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Sample Business ContractsHome: Sample Business Contracts:
LEASE
between
TMT RESTON I & II, INC.,
as Landlord,
and
GO2MARKET.COM INCORPORATED,
D/B/A NITROSECURITY,
as Tenant
TABLE OF CONTENTS
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LEASE
REFERENCE PAGES
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The Reference Pages information is incorporated into and made a part of the Lease. In the event of any conflict between any Reference Pages information and the Lease, the Lease shall control. This Lease includes the Exhibits, all of which are made a part of this Lease.
[SIGNATURES CONTAINED ON NEXT PAGE]
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Corporate Seal
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LEASE
By this Lease Landlord leases to Tenant and Tenant leases from Landlord the Premises in the Building as set forth and described on the Reference Pages. The Premises are depicted on the floor plan attached hereto as Exhibit A, and the Building is depicted on the site plan attached hereto as Exhibit A-1. The Reference Pages, including all terms defined thereon, are incorporated as part of this Lease.
1. USE AND RESTRICTIONS ON USE.
1.1. The Premises are to be used solely for general office purposes. Tenant shall not do or permit anything to be done in or about the Premises which will in any way obstruct or interfere with the rights of other tenants or occupants of the Building, including, but not limited to, any exclusive rights of another tenant or occupant of the Building, or injure, annoy, or disturb them, or allow the Premises to be used for any improper, immoral, unlawful, or objectionable purpose, or commit any waste. Tenant shall not do, permit or suffer in, on, or about the Premises the sale of any alcoholic liquor without the written consent of Landlord first obtained. Tenant shall comply with all governmental laws, ordinances and regulations applicable to the use of the Premises and its occupancy and shall promptly comply with all governmental orders and directions for the correction, prevention and abatement of any violations in the Building or appurtenant land, caused or permitted by, or resulting from the specific use by, Tenant, or in or upon, or in connection with, the Premises, all at Tenant’s sole expense. Tenant shall not do or permit anything to be done on or about the Premises or bring or keep anything into the Premises which will in any way increase the rate of, invalidate or prevent the procuring of any insurance protecting against loss or damage to the Building or any of its contents by fire or other casualty or against liability for damage to property or injury to persons in or about the Building or any part thereof.
1.2. Tenant shall not, and shall not direct, suffer or permit any of its agents, contractors, employees, licensees or invitees (collectively, the “Tenant Entities”) to at any time handle, use, manufacture, store or dispose of in or about the Premises or the Building any (collectively “Hazardous Materials”) flammables, explosives, radioactive materials, hazardous wastes or materials, toxic wastes or materials, or other similar substances, petroleum products or derivatives or any substance subject to regulation by or under any federal, state and local laws and ordinances relating to the protection of the environment or the keeping, use or disposition of environmentally hazardous materials, substances, or wastes, presently in effect or hereafter adopted, all amendments to any of them, and all rules and regulations issued pursuant to any of such laws or ordinances (collectively “Environmental Laws”), nor shall Tenant suffer or permit any Hazardous Materials to be used in any manner not fully in compliance with all Environmental Laws, in the Premises or the Building and appurtenant land or allow the environment to become contaminated with any Hazardous Materials. Notwithstanding the foregoing, Tenant may handle, store, use or dispose of products containing small quantities of Hazardous Materials (such as aerosol cans containing insecticides, toner for copiers, paints, paint remover and the like) to the extent customary and necessary for the use of the Premises for general office purposes; provided that Tenant shall always handle, store, use, and dispose of any such Hazardous Materials in a safe and lawful manner and never allow such Hazardous Materials to contaminate the Premises, Building and appurtenant land or the environment. Tenant shall
protect, defend, indemnify and hold each and all of the Landlord Entities (as defined in Article 30) harmless from and against any and all loss, claims, liability or costs (including court costs and attorney’s fees) incurred by reason of any actual or asserted failure of Tenant to fully comply with all applicable Environmental Laws, or the presence, handling, use or disposition in or from the Premises of any Hazardous Materials by Tenant or any Tenant Entity (even though permissible under all applicable Environmental Laws or the provisions of this Lease), or by reason of any actual or asserted failure of Tenant to keep, observe, or perform any provision of this Section 1.2.
