Minnesota-Minneapolis-225 South Sixth Street Office Lease - 601 Second Avenue LP and Capella Education Co.
OFFICE LEASE
BETWEEN
601 SECOND AVENUE LIMITED PARTNERSHIP,
A TEXAS LIMITED PARTNERSHIP
LANDLORD
AND
CAPELLA EDUCATION COMPANY,
A MINNESOTA CORPORATION,
TENANT
225 SOUTH SIXTH STREET
MINNEAPOLIS, MINNESOTA
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TABLE OF CONTENTS
Section Page
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1. DEFINITIONS......................................................................... 1
2. PREMISES............................................................................ 4
3. RENTABLE AREA....................................................................... 4
4. TENANT'S LEASEHOLD IMPROVEMENTS..................................................... 5
5. TERM................................................................................ 5
6. BASE RENT........................................................................... 7
7. CONTRIBUTION TO OPERATING COSTS..................................................... 9
8. NO PERSONAL LIABILITY............................................................... 15
9. USE................................................................................. 16
10. ASSIGNMENT AND SUBLETTING........................................................... 17
11. MAINTENANCE......................................................................... 19
12. ALTERATIONS; EQUIPMENT.............................................................. 21
13. KEYS; RIGHT OF ENTRY; RESERVED RIGHTS IN COMMON AREAS............................... 23
14. SERVICES AND UTILITIES.............................................................. 24
15. WAIVER AND INDEMNITY................................................................ 27
16. INSURANCE........................................................................... 27
17. WAIVER OF CLAIMS AND SUBROGATION.................................................... 28
18. DAMAGE.............................................................................. 29
19. CONDEMNATION........................................................................ 29
20. DEFAULT............................................................................. 29
21. LANDLORD'S RIGHT TO CURE DEFAULTS; LATE PAYMENTS.................................... 32
22. WAIVER.............................................................................. 32
23. SUBORDINATION....................................................................... 33
24. RULES AND REGULATIONS............................................................... 34
25. COVENANT OF QUIET ENJOYMENT......................................................... 34
26. LIMITED LIABILITY................................................................... 34
27. NO REPRESENTATIONS OR WARRANTIES BY LANDLORD........................................ 35
28. NOTICES............................................................................. 35
29. ESTOPPEL CERTIFICATES............................................................... 36
30. SURRENDER, HOLDING OVER............................................................. 37
31. TENANT'S TAXES...................................................................... 37
32. NO MERGER........................................................................... 38
33. GRAPHICS; BUILDING DIRECTORY........................................................ 38
34. LIEN FOR RENT ...................................................................... 38
35. MISCELLANEOUS....................................................................... 38
36. ADDITIONAL RIGHTS OF TENANT......................................................... 40
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LIST OF ATTACHED EXHIBITS
EXHIBIT A FLOOR PLAN OF PREMISES
EXHIBIT B LEGAL DESCRIPTION
EXHIBIT C FORM OF DECLARATION OF COMMENCEMENT DATE AND RENTABLE AREA
EXHIBIT D WORKLETTER
EXHIBIT E RULES AND REGULATIONS OF THE PROJECT
EXHIBIT F AIR CONDITIONING AND HEATING SERVICES
EXHIBIT G EXTENSION OPTION
EXHIBIT H PARKING
EXHIBIT I-1 EXPANSION OPTIONS
EXHIBIT I-2 POTENTIAL EXPANSION FLOORS
EXHIBIT J RIGHT OF OFFER
EXHIBIT K FORM OF CONFIDENTIALITY AGREEMENT
EXHIBIT L STORAGE SPACE
EXHIBIT M ASSIGNMENT LIMITATIONS
EXHIBIT N FORM OF NON DISTURBANCE AGREEMENT
EXHIBIT O CLEANING SPECIFICATIONS
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LEASE
This Lease is made as of February _23 , 2004 ("EFFECTIVE DATE"), by
and between 601 Second Avenue Limited Partnership, a Texas limited partnership
("LANDLORD"), and Capella Education Company, a Minnesota corporation ("TENANT").
1. DEFINITIONS.
"AFFILIATE" of any entity means any other entity directly or
indirectly controlling or controlled by or under direct or indirect common
control with such entity. For purposes of this definition, "control" (including,
with correlative meanings, the terms "controlled by" and "under common control
with") as used with respect to any entity shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such entity, whether through the ownership of voting securities or
by agreement or otherwise.
