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Sample Business ContractsHome: Sample Business Contracts:
LEASE
BY AND BETWEEN
HERNDON ASSOCIATES,
A VIRGINIA GENERAL PARTNERSHIP
(LANDLORD)
AND
MCAFEE ASSOCIATES, INC.,
A DELAWARE CORPORATION
(TENANT)
JULY , 1996
<PAGE> 2
TABLE OF CONTENTS
SECTION PAGE
------- ----
Section 1. Definitions.................................................. 1
Section 2. Term......................................................... 8
Section 3. Rent; Security Deposit....................................... 10
Section 4. Use of Premises.............................................. 14
Section 5. Insurance and Indemnification................................ 20
Section 6. Full Service Lease........................................... 24
Section 7. Repairs; Cleaning/Char Services.............................. 25
Section 8. Improvements................................................. 26
Section 9. Landlord's Right of Entry.................................... 27
Section 10. Fire and Other Casualties.................................... 27
Section 11. Condemnation................................................. 28
Section 12. Assignment and Subletting.................................... 29
Section 13. Expansion Option............................................. 32
Section 14. Rules and Regulations........................................ 33
Section 15. Subordination; Attornment and Nondisturbance................. 33
Section 16. Default...................................................... 34
Section 17. Estoppel Certificate......................................... 39
Section 18. Quiet ....................................................... 39
Section 19. Notices...................................................... 40
Section 20. Renewal Option............................................... 41
Section 21. General...................................................... 43
EXHIBITS
A Outline of the Premises
B Tenant Work
B-1 Drawings and Specifications
C Space Plan
D Current Rules and Regulations
E Form of Subordination, Non-disturbance and
Attornment Agreement
F Form of Tenant Estoppel
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LEASE
THIS LEASE ("LEASE") is made this ____ day of July 1996, by and between
HERNDON ASSOCIATES, a Virginia general partnership (the "Landlord"), and MCAFEE
ASSOCIATES, INC., a Delaware corporation (the "Tenant").
WITNESSETH, THAT IN CONSIDERATION of the entry into this Lease by the
parties hereto, and for other good and valuable consideration, the receipt and
adequacy of which hereby are acknowledged by each party hereto, the Landlord
hereby leases to the Tenant, and the Tenant hereby leases from the Landlord, all
of that space having a floor area of approximately ten thousand three hundred
sixty-five (10,365) rentable square feet (subject to adjustment based upon the
exact rentable square footage of the Premises as determined by the Landlord's
architect and as agreed to by the Tenant), as more particularly set forth on
Exhibit A attached hereto, and located within Building B (the "Building"), 1145
Herndon Parkway, Herndon, Fairfax County, Virginia.
TOGETHER WITH any and all improvements to such space, and any and all
rights, alleys, ways, waters, privileges, appurtenances and advantages, to the
same belonging or in any way appertaining (all of which are hereinafter referred
to collectively as the "Premises"), and
SUBJECT TO THE OPERATION AND EFFECT of any and all instruments and
matters of record or in fact on the date hereof,
TO HAVE AND TO HOLD the Premises unto the Tenant and its heirs,
personal representatives, successors and permitted assigns, for the term of
years set forth herein,
UPON THE TERMS AND SUBJECT TO THE CONDITIONS which are hereinafter set
forth:
SECTION 1. DEFINITIONS.
1.1. Defined Terms. As used herein, the following
terms have the following meanings:
"Additional Rent" has the meaning given it in Subsection 3.1.
"Annual Operating Costs" means any and all costs and expenses
incurred by the Landlord for services performed by the Landlord or by others on
behalf of the Landlord with respect to the Premises and/or the operation and
maintenance of the Property and the Common Areas located therein and serving or
allocable to the Premises, including, without limitation, all costs and expenses
of:
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(a) operating, maintaining, repairing, lighting, signing,
cleaning, removing trash, painting, striping, controlling of traffic,
controlling of rodents, and policing and securing the Common Areas (including,
without limitation, the costs of uniforms, equipment, assembly permits, supplies
and alarm systems);
(b) purchasing and maintaining in full force insurance
(including, without limitation, liability insurance for personal injury, death
and property damage, rent insurance, insurance against fire, extended coverage,
theft or other casualties, workmen's compensation insurance covering personnel,
fidelity bonds for personnel, insurance against liability for defamation and
claims of false arrest occurring on or about the Common Areas, and plate glass
insurance);
(c) removing snow, ice, water and debris;
(d) operating, maintaining, repairing and replacing machinery,
furniture, accessories and equipment used in the operation and maintenance of
the Property, and the personal property taxes and other charges incurred in
connection with such machinery, furniture, accessories and equipment;
(e) maintaining, repairing and replacing paving, curbs,
walkways, drainage, pipes, ducts, conduits, grease traps and lighting fixtures
throughout the Property;
(f) planting, replanting and replacing flowers, shrubbery,
trees, grass and planters;
(g) providing electricity, heating, ventilation and air
conditioning to the Property and operating, maintaining and repairing any
equipment used in connection therewith, including, without limitation, costs
incurred in connection with determining the feasibility of installing,
maintaining, repairing or replacing any facilities, equipment, systems or
devices which are intended to reduce utility expenses of the Property as a
whole;
(h) water and sanitary sewer services and other services, if
any, furnished to the Premises, the Common Areas and/or the Property;
(i) parcel pick-up, delivery and other similar services;
(j) enforcing any operating agreements pertaining to the
Common Areas or any portions thereof, and any easement and/or rights agreements
entered into by the Landlord for the benefit and use of the Landlord, the
Property or tenants thereof, or any
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arbitration or judicial actions undertaken with respect to the same;
(k) maintaining and repairing the Property, including, without
limitation, exhaust systems, sprinkler systems, pumps, fans, switchgear, loading
docks and ramps, stairways, service corridors, delivery passages, utility
plants, transformers, doors, walls, floors, skylights, ceiling and windows;
(l) Taxes; and
(m) audits, reasonable management fees and expenses, payroll,
payroll taxes and employee benefits of all personnel, including, without
limitation, security and maintenance personnel, secretaries and bookkeepers
(including, specifically, uniforms and working clothes and the cleaning thereof,
tools, equipment and supplies used by such personnel, and the expenses imposed
on or allocated to the Landlord or its agents pursuant to any collective
bargaining or other agreement).
Notwithstanding any other provisions of this Lease, Annual Operating
Costs shall not include (and the Landlord shall be solely responsible for) the
following expenses:
A. Excessive and unreasonable costs with respect to
the acquisition of sculpture, paintings and other objects of art;
B. Increased insurance premiums caused by the acts or
omissions of the Landlord or any other tenant of the Property, to
the extent of such increase;
C. Costs or fees relating to the defense of the
Landlord's title or interest in or to the Building and/or the Property;
D. Costs directly resulting from the gross negligence
or willful misconduct of the Landlord or its employees, contractors or agents;
E. Any costs or expenses relating to the Landlord's
obligations under any workletter to construct tenant improvements;
F. Any costs for which the Landlord is entitled to
reimbursement by other tenants;
G. Any compensation paid or accrued with respect to
clerks, attendants and/or others with respect to commercial concessions
operated for profit or with respect to any parking garage;
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H. Costs incurred with respect to any item to the
extent of the Landlord's recovery under any manufacturer's,
materialman's, vendor's or contractor's warranty;
I. Any special assessments caused by other tenants of the
Property;
J. Legal fees, space planners' fees, commissions,
advertising/promotional programs and expenses and all other costs
incurred in connection with the leasing of space in the Property;
K. Allowances, concessions, permits, licenses,
inspections and other costs and expenses (or cash payments or abatements in lieu
thereof) incurred to lease, construct, furnish, renovate, improve, decorate or
redecorate space for tenants (or prospective tenants) of the Property or with
respect to vacant leasable space within the Property, including constructing or
finishing demising walls;
L. Repairs or other work occasioned by fire, windstorm
or other insurable casualty or exercise of eminent domain;
M. Expenses incurred in connection with services or
benefits provided solely for the benefit of any other tenant or occupant of the
Property which are not available to the Tenant without the payment of a separate
additional charge;
N. Costs incurred in connection with the sale, financing,
refinancing or change in ownership of the Property, including, without
limitation, brokerage commissions, attorneys' fees, accountants' fees, title
insurance premiums, prepayment penalties, transfer taxes and interest charges;
O. Payments of principal, interest, amortization or
other finance charges with respect to any loans financing the
Property or any rental payments made under any ground lease;
P. Legal fees, arbitration expenses and other costs
incurred to enforce the terms of any lease with any tenant in the
Property or which are not related to the operation, maintenance
and management of the Property;
Q. The cost of the design and/or construction of the
Property, including the Premises or any building systems or
equipment, or for the correction of defects with respect to the
initial construction thereof;
R. Costs to maintain the Landlord's legal existence;
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S. Any business, professional and occupational tax, and any
federal, state or local income taxes, franchise, gift, transfer, sales, use,
excise, capital stock, estate, inheritance or succession taxes, recordation or
transfer taxes, or any interest charges, penalties or fines, incurred as the
result of the Landlord's failure to pay any Taxes when due.
T. Costs, fines, interest, penalties, legal fees or costs of
litigation incurred due to the late payments of taxes, utility bills or other
invoices, and other costs incurred by the Landlord's failure to make such
payments when due.
U. Costs incurred to abate, remove or otherwise remediate
hazardous substances or materials from the Property (except to the extent caused
by the Tenant);
V. Any capital expenditures except the cost for capital
improvements which are installed to reduce the Annual Operating Costs for the
general benefit of all the Property's tenants, but only to the extent of any net
reduction (after including the amortized cost of the improvement in Annual
Operating Costs). Any such capital expenditures shall be amortized on a
straight-line basis over the useful life of the capital improvement;
W. Moving expense costs of tenants of the Property;
X. Costs not usually, in accordance with generally accepted
accounting principles, included by landlords of first-class office buildings or
that are unreasonable in view of the goods and services obtained for such costs.
"Base Rent" has the meaning given it in Subsection 3.1.
"Building" has the meaning given it hereinabove.
"Building Service Equipment" means all apparatus, machinery,
devices, fixtures, appurtenances, equipment and personal property now or
hereafter located on the Premises and owned by the Landlord.
"Commencement Date" has the meaning given it in Subsection 2.1.
"Common Areas" has the meaning given it in Subsection 4.5.1.
"Condemnation" has the meaning given it in Section 11.
"Drawings and Specifications" has the meaning given it in
Section 3 of Exhibit B hereof.
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"Event of Default" has the meaning given it in Subsection 16.1.
"Exclusive Parking Areas" has the meaning given it in
Subsection 4.5.3.
"Insurance Premiums" means the aggregate of any and all
premiums paid by the Landlord for hazard, liability, loss-of-rent, workmen's
compensation or similar insurance upon any or all of the Property.
"Landlord" means the person hereinabove named as such and its
heirs, personal representatives, successors and assigns.
"Lease Year" means (a) the period commencing on the
Commencement Date and terminating on the day immediately preceding the first
(1st) anniversary of the Commencement Date and (b) each successive twelve (12)
month period thereafter during the Term.
"Leasehold Improvement Allowance" has the meaning given it in
Section 2 of Exhibit B hereof.
"Mortgage" has the meaning given it in Subsection 15.1.
"Mortgagee" has the meaning given it in Subsection 15.1.
"Non-Exclusive Parking Areas" has the meaning given it in
Subsection 4.5.3.
"Original Term" has the meaning given it in Subsection 2.1.
"Parking Areas" has the meaning given it in Subsection 4.5.
"Person" means a natural person, a trustee, a corporation, a
limited liability company, a partnership and/or any other form of legal entity.