2. TERM.
2.1. The Term of this Lease shall begin on the date (“Commencement Date”) which shall be the later of the Scheduled Commencement Date as shown on the Reference Pages and the date that Landlord shall tender possession of the Premises to Tenant, and shall terminate on the date as shown on the Reference Pages (“Termination Date”), unless sooner terminated by the provisions of this Lease. Landlord shall tender possession of the Premises with all the work, if any, to be performed by Landlord pursuant to Exhibit B to this Lease substantially completed. Tenant shall deliver a punch list of items not completed within ten (10) days after Landlord tenders possession of the Premises and Landlord agrees to proceed with due diligence to perform its obligations regarding such items. Tenant shall, at Landlord’s request, execute and deliver a memorandum agreement provided by Landlord in the form of Exhibit C attached hereto, setting forth the actual Commencement Date, Termination Date and, if necessary, a revised rent schedule. Should Tenant fail to do so within thirty (30) days after Landlord’s request, the information set forth in such memorandum provided by Landlord shall be conclusively presumed to be agreed and correct. Notwithstanding any provision in this Lease to the contrary, if the Term has not commenced within one (1) year after the date of this Lease, this Lease shall automatically terminate on the first (1st) anniversary of the date hereof. The sole purpose of the preceding sentence is to avoid any possible interpretation that this Lease violates the Rule Against Perpetuities or other rule of law against restraints on alienation.
2.2. Tenant agrees that in the event of the inability of Landlord to deliver possession of the Premises on the Scheduled Commencement Date for any reason, Landlord shall not be liable for any damage resulting from such inability, but Tenant shall not be liable for any rent until the time when Landlord can, after notice to Tenant, deliver possession of the Premises to Tenant. No such failure to give possession on the Scheduled Commencement Date shall affect the other obligations of Tenant under this Lease, except that if Landlord is unable to deliver possession of the Premises within sixty (60) days after the Scheduled Commencement Date (other than as a result of strikes, shortages of materials, holdover tenancies or similar matters beyond the reasonable control of Landlord and Tenant is notified by Landlord in writing as to such delay), Tenant shall have the option to terminate this Lease unless said delay is as a result of: (i) Tenant’s request for changes to the Landlord’s Work (defined in Exhibit B) (or other Tenant change orders); (ii) Tenant’s acts or omissions which result in Landlord’s inability to obtain timely a certificate of occupancy for the Premises, if any, provided that Landlord shall have expressly agreed to obtain same; (iii) based upon Landlord’s Work, the inclusion in Landlord’s Work by either party hereunder of any materials, finishes, or other items which: (A) require a long lead time for procurement and installation; or (B) are non-Landlord Building standard materials, finishes, or other items; or (iv) Tenant’s failure to timely furnish its
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requirements or agree to any plans and specifications (each of the foregoing, a “Tenant Delay”). If any delay is the result of a Tenant Delay, the Commencement Date and the payment of rent under this Lease shall be accelerated by the number of days of such Tenant Delay.
2.3. Notwithstanding that the Term or Commencement Date may not have yet occurred, if Landlord shall permit Tenant or any person or entity lawfully acting by or through Tenant to possess or otherwise use the Premises prior to the Term or Commencement Date, such possession or use shall be subject to all the provisions of this Lease as if the Term and Commencement Date had otherwise commenced or occurred; provided, however: (i) Tenant shall not be obligated to pay Annual Rent or Tenant’s proportionate share of Expenses, Insurance Costs, or Taxes with respect to any period prior to the actual Term or Commencement Date; and (ii) such early possession and use shall not be included in determination of the Lease Year, as defined in Section 4.1.1 of this Lease. If Tenant or such person or entity should enjoy such early possession or use of the Premises, the Term of the Lease shall be deemed to have so commenced solely for the purpose of causing Tenant’s covenants, obligations, indemnities, and other agreement under the Lease during the Term to be effective and binding upon Tenant during such early possession (such as, but not limited to, Tenant’s being obligated to obtain all insurance required of it under the Lease). Said early possession and use shall not advance the Termination Date. Subject to the provisions of this Lease, including Section 2.1, prior access to, and use of, the Premises by Tenant or Tenant’s agents or vendors for the purposes of installing furniture, fixtures, or equipment of Tenant shall not advance the Term or Commencement Date.