"ANTENNA SITE MANAGER" means SpectraSite Building Group, Inc.
"ASSIGNEE" means the assignee, mortgagee, subtenant or other
transferee under an Assignment.
"ASSIGNMENT" means (i) any assignment, transfer, mortgage or other
encumbrance of this Lease or any interest in this Lease, or (ii) any subletting
or renting or permitting occupancy or use of the Premises, or any part thereof,
by any third party, whether direct or indirect, voluntary or by operation of
law.
"BASE BUILDING SYSTEMS" means the systems of the Project including,
without limitation, the Project's electrical, mechanical, structural, plumbing,
heating, ventilating, air conditioning and life safety/fire systems.
"BASE RENT" shall have the meaning set forth in Section 6.
"BUILDING" means the 18 story Park building located in the Project.
"CAMPBELL MITHUN LEASE" means that certain Lease dated June 28,
2000, between 222 South Ninth Street Limited Partnership, a Minnesota limited
partnership, as landlord, and Tenant, as tenant, as amended by that certain
Amendment No. 1 To Lease Agreement dated December 5, 2001, between ND
Properties, Inc., as landlord, and Tenant, as tenant, and as further amended by
that certain Amendment No. 2 To Lease Agreement dated October 28, 2002, for the
premises which Capella is currently leasing in the Campbell Mithun Tower in
Minneapolis, Minnesota.
"COMMENCEMENT DATE" shall have the meaning set forth in Section 5.2.
"COMMON AREAS" means those portions of the Project which are not
leased or held for lease and which are, from time to time, made available by
Landlord for the use in common by Landlord, Tenant, other tenants of the Project
and such other persons as Landlord may designate including, without limitation,
the main floor lobby and other public areas of the Project located on levels
B-1, 1 and 2, those portions of the loading dock areas not reserved for
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the specific use of any particular tenant of the Project, the elevators located
in the Project, the mail room for the Project and the elevator foyers, corridors
and rest rooms on multi-tenant floors.
"DIRECT COMPETITOR OF TENANT" means any entity in the business of
providing post secondary educational courses to students.
"EFFECTIVE DATE" means the date on which this Lease has been fully
executed, which date shall be inserted into this Lease by Landlord
contemporaneously with Landlord's execution of this Lease.
"ESTIMATED OPERATING COSTS" means Landlord's estimate of Operating
Costs for a particular calendar year (or fiscal year where Landlord has
exercised its option under Section 7.8).
"EVENT OF DEFAULT" shall have the meaning set forth in Section 20.
"HAZARDOUS MATERIAL" means any hazardous substance, toxic chemical,
pollutant or other material which is or becomes regulated by the Comprehensive
Environmental Response, Compensation and Liability Act of 1985 or the Minnesota
Environmental Response and Liability Act or any similar law, regulation or code
(local, state or federal), including without limitation petroleum and petroleum
products and any material, equipment or machinery containing asbestos,
polychlorinated biphenyls (PCB's), chlorofluorocarbons (CFC's) or
hydrofluorocarbons (HCFC's).
"INITIAL PREMISES" means the Phase I Space, the Phase II Space and
the Phase III Space.
"INITIAL EXTENDED TERM" shall have the meaning set forth in Section
5.
"INITIAL SCHEDULED TERM" shall mean the six year period beginning on
the Phase I & II Rent Commencement Date.
"INTEREST RATE" means an annual rate equal to the lesser of (i) two
percentage points above the reference rate of interest published from time to
time by U.S. Bancorp (or its successors), or if U.S. Bancorp (or its successors)
discontinues publishing such a rate, two percentage points in excess of the
published prime rate or other equivalent reference rate of interest of a major
commercial bank reasonably designated by Landlord, or (ii) the maximum contract
interest rate per annum permitted by applicable law.
"LAND" means the real estate described on Exhibit B attached hereto.
"LEGAL REQUIREMENTS" shall have the meaning set forth in Section
9.1.
"MORTGAGE" means any mortgage or trust deed now existing or
hereafter encumbering or otherwise affecting the Project or any substantial part
thereof and all renewals, modifications, consolidations, replacements or
extensions thereof.
"MORTGAGEE" shall have the meaning set forth in Section 23.