"Premises" has the meaning given it hereinabove; provided, that
if at any time hereafter any portion of the Premises becomes no longer subject
to this Lease, "Premises" shall thereafter mean so much thereof as remains
subject to this Lease. Exact rentable square footage of the Premises shall be
determined by the Landlord's architect upon completion of final space plan
drawings; with respect thereto, the Premises shall be measured in accordance
with WDCAR Standard Method of Measurement, January 1, 1989 edition.
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"Property" means the Herndon Corporate Center, located at 1145,
1155, 1165 and 1175 Herndon Parkway, Herndon, Fairfax County, Virginia.
"Refuse Collection Area" has the meaning given it in Subsection
4.5.4.
"Renewal Term" has the meaning given it in Subsection 20.1.
"Rent" means all Base Rent and all Additional Rent.
"Space Plan" has the meaning given it in Section 3 of Exhibit B
hereof.
"Substantial Completion" has the meaning given it in Section 6
of Exhibit B hereof.
"Taxes" means all amounts payable by the Landlord with respect
to real estate taxes, ad valorem taxes, general and special assessments, taxes
on real estate rental receipts, taxes on the Landlord's gross receipts,
metropolitan district charges, front foot benefit assessments, or any other tax
or public or private assessment imposed upon, or levied against, real estate or
upon owners of real estate rather than persons generally, payable with respect
to or allocable to the Property, plus all reasonable costs incurred by the
Landlord in contesting or appealing any tax assessment in any effort to reduce
the same.
"Tenant" means the person hereinabove named as such and its
heirs, personal representatives, successors and permitted assigns in interest
hereunder.
"Tenant Delay" has the meaning given it in Section 6 of Exhibit
B hereof.
"Tenant's Operating Costs Percentage" (a) means the percentage
assigned to the Premises for purposes of allocating the Annual Operating Costs
to the Premises (and the rest of the net rentable spaces within the Property) in
accordance with this Subsection, (b) represents the approximate and (for
purposes of this Lease) hereby agreed upon proportion which the leasable floor
area of the Premises bears to the aggregate leasable space within the Property,
and (c) shall be eight and two-tenths percent (8.2%) (subject to adjustment
based upon the exact rentable square footage of the Premises as determined by
the Landlord's architect). For purposes hereof, the Premises and the Property
shall be measured in accordance with WDCAR Standard Method of Measurement,
January 1, 1989 edition.
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"Tenant's Representative" has the meaning given it in Section 1
of Exhibit B hereof.
"Tenant Work" has the meaning gives it in Exhibit B hereof.
"Term" has the meaning given it in Subsection 2.6.
"Termination Date" has the meaning given it in Subsection 2.1.
"Transfer" has the meaning given it in Subsection 12.1.
1.2. Other Terms. Any other term to which meaning is expressly
given in this Lease shall have such meaning.
SECTION 2. TERM.
2.1. Original Term. This Lease shall be for a term (the
"Original Term") (a) commencing on the date on which the Landlord Substantially
Completes (as defined in Exhibit B hereof) the improvements to the Premises
under Subsection 8.1 hereof and tenders possession thereof to the Tenant (which
date hereinafter is referred to as the "Commencement Date," except that if the
date of such commencement is hereafter advanced or postponed pursuant to this
Lease, or by express, written agreement of the parties hereto, the date to which
it is advanced or postponed shall thereafter be the "Commencement Date" for all
purposes of this Lease), and (b) terminating at 11:59 o'clock P.M. on the date
immediately preceding the fifth (5th) anniversary of the first (1st) day of the
first (1st) full calendar month during the Term (the "Termination Date"), except
that if the date of such termination is hereafter advanced or postponed pursuant
to this Lease, or by express, written agreement of the parties hereto, the date
to which it is advanced or postponed shall thereafter be the "Termination Date"
for all purposes of this Lease).
2.2. Confirmation of Commencement and Termination. The Landlord
and the Tenant, at the Landlord's or the Tenant's request after (a) the
commencement of the Term and/or (b) the expiration of the Term or any earlier
termination of this Lease by action of law or in any other manner, shall confirm
in writing by instrument in recordable form that, respectively, such
commencement or such termination has occurred, setting forth therein,
respectively, the Commencement Date and the Termination Date.
2.3. Surrender. The Tenant at its expense, at the expiration
of the Term or any earlier termination of this Lease, shall (a) surrender
promptly to the Landlord possession of the Premises (including any fixtures or
other improvements which,
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under Section 8, are owned by the Landlord) in good order and repair (ordinary
wear and tear excepted) and broom clean, (b) remove therefrom all signs, goods,
effects, machinery, fixtures and equipment used in conducting the Tenant's trade
or business which are neither part of the Building Service Equipment nor owned
by the Landlord, and (c) repair any damage caused by such removal.
2.4. Holding Over. If the Tenant continues to occupy the Premises
after the expiration of the Term or any earlier termination of this Lease after
obtaining the Landlord's express, written consent thereto,
2.4.1. such occupancy shall (unless the parties hereto
otherwise agree in writing) be deemed to be under a month-to-month tenancy,
which shall continue until either party hereto notifies the other in writing, at
least thirty (30) days before the end of any calendar month, that the notifying
party elects to terminate such tenancy at the end of such calendar month, in
which event such tenancy shall so terminate; and
2.4.2. anything in this Section to the contrary
notwithstanding, the rent payable for each such monthly period shall equal
one-twelfth (1/12) of the sum of (a) one hundred twenty-five percent (125%) of
the Base Rent for the Lease Year during which such expiration of the Term or
termination of this Lease occurs and (b) the Additional Rent payable under
Subsection 3.2; and
2.4.3. except as provided herein, such month-to-month tenancy
shall be on the same terms and subject to the same conditions as those set forth
in this Lease; provided, that if the Landlord gives the Tenant, at least thirty
(30) days before the end of any calendar month during such month-to-month
tenancy, written notice that such terms and conditions (including any thereof
relating to the amount and payment of Rent) after such month, shall be modified
in any manner specified in such notice, then such tenancy after such month,
shall be upon the said terms and subject to the said conditions, as so modified.
2.5 Early Access. The Landlord shall grant the Tenant the right and
license to enter the Premises at least thirty (30) days prior to the
Commencement Date solely for the purposes of installing the Tenant's telephone,
communications and voice/data equipment; provided, however, that such right and
license to enter the Premises (i) shall be conditioned upon the Tenant's
cooperation with the Landlord's construction manager, and (ii) will not
substantially interfere with or hinder the Landlord's construction of the
improvements contemplated in Subsection 8.1 hereof.
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SECTION 3. RENT; SECURITY DEPOSIT.
3.1. Amount. As rent for the Premises, the Tenant shall pay to
the Landlord all of the following:
3.1.1. Base Rent. An annual rent (the "Base Rent"),
which:
(a) for the initial Lease Year during the Original Term,
is in the sum of Thirteen and 60/100 Dollars ($13.60) per rentable square foot
of the Premises (for a total sum of One Hundred Forty Thousand Nine Hundred
Sixty-Four and 00/100 Dollars ($140,964.00), subject to adjustment based upon
the exact rentable square footage of the Premises as determined by the
Landlord's architect), plus, if the Term commences on a day other than the first
(1st) day of a calendar month, for the initial Lease Year, one three hundred
sixty-fifth (1/365) of such sum for each day of such partial calendar month; and
(b) for each Lease Year during the Original Term after
the initial Lease Year, is in the sum of one hundred and three percent (103%)
multiplied by the Base Rent in effect with respect to the immediately preceding
Lease Year.
3.1.2. Additional Rent. The Tenant shall pay the
Landlord additional rent ("Additional Rent") in the amount of any item referred
to as such in this Lease which accrues while this Lease is in effect (which
Additional Rent also shall include any and all charges or other amounts which
the Tenant is obligated to pay to the Landlord under this Lease, other than the
Base Rent).
3.2. Annual Operating Costs.
3.2.1. Computation. After the end of each calendar year
during the Term, the Landlord shall compute the total of the Annual Operating
Costs incurred for all of the Property during such calendar year, and the
Landlord shall allocate them to each separate leasable space within the Property
in proportion to the respective Operating Costs percentages assigned to such
spaces; provided, that anything in this Subsection 3.2 to the contrary
notwithstanding, wherever the Tenant and/or any other tenant of space within the
Property has agreed in its lease or otherwise to provide any item of such
services partially or entirely at its own expense, or wherever in the Landlord's
reasonable sole judgment any such significant item of expense is not incurred
with respect to or for the benefit of all of the net rentable space within the
Property (including but not limited to any such expense which, by its nature, is
incurred only with respect to those spaces which are occupied), in allocating
the Annual Operating Costs pursuant to this Subsection
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the Landlord shall make an appropriate adjustment, using generally accepted
accounting principles, as aforesaid, so as to avoid allocating to the Tenant or
to such other tenant (as the case may be) those Annual Operating Costs covering
such services already being provided by the Tenant or by such other tenant at
its own expense, or to avoid allocating to all of the net rentable space within
the Property those Annual Operating Costs incurred only with respect to a
portion thereof, as aforesaid. The Tenant shall have the right to review the
books and records of the Landlord with respect to the calculation of Annual
Operating Costs, provided (i) Tenant provides at least ten (10) days' written
notice to the Landlord of its desire to inspect such books and records, and (ii)
such request is made with respect to any calendar year no later than December 31
of the second succeeding calendar year.
3.2.2. Payment as Additional Rent. The Tenant within
fifteen (15) days after demand therefor by the Landlord (with respect to each
calendar year during the Term), accompanied by a statement setting forth in
reasonable detail the Annual Operating Costs for such calendar year, shall pay
to the Landlord as Additional Rent the amount equalling the Tenant's Operating
Costs Percentage of the Annual Operating Costs for such calendar year (as
derived and allocated under Subsection 3.2.1), subject, however, to the limits
set forth in Subsection 3.2.5.
3.2.3. Proration. If only part of any calendar year
falls within the Term, the amount computed as Additional Rent for such calendar
year under this Subsection shall be prorated in proportion to the portion of
such calendar year falling within the Term (but the expiration of the Term
before the end of a calendar year shall not impair the Tenant's obligation
hereunder to pay such prorated portion of such Additional Rent for that portion
of such calendar year falling within the Term, which shall be paid on demand, as
aforesaid).
3.2.4. Landlord's Right to Estimate. Anything in this
Subsection to the contrary notwithstanding, the Landlord, at its discretion, may
(a) make from time to time during the Term a reasonable estimate of the
Additional Rent which may become due under this Subsection for any calendar
year, (b) require the Tenant to pay to the Landlord for each calendar month
during such year one twelfth (1/12) of such Additional Rent, at the time and in
the manner that the Tenant is required hereunder to pay the monthly installment
of the Base Rent for such month, and (c) at the Landlord's reasonable
discretion, increase or decrease from time to time during such calendar year the
amount initially so estimated for such calendar year, all by giving the Tenant
written notice thereof, accompanied by a schedule setting forth in reasonable
detail the expenses comprising the Annual Operating Costs, as so estimated. In
such event, the Landlord shall cause
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the actual amount of such Additional Rent to be computed and certified to the
Tenant within one hundred twenty (120) days after the end of such calendar year,
and the Tenant or the Landlord, as the case may be, promptly thereafter shall
pay to the other the amount of any deficiency or overpayment therein, as the
case may be.
3.2.5. Increases in Annual Operating Costs.
Notwithstanding anything contained in this Section 3 to the contrary, the Tenant
shall be required to pay its pro rata share of Annual Operating Costs with
respect to any calendar year (or portion thereof) during the Term only to the
extent such total Annual Operating Costs exceed the total Annual Operating Costs
incurred or accrued during or with respect to the calendar year 1996.