2.4. Provided that: (i) Tenant is in physical possession and actual occupancy of the Premises and no Event of Default exists at the time of the exercise of such option or arises subsequent thereto, and no event exists which by notice and/or the passage of time would constitute an Event of Default if not cured within the applicable cure period provided under this Lease; and (ii) Tenant has not sublet or assigned any of its rights, title, and interest in and to this Lease, Tenant shall have the option to extend this Lease for one (1) consecutive extension term of five (5) consecutive years, provided Tenant notifies Landlord in writing of its exercise of such option not sooner than twelve (12) months nor later than nine (9) months prior to the Termination Date. Annual Rent during such extension term shall be at one hundred percent (100%) of the fair market rate, including market concessions, as determined by the mutual agreement of Landlord and Tenant, provided that in no event shall such Annual Rent be less than the then current escalated rate, and provided that Tenant shall post an increase in its Security Deposit which is commensurate with such new Annual Rent. Such Annual Rent for the extension term shall escalate at the fair market escalation rate as determined by the mutual agreement of Landlord and Tenant, provided that in no event shall such Annual Rent escalate at less than the escalation rate of three percent (3%) per annum. All other provisions of this Lease shall remain the same during the extension term, except that Tenant shall have no further extension option and the Base Year shall be the first (1st) full calendar year of the extension term. Should Landlord and Tenant be unable for any reason to agree upon a new Annual Rent and/or escalation rate within thirty (30) days after Tenant’s exercise of this option, then the Annual Rent and/or escalation rate, as applicable, shall be determined by appraisal by a board of three (3) real estate brokers, one of whom shall be named by Landlord, one by Tenant, and the two so appointed shall select a third. Such brokers shall be members of the Greater Washington Association of Commercial Realtors or any successor thereto, licensed in the Commonwealth of Virginia, and each shall have not less than ten (10) years’ experience in the field of commercial
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office leasing in the northern Virginia metropolitan area. Each shall be recognized as being ethical and reputable within its field. Landlord and Tenant agree to make their appointments promptly within ten (10) business days after the expiration of the thirty (30) day period, and the two brokers shall promptly select a third broker within fifteen (15) days thereafter. Each broker shall, within thirty (30) days after selection of the third broker, submit its determination of the Annual Rent and/or escalation rate, as applicable and the Annual Rent and/or escalation rate, as applicable, shall be deemed to be the rent and/or escalation rate, as applicable, determined by the third broker, unless it is higher than the higher of the two values determined by the first two brokers, in which event the higher of the first two appraisals shall be the Annual Rent and/or escalation rate, as applicable, or unless it is lower than the lower of the two values determined by the first two brokers, in which event the lower of the first two appraisals shall be the Annual Rent or escalation rate, as applicable. In arriving at its rental rate determinations, each broker shall consider and analyze all material components of the Lease, and review terms being offered to prospective office tenants for comparable space in comparable office buildings and locations in the northern Virginia metropolitan area for leases commencing on or about the time of commencement of the extension period. In no event shall the Annual Rent so determined be less than the Annual Rent as of the expiration of the initial Term of the Lease, and in no event shall the escalation rate be less than three percent (3%) per annum. Landlord and Tenant shall each pay the fee of the broker selected by it and they shall share equally the payment of the fee of the third broker.