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"NORMAL BUSINESS HOURS" means the periods from 7:30 a.m. to 6:00
p.m., Monday through Friday, and 7:30 a.m. to 1:00 p.m. on Saturday, except
during Holidays as defined in Exhibit F.
"OPERATING COSTS" shall have the meaning set forth in Section 7, as
adjusted pursuant to Section 7.8.
"PHASE I & II RENT COMMENCEMENT DATE" means November 1, 2004.
"PHASE III RENT COMMENCEMENT DATE" means November 1, 2005.
"PHASE I SPACE" means the 119,711 square feet of Rentable Area which
is located on the 8th and 9th floors of the Building and the 8th, 9th and 15th
floors of the Tower and depicted on the floor plans which are attached hereto as
Exhibit A.
"PHASE II SPACE" means the 30,335 square feet of Rentable Area which
is located on the 7th floor of the Building and depicted on the floor plans
which are attached hereto as Exhibit A.
"PHASE III SPACE" means the 53,275 square feet of Rentable Area
which is located on the 6th and 7th floors of the Tower and depicted on the
floor plans which are attached hereto as Exhibit A.
"PREMISES" shall mean Initial Premises and any other space which is
added to the Initial Premises pursuant to the Expansion Options provided in
Exhibit I-1, the Right of Offer provided in Exhibit J or in any other manner.
"PROJECT" means the Land, the Building and the Tower, the atrium
connecting the Building and the Tower, the subterranean parking garage, all
skyways and other improvements of Landlord now or hereafter constructed on the
Land or on or in any appurtenant easement or encroachment areas, except
improvements which tenants may remove therefrom pursuant to the terms of their
respective leases.
"RENT" means Base Rent, Tenant's Additional Rent, and all other sums
which shall become due and payable by Tenant to Landlord hereunder.
"RENTABLE AREA" shall be determined in accordance with Section 3.
"RENTABLE AREA OF THE PROJECT" means, during any year, the Rentable
Area of space leased or held for lease as office space or retail space contained
in the Project for such year.
"SUCCESSOR" shall have the meaning set forth in Section 10.7.
"TENANT'S ADDITIONAL RENT" means the sum of Tenant's Pro Rata Share
of Operating Costs (determined in accordance with Section 7 below) plus Tenant's
Property Management Fee.
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"TENANT IMPROVEMENTS" shall have the meaning set forth in Exhibit D.
"TENANT'S PRO RATA SHARE" is a fraction, the numerator of which for
any year shall be the weighted average Rentable Area of the Premises for such
year and the denominator of which shall be the Rentable Area of the Project for
such year.
"TENANT'S PROPERTY MANAGEMENT FEE" means for any year three and
09/100 percent (3.09%) of the sum of Tenant's Base Rent and Tenant's Pro Rata
Share of Operating Costs for such year.
"TERM" shall have the meaning set forth in Section 5.
"TOWER" means the 53 story office building located in the Project.
2. PREMISES.
2.1 Subject to and upon the terms, provisions and conditions hereinafter
set forth, and each in consideration of the duties, covenants and obligations of
the other hereunder, (i) Landlord hereby leases the Initial Premises to Tenant,
and Tenant hereby leases the Initial Premises from Landlord, beginning on the
Commencement Date and thereafter throughout the Lease Term, and (ii) Landlord
hereby grants Tenant a non-exclusive license to use the Common Areas throughout
the Lease Term for their intended purpose and in accordance with the rules and
regulations of the Project. Landlord covenants and represents that (y) the
Initial Premises is currently vacant (other than some personal property located
thereon which belongs to American Express Financial Corporation), and (z)
Landlord will cause the Initial Premises to be served by, and to be delivered in
accordance with, Base Building Systems and conditions which meet or exceed the
standards described in Section 14 (the "SPACE DELIVERY STANDARDS").
2.2 The Premises may be contracted pursuant to Section 5.3 or expanded
pursuant to the Expansion Options provided in Exhibit I-1 or the Right of Offer
provided in Exhibit J.
3. RENTABLE AREA.
3.1 For purposes of this Lease, the terms "RENTABLE AREA" and "USABLE
AREA" shall be calculated substantially in accordance with the Standard Method
for Measuring Floor Area in Office Buildings, ANSI/BOMA Z65.1-1996.