3.3. When Due and Payable.
3.3.1. The Base Rent for any Lease Year (or portion
thereof) shall be due and payable in twelve (12) consecutive, equal monthly
installments, in advance, on the first (1st) day of each calendar month during
such Lease Year; provided, that the installment of the Base Rent payable for the
first (1st) full calendar month during the Term and, if the Term commences on a
day other than the first (1st) day of a calendar month, that portion of the Base
Rent which is payable for the remainder of such month shall be due and payable
on the Commencement Date.
3.3.2. Any Additional Rent accruing to the Landlord under
this Lease shall, except as is otherwise set forth herein, be due and payable
when the installment of Base Rent next falling due after such Additional Rent
accrues becomes due and payable, unless the Landlord makes written demand upon
the Tenant for payment thereof at any earlier time, in which event such
Additional Rent shall be due and payable within fifteen (15) days of demand.
3.3.3. Each such payment shall be made promptly when due,
without any deduction or set off whatsoever, and without demand, failing which
the Tenant shall pay to the Landlord as Additional Rent, for each day on which
such payment is due but unpaid, a late charge equalling 1/365th of ten percent
(10%) of such payment; provided, however, that no such interest charge shall
apply with respect to the first ten (10) days after payment is otherwise due.
Any payment made by the Tenant to the Landlord on account of Rent may be
credited by the Landlord to the payment of any Rent then past due before being
credited to Rent currently falling due. Any such payment which is less than the
amount of Rent then due shall constitute a payment made on account thereof, the
parties hereto hereby agreeing that the
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Landlord's acceptance of such payment (whether or not with or accompanied by an
endorsement or statement that such lesser amount or the Landlord's acceptance
thereof constitutes payment in full of the amount of Rent then due) shall not
alter or impair the Landlord's rights hereunder to be paid all of such amount
then due, or in any other respect.
3.4. Where Payable. The Tenant shall pay the Rent, in lawful
currency of the United States of America, to the Landlord by delivering or
mailing it to the Landlord's address which is set forth hereinbelow, or to such
other address or in such other manner as the Landlord from time to time
specifies by written notice to the Tenant.
3.5. Tax on Lease. If federal, state or local law now or
hereafter imposes any tax, assessment, levy or other charge (other than an
income tax or other tax based on the income of the Landlord) directly or
indirectly upon (a) the Landlord with respect to this Lease or the value
thereof, (b) the Tenant's use or occupancy of the Premises, (c) the Base Rent,
Additional Rent or any other sum payable under this Lease, or (d) this
transaction, then the Tenant shall pay the amount thereof as Additional Rent to
the Landlord upon demand, unless the Tenant is prohibited by law from doing so,
in which event the Landlord, at its election, may terminate this Lease by giving
at least one (1) month's written notice thereof to the Tenant.
3.6. Security Deposit. Simultaneously upon the execution and
delivery of this Lease by the parties hereto, the Tenant shall deposit with the
Landlord a sum equal to one (1) month's Base Rent (i.e. Eleven Thousand Seven
Hundred Forty-Seven and 00/100 Dollars ($11,747.00), subject to adjustment based
upon the exact rentable square footage of the Premises as determined by the
Landlord's architect), which (a) shall be retained by the Landlord as security
for the Tenant's payment of the Rent and performance of all of its other
obligations under this Lease, and (b) shall not be deemed to represent payment
of any Rent. If an Event of Default occurs, the Landlord shall be entitled, in
its sole discretion, (a) to apply any or all of such sum in payment of (i) any
Rent then due and unpaid, (ii) any expense incurred by the Landlord in curing
any such default, and/or (iii) any damages incurred by the Landlord by reason of
such default (including but not limited to that of reasonable attorneys' fees),
in which even the Tenant, immediately upon its receipt of a written demand
therefor from the Landlord, shall pay to the Landlord a sum equalling the amount
so applied, so as to restore the said sum to its original amount; and /or (b) to
retain any or all of such sum in liquidation of any or all damages suffered by
the Landlord by reason of such default. On the termination of this Lease, any of
such sum which is not so applied or retained shall be returned to
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the Tenant. Such sum shall not bear interest while being held by the Landlord
hereunder.
SECTION 4. USE OF PREMISES.
4.1. Nature of Use. The Tenant shall use the Premises only for
(a) general office purposes; and (b) such other, secondary uses as are
reasonably and customarily incident to such uses so long as such other uses are
not unlawful; but (c) for no use other than those permitted by this Subsection.
4.2. Compliance with Law and Covenants. As of the time the
Landlord delivers the Premises to the Tenant, the Premises shall be in
compliance with all applicable laws and regulations. The Tenant, throughout the
Term and at its sole expense, in its use and possession of the Premises,
4.2.1. shall comply promptly and fully with (a) all laws,
ordinances, notices, orders, rules, regulations and requirements of all federal,
state and municipal governments and all departments, commissions, boards and
offices thereof, (b) all requirements imposed by any policy of insurance
covering any or all of the Premises and required by Section 5 to be maintained
by the Tenant, and (c) all covenants and restrictions which may encumber the
title to any or all of the Premises, all if and to the extent that any of such
requirements relate to any or all of the Premises, the Building, the Building
Service Equipment, the Property, the fixtures and other equipment upon the
Premises, or the use or manner of use thereof, whether any of the foregoing are
foreseen or unforeseen, or are ordinary or extraordinary;
4.2.2. (without limiting the generality of the foregoing
provisions of this Subsection) shall keep in force throughout the Term all
licenses, consents and permits necessary for the lawful use of the Premises for
the purposes herein provided; and
4.2.3. shall pay when due all personal property taxes,
income taxes, license fees and other taxes assessed, levied or imposed upon the
Tenant or any other person in connection with the operation of its business upon
the Premises or its use thereof in any other manner.
4.3. Mechanics' Liens.
4.3.1. Without limiting the generality of the foregoing
provisions of this Section , the Tenant shall not create or permit to be
created, and if created shall discharge or have released, any mechanics' or
materialmen's lien arising while this Lease is in effect and affecting any or
all of the Premises, and the Tenant shall not permit any other matter or thing
whereby the Landlord's estate, right and interest in any or all of the
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Premises might be impaired. The Tenant shall defend, indemnify and hold harmless
the Landlord against and from any and all liability, claim of liability or
expense (including but not limited to that of reasonable attorneys' fees)
incurred by the Landlord on account of any such lien or claim.
4.3.2. The Tenant shall have the right to contest any
such lien. If the Tenant fails to discharge any such lien or have such lien
bonded over within fifteen (15) days after it first becomes effective against
any of the Premises, then, in addition to any other right or remedy held by the
Landlord on account thereof, the Landlord may (a) discharge it by paying the
amount claimed to be due or by deposit or bonding proceedings, and/or (b) in any
such event compel the prosecution of any action for the foreclosure of any such
lien by the lienor and pay the amount of any judgment in favor of the lienor
with interest, costs and allowances. The Tenant shall reimburse the Landlord for
any amount paid by the Landlord to discharge any such lien and all expenses
incurred by the Landlord in connection therewith, together with interest thereon
at the rate of ten percent (10%) per annum from the respective dates of the
Landlord's making such payments or incurring such expenses (all of which shall
constitute Additional Rent).
4.3.3. Nothing in this Lease shall be deemed in any way
(a) to constitute the Landlord's consent or request, express or implied, that
any contractor, subcontractor, laborer or materialman provide any labor or
materials for any alteration, addition, improvement or repair to any or all of
the Premises, or (b) to give the Tenant any right, power or authority to
contract for or permit to be furnished any service or materials, if doing so
would give rise to the filing of any mechanics' or materialmen's lien against
any or all of the Premises or the Landlord's estate or interest therein, or (c)
to evidence the Landlord's consent that the Premises be subjected to any such
lien.
4.4. Signs. The Landlord, at its sole cost and expense, shall
provide and maintain in good condition a monument directory at or near the
location of the Building, which directory shall include the names of the tenants
of the Building, including the Tenant. Except for one or more signs which are
located wholly within the interior of the Premises and are not visible from the
exterior of the Building, the Tenant shall have no right to erect signs upon the
Premises or the remainder of the Building or the Property unless the Landlord
has given its express, written consent thereto; provided, however, that the
Tenant shall have the right to place a sign bearing the Tenant's name at a
location above the entry to the Tenant's suite, the cost of which shall be
charged to the Leasehold Improvement Allowance (as defined in Exhibit B),
provided further, however,
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that (i) the Tenant first shall obtain the Landlord's prior written consent
thereto (which consent shall not be withheld, delayed or conditioned
unreasonably) with respect to the design, size, materials and location of such
sign, and (ii) the Tenant first shall obtain any and all permits, licenses and
the like from all applicable governing bodies. The Tenant, at its expense, (a)
shall maintain in good order and repair each sign placed by the Tenant anywhere
within the Premises or elsewhere on the Property, and (b) at the earlier of the
expiration or termination of this Lease or the Tenant's surrender or abandonment
of possession of the Premises, immediately shall remove each such sign from the
Property and restore and repair any damage to the Premises, the Building or the
rest of the Property occasioned by the installation, maintenance or removal of
any such sign (which obligation shall survive the expiration or termination of
this Lease).
4.5. License.
4.5.1. The Landlord hereby grants to the Tenant a
non-exclusive license to use (and to permit its officers, directors, agents,
employees and invitees to use) in the course of conducting business at the
Premises, all of those portions of the Property designated by the Landlord as
the common areas (the "Common Areas") for and only for the following purposes:
(a) those portions of the Common Areas which are paved
and, by their nature, manifestly intended to be used for such purpose, for
pedestrian and vehicular access to and from the Premises (which portions from
time to time may be relocated and/or reconfigured by the Landlord in its sole
discretion and at its expense, so long as reasonable access to and from the
Premises is maintained); and
(b) that portion of the dock and loading area which
adjoins the Premises, for loading and unloading inventory, supplies and other
materials being delivered to or taken from the Premises; and
(c) any and all portions of the Common Areas which from
time to time are designated by the Landlord for such purpose (the "Parking
Areas") for the parking of automobiles and other automotive vehicles while
engaged in business upon the Premises (other than while being used to make
deliveries to and from the Premises) and subject to the restrictions set forth
in this Section and/or the Rules and Regulations.
4.5.2. Such license shall be exercised in common with the
exercise thereof by the Landlord, the other tenants or occupants of the
Property, and their respective officers, directors, agents, employees and
invitees.
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4.5.3. Parking Areas.
(a) Exclusive Parking Areas. At no expense to the
Tenant, the Landlord hereby grants to the Tenant throughout the Term and the
Renewal Term (if this Lease is renewed) an exclusive license to use (and to
permit its officers, directors, agents, employees and invitees to use), in the
course of conducting business at the Premises, four (4) reserved parking spaces
located near the side entry door of the Premises (the "Exclusive Parking
Areas"), and subject to the restrictions set forth in this Section . The
Exclusive Parking Areas shall be marked appropriately as such.
(b) Non-Exclusive Parking Areas. At no expense to the
Tenant, the Landlord hereby grants to the Tenant throughout the Term and the
Renewal Term (if this Lease is renewed) a non-exclusive license to use (and to
permit its officers, directors, agents, employees and invitees to use), in the
course of conducting business at the Premises, thirty-three (33) unreserved
parking spaces located on the Property (the "NonExclusive Parking Areas"), for
and only for the parking of automobiles while engaged in business upon the
Premises, and subject to the restrictions set forth in this Section ; provided,
however, that such number shall be adjusted based upon the exact square footage
of the Premises as determined by the Landlord's architect, so that the Tenant
shall be granted a number of unreserved parking spaces equal to (i) three and
six tenths (3.6) per one thousand (1,000) rentable square feet of the Premises,
less (ii) the number of reserved parking spaces granted the Tenant above. Such
license shall be exercised in common with the exercise thereof by the Landlord,
the other tenants or occupants of the Property, and their respective officers,
directors, agents, employees and invitees.