3. RENT.
3.1. Tenant agrees to pay to Landlord the Annual Rent in effect from time to time by paying the Monthly Installment of Rent then in effect on or before the first day of each full calendar month during the Term, except that the first full month’s rent shall be paid upon the execution of this Lease. The Monthly Installment of Rent in effect at any time shall be one-twelfth (1/12) of the Annual Rent in effect at such time. Rent for any period during the Term which is less than a full month shall be a prorated portion of the Monthly Installment of Rent based upon the number of days in such month. Said rent shall be paid to Landlord, without deduction or offset and without notice or demand, at the Rent Payment Address, as set forth on the Reference Pages, or to such other person or at such other place as Landlord may from time to time designate in writing. If a monetary Event of Default occurs, Landlord may require by notice to Tenant that all subsequent rent payments be made by an automatic payment from Tenant’s bank account to Landlord’s account, without cost to Landlord. Tenant must implement such automatic payment system prior to the next scheduled rent payment or within ten (10) days after Landlord’s notice, whichever is later. Unless specified in this Lease to the contrary, all amounts and sums payable by Tenant to Landlord pursuant to this Lease shall be deemed additional rent.
3.1.1. Notwithstanding the foregoing, provided that there shall not exist any Event of Default, and no event exists which by notice and/or the passage of time would constitute an Event of Default if not cured within the applicable cure period provided under this Lease, and subject to the provisions of Section 19.3 below, the Monthly Installments of Annual Rent due for the first (1st) full calendar month following the Commencement Date shall be abated. Nothing in this Section 3.1.1, however, shall be interpreted to except or excuse Tenant from any Additional Rent or other amounts due under this Lease to Landlord.
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3.2. Tenant recognizes that late payment of any rent or other sum due under this Lease will result in administrative expense to Landlord, the extent of which additional expense is extremely difficult and economically impractical to ascertain. Tenant therefore agrees that if rent or any other sum is not paid when due and payable pursuant to this Lease, a late charge shall be imposed in an amount equal to the greater of: (a) Fifty Dollars ($50.00), or (b) six percent (6%) of the unpaid rent or other payment; provided, however, Landlord agrees to waive and forgive the first (1st) of any such late charges during the Term, provided that Landlord receives such overdue rent or other sum within five (5) days after the date due. The amount of the late charge to be paid by Tenant shall be reassessed and added to Tenant’s obligation for each successive month until paid. The provisions of this Section 3.2 in no way relieve Tenant of the obligation to pay rent or other payments on or before the date on which they are due, nor do the terms of this Section 3.2 in any way affect Landlord’s remedies pursuant to Article 19 of this Lease in the event said rent or other payment is unpaid after date due.
3.3. Notwithstanding anything to the contrary contained herein, if the Commencement Month is not a full calendar month, such Commencement Month shall be deemed for all purposes of this Lease to be part of the First Lease Year and Tenant shall pay additional Annual Rent for such Commencement Month calculated on a per diem basis at the Annual Rental Rate for the First Lease Year.
4. RENT ADJUSTMENTS.
4.1. For the purpose of this Article 4, the following terms are defined as follows:
4.1.1. Lease Year: Each consecutive twelve (12) month period falling partly or wholly within the Term; provided, however, if the Commencement Month is not a full calendar month, then the first Lease Year shall consist of the Commencement Month and the subsequent twelve (12) consecutive month period.