3.2 Landlord certifies to Tenant that the Rentable Area of the Phase I
Space, the Phase II Space and the Phase III Space has been calculated as of the
Effective Date on the basis of the foregoing definitions as follows: (i) 119,711
square feet for the Phase I Space; (ii) 30,355 square feet for the Phase II
Space; and (iii) 53,275 square feet for the Phase III Space (and such amounts
shall not be adjusted as a result of minor variations resulting from any
construction and completion of the Initial Premises for occupancy so long as
such work is done in accordance with the terms and provisions of this Lease).
Landlord further certifies to Tenant that the Rentable Area of the Project as of
the Effective Date is 1,401,233 square feet.
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4. TENANT'S LEASEHOLD IMPROVEMENTS.
Landlord and Tenant shall each comply with the provisions of Exhibit
D. Landlord is under no obligation to make any alterations, decorations,
additions or improvements in or to the Premises, nor to bear the cost of the
same, except as expressly set forth in Exhibit D. By taking occupancy of the
Premises, Tenant shall be deemed to have acknowledged that Landlord has
completed all of its obligations for improvements to the Premises, except as
otherwise provided in Exhibit D. Except as expressly set forth in Section 2, on
Exhibit D or elsewhere in this Lease, Tenant agrees that it is taking and
accepting the Premises on the Commencement Date and thereafter on an "as is",
"where is", and "with all faults" basis, without warranty or representation of
any kind, including without limitation any warranty as to the merchantability or
fitness for a particular purpose of any portion of the Premises, subject,
however, to Landlord's obligations under Section 11.2.
5. TERM.
5.1 Subject to and upon the terms and conditions set forth herein, or in
any Exhibit or Addendum hereto, the initial term of this Lease (the "INITIAL
SCHEDULED TERM") shall commence on the Phase I & II Rent Commencement Date and
shall continue until 11:59 p.m., Minneapolis, Minnesota, time on the day prior
to the sixth anniversary of the Phase I & II Rent Commencement Date unless
extended by Tenant's exercise of an Expansion Option pursuant to Exhibit I-1 or
a Right of Offer pursuant to Exhibit J, as the case may be (as extended, the
"INITIAL EXTENDED TERM"). For purposes of this Lease, the "TERM" or "LEASE TERM"
means the Initial Scheduled Term of this Lease as the same may be hereafter
extended or renewed pursuant to the Expansion Options provided in Exhibit I-1,
the Right of Offer provided in Exhibit J, the Extension Options provided in
Exhibit G, or in any other manner.
5.2 Landlord shall provide Tenant with access to the Phase I Space and
the Phase II Space as soon as reasonably possible (and in any event within
thirty (30) days) after the Effective Date (the date Landlord provides Tenant
with access to the Phase I Space and the Phase II Space being referred to herein
as the "COMMENCEMENT DATE") and access to the Phase III Space on May 1, 2005, so
that Tenant may prepare the Initial Premises for its use. Landlord shall not,
however, be liable to Tenant for any delay in giving possession of the Initial
Premises to Tenant because of any holding over or retention of possession by any
previous tenants or occupants of the same, nor shall any delay impair the
validity of this Lease; provided, however, that if Landlord fails to deliver the
Phase I Space and Phase II Space to Tenant on or before November 1, 2004, Tenant
may, at its option, within thirty (30) days of said date, terminate this Lease
by delivering written notice of termination to Landlord, and upon any such
termination Landlord shall reimburse Tenant for all out-of-pocket costs and
expenses incurred by Tenant in connection with this Lease, including, without
limitation, design fees, construction costs and expenses, attorneys' fees, and
consultants' fees. If Landlord fails to deliver the Phase III Space to Tenant on
or before July 1, 2005, Tenant may, at its option, by written notice to Landlord
given within thirty (30) days of said date, elect to exclude the Phase III Space
from the Initial Premises, whereupon the Phase III Space shall become part of
the Available Space under the Right of Offer. If any delay in delivering
possession to Tenant of the Phase I and Phase II Space or the Phase III Space,
as the case may be, actually delays the completion of the Tenant Improvements,
the Phase I & II Rent Commencement Date or the Phase III Rent
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Commencement Date, as applicable, will be extended by the number of days that
completion of the Tenant Improvements has been delayed, and if the Phase I & II
Rent Commencement Date is so extended, then the expiration of the Initial
Scheduled Term shall be similarly extended and any other date in this Lease
which is thereby affected will be appropriately adjusted. Tenant agrees to be
bound by and to comply with all of the terms and conditions of this Lease (other
than Tenant's obligation to pay Rent) during any occupancy of the Premises by
Tenant prior to the Phase I & II Rent Commencement Date with respect to the
Phase I Space and the Phase II Space and prior to the Phase III Rent
Commencement Date with respect to the Phase III Space. Notwithstanding anything
to the contrary in this Lease, Tenant shall not be obligated to pay any Rent for
the Phase I Space or the Phase II Space prior to the Phase I & II Rent
Commencement Date and Tenant shall not be obligated to pay any Rent for the
Phase III Space prior to the Phase III Rent Commencement Date.
