal by the highest court for which an appeal thereof may
be filed or the time for filing such an appeal has expired, then in such event,
and only in such event, Tenant may deduct the amount of such money judgment for
which a lien is of record from the next monthly installment or installments of
Base Rent due hereunder subject to the rights of Mortgagee.
27.15 Non-Reliance. Tenant confirms it has not relied on any statements,
------------
representations, or warranties by Landlord or its representatives except as set
forth herein.
27.16 Written Modification. No amendment or modification of this Lease
--------------------
is valid or binding unless in writing and executed by the parties.
27.17 Lender's Requirements. In the event that any lender providing
---------------------
permanent financing or any refinancing for the Building requires, as a condition
of such financing, that modifications to this Lease be obtained, and provided
that such modifications (a) are reasonable, (b) do not adversely affect in a
material manner Tenant's use of the Premises as herein permitted, (c) do not
increase the rent and other sums to be paid by Tenant hereunder, and (d) do not
diminish any of Tenant's other rights under this Lease (including the type,
quantity, and quality of services Landlord is required to provide under this
Lease) or materially increase Tenant's obligations or decrease Tenant's rights,
Landlord may submit to Tenant a written amendment to this Lease incorporating
such required changes. Tenant hereby covenants and agrees to execute,
acknowledge and deliver such amendment to Landlord within 15 days of Tenant's
receipt thereof.
27.18 Effectiveness. Submission of this instrument for examination or
-------------
signature by Tenant does not constitute a reservation of or option to lease and
it is not effective unless and until execution and delivery by both Landlord and
Tenant.
27.19 Survival. This Lease, notwithstanding expiration or termination,
--------
continues in effect as to any provisions requiring observance or performance
subsequent to termination or expiration.
27.20 Time of Essence. Time is of the essence herein.
---------------
27.21 Rules and Regulations. Tenant and Tenant's agents, employees, and
---------------------
contractors shall at all times abide by the rules and regulations attached
hereto as Exhibit E. Landlord shall use reasonable efforts to enforce all such
rules and regulations, including any exceptions thereto, uniformly and in a
manner which does not unreasonably discriminate against Tenant, or increase
Tenant's monetary obligations under this Lease. If there is any inconsistency
between this Lease and the rules set forth in Exhibit E, this Lease shall
govern.
27.22 Recording. Tenant will not record this Lease. Recording of the
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Lease by or on behalf of Tenant is an Event of Default.
27.23 Deed of Lease. For purposes of Section 55-2, Code of Virginia
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(1950), as amended, this Lease is and shall be deemed to be a deed of lease.
28. AUTHORITIES FOR ACTION AND NOTICE.
---------------------------------
28.1 Unless otherwise provided, Landlord may act through Landlord's
Building Manager or other designated representatives from time to time.
28.2 All notices or other communications required or desired to be given
to Landlord must be in writing and shall be deemed received when delivered
personally to any officer, partner, or member of Landlord (depending upon the
nature of Landlord) or the manager of the Building (the "Building Manager")
whose office is in the Building, or when deposited in the United States mail,
postage prepaid, certified or registered, return receipt requested, addressed as
19
set forth in Section 1.10. All notices or communications required or desired to
be given to Tenant shall be in writing and deemed duly served when delivered
personally to any officer, employee, partner, or member of Tenant (depending
upon the nature of Tenant), individually if a sole proprietorship, or manager of
Tenant whose office is in the Building, or when deposited in the United States
mail, postage prepaid, certified or registered, return receipt requested,
addressed to the appropriate address set forth in Section 1.13. Either party may
designate in writing served as above provided a different address to which
notice is to be mailed. The foregoing does not prohibit notice from being given
as provided in the rules of civil procedure, as amended from time to time, for
the state in which the Real Property is located.
29. PARKING. Landlord will make available the number of parking spaces set
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forth in Section 1.9, in surface parking areas or garage parking areas,
respectively. All parking spaces shall be in and out, non-assigned parking
spaces in the designated areas for the respective spaces; the garage parking
spaces shall be non-assigned unreserved spaces in the uncovered portion of the
garage. Tenant shall pay the current monthly rate charged for each such space,
as it may change from time to time; provided, however, that all of the surface
or uncovered garage spaces shall be provided to Tenant without charge of parking
fees during the Initial Term. Tenant shall have the right to elect separately
to license reserved covered garage spaces on the 1st level on an availability
basis at Landlord's then-current parking rate for such spaces as it may change
from time to time; provided that future increases in any charged after the first
Lease Year shall be competitively priced and shall not exceed the prevailing
market rates in the Herndon-Dulles metropolitan area. Notwithstanding the
above, the right granted to Tenant to use such spaces is a license only and
Landlord's inability to make such spaces available at any time for reasons
beyond Landlord's reasonable control is not a material breach by Landlord of its
obligations hereunder and Tenant has no rights to use the parking garage except
as provided in this Section. The abatement of Tenant's obligation to pay for
unavailable spaces during any period of unavailability constitutes Tenant's sole
remedy. Tenant's failure to timely pay a parking bill shall constitute an Event
of Default hereunder. All vehicles parked in the parking facilities and the
personal property therein shall be at the sole risk of Tenant, Tenant's Agents
and the users of such spaces and Landlord shall have no liability for loss or
damage thereto for whatever cause.