4.1.2. Expenses: All costs of operation, maintenance, repair, replacement and management of the Building (including the amount of any credits which Landlord may grant to particular tenants of the Building in lieu of providing any standard services or paying any standard costs described in this Section 4.1.2 for similar tenants), as determined in accordance with generally accepted accounting principles, including the following costs by way of illustration, but not limitation: water and sewer charges; utility costs, including, but not limited to, the cost of heat, light, power, steam, gas; waste disposal; the cost of janitorial services; the cost of access control and monitoring services (including any central station signaling system); costs of cleaning, repairing, replacing and maintaining the common areas, including parking and landscaping, window cleaning costs; labor costs; costs and expenses of managing the Building including management and/or administrative fees; air conditioning maintenance costs; elevator maintenance fees and supplies; material costs; equipment costs including the cost of maintenance, repair and service agreements and rental and leasing costs; purchase costs of equipment; current rental and leasing costs of items which would be capital items if purchased; tool costs; licenses, permits and inspection fees; wages and salaries; employee benefits and payroll taxes; accounting and legal fees; any sales, use or service taxes incurred in connection therewith. In addition, Landlord shall be entitled to recover, as additional rent (which, along with any other capital expenditures constituting Expenses, Landlord may either include in
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Expenses or cause to be billed to Tenant along with Expenses and Taxes but as a separate item), Tenant’s Proportionate Share of: (i) an allocable portion of the cost of capital improvement items which are reasonably calculated to reduce operating expenses; (ii) the cost of fire sprinklers and suppression systems and other life safety systems; and (iii) other capital expenses which are required under any governmental laws, regulations or ordinances which were not applicable to the Building at the time it was constructed; but the costs described in this sentence shall be amortized over the reasonable life of such expenditures in accordance with such reasonable life and amortization schedules as shall be determined by Landlord in accordance with generally accepted accounting principles, with interest on the unamortized amount at one percent (1%) in excess of the Wall Street Journal prime lending rate announced from time to time. Expenses shall not include Taxes, Insurance Costs, depreciation or amortization of the Building or equipment in the Building except as provided herein, loan principal payments, costs of alterations of tenants’ premises, leasing commissions, interest expenses on long-term borrowings or advertising costs. If any Direct Expenses are shared jointly between or among the Building and another building, such as, but not limited to, Reston Plaza II, such costs shall be allocated proportionately between or among such buildings based upon the rentable square footage of each building, or such other equitable manner as Landlord shall deem appropriate.
4.1.3. Taxes: Real estate taxes and any other taxes, charges and assessments which are levied with respect to the Building or the land appurtenant to the Building, or with respect to any improvements, fixtures and equipment or other property of Landlord, real or personal, located in the Building and used in connection with the operation of the Building and said land, any payments to any ground lessor in reimbursement of tax payments made by such lessor; and all fees, expenses and costs incurred by Landlord in investigating, protesting, contesting or in any way seeking to reduce or avoid increase in any assessments, levies or the tax rate pertaining to any Taxes to be paid by Landlord in any calendar year. Taxes shall not include any corporate franchise, or estate, inheritance or net income tax, or tax imposed upon any transfer by Landlord of its interest in this Lease or the Building or any taxes to be paid by Tenant pursuant to Article 28. If any Taxes are shared jointly between or among the Building and another building, such as, but not limited to, Reston Plaza II, such costs shall be allocated proportionately between or among such buildings based upon the rentable square footage of each building, or such other equitable manner as Landlord shall deem appropriate.
4.1.4. Insurance Costs: Any and all insurance charges of or relating to all insurance policies and endorsements deemed by Landlord to be reasonably necessary or desirable and relating in any manner to the protection, preservation, or operation of the Building or any part thereof. If any Insurance Costs are shared jointly between or among the Building and another building, such as, but not limited to, Reston Plaza II, such costs shall be allocated proportionately between or among such buildings based upon the rentable square footage of each building, or such other equitable manner as Landlord shall deem appropriate.
4.2. If in any calendar year, (i) Expenses paid or incurred shall exceed Expenses paid or incurred in the Base Year (Expenses) and/or (ii) Taxes paid or incurred by Landlord shall exceed the amount of such Taxes which became due and payable in the Base Year (Taxes), and/or (iii) Insurance Costs paid or incurred by Landlord shall exceed the amount of such Insurance Costs which became due and payable in the Base Year (Insurance Costs), Tenant shall
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pay as additional rent for such calendar year Tenant’s Proportionate Share of each such excess amount.