5.3 During the Initial Scheduled Term, Tenant shall have the one time
right (the "CONTRACTION OPTION") to contract the Premises by surrendering
possession to Landlord of either one or two full floors of the Premises;
provided that for purposes of such Contraction Option, a "full floor" shall mean
all of the Rentable Area of a floor in the Tower only or in the Building only
(so that if, for example, Tenant would like to surrender possession of all of
the Rentable Area on the 9th floor of the Tower and the 9th floor of the
Building, all of the space on the 9th floor of the Tower and the 9th floor of
the Building would constitute two "full floors"). Tenant must exercise the
Contraction Option, if at all, (i) by delivering a written notice to Landlord
not earlier than fifteen (15) months and not later than twelve (12) months'
prior to the date on which Tenant intends to surrender such space (the
"CONTRACTION DATE"), which identifies the floor or floors which will be
surrendered (the "CONTRACTION SPACE"), and (ii) by Tenant's payment not later
than the Contraction Date, to Landlord in immediately available good funds of a
Contraction Fee, computed as set forth in this Section 5.3. Tenant may not
specify as the Contraction Date any date prior to July 1, 2008, or any date that
is more than twelve (12) months after the last day of the Initial Scheduled
Term. For purposes of designating Contraction Space (a) if Tenant's notice
designates only one floor as Contraction Space, such floor shall be the
uppermost floor of the Premises in the Tower or in the Building; (b) if Tenant's
notice designates two floors as Contraction Space, one floor shall be the
uppermost floor of the Premises in the Tower or in the Building, and the second
floor shall be contiguous thereto (either vertically or horizontally), provided,
however, if said uppermost floor in the Tower or Building is not contiguous
(either vertically or horizontally) to any other floor of the Premises, then the
second floor shall be the next uppermost floor in the Tower or Building; (c) in
any case where Tenant is to designate as Contraction Space a floor that is the
uppermost floor in the Premises and the uppermost floor of the Premises in the
Tower is on the same level as the uppermost floor of the Premises in the
Building, Tenant may designate either the floor in the Tower or the floor in the
Building as the Contraction Space; and (d) in determining which floor is the
uppermost floor in the Premises under this Section 5.3, that portion of the
Premises on the 15th Floor of the Tower shall be disregarded. The "CONTRACTION
FEE" shall be an amount equal to the sum of (A) the unamortized portion of
Landlord's Transaction Costs as of the Contraction Date, with respect to the
Contraction Space, plus (B) two months of the Base Rent and Tenant's Additional
Rent (based upon the amounts which Tenant is obligated to pay Landlord for the
month in which the Contraction Date occurs) for the Contraction Space. For
purposes of determining the amount of the Contraction Fee, (x) "LANDLORD'S
TRANSACTION COSTS" shall mean the total of the brokerage fees paid to CRESA
Partners for their services in connection with this Lease, plus the
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Improvement Allowance (as defined in Exhibit D attached hereto) that is actually
advanced or applied as a credit against Base Rent, (y) Landlord's Transaction
Costs shall be amortized on a fully amortized basis together with ten percent
(10%) interest on Landlord's Transaction Costs over the Initial Scheduled Term,
and (z) the unamortized portion of Landlord's Transaction Costs with respect to
the Contraction Space shall be determined by multiplying the total amount of the
unamortized portion of Landlord's Transaction Costs as of Contraction Date, by a
fraction, the numerator of which shall be the number of square feet of the
Rentable Area of the Contraction Space, and the denominator of which shall be
203,321. Tenant shall also reimburse Landlord for the reasonable costs of
removing and filling in any internal stairways installed by Tenant which serve
the Contraction Space within thirty (30) days after Tenant's receipt of an
invoice from Landlord for such costs based upon the lowest of three bids for
such work which are obtained by Landlord.