(c) Landlord Control. The Landlord reserves the right to
change the entrances, exits, traffic lanes, boundaries and locations of the
Parking Areas (which includes the Exclusive Parking Areas and the Non-Exclusive
Parking Areas). The Landlord reserves the right to designate certain portions of
the Parking Areas for the parking of trucks, vans and other vehicles, and to
designate for the specific account of the Tenant, or of other tenants of the
Property, specific parking areas or spaces constructed around, within or under
the Building and/or the Property. All Parking Areas and facilities which may be
furnished by the Landlord in or near the Premises, including any employee
parking areas, truckways, loading docks, pedestrian sidewalks and ramps,
landscaped areas and other areas and improvements which may be provided by the
Landlord for the general use, in common, with other tenants, their officers,
agents, employees and visitors, shall at all times be subject to the Landlord's
exclusive control and management, and the Landlord
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shall have the right from time to time to establish, modify and enforce
reasonable rules and regulations with respect thereto. The Landlord shall have
the right to police the Common Areas; to establish and from time to time to
change the level of parking surfaces; to temporarily close all or any portion of
the Common Areas (including the Parking Areas) to such extent as, in the opinion
of the Landlord's counsel, may be legally sufficient to prevent a dedication
thereof or the accrual of any rights to any person or to the public therein; to
close temporarily all or any portion of the Parking Areas; to discourage
non-tenant parking; and to do and perform such other acts in and to Parking
Areas as, in the use of good business judgment, the Landlord determines to be
advisable with a view to the improvement of the convenience and use thereof by
tenants, their officers, agents, employees and visitors. The Tenant shall cause
its officers, agents and employees to park their automobiles only in the Parking
Areas and/or in such other areas as Landlord from time to time may reasonably
designate by written notice to the Tenant as employee parking areas, and the
Tenant shall not use or permit the use of any of the Common Areas in any manner
which will obstruct the driveways or throughways serving the Parking Areas or
any other portion of the Common Areas allocated for the use of others.
4.5.4. Use of Common Areas.
(a) The Landlord shall maintain and operate lighting
facilities on all of the Common Areas and shall police the Common Areas.
(b) The Tenant shall not locate or install or cause to be
located or installed on the sidewalk and service area (if any) immediately
adjoining the Premises any bike rack, newspaper holder stand, vending machine of
any kind, mailbox, telephone booth, ash tray or other device of a similar nature
which would impede or obstruct the sidewalks and service area.
(c) The Tenant shall maintain in a neat and clean
condition that area designated by the Landlord as the "Refuse Collection Area",
and shall not place or maintain anywhere within the Property, other than within
the Refuse Collection Area, any trash, garbage, discarded tires, batteries,
other discarded automobile parts or other items, except as may otherwise be
expressly permitted by this Lease. The Landlord shall provide and maintain in
the Refuse Collection Area a dumpster or other authorized container for the
deposit of such garbage and refuse.
(d) The Tenant regularly and frequently shall remove or
cause to be removed, at its expense, from any and all areas throughout the
Property other than the interior of the Premises, all pushcarts or similar
devices owned by or under the control of the Tenant, and the Tenant shall keep
such carts or
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similar devices within the interior of the Premises except while being used by
the Tenant or its customers.
(e) In its use of the Common Areas, the Tenant shall not
take, or knowingly permit its agents, employees, invitees, visitors and guests
to take, any of the following actions:
(i) the parking or storage of automobiles, trucks or
other automotive vehicles
(1) anywhere within the Property if such
vehicles lack current, valid license plates; or
(2) other than in the Parking Areas (and the
individual parking spaces from time to time designated therein); or
(3) anywhere within the Property if the body,
windows or other exterior portions of such vehicles are in an obvious state of
severe damage or disrepair; or
(ii) the performance of repair or maintenance work on
any vehicle on the Property; or
(iii) the performance of any body work or other
significant repairs to the bodies of vehicles, or the painting of any vehicle,
anywhere within the Premises or the rest of the Property.
4.5.5. No Liability. Except as provided herein, the
Landlord and its agents and employees shall not be liable to the Tenant or any
other person whatsoever (a) for any injury to person or damage to property
caused by any defect in or failure of equipment, pipes or wiring, or broken
glass, or the backing up of any drains or by gas, water, steam, electricity or
oil leaking, escaping or flowing into the Premises, or (b) for any loss or
damage that may be occasioned by or through the acts or omissions of any other
tenant of the Property or of any other person whatsoever, other than the
Landlord's duly authorized employee or agent.
4.6. Environmental Matters.
4.6.1. Environmental Covenants. In its use of the
Premises and the remainder of the Property, the Tenant shall not (either with or
without negligence) cause or permit the escape, disposal or release of any
biologically or chemically active or other hazardous substances or materials, or
allow the storage or use of such substances or materials in any manner, or
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allow any such materials or substances to be brought onto the Premises and/or
the Property.
4.6.2. Environmental Laws. For the purposes of this
Lease, "hazardous substances and materials" shall include, without limitation,
those described in the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended (42 U.S.C. sections 9601 et seq.), the
Resource Conservation and Recovery Act, as amended (42 U.S.C. sections 6901 et
seq.), any applicable state or local laws, and the regulations adopted under
these acts.
4.6.3. Indemnity. If any lender or governmental agency
ever requires testing to ascertain whether or not there has been any release of
hazardous substances or materials on the Premises and/or the Property while this
Lease is in effect, then the Tenant's proportional share of the reasonable costs
thereof shall be reimbursed by the Tenant to the Landlord upon demand as
Additional Rent if such requirement applies to the Premises. The Tenant shall
execute affidavits, representations and the like from time to time at the
Landlord's request concerning the Tenant's best knowledge and belief regarding
the presence of hazardous substances or materials on the Premises. The Tenant
shall defend, indemnify and hold harmless the Landlord against and from any
liability, claim of liability or expense resulting from any release of hazardous
substances or materials on the Premises occurring while the Tenant is in
possession thereof, or elsewhere on the Property if caused by the Tenant or any
person acting under the Tenant.
4.6.4. Survival. The foregoing covenants shall survive
the expiration or earlier termination of this Lease.
SECTION 5. INSURANCE AND INDEMNIFICATION.
5.1. Insurance. At all times from and after the entry by the
Tenant into the Premises for the purpose of completing the equipping or
furnishing prior to the opening of business, the Tenant shall take out and keep
in full force and effect, at its expense:
5.1.1. Commercial general liability insurance (1986 ISO
Form or the equivalent) with a combined single limit of not less than One
Million Dollars ($1,000,000) per occurrence and Two Million Dollars ($2,000,000)
in the General Aggregate--each location; and
5.1.2. All-risk property insurance (including the perils
of theft) written at full replacement cost value and with an agreed amount
clause endorsement covering (i) all of Tenant's Property, including, without
limitation, inventory, trade
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fixtures, floor covering, furniture, electronic data processing equipment and
any other property removable by Tenant under the provisions of this Lease, and
(ii) all permanent leasehold improvements installed in the Premises by or on
behalf of Tenant, regardless of the source of funding thereof.
5.1.3. Workers' compensation to the extent and in the
amounts required by law.
5.1.4. Employer's liability insurance for (i) bodily
injury by accident--$100,000 each accident, and (ii) bodily injury by
disease--$500,000 policy limits, $100,000 each employee.
5.1.5. Business automobile liability insurance on all
owned, non-owned or hired automobiles to be used by the Tenant, with a combined
single limit of not less than One Million Dollars ($1,000,000).
5.2. Tenant's Contractor's Insurance. The Tenant shall require
any contractor of the Tenant performing construction work in, on or about the
Premises to take out and keep in full force and effect, at no expense to the
Landlord:
5.2.1. Commercial general liability insurance in an amount
not less than One Million Dollars ($1,000,000) combined single limit per
occurrence and Two Million Dollars ($2,000,000) General Aggregate;
5.2.2. Business automobile liability insurance, with a
combined single limit of not less than One Million Dollars ($1,000,000) covering
all owned, non-owned or hired automobiles;
5.2.3. Worker's compensation or similar insurance in form
and amounts required by law; and
5.2.4. Employers liability insurance for (i) bodily injury
by accident--$100,000 each accident, and (ii) bodily injury by disease--$500,000
policy limits, $100,000 each employees.
5.3. Policy Requirements.
5.3.1. The company or companies writing any insurance
which the Tenant is required to take out and maintain or cause to be taken out
or maintained pursuant to Sections 5.1 and 5.2, as well as the form of such
insurance, shall at all times be subject to the Landlord's reasonable approval,
and any such company or companies shall be licensed to do business in the
Commonwealth of Virginia and have a Best rating of at least A-VII. Commercial
liability and all-risk property insurance policies evidencing such insurance
shall name the Landlord and/or
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its designees (including, without limitation, any Mortgagee) as additional
insureds, shall be primary and noncontributory, and shall also contain a
provision by which the insurer agrees that such policy shall not be cancelled,
materially changed, terminated or not renewed except after thirty (30) days'
advance written notice to the Landlord and/or such designees. All such policies,
or certificates thereof, shall be deposited with the Landlord promptly upon
commencement of the Tenant's obligation to procure the same. None of the
insurance which the Tenant is required to carry and maintain or cause to be
carried or maintained pursuant to Sections 5.1 and 5.2 shall contain deductible
provisions in excess of Five Thousand Dollars ($5,000.00), unless approved in
writing in advance by the Landlord. If the Tenant shall fail to perform any of
its obligations pursuant to this Article 5, the Landlord may perform the same
and the cost thereof shall be payable upon the Landlord's demand therefor as
Additional Rent.
5.3.2. The Landlord and the Tenant agree that on January 1
of the second (2nd) full calendar year during this Lease and on January 1 of
every second (2nd) calendar year thereafter, the Landlord will have the right to
request a change in the character and/or amounts of insurance required to be
carried by the Tenant pursuant to the provisions of this Article 5, and the
Tenant shall comply with the requested change in character and/or amount within
thirty (30) days of the Landlord's request therefor; provided such changes are
consistent with insurance generally required of office tenants in similar
buildings in the Northern Virginia area or as required to remain consistent with
industry standards.
5.4. Indemnities by Tenant and Landlord.
5.4.1. Notwithstanding any policy or policies of insurance
required of the Tenant, the Tenant, for itself and its successors and assigns,
to the extent permitted by law, shall defend, indemnify and hold harmless the
Landlord, Landlord's agents and any Mortgagee against and from any and all
liability or claims of liability by any person asserted against or incurred by
the Landlord and/or such agent or Mortgagee to the extent the same arises from
(i) the use, occupancy, conduct, operation or management of the Premises by the
Tenant or any of its agents, contractors, servants, employees, licensees,
concessionaires, suppliers or materialmen during the Term; or (iii) any work or
thing whatsoever done or not done on the Premises during the Term; or (iv) any
breach or default in performing any of the obligations under the provisions of
this Lease and/or applicable law by the Tenant or any of its agents,
contractors, servants, employees, licensees, suppliers or materialmen during the
Term; or (v) any negligent, intentionally tortious or other act or omission by
the Tenant or any of its agents, contractors, servants, employees, licensees,
concessionaires, suppliers,
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materialmen or invitees during the Term; or (vi) any injury to or death of any
person or any damage to any property occurring upon the Premises (whether or not
such event results from a condition existing before the execution of this Lease
or resulting in the termination of this Lease), and from and against all costs,
expenses and liabilities incurred in connection with any claim, action, demand,
suit at law, in equity or before any administrative tribunal, arising by reason
of any of the foregoing (including, by way of example rather than of limitation,
the reasonable fees of attorneys, investigators and experts), all regardless of
whether such claim, action or proceeding is asserted before or after the
expiration of the Term or any earlier termination of this Lease.