30. SUBSTITUTE PREMISES. [INTENTIONALLY DELETED]
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31. BROKERAGE. Tenant and Landlord each represents it has not employed any
---------
broker with respect to this Lease and has no knowledge of any broker's
involvement in this transaction except those listed in Sections 1.15 and 1.16
(collectively, the "Brokers"). Landlord shall pay the Brokers a commission
pursuant to a separate agreement between each such Broker and Landlord. Tenant
shall indemnify Landlord against any expense incurred by Landlord as a result of
any claim for commissions or fees by any other broker, finder, or agent, whether
or not meritorious, employed by Tenant or claiming by, through, or under Tenant,
other than the Brokers. Landlord shall indemnify Tenant against any expense
incurred by Tenant as a result of any claim for commissions or fees by any other
broker, finder, or agent, whether or not meritorious, employed by Landlord or
claiming by, through, or under Landlord, other than the Brokers. Tenant
acknowledges Landlord is not liable for any representations by the Brokers
regarding the Premises, Building, Building Complex, or this Lease.
32. COUNTERPARTS. This Lease may be executed in two or more counterparts,
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each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument. Any one or more counterpart signature
pages may be removed from one counterpart of the Lease and annexed to another
counterpart of the Lease to form a completely executed original instrument
without impairing the legal effect of the signature thereon.
33. ADDENDUM/EXHIBITS. Any Addenda and/or Exhibits referred to herein and
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attached hereto are incorporated herein by reference.
20
IN WITNESS WHEREOF, the parties have executed this Lease as of the day and
year first above written and it is effective upon delivery of a fully-executed
copy to Tenant.
LIFEMINDERS.COM, INC., a Delaware DTC ASSOCIATES, LLC, a Virginia limited
corporation liability company
By: By:
Print Name: Authorized Signatory
Print Title:
"Landlord"
ATTEST:
By:
Print Name:
Print Title:
"Tenant"
21
ADDENDUM
THIS ADDENDUM is to that certain lease agreement (the "Lease") by and between
DTC ASSOCIATES, LLC, a Virginia limited liability company ("Landlord"), and
LIFEMINDERS.COM, INC., a Delaware corporation ("Tenant"), with respect to
approximately 131,841 rentable square feet of space (the "Premises") in the
Building. In the event of any conflict between the terms and provisions of the
Lease and the terms and provisions of this Addendum, the terms and provisions of
this Addendum shall control.
1. Landlord and Tenant agree that the Rentable Area of the Building and the
rentable square footage of the Premises have been verified from Landlord's
Drawings (as defined in the Work Letter). Upon completion of construction of
the Building Improvements, Landlord shall have Landlord's Architect verify
whether the as-built Building varied from the Landlord's Drawings so as to alter
the calculation of the Rentable Area or of the rentable square footage of the
Premises, calculated on the same basis as used in calculating the initial
measurement approved by Landlord and Tenant (determined by measuring the usable
area in accordance with the June 7, 1996 American National Standards Institute
(ANSI)/Building Owners and Managers Association (BOMA) standard method of
measurement of floor area for multi-tenanted office buildings). If Landlord's
Architect determines that such a variance exists (which determination shall be
subject to the reasonable approval of Tenant's architect), there shall be an
adjustment to reflect such re-measurement and recalculation of the Base Rent
(based on the annually per rentable square foot rates set forth in Section 1.4),
Tenant's Pro Rata Share, the Finish Allowance (based on $27.50 per rentable
square foot) and the number of parking spaces to which Tenant is entitled (based
on a ratio of 4 parking spaces per 1,000 usable square feet of space leased, of
which 20 shall be unassigned uncovered garage spaces). If the amount of Base
Rent payable for such period exceeds the amount theretofore paid by Tenant,
Tenant shall pay the amount of such excess to Landlord within 30 days of written
demand thereof from Landlord. If the amount of Base Rent payable for such
period is less than the amount theretofore paid by Tenant, Landlord shall credit
the same to the next payment of Base Rent due hereunder.