5.4 Landlord shall promptly after the Commencement Date, the Phase I &
II Rent Commencement Date, and the Phase III Rent Commencement Date, prepare a
declaration (substantially in the form of Exhibit C attached hereto) confirming
such date and the date on which the Initial Scheduled Term shall expire. Tenant
shall execute and return each such declaration within twenty (20) days after
submission. If Tenant fails to execute and return either declaration to Landlord
within said twenty (20) day period, Tenant shall be conclusively deemed to have
agreed that the information in the declaration is accurate and Tenant shall have
thereby waived any right to object to the accuracy of such information unless
Landlord has, during said twenty (20) day period, received a written notice from
Tenant objecting to such information and describing in detail Tenant's reasons
for so objecting.
6. BASE RENT.
6.1 Tenant shall pay as monthly "BASE RENT" for the Premises one-twelfth
of the product of:
(a) Nine and 75/100 Dollars ($9.75) times the number of square feet
of Rentable Area of the Phase I Space and the Phase II Space,
collectively, for the period beginning on November 1, 2004 and ending on
October 31, 2005;
(b) Ten Dollars ($10.00) times the number of square feet of Rentable
Area of the Premises for the period beginning on November 1, 2005 and
ending on October 31, 2006;
(c) Ten and 25/100 Dollars ($10.25) times the number of square feet
of Rentable Area of the Premises for the period beginning on November 1,
2006 and ending on October 31, 2007;
(d) Ten and 50/100 Dollars ($10.50) times the number of square feet
of Rentable Area of the Premises for the period beginning on November 1,
2007 and ending on October 31, 2008;
(e) Ten and 75/100 Dollars ($10.75) times the number of square feet
of Rentable Area of the Premises for the period beginning on November 1,
2008 and ending on October 31, 2009;
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(f) Eleven Dollars ($11.00) times the number of square feet of
Rentable Area of the Premises for the period beginning on November 1, 2009
and ending on October 31, 2010.
The Base Rent shall be paid in monthly installments, in advance, on
the first day of each and every calendar month during the Term. If the initial
or final month of the Term of this Lease is less than a calendar month, all Rent
including the Base Rent for such partial month shall be prorated at the rate of
one-thirtieth of the monthly Base Rent and all other Rent for each day within
the Term of this Lease. Tenant will pay said Base Rent, together with Tenant's
Additional Rent and all other amounts due under this Lease, to Landlord at the
Project, or to such other party or address as Landlord may designate from time
to time by notice to Tenant, without demand and without deduction, set-off,
counterclaim or abatement except as expressly provided herein.
6.2 Notwithstanding anything to the contrary in this Lease, Tenant
shall, for the period beginning on November 1, 2004, and ending on November 30,
2005, receive a credit each month against Tenant's obligation to pay Rent for
the Premises in an amount equal to all of the monthly rent, estimated operating
expenses (including management fees, but excluding charges for any services in
addition to the basic services to be provided to Capella under the Campbell
Mithun Lease) and real estate taxes which Tenant pays for the premises which
Tenant is currently leasing (the "CAMPBELL MITHUN PREMISES") pursuant to the
Campbell Mithun Lease as in effect on the Effective Date for the period from
November 1, 2004, through November 30, 2005 (the "CAMPBELL MITHUN RENT"). If the
Phase I & II Rent Commencement Date shall be extended pursuant to Section 5.2
(or Section 4 of Part III of the Work Letter), then the period during which
Tenant is entitled to receive a credit pursuant to the preceding sentence shall
be extended from November 30, 2005, to such later date as will enable Tenant to
receive credit in the full amount of the Campbell Mithun Rent. Tenant represents
to Landlord that: (a) the total monthly amount of base rent which Tenant is
obligated to pay for the Campbell Mithun Premises during the period of November
1, 2004, through November 30, 2005, is $104,820.83 per month; (b) Tenant is
obligated to pay during calendar year 2004 current estimated operating expenses
(including management fees) of $57,679.52 per month and real estate taxes of
$29,778.71 per month for the Campbell Mithun Premises which is comprised of a
total of 91,480 square feet of rentable area; and (c) Tenant is not aware of the
monthly charges for operating expenses and real estate taxes during calendar
year 2005 for the Campbell Mithun Premises. Tenant shall, within ten (10) days
after being notified of any adjustment (including any refund or abatement) in
the amount of the Campbell Mithun Rent for calendar years 2004 and 2005, notify
Landlord of such adjustment, but if Tenant shall fail to so notify Landlord,
such failure shall constitute an Event of Default by Tenant only if such failure
shall continue for fifteen (15) days after written notice of default is given by
Landlord in accordance with Section 20.1(c). Tenant hereby acknowledges that
Landlord shall be entitled to receive a portion of any refund of estimated
operating expenses which Tenant is entitled to receive pursuant to the Campbell
Mithun Lease for calendar years 2004 and 2005, and that Tenant shall not be
entitled to compromise the amount of any such refund. Tenant shall, within ten
(10) days after receiving a refund of the operating expenses which Tenant has
paid pursuant to the Campbell Mithun Lease, pay to Landlord (i) in the case of
any refund for calendar year 2004, one-sixth (1/6) of such refund, and (ii) in
the case of any refund for calendar year 2005, the full amount of such refund.