5.4.2. If any such claim, action or proceeding is brought
against the Landlord and/or any agent or Mortgagee, the Tenant shall promptly if
requested by the Landlord or such agent or Mortgagee, and at the Tenant's
expense, resist or defend such claim, action or proceeding or cause it to be
resisted or defended by an insurer. The Landlord shall, at its option, be
entitled to participate in the selection of counsel, settlement and all other
matters pertaining to such claim, action or proceeding, all of which shall be
subject, in any case, to the prior written approval of the Landlord.
5.4.3. Subject to the provisions of Section 5.8, the
Landlord hereby agrees for itself and its successors and assigns to indemnify
and save the Tenant harmless from and against any liability or claims of
liability arising out of the negligence or intentional acts and omissions of the
Landlord, its agents or employees.
5.5. Landlord Not Responsible for Acts of Others. The Landlord
shall not be responsible or liable to the Tenant, or to those claiming by,
through or under the Tenant, for any loss or damage which may be occasioned by
or through the acts or omissions of persons occupying or using space adjoining
the Premises or any part of the premises adjacent to or connecting with the
Premises or any other part of the Building or the Property, or for any loss or
damage resulting to the Tenant (or those claiming by, through or under the
Tenant), or its or their property, from the breaking, bursting, stoppage or
leaking of electrical cable and wires, and water, gas, sewer or steam pipes. To
the maximum extent permitted by law, the Tenant agrees to use and occupy the
Premises, and to use such other portions of the Building and the Property as the
Tenant is herein given the right to use, at the Tenant's own risk.
5.6. Landlord's Insurance. During the Term, to the extent
deemed reasonable or necessary in the Landlord's sole discretion, the Landlord
shall maintain (a) insurance on the Building against loss or damage by fire and
all of the hazards
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included in the extended coverage endorsement, in an amount deemed reasonable by
the Landlord, (b) comprehensive liability and property damage insurance with
respect to the Common Areas, against claims for personal injury or death, or
property damage suffered by others occurring in, on or about the Building and/or
the Property, such public liability insurance to afford protection in limits
deemed reasonable by the Landlord, and (c) any other insurance, in such form and
in such amounts as are deemed reasonable by the Landlord, including, without
limitation, rent continuation and business interruption insurance, theft
insurance and worker's compensation, flood and earthquake, and boiler and
machinery insurance. The costs and expenses of any and all insurance carried by
the Landlord pursuant to the provisions of this Subsection 5.6 shall be deemed a
part of Annual Operating Costs.
5.7. Increase in Insurance Premiums. The Tenant shall not do or
suffer to be done, or keep or suffer to be kept, anything in, upon or about the
Premises or the Building or the Property which will contravene the Landlord's
policies of hazard or liability insurance or which will prevent the Landlord
from procuring such policies from companies acceptable to the Landlord. If
anything done, omitted to be done or suffered by the Tenant to be kept in, upon
or about the Premises, the Building or the Property shall cause the rate of fire
or other insurance on the Premises, the Building, the Property or on other
property of the Landlord or of others within the Property to be increased beyond
the minimum rate from time to time applicable to the Premises or to any such
other property for the use or uses made thereof, the Tenant shall pay to the
Landlord, as Additional Rent, the amount of any such increase upon the
Landlord's demand therefor.
5.8. Waiver of Right of Recovery. To the extent that any loss or
damage to any building, structure or other tangible property, or resulting loss
of income, or losses under worker's compensation laws and benefits, are covered
by insurance, neither party shall be liable to the other party or to any
insurance company insuring the other party (by way of subrogation or otherwise),
even though such loss or damage might have been occasioned by the negligence of
such party, its agents or employees; provided, however, that if, by reason of
the foregoing waiver, either party shall be unable to obtain any such insurance,
then such waiver shall be deemed not to have been made by such party.
Notwithstanding the foregoing, in the event that such waiver of subrogation
shall not be available to the Tenant except through the payment of reasonable
additional premium therefor, the Tenant shall pay such additional premium.
SECTION 6. FULL SERVICE LEASE. The Landlord and the Tenant agree that
this Lease is intended to be a "full service" lease, and that, except as
otherwise specifically provided herein, the
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Landlord shall pay all charges with respect to the Premises for all gas,
electricity, light, heat, steam, power, water and sewerage and such other
utilities and services (including janitorial and security services) as are
customarily supplied under a full service lease, specifically excluding
telephone or other communications services.
SECTION 7. REPAIRS; CLEANING/CHAR SERVICES.
7.1. Landlord's Duty to Maintain Structure and Premises. The
Landlord shall maintain or cause to be maintained the structure of the Building
and shall be responsible for: (a) repairs to any sprinkler system or HVAC system
installed by or on behalf of the Landlord and serving the Premises, and (b)
structural repairs to the exterior walls, structural columns and structural
floors which collectively enclose the Premises. In addition, the Landlord shall
at all times from and after delivery of possession of the Premises to the
Tenant, at its own cost and expense, maintain the Premises in good and
tenantable condition, and make all repairs to the Premises or any installations,
equipment or facilities therein; in addition, the HVAC system, sprinkler system
and other mechanical systems and components shall be in good working order and
repair at the Commencement Date, and any cost incurred with respect thereto
shall be borne by the Landlord and shall not be deducted from the Leasehold
Improvement Allowance. Without limiting the generality of the foregoing, the
Landlord shall keep the interior of the Premises, together with all electrical,
plumbing and other mechanical installations therein, in good order and repair
and shall make all replacements thereof from time to time required by any
governmental agency having jurisdiction thereover; provided (1) the Tenant shall
give the Landlord notice of the necessity for such repairs and (ii) the
necessity for such repairs shall not have arisen, in whole or in part, from the
negligence or willful acts or omissions of the Tenant, its agents,
concessionaires, officers, employees, licensees, invitees or contractors.
7.2. Tenant's Duty to Maintain Premises. The Tenant shall (i)
surrender the Premises at the expiration of the Term or at such other time as
the Tenant may vacate the Premises in as good condition as when received, except
for (A) ordinary wear and tear, (B) damage by casualty (other than such damage
by casualty which is caused, in whole or in part, by the negligence or willful
act or omissions of the Tenant, its agents, concessionaires, officers,
employees, licensees, invitees or contractors and which is not wholly covered by
the Landlord's hazard insurance policy), or (C) acts of God; and (ii) take care
not to overload the electrical wiring serving the Premises or within the
Premises.
7.3. Cleaning/Char Services. At no additional expense to the
Tenant, the Landlord shall provide cleaning/char services
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with respect to the Premises. The services, which shall be of a kind and quality
befitting a "Class A" office building, shall be provided five (5)
evenings/nights per week, exclusive of legal holidays.
SECTION 8. IMPROVEMENTS.
8.1. By Landlord. The Landlord shall make certain building
standard improvements to the existing leasehold improvements to the Premises,
upon the terms and conditions set forth in Exhibit B hereof.
8.1.1. Contractor. The Landlord shall select the general
contractor to perform the leasehold improvements contemplated in Subsection 8.1
hereof, and the Landlord shall oversee, supervise and manage the general
contractor with respect to the performance and construction of the improvements
contemplated in Subsection 8.1.
8.2. By Tenant. The Tenant shall not make any alteration,
improvement or addition to the Building or the rest of the Premises without
first (a) presenting to the Landlord plans and specifications therefor and
obtaining the Landlord's written consent thereto (which shall not, in the case
of non-structural alterations, additions, or improvements, be unreasonably
withheld so long as such alteration, improvement or addition will not violate
applicable law or the provisions of this Lease, or impair the value of the
Building, the Property and/or the Premises) and (b) obtaining any and all
governmental permits or approvals of such alteration, addition or improvement
which are required by applicable law; provided, that (i) any and all contractors
or workmen performing such alterations, improvements and/or additions must first
be approved by the Landlord, and (ii) the Tenant shall restore the Premises to
their condition immediately before such alteration, improvement or addition was
made, by not later than the date on which the Tenant vacates the Premises or the
Termination Date, whichever is earlier.
8.3. Fixtures. Any and all improvements, repairs, alterations and
all other property attached to, used in connection with or otherwise installed
within the Premises by the Landlord or the Tenant shall, immediately on the
completion of their installation, become the Landlord's property without payment
therefor by the Landlord; provided, that any machinery, equipment or fixtures
installed by the Tenant and used in the conduct of the Tenant's trade or
business (rather than to service the Premises or any of the remainder of the
Building or the Property generally) and not part of the Building Service
Equipment shall remain the Tenant's property; but further provided that, if any
leasehold improvement made by the Tenant replaced any part of the Premises, such
leasehold improvements
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that replaced any part of the Premises shall be and remain the Landlord's
property.
SECTION 9. LANDLORD'S RIGHT OF ENTRY. The Landlord and its authorized
representatives shall be entitled to enter the Premises at any reasonable time
during the Tenant's usual business hours, after giving the Tenant at least
forty-eight (48) hours' notice thereof, (a) to inspect the Premises, (b) to
exhibit the Premises during the last six (6) months of the Term (i) to any
existing or prospective purchaser or Mortgagee thereof, or (ii) to any
prospective tenant thereof, provided that in doing so the Landlord and each such
invitee observes all reasonable safety standards and procedures which the Tenant
may require; and (c) to make any repair thereto and/or to take any other action
therein which the Landlord is permitted to make by this Lease or applicable law
(provided, that in any situation in which, due to an emergency or otherwise, the
physical condition of the Building or any other part of the Premises or the
Property would be unreasonably jeopardized unless the Landlord were to take such
action immediately, the Landlord shall not be required to give such notice to
the Tenant and may enter the same at any time). Nothing in this Section shall be
deemed to impose any duty on the Landlord to make any such repair or take any
such action, and the Landlord's performance thereof shall not constitute a
waiver of the Landlord's right hereunder to have the Tenant perform such work.
Except as provided herein, the Landlord shall not in any event be liable to the
Tenant for any inconvenience, annoyance, disturbance, loss of business or other
damage sustained by the Tenant by reason of the making of such repairs, the
taking of such action or the bringing of materials, supplies and equipment upon
the Premises during the course thereof, and the Tenant's obligations under this
Lease shall not be affected thereby.
SECTION 10. FIRE AND OTHER CASUALTIES.
10.1. Option to Terminate. If during the Term either the Premises
or the Building generally are substantially damaged or destroyed by fire or
other casualty, Base Rent and Annual Operating Costs shall be abated with
respect to such damaged portion of the Premises as of the date of such damage or
destruction, and the Landlord shall have the option (which it may exercise by
giving written notice thereof to the Tenant within sixty (60) days after the
date on which such damage or destruction occurs) to terminate this Lease as of
the date specified in such notice (which date shall not be earlier than the
thirtieth (30th) day after such notice is given). On such termination, the
Tenant shall pay to the Landlord all Base Rent, Additional Rent and other sums
and charges payable by the Tenant hereunder and accrued through such date with
respect to such undamaged useable portion of the Premises (as justly apportioned
to the date of such termination). If the Landlord does not
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terminate this Lease pursuant to this Section , the Landlord shall restore the
Premises as soon thereafter as is reasonably possible, taking into account any
delay experienced by the Landlord in recovering the proceeds of any insurance
policy payable on account of such damage or destruction, but in no event later
than one hundred twenty (120) days after the date of casualty or destruction.
Until the Premises are so repaired, the Base Rent (and each installment thereof)
and the Additional Rent payable under Subsection 3.2 shall abate in proportion
to the floor area of so much, if any, of the Premises as is rendered
substantially unusable by the Tenant by such damage or destruction and
correction and/or repairs thereof.