4.3. The annual determination of Expenses and Insurance Costs shall be made by Landlord and shall be binding upon Landlord and Tenant, subject to the provisions of this Section 4.3. During the Term, Tenant may review, at Tenant’s sole cost and expense, the books and records supporting such determination in an office of Landlord, or Landlord’s agent, during normal business hours, upon giving Landlord five (5) days advance written notice within sixty (60) days after receipt of such determination, but in no event more often than once in any one (1) year period, subject to execution of a confidentiality agreement acceptable to Landlord, and provided that if Tenant utilizes an independent accountant to perform such review it shall be one of national standing which is reasonably acceptable to Landlord, is not compensated on a contingency basis and is also subject to such confidentiality agreement. If Tenant fails to object to Landlord’s determination of Expenses and Insurance Costs within ninety (90) days after receipt, or if any such objection fails to state with specificity the reason for the objection, Tenant shall be deemed to have approved such determination and shall have no further right to object to or contest such determination. In the event that during all or any portion of any calendar year or Base Year, the Building is not fully rented and occupied Landlord shall make an appropriate adjustment in occupancy-related Expenses for such year for the purpose of avoiding distortion of the amount of such Expenses to be attributed to Tenant by reason of variation in total occupancy of the Building, by employing consistent and sound accounting and management principles to determine Expenses that would have been paid or incurred by Landlord had the Building been at least ninety-five percent (95%) rented and occupied, and the amount so determined shall be deemed to have been Expenses for such calendar year.
4.4. Prior to the actual determination thereof for a calendar year, Landlord may from time to time estimate Tenant’s liability for Expenses, Insurance Costs and/or Taxes under Sections 4.1, Article 6.3 and Article 28 for the calendar year or portion thereof. Landlord will give Tenant written notification of the amount of such estimate and Tenant agrees that it will pay, by increase of its Monthly Installments of Rent due in such calendar year, additional rent in the amount of such estimate. Any such increased rate of Monthly Installments of Rent pursuant to this Section 4.4 shall remain in effect until further written notification to Tenant pursuant hereto.
4.5. When the above mentioned actual determination of Tenant’s liability for Expenses, Insurance Costs and/or Taxes is made for any calendar year and when Tenant is so notified in writing, then:
4.5.1. If the total additional rent Tenant actually paid pursuant to Section 4.3 on account of Expenses, Insurance Costs and/or Taxes for the calendar year is less than Tenant’s liability for Expenses, Insurance Costs and/or Taxes, then Tenant shall pay such deficiency to Landlord as additional rent in one lump sum within thirty (30) days of receipt of Landlord’s bill therefor; and
4.5.2. If the total additional rent Tenant actually paid pursuant to Section 4.3 on account of Expenses, Insurance Costs and/or Taxes for the calendar year is more than Tenant’s liability for Expenses, Insurance Costs and/or Taxes, then Landlord shall credit the difference
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against the then next due payments to be made by Tenant under this Article 4, or, if the Lease has terminated, refund the difference in cash. Tenant shall not be entitled to a credit by reason of actual Expenses and/or Taxes and/or Insurance Costs in any calendar year being less than Expenses and/or Taxes and/or Insurance Costs in the Base Year (Expenses and/or Taxes and/or Insurance).
4.6. If the Commencement Date is other than January 1 or if the Termination Date is other than December 31, Tenant’s liability for Expenses, Insurance Costs and Taxes for the calendar year in which said Date occurs shall be prorated based upon a three hundred sixty-five (365) day year. Tenant’s obligation to pay Tenant’s Proportionate Share of any unpaid Expenses, Insurance Costs, and Taxes which are otherwise due and payable under this Lease shall survive the expiration or earlier termination of the Term.
5. SECURITY DEPOSIT.
5.1. Tenant shall deposit the Security Deposit with Landlord upon the execution of this Lease. Said sum shall be held by Landlord as security for the faithful performance by Tenant of all the terms, covenants and conditions of this Lease to be kept and performed by Tenant and not as an advance rental deposit or as a measure of Landlord’s damage in case of a default. If an Event of Default should exist with respect to any provision of this Lease, Landlord may use any part of the Security Deposit for the payment of any rent or any other sum in default, or for the payment of any amount which Landlord may spend or become obligated to spend by | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