2. Throughout the Term of this Lease, Tenant shall have the right to have
Tenant's name identification signage on the top spandrels of the Building
generally as depicted on the attached Exhibit H (the "Signage"). The Signage is
subject to approval by Landlord (which approval shall not be unreasonably
withheld, conditioned or delayed; Landlord acknowledges that it has approved the
signage generally as depicted on the attached Exhibit H, subject to verification
of installation details and methods of attachment) and the applicable
governmental officials and under the Declaration and no Signage shall be
permitted if such approval is not obtained. Landlord and Tenant agree to
cooperate reasonably to seek approval of the Signage from the applicable
governmental authorities and under the Declaration. Tenant shall bear the costs
of fabricating and installing the such Signage and will bear the costs of
removal of the Signage at the termination or expiration of the Lease, including
restoring or repairing damages to the Building caused by such removal to the
condition at the time of installation. In addition, if Landlord is required at
any time to remove any Signage, including any approved Signage, due to any
Applicable Law or if Tenant elects to remove or change the Signage at any time,
Tenant shall bear the costs of such change or removal. Tenant will be
responsible at its cost to maintain its Signage in a condition consistent with
the maintenance provided for similar signage in the Herndon-Dulles metropolitan
area. In addition to the Signage, Landlord, at Landlord's sole cost and expense,
shall also provide Tenant with Building Standard directory signage on the
Building's directory board in the lobby of the Building and any other directory
which may become a part of the Building Complex. The Signage rights granted to
Tenant pursuant to this Paragraph (not including Building directory signage) are
personal to Tenant, provided that Tenant may assign its Signage rights to
Permitted Transferees under Section 14.7 and any assignees or subtenants for
which Landlord has termination rights pursuant to Section 14.3 but for which
Landlord does not exercise such rights. Landlord shall not grant rights to
identification signage on the Building spandrel or on the exterior walls of the
Building to other tenants.
3. Landlord grants Tenant an option (the "Option") to extend the term of the
Lease for one (1) additional term of five (5) years (the "Option Term")
commencing immediately after expiration of the Initial Term of this Lease. The
Option applies only to the Premises and is on the following conditions:
A. Notice of Tenant's interest in exercising the Option must be given to
Landlord no earlier than 12 months and no later than 9 months prior to the
Expiration Date ("Tenant's Notice"). Not later than thirty (30) days after
receiving Tenant's Notice, Landlord will notify Tenant of the Base Rent
applicable during the Option Term in accordance with subparagraph D below
("Landlord's Notice"). If the Tenant's notice is not given timely, Tenant's
Option with respect to the Option Term shall lapse and be of no further force or
effect.
B. Tenant shall have 15 days following Tenant's receipt of Landlord's
Notice within which to provide notice to Landlord electing (i) to exercise the
Option for the Option Term by delivering notice of such exercise to Landlord at
the Base Rent, allowances and concessions, if any, set forth in Landlord's
Notice, (ii) to exercise the Option for the Option Term but reserving the right
to final determination of the Base Rent to be paid in accordance with
1
subparagraph D below ("Tenant's Dispute Notice"), or (iii) to rescind its
exercise of the Option for the Option Term. If Tenant timely elects (i) first
above, the Lease shall be deemed extended and thereafter the parties shall
execute an amendment to the Lease setting forth the extension for the Option
Term and the rental rate applicable during the Option Term. If Tenant timely
elects (ii) first above, the parties shall have 30 days after the date Tenant
delivers its Tenant's Dispute Notice to Landlord in which to agree on the Base
Rent, escalation factor and additional rent which shall be payable during the
Option Term. If during such 30-day period the parties agree on such Base Rent,
escalation factor and additional rent payable during each year of the Option
Term, then during such period they shall execute an amendment to this Lease
stating the rent so agreed upon. If during such period the parties do not for
any reason whatsoever agree in writing upon such rent, then the Base Rent,
escalations, additional rent, and concessions shall be determined in accordance
with subparagraph D below. If Tenant fails to timely make any election, Tenant
shall be deemed to have elected (ii) first above (i.e., Tenant shall have been
deemed to have timely delivered the Tenant's Dispute Notice). If Tenant elects
(iii) first above, Tenant's right to renew the Term of the Lease shall lapse and
be of no further force or effect.
C. Tenant's right to exercise the Option is conditioned on: (i) there not
being an Event of Default hereunder at the time of exercise or at the time of
commencement of the Option Term; (ii) Tenant not having subleased or vacated
more than 50% of the Premises to other than Permitted Transferees as of the
commencement of the Option Term; (iii) Tenant not having assigned its interest
under the Lease as of the commencement of the Option Term to other than a
Permitted Transferee; and (iv) Tenant having the financial ability to perform
its obligations under the Option Term as evidenced by maintenance of the Letter
of Credit (as referred to below). Upon an assignment of the Lease to other than
a Permitted Transferee, this Paragraph is null and void.
D. If following delivery of Tenant's Dispute Notice, Landlord and Tenant
have not agreed upon the terms as of the 30th day after the date of Tenant's
Dispute Notice, then Landlord and Tenant shall, within 5 days thereafter, agree
upon a qualified commercial real estate broker of good reputation, having at
least 5 years' experience in the northern Virginia real estate market; if
Landlord and Tenant cannot agree upon the broker, then they shall each select,
within the foregoing 5-day period, a real estate broker who meets the above
qualifications and together such brokers will then select as the arbitrator a
real estate broker who meets the above qualifications (the broker selected shall
be deemed the "Arbitrator" hereunder) |