10.2. No Termination. Except as is otherwise expressly permitted
by Subsection 10.1, no total or partial damage to or destruction of any or all
of the Premises shall entitle either party hereto to surrender or terminate this
Lease, or shall relieve the Tenant from its liability hereunder to pay in full
the Base Rent, any Additional Rent and all other sums and charges which are
otherwise payable by the Tenant hereunder, or from any of its other obligations
hereunder, and the Tenant hereby waives any right now or hereafter conferred
upon it by statute or otherwise, on account of any such damage or destruction,
to surrender this Lease, to quit or surrender any or all of the Premises, or to
have any suspension, diminution, abatement or reduction of the Base Rent or any
Additional Rent or other sum payable by the Tenant hereunder.
SECTION 11. CONDEMNATION.
11.1. Termination of Lease. If any or all of the Premises and/or
of that portion of the Property underlying the Premises is taken by the exercise
of any power of eminent domain or is conveyed to or at the direction of any
governmental entity under a threat of any such taking (each of which is herein
referred to as a "Condemnation"), this Lease shall terminate on the date on
which the title to so much of the Premises as is the subject of such
Condemnation vests in the condemning authority, unless the parties hereto
otherwise agree in writing. If (a) any portion of the Building other than the
Premises, or (b) all or any substantial portion of the Property other than that
portion thereof underlying the Premises, is taken or conveyed in a Condemnation,
the Landlord shall be entitled, by giving written notice thereof to the Tenant,
to terminate this Lease on the date on which the title to so much thereof as is
the subject of such Condemnation vests in the condemning authority. If this
Lease is not terminated pursuant to this Subsection, the Landlord shall restore
any of the Premises damaged by such Condemnation substantially to its condition
immediately before such Condemnation, as soon after the Landlord's receipt of
the proceeds of such Condemnation as is reasonably possible under the
circumstances.
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11.2. Condemnation Proceeds. Regardless of whether this Lease is
terminated under this Section , the Tenant shall have no right in any such
Condemnation to make any claim on account thereof against the condemning
authority, except that the Tenant may make a separate claim for the Tenant's
removal and moving expenses, provided that such claim does not reduce the sums
otherwise payable by the condemning authority to the Landlord. Except as
aforesaid, the Tenant hereby (a) waives all claims which it may have against the
Landlord or such condemning authority by virtue of such Condemnation, and (b)
assigns to the Landlord all such claims (including but not limited to all claims
for leasehold damages or diminution in value of the Tenant's leasehold interest
hereunder).
11.3. Effect on Rent. If this Lease is terminated under this
Section , any Base Rent, any Additional Rent and all other sums and charges
required to paid by the Tenant hereunder shall be apportioned and paid to the
date of such termination. If this Lease is not so terminated in the event of a
Condemnation, the Base Rent (and each installment thereof) and the Additional
Rent payable under Subsection 3.2 shall be abated from the date on which the
title to so much, if any, of the Premises as is the subject of such Condemnation
vests in the condemning authority, through the Termination Date, in proportion
to the floor area of such portion of the Premises as is the subject of such
Condemnation.
11.4. No Termination. Except as otherwise expressly provided in
this Section , no total or partial Condemnation shall entitle either party
hereto to surrender or terminate this Lease, or shall relieve the Tenant from
its liability hereunder to pay in full the Base Rent, any Additional Rent and
all other sums and charges which are otherwise payable by the Tenant hereunder,
or from any of its other obligations hereunder, and the Tenant hereby waives any
right now or hereafter conferred upon it by statute or otherwise, on account of
any such Condemnation, to surrender this Lease, to quit or surrender any or all
of the Premises, or to receive any suspension, diminution, abatement or
reduction of the Base Rent or any Additional Rent or other sum payable by the
Tenant hereunder.
SECTION 12. ASSIGNMENT AND SUBLETTING.
12.1. Landlord's Consent Required. The Tenant shall not assign
this Lease, in whole or in part, nor sublet all or any part of the Premises, nor
license concessions or lease departments therein, nor otherwise permit any other
person to occupy or use any portion of the Premises (collectively, a
"Transfer"), without in each instance first obtaining the written consent of the
Landlord, which consent shall not be unreasonably withheld, conditioned or
delayed. This prohibition includes any subletting or assignment which would
otherwise occur by operation
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of law, merger, consolidation, reorganization, transfer or other change of the
Tenant's corporate or proprietary structure (including, without limitation, the
transfer of partnership interests, the creation of additional partnership
interests or the transfer of corporate shares or beneficial interests), or an
assignment or subletting to or by a receiver or trustee in any Federal or state
bankruptcy, insolvency, or other similar proceedings. Consent by the Landlord to
any assignment, subletting, licensing or other transfer shall not (i) constitute
a waiver of the requirement for such consent to any subsequent assignment,
subletting, licensing or other Transfer, or (ii) relieve the Tenant from its
duties, responsibilities and obligations under this Lease.
12.2. Transfer; Issuance of Corporate Shares; Creation of
Partnership Interests. If the Tenant (or any general partner of the Tenant, or
any guarantor of the Tenant), is a corporation (other than a corporation the
outstanding voting stock of which is listed on a "national securities exchange,"
as defined in the Securities Exchange Act of 1934), or a general or limited
partnership, the Tenant shall give the Landlord notice within fifteen (15) days
following the date upon which (i) additional voting stock shall be issued by the
Tenant or any such general partner or guarantor, or any part or all of the
corporate shares of the Tenant or any such general partner or guarantor shall be
Transferred, or (ii) additional partnership interests shall be created by the
Tenant or any such guarantor, or any part or all of the partnership interests of
the Tenant or of any such guarantor shall be Transferred, by sale, assignment,
pledge, bequest, inheritance, operation of law or otherwise (including such a
Transfer to or by a receiver or trustee in any Federal or state bankruptcy,
insolvency, or other similar proceedings), in the event that such issuance,
creation and/or Transfer results in a change in the present control of said
corporation or partnership or if more than fifty percent (50%) of said corporate
shares or partnership interests are Transferred. In the event of a Transfer and
whether or not the Tenant has given such notice, the Landlord may elect, in the
Landlord's sole discretion, to either (a) terminate this Lease at any time
thereafter by giving the Tenant notice of such election, in which event this
Lease and the rights and obligations of the parties hereunder shall cease as of
a date set forth in such notice, which date shall not be less than sixty (60)
days after the date of such notice (and in the event of any such termination,
all Rent shall be adjusted as of the date of such termination), or (b) deem such
Transfer to be an Event or Default hereunder, thereby entitling the Landlord to
all of the rights and remedies set forth in Subsection 16.3.
12.3. Acceptance of Rent from Transferee. The acceptance by the
Landlord of the payment of Rent from any person following any act, assignment or
other Transfer prohibited by this Section shall not constitute a consent to such
act,
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assignment or other Transfer, nor shall the same be deemed to be a waiver of any
right or remedy of the Landlord's hereunder.
12.4. Conditions of Consent.
12.4.1. If the Tenant receives consent to a Transfer under
Section 12.1 above, then, in addition to any other reasonable terms and
conditions imposed by the Landlord in the giving of such consent, the Tenant and
the transferee shall execute and deliver, on demand, an agreement prepared by
the Landlord agreeing that the transferee shall be directly bound to the
Landlord to perform all obligations of the Tenant hereunder including, without
limitation, the obligation to pay all Rent and other amounts provided for
therein; acknowledging and agreeing that there shall be no subsequent Transfer
of this Lease or of the Premises or of any interest therein without the prior
consent of the Landlord pursuant to Section 12.1 above; acknowledging that the
Tenant as originally named herein shall remain fully liable for all obligations
of the Tenant hereunder, including the obligation to pay all Rent provided
herein and including any and all obligations arising out of any subsequent
amendments to this Lease made between the Landlord and the transferee (whether
or not consented to by the Tenant), jointly and severally with the transferee;
and such other provisions as the Landlord shall require.
12.4.2. All reasonable costs incurred by the Landlord in
connection with any request for consent to a Transfer, including costs of
investigation and the fees of the Landlord's counsel, shall be paid by the
Tenant on demand as a further condition of any consent which may be given.
Increases in Rent, if required by the Landlord as a condition to its consent to
such Transfer, shall be prorated as of the date of such Transfer.
12.5. Profits from Use or Transfer.
12.5.1. Neither the Tenant nor any other person having an
interest in the use, occupancy or other utilization of space in the Premises
shall enter into any lease, sublease, license, concession or other Transfer
which provides for rent or other payment for such use, occupancy or utilization
based in whole or in part on the net income or profits derived from the Premises
(other than an amount based on a fixed percentage of receipts or sales), and any
such purported lease, sublease, license, concession or other Transfer shall be
absolutely void and ineffective as a conveyance or creation of any right or
interest in the possession, use, occupancy or utilization of any part of the
Premises.
12.5.2. The Tenant and the Landlord agree that in the
event of a Transfer, any and all consideration, money or
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thing of value received by the Tenant and/or the Landlord or payable to the
Tenant and/or the Landlord in connection with such Transfer, in excess of the
amounts payable under this Lease (except for any amounts in the nature of
interest or penalties), shall be divided (and immediately payable) as follows:
(i) fifty percent (50%) to the Tenant and (ii) fifty percent to the Landlord.
SECTION 13. EXPANSION OPTION. Provided (i) there exists no Event of
Default under the Lease beyond any applicable notice, grace or cure period, (ii)
the Lease has not been terminated prior to the end of the Term pursuant to the
provisions of the Lease, and (iii) the Tenant has not Transferred more than
fifty percent (50%) of this Lease or its interest therein, the Tenant shall have
throughout the Original Term the first right to negotiate with respect to the
leasing of approximately four thousand four hundred eighty-three (4,483)
rentable square feet of space located in the Building, contiguous with the
Premises and currently leased to Telematics; further provided, however, that
such expansion option shall be subject to any renewal and/or expansion rights or
options currently held by others (including Telematics and AIB Software
Corporation). The Landlord shall provide a written notice and offer to the
Tenant when and if such space becomes available, which notice shall contain
provisions regarding, among others, rent and allowances, if any, that will apply
with respect to the leasing of such space. Rent with respect to such space shall
be market rent, as reasonably determined by the Landlord, but shall be no less
favorable than that generally offered by the Landlord to third parties at that
time for comparable space in the Property. Within ten (10) business days after
receipt of the Landlord's notice, the Tenant shall provide the Landlord with
written notice of the Tenant's acceptance or rejection of the Landlord's offer;
in the event the Tenant fails to provide such written notice, the Tenant shall
be deemed to have declined to lease such space. In the event the Tenant accepts
the Landlord's offer, this Lease shall be amended to include such space under
Lease, subject to the terms and conditions set forth in the offer. If the Tenant
does not accept the Landlord's offer, and in the event the Landlord receives a
bona fide offer to lease said space reasonably acceptable to teh Landlord from
any third party (an "Offer"), the Landlord shall provide the Teantn with the
terms and conditions of such Offer, and the Tenant shall have the right of first
opportunity to lease such space substantially on the terms and conditions
contained in such Offer. If the Tenant elects to lease such space on the terms
and conditions provided in the Offer, the Tenant shall give written notice
thereof to the Landlord within fifteen (15) business days after receipt of the
Landlord's notice containign the Offer. In the event the Landlord does not
receive said written election to lease within said fifteen (15) business day
period, the Landlord shall be free to lease such space to any third party upon
such terms and conditions as the Landlord shall
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determine, and the Tenant shall have no further right or option thereafter to
lease such space. Notwithstanding the above, in the event the Tenant exercises
an option to lease pursuant to this Section 13 within twenty-four (24) months
from the date hereof, the term with respect to the expansion premises shall be
co-terminous with the Term hereof.
SECTION 14. RULES AND REGULATIONS. The Landlord shall have the right to
prescribe, at its sole discretion, reasonable rules and regulations (the "Rules
and Regulations") having uniform applicability to all tenants of the Building
and of the Property (subject to their respective leases) and governing their use
and enjoyment of the Building and the Property; provided, that the Rules and
Regulations shall not materially interfere with the Tenant's use and enjoyment
of the Premises in accordance with this Lease for the purposes listed in
Section 4. The Rules and Regulations may govern, without limitation, the use
of sound apparatus, noise or vibrations emanating from machinery or equipment,
obnoxious fumes and/or odors, the parking of vehicles, lighting, and storage
and disposal of trash and garbage. The Tenant shall adhere to the Rules and
Regulations and shall cause its agents, employees, invitees, visitors and
guests to do so. A copy of the Rules and Regulations in effect on the date
hereof is attached hereto as Exhibit D.
SECTION 15. SUBORDINATION; ATTORNMENT AND NONDISTURBANCE.
15.1. Subordination.
15.1.1. Unless a Mortgagee shall otherwise elect as
provided in Subsection 15.2, the Tenant's rights under this Lease are and shall
remain subject and subordinate to the operation and effect of any mortgage, deed
of trust or other security instrument constituting a lien upon the Premises, the
Building and/or the Property, whether the same shall be in existence on the date
hereof or created hereafter (any such lease, mortgage, deed of trust or other
security instrument being referred to herein as a "Mortgage," and the party or
parties having the benefit of the same, whether as beneficiary, trustee or
noteholder, being referred to hereinafter collectively as "Mortgagee"). The
Tenant's acknowledgement and agreement of subordination as provided for in this
Section is self-operative and no further instrument of subordination shall be
required. Notwithstanding the foregoing, however, the Tenant's subordination
shall be predicated upon obtaining a non-disturbance agreement from such
Mortgagee, in the form attached hereto as Exhibit E. The Tenant shall execute,
within ten (10) days after request therefor, such further assurance thereof as
shall be requisite or as may be requested from time to time by the Landlord or
any Mortgagee.
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15.1.2. The Landlord hereby directs the Tenant, upon (i)
the occurrence of any event of default by the Landlord, as mortgagor under any
Mortgage, (ii) the receipt by Tenant of a notice of the occurrence of such event
of default under such Mortgage from the Landlord or such Mortgagee, and (iii) a
direction by the Mortgagee under such Mortgage to the Tenant to pay all Rent
thereafter to such Mortgagee, to make such payment to such Mortgagee, and the
Landlord agrees that in the event that the Tenant makes such payments to such
Mortgagee, as aforesaid, the Tenant shall not be liable to the Landlord for the
same.
15.2. Mortgagee's Unilateral Subordination. If a Mortgagee shall
so elect by notice to the Tenant or by the recording of a unilateral declaration
of subordination, this Lease and the Tenant's rights hereunder shall be superior
and prior in right to the Mortgage of which such Mortgagee has the benefit, with
the same force and effect as if this Lease had been executed, delivered and
recorded prior to the execution, delivery and recording of such Mortgage,
subject, nevertheless, to such conditions as may be set forth in any such notice
or declaration.
15.3. Attornment and Non-disturbance. If any person shall succeed
to all or any part of the Landlord's interest in the Premises, whether by
purchase, foreclosure, deed in lieu of foreclosure, power of sale, termination
of lease or otherwise, and if such successor-in-interest requests or requires,
the Tenant shall attorn to such successor-in-interest and shall execute within
thirty (30) days after receipt thereof an agreement in confirmation of such
attornment in accordance with that form attached hereto as Exhibit E. Failure to
respond within such thirty (30) day period shall be deemed to be a confirmation
by the Tenant of the facts and matters set forth therein. The Tenant hereby
agrees that any suit, action or other proceeding commenced by any Mortgagee in
order to realize upon the Landlord's interest in, under and to this Lease or any
other part of the Property shall not, by operation of law or otherwise, result
in the cancellation or termination of this Lease or of the obligations of the
Tenant hereunder.
SECTION 16. DEFAULT.
16.1. "Event of Default" Defined. Any one or more of the
following events shall constitute a default under the terms of this Lease
("Event of Default"):
16.1.1. failure of the Tenant to pay any Rent or other
sum of money due hereunder to the Landlord or any other person within seven (7)
days after written notice from the Landlord that the same is due; provided, that
the Landlord shall not be obligated to provide notice to the Tenant more than
two (2) times during any twelve (12) month period;
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16.1.2. sale of the Tenant's interest in the Premises
under attachment, execution or similar legal process without the Landlord's
approval;
16.1.3. filing of a petition proposing the adjudication
of the Tenant as a bankrupt or insolvent, or the reorganization of the Tenant,
or an arrangement by the Tenant with its creditors, whether pursuant to the
Federal Bankruptcy Act or any similar Federal or state proceeding, unless such
petition is filed by a party other than the Tenant and is withdrawn or dismissed
within sixty (60) days after the date of its filing;
16.1.4. admission in writing by the Tenant of its
inability generally to pay its debts when due;
16.1.5. appointment of a receiver or trustee for the
business or property of the Tenant, unless such appointment shall be vacated
within sixty (60) days of its entry;
16.1.6. making by the Tenant of an assignment for the
benefit of its creditors; or
16.1.7. default by the Tenant in the performance or
observance of any covenant or agreement of this Lease to be performed or
observed by the Tenant (other than as set forth in Subsections 16.1.1. through
16.1.6. above), which default is not cured within thirty (30) days after the
giving of written notice thereof by the Landlord, unless such default is of such
nature that it cannot be cured within said thirty (30) day period, in which
event an Event of Default shall not be deemed to have occurred if the Tenant
institutes a cure within the thirty (30) day period and thereafter diligently
and continuously prosecutes the curing of same until completion, but in no event
shall such cure period exceed ninety (90) days; provided, however, that if the
Tenant shall default in the performance of any such covenant or agreement more
than two (2) times in any twelve (12) month period, then notwithstanding that
such defaults have each been cured by the Tenant, any further defaults shall be
deemed an Event of Default without the ability to cure.
16.2. Landlord's Remedies. Upon the occurrence of an Event of
Default, the Landlord, with written notice to the Tenant and in accordance with
all applicable laws governing the same in any instance (except where expressly
provided for below), may do any one or more of the following:
16.2.1. The Landlord may accelerate the Rent and any
other charges, whether or not stated to be Additional Rent, for the entire
balance of the Term, or any part of such Rent, and any costs and sheriff's or
other official's commissions, whether chargeable to the Landlord or the Tenant,
including watchman's
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wages, as if by the terms of this Lease the balance of the Rent and other
charges and expenses were on that date payable in advance;
16.2.2. The Landlord may elect to terminate this Lease
and the tenancy created hereby by giving notice of such election to the Tenant
without any right on the part of the Tenant to save the forfeiture by payment of
any sum due or by other performance of condition, term, agreement or covenant
broken. The Landlord may also elect to terminate the Tenant's possessory rights
and all other rights of the Tenant without terminating this Lease, and the
Landlord may peaceably reenter the Premises, for the purpose of recovering
possession of the Premises, and may proceed to recover possession of the
Premises by process of law only;
16.2.3. When this Lease shall be terminated by covenant
or condition broken, either during the Term, and also after the Term hereby
created shall have expired, any attorney for the Landlord may proceed in any
competent court for judgment in ejectment against the Tenant and all persons
claiming under the Tenant for the recovery by the Landlord of possession of the
Premises. If for any reason after such action shall have been commenced, it
shall be cancelled or suspended and possession of the Premises remains in or is
restored to the Tenant, the Landlord shall have the right upon any subsequent
default or upon the expiration or termination of this Lease, or any renewal or
extension hereof, to bring one or more actions to recover possession of the
Premises;
16.2.4. In any action for possession of the Premises, or
for monetary damages, including Termination Damages and Liquidated Damages (as
those terms are defined in Subsection 16.3), or for the recovery of Rent due for
the balance of the Term, the Landlord may cause to be filed in such action an
affidavit setting forth the facts necessary to authorize the entry of judgment.
If a true copy of this Lease (and of the truth of the copy, such affidavit shall
be sufficient proof) must be filed in such action, it shall not be necessary to
file the original, notwithstanding any law, rule of court, custom or practice to
the contrary;
16.2.5. The Landlord may perform, on behalf and at the
expense of the Tenant, any obligation of the Tenant under this Lease which the
Tenant has failed to perform beyond any applicable grace or cure periods and of
which the Landlord shall have given the Tenant notice, the cost of which
performance by the Landlord shall be deemed Additional Rent and shall be payable
by the Tenant to the Landlord as otherwise set forth herein. Notwithstanding
anything to the contrary contained herein, regardless of whether an Event of
Default shall have occurred, the Landlord may exercise the remedy described in
this Subsection
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16.2.5. without any notice to the Tenant if the Landlord, in its good faith
judgment, believes it would be materially injured by failure to take rapid
action or if the unperformed obligation of the Tenant constitutes an emergency;
and/or
16.2.6. The Landlord may exercise any other legal or
equitable right or remedy which it may have at law or in equity, including
rights of specific performance and/or injunctive relief, where appropriate.
16.3. Damages.
16.3.1. If the Lease is terminated by the Landlord
pursuant to Subsection 16.2, the Tenant nevertheless shall remain liable for any
Rent and damages which may be due or sustained prior to such termination, and
all reasonable costs, fees and expenses; including, without limitation,
sheriffs' or other officers' commissions whether chargeable to the Landlord or
the Tenant, watchmen's wages, brokers' and attorneys' fees, and repair and
renovation costs incurred by the Landlord in pursuit of its remedies hereunder,
and/or in connection with any bankruptcy proceedings of the Tenant, and/or in
connection with renting the Premises to others from time to time (all such Rent,
damages, costs, fees and expenses being referred to herein as "Termination
Damages"), plus additional damages for all Rent treated as in arrears
("Liquidated Damages"). The Landlord shall use commercially reasonable efforts
to relet the Premises, as further described in Subsection 16.3.2. At the
election of the Landlord, Termination Damages and Liquidated Damages shall be an
amount equal to either:
(a) the Rent which, but for the termination of this
Lease, would have become due during the remainder of the Term, less the amount
or amounts of rent, if any, which the Landlord shall receive during such period
from others to whom the Premises may be rented (other than any additional rent
received by the Landlord as a result of any failure of such other person to
perform any of its obligations to the Landlord), in which case Liquidated
Damages shall be computed and payable in monthly installments, in advance, on
the first business day of each calendar month following the termination of this
Lease and shall continue until the date on which the Term would have expired but
for such termination, and any action or suit brought to collect any such
Liquidated Damages for any month shall not in any manner prejudice the right of
the Landlord to collect any Liquidated Damages for any subsequent months by
similar proceeding; or
(b) the present worth (as of the date of such
termination) of the Rent which, but for the termination of this Lease, would
have become due during the remainder of the Term, less the fair rental value of
the Premises, as determined by an independent real estate appraiser selected by
the Landlord,
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in which case such Liquidated Damages shall be payable to the Landlord in one
lump sum on demand. "Present worth" shall be computed by discounting such amount
to present worth at a rate equal to one percentage point above the discount rate
then in effect at the Federal Reserve Bank.
16.3.2. If this Lease is terminated pursuant to
Subsection 16.2, the Landlord shall use its commercially reasonable efforts to
relet the Premises or any part thereof, for such term or terms (which may be
greater or less than the period which otherwise would have constituted the
balance of the Term) and on such terms and conditions (which may include
concessions or free rent and alterations of the Premises) as the Landlord may
determine in its sole discretion. The Landlord shall, as part of its efforts to
relet the Premises, place the Premises with its broker.
16.3.3. Notwithstanding anything to the contrary set
forth in this Subsection 16.3, in the event (i) the Landlord must initiate legal
action to enforce any one or more of the provisions of this Lease against the
Tenant, its successors or assigns, or (ii) the Landlord must consult with and/or
engage an attorney(s) in order (A) to enforce any one or more of the provisions
of this Lease against the Tenant, its successors or assigns, or (B) in
connection with any bankruptcy proceeding of the Tenant, whether or not such
consultation and/or engagement results in the initiation of any judicial action
or termination of this Lease, then and in any of such events, the Tenant, its
successors and assigns, undertakes and agrees to pay any and all reasonable
costs incurred by the Landlord in connection therewith, including, by way of
illustration and not of limitation, all reasonable attorneys' fees (inclusive of
consultation fees, research costs and correspondence fees), court costs (if
awarded post-judgment) and any similar professional fees or costs associated
therewith, in the event the Landlord substantially prevails.
16.4. Default by Landlord. If the Landlord violates any of its
obligations under this Lease, the Tenant may (subject to the provisions of
Subsection 3.3.3, requiring the Tenant to pay all Rent when due, without
deduction or set-off whatsoever) exercise any right or remedy which it holds on
account thereof hereunder, at law or in equity; provided, that if any or all of
the Premises is then subject to any Mortgage, and the Landlord shall have
provided the Tenant with the name and address of such Mortgagee, the Tenant
shall not exercise any of its rights or remedies on account thereof unless and
until it has given written notice of its intention to do so, by certified or
registered mail, return receipt requested, to the Mortgagee under such Mortgage,
specifying therein the nature of such default in reasonable detail, and unless
such Mortgagee has not cured such
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default on the Landlord's behalf within thirty (30) days after such notice is
given.
16.5. Waiver of Jury Trial. Each party hereto hereby waives any
right which it may otherwise have at law or in equity to a trial by jury in
connection with any suit or proceeding at law or in equity brought by the other
against the waiving party or which otherwise relates to this Lease, as a result
of an Event of Default or otherwise.
SECTION 17. ESTOPPEL CERTIFICATE. The Tenant agrees from time to time,
upon not less than ten (10) business days prior written request by the Landlord,
to execute, acknowledge and deliver to the Landlord a statement in writing, in
the form attached as Exhibit F, certifying whether this Lease is unmodified and
in full force and effect and whether the Tenant has no defenses, offsets or
counterclaims against its obligations to pay the Rent and to perform its other
obligations under this Lease, and whether there are any uncured defaults of the
Landlord or the Tenant under this Lease, and the dates through which all Rent
has been paid, and all such other or further matters as are reasonably set forth
therein. The statement delivered pursuant to this Section 17 may be relied upon
by any purchaser or Mortgagee, or prospective purchaser or Mortgagee, of the
Property or any portion thereof.
SECTION 18. QUIET ENJOYMENT.
18.1. The Landlord hereby (a) covenants and agrees that, at the
time of the execution and delivery of this Lease by the parties hereto, it (i)
is the owner of a fee simple estate in and to the Premises, and (ii) has full
right, power and authority to enter into this Lease and thereby to lease the
Premises; and (b) warrants that, so long as all of the Tenant's obligations
hereunder are timely performed, the Tenant will have during the Term quiet and
peaceful possession of the Premises and enjoyment of such rights as the Tenant
may hold hereunder to use the Common Areas, except if and to the extent that
such possession and use are terminated pursuant to this Lease.
18.2. The Tenant hereby acknowledges that it has examined the
Premises, the adjoining streets, sidewalks, parking areas, curbs and access
ways, any surface conditions thereof, and the present uses and nonuses thereof,
if any, and that (without altering or impairing the Landlord's obligation to
make the improvements, if any, which it is required to make by Section 8) it
accepts each of them in its present condition or state, without restriction,
representation, covenant or (except as is set forth in Subsection 18.1)
warranty, express or implied, in fact or at law, by the Landlord or any other
person, and without recourse to the Landlord.
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SECTION 19. NOTICES. Any notice, demand, consent, approval, request or
other communication or document to be provided hereunder to the Landlord or the
Tenant (a) shall be in writing, and (b) shall be deemed to have been provided on
the earlier of (i) (1) forty-eight (48) hours after being sent as certified or
registered mail in the United States mails, postage prepaid, return receipt
requested, or (2) the next business day after having been deposited (in time for
delivery by such service on such business day) with Federal Express or another
national courier service, or (3) (if such party's receipt thereof is
acknowledged in writing) upon having been sent by telefax or another means of
immediate electronic communication, in each case to the address of such party
set forth hereinbelow or to such other address in the United States of America
as such party may designate from time to time by notice to each other party
hereto, or (ii) (if such party's receipt thereof is acknowledged in writing) its
hand or other delivery to such party.
IF TO THE LANDLORD, NOTICE SHALL BE SENT TO:
Herndon Associates
c/o Faison Associates
8045 Leesburg Pike
Suite 200
Vienna, Virginia 22182
Attn: Mr. C. Michael Duncan
WITH A COPY TO:
Teachers Insurance and Annuity Association
of America
730 Third Avenue
New York, New York 10017
Attn: Mr. James Fitzpatrick, Mortgage and
Real Estate
WITH AN ADDITIONAL COPY TO:
Teachers Insurance and Annuity Association
of America
730 Third Avenue
New York, New York 10017
Attn: Vice President and Manager, Real Estate
and Mortgage Law
IF TO THE TENANT, NOTICE SHALL BE SENT TO:
McAfee Associates, Inc.
2710 Walsh Avenue
Santa Clara, California 95051-0963
Attn: R. J. Schwei
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WITH A COPY TO:
McAfee Associates, Inc.
2710 Walsh Avenue
Santa Clara, California 95051-0963
Attn: Chief Financial Officer
SECTION 20. RENEWAL OPTION.
20.1. Grant of Option. The Tenant shall have and is hereby
granted an option to renew or extend the Original Term of this Lease for one (1)
additional period of five (5) years (the "Renewal Term"). Subject to the
provisions hereof, this renewal option shall be exercisable by the Tenant (but
only if (i) there exists no Event of Default under the Lease beyond any
applicable notice, grace or cure period, (ii) the Lease has not been terminated
prior to the end of the Original Term pursuant to the provisions of the Lease,
and (iii) the Tenant has not Transferred more than fifty percent (50%) of this
Lease or its interest herein), by giving written notice of its intent to
exercise such renewal option to the Landlord at least one hundred eighty (180)
days prior to the expiration of the Original Term. Except as otherwise expressly
provided in this Section 20, the Renewal Term shall be upon the same terms,
covenants and conditions as set forth in the Lease; provided, however, that the
Base Rent shall be the greater of (i) ninety-five percent (95%) of the "Market
Rent" (hereinafter defined), or (ii) the Base Rent in effect on the last day of
the Original Term. All references in the Lease to the Term shall be construed to
mean the Original Term and the Renewal Term, unless the context clearly
indicates that another meaning is intended. For purposes of the Lease, no
distinction is made between the terms "extend" and/or "renew," or any variations
thereof.
20.2. Market Rent Defined. For purposes of this Section 20, the
term "Market Rent" means the annual fair market rental for the Premises that
would be agreed upon between a landlord and a tenant executing a lease of
comparable office space in a comparable building of comparable age located in
the general area of the Premises (i.e., the Dulles Corridor market), assuming
the following: (a) the landlord and the tenant are well informed and well
advised and each is acting in what it considers its own best interests; (b) the
rental is unaffected by special financing amounts and/or terms or unusual
services, fees, concessions, costs or credits in connection with the leasing
transaction; (c) the Premises are to be let in "as is" condition and subject to
the provisions of the Lease for a five (5) year term; and (d) the other
provisions of the Lease remain unchanged.
20.3. Negotiation Period. Between one hundred eighty (180) and
one hundred fifty (150) days prior to the commencement of the Renewal Term, the
Landlord in good faith shall send to the
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Tenant a written notice specifying its determination of the Market Rent for the
Premises for the Renewal Term as set forth above. Within thirty (30) days after
receipt of such notice from the Landlord, the Tenant shall send the Landlord
written determination of the Tenant's acceptance or challenge of the Landlord's
determination of such Market Rent; provided, however, that in the event that the
Tenant fails to respond within such thirty (30) day period, (i) the Tenant shall
be deemed to have rejected the Landlord's determination of the Market Rent
applicable for the Renewal Term, (ii) the Landlord thereafter may lease such
Premises without restriction to any party upon such terms and conditions as the
Landlord solely shall determine, and (iii) the Tenant shall have no further
right or option to renew or extend this Lease. In the event that the Tenant and
the Landlord are not able to agree on such Market Rent within ten (10) business
days (hereinafter referred to as the "Negotiation Period") after the Tenant
affirmatively and in writing notifies the Landlord of the Tenant's initial
rejection of the Landlord's determination of such Market Rent, the Landlord and
the Tenant each, within ten (10) business days after the expiration of the
Negotiation Period, shall select a broker, each of whom shall be a reputable
duly licensed real estate broker with at least five (5) years' experience in the
Fairfax County, Virginia, area who shall determine the Market Rent for the
Premises for the Renewal Period in accordance with this Section . The brokers
shall be instructed to complete the procedure independently and to submit their
written determinations to the Landlord and the Tenant within thirty (30) days
after their appointment.
20.4. Three Broker Method. In the event that the higher
determination of the Market Rent submitted by one of the brokers is equal to or
less than one hundred ten percent (110%) of the determination of the Market Rent
submitted by the other broker, the Market Rent for the Renewal Period shall be
the average of such determinations. If the determination of the Market Rent
submitted by one broker is greater than one hundred ten percent (110%) of the
determination of Market Rent submitted by the other broker, the brokers, within
five (5) days of notice from the Landlord or the Tenant, shall appoint a third
broker with similar qualifications to make a determination of the Market Rent
for the Renewal Period. In the event that the two (2) brokers cannot agree as to
the selection of the third broker within five (5) days after the Landlord or the
Tenant have requested that they do so, either party may request that the
president of the local Board of Realtors (or any successor organization) appoint
the third broker, which appointment shall be made within ten (10) days after the
Landlord or the Tenant have made such a request. The third broker shall be
instructed to complete the procedure and to submit a written determination of
the Market Rent to the Landlord and the Tenant within thirty (30) days after
such broker's appointment. The determination which is neither the highest nor
the lowest of the three (3)
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determinations shall be binding upon the Landlord and the Tenant as the Market
Rent, unless two (2) determinations are the same, in which event the Market Rent
shall be such amount. The Landlord and the Tenant each shall bear the costs of
its respective broker. The expense of the third broker shall be borne one-half
(1/2) by the Landlord and one-half (1/2) by the Tenant.
20.5. Lease Amendment. If the Lease is so renewed for the Renewal
Term, the Landlord and the Tenant shall execute an amendment to the Lease
specifying the Base Rent for the Premises for the Renewal Term; in all other
respects, the terms and conditions of this Lease shall apply during the Renewal
Term.
SECTION 21. GENERAL.
21.1. Effectiveness. This Lease shall become effective on and
only on its execution and delivery by each party hereto.
21.2. Complete Understanding. This Lease represents the complete
understanding between the parties hereto as to the subject matter hereof, the
Premises, the Building, the Building Service Equipment, the Property, or the
rights and obligations of the parties hereto as to the same, and supersedes all
prior negotiations, representations, guaranties, warranties, promises,
statements or agreements, either written or oral, between the parties hereto as
to the same.
21.3. Amendment. This Lease may be amended by and only by an
instrument executed and delivered by each party hereto. Provided, however, that
the Landlord shall have the right at any time, and from time to time, during the
Term of the Lease, to unilaterally amend the provisions of the Lease if the
Landlord (or any of its partners) is advised by its counsel that all or any
portion of the monies paid, directly or indirectly, by the Tenant to the
Landl |