Landlord acknowledges that if Tenant receives a reconciliation of operating
expenses under the Campbell Mithun Lease
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requiring Tenant to make an additional payment for calendar years 2004 or 2005
over and above the estimated operating expenses theretofore paid by Tenant,
Tenant shall be entitled to an additional credit against Rent in an amount equal
to (a) in the case of any additional payment due for calendar year 2004,
one-sixth (1/6) of such additional payment, and (b) in the case of any
additional payment due for calendar year 2005, the full amount of such
additional payment. Tenant shall not be entitled to receive a credit against the
Base Rent due to Landlord under this Section 6.2 which is greater than the total
amount of the monthly rent, operating expenses and management fees which Tenant
actually pays for the Campbell Mithun Premises for the period commencing on
November 1, 2004, and ending on November 30, 2005. Tenant agrees to provide
Landlord with reasonable evidence of Tenant's payment of Campbell Mithun Rent
from time to time upon Landlord's request.
7. CONTRIBUTION TO OPERATING COSTS.
7.1 Tenant shall pay to Landlord on the first day of each month
throughout the Lease Term an amount equal to one-twelfth of Tenant's Additional
Rent (based on Estimated Operating Costs in accordance with Section 7.5 below).
Tenant's Additional Rent shall be paid to Landlord without deduction, set-off,
counterclaim or abatement except as expressly provided herein and shall be
prorated for any partial month during the Lease Term.
7.2 "OPERATING COSTS" are hereby defined with respect to any calendar
year to include all operating expenses of the Project, computed on an accrual
basis in accordance with generally accepted accounting principles which shall be
consistently applied (except that taxes shall be based on a due and payable, and
not an accrual, basis). Except as otherwise specifically excluded herein, the
term "operating costs" as used herein shall mean all expenses, costs and
disbursements of every kind and nature relating to or incurred or paid in
connection with the ownership, operation, repair and maintenance of the Project,
including but not limited to, the following:
(a) all taxes and assessments and governmental charges whether
federal, state, county or municipal, and whether they be by taxing
districts or authorities presently taxing the Premises or by others,
subsequently created or otherwise, and any other taxes and assessments
attributable to the Project or its operation or the rent payable by
tenants of the Project (provided that Tenant will be responsible for ad
valorem taxes on its personal property and on the value of leasehold
improvements to the extent that same exceed the base building
improvements), together with any reasonable costs or fees incurred in any
challenge or contest of such taxes, assessments or other charges
(collectively, "TAXES"); provided that operating expenses shall not
include Landlord's general income, excess profit, franchise, transfer,
inheritance, estate or gift taxes, except to the extent assessed, levied
or imposed in lieu of Taxes;
(b) any other fee, charge or assessment imposed by any governmental
entity for fire protection, police, trash or other service or amenity;
(c) costs incurred for electricity, gas, fuel, steam, water, sewer
or other utilities required in connection with the operation and
maintenance of the Project;
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(d) the cost of all premiums and other charges incurred by Landlord
with respect to insurance on the Project for all risk property insurance,
liability insurance, workers' compensation insurance, boiler and machinery
insurance, sprinkler leakage, water damage, legal liability, burglary and
hold-up insurance, fidelity and pilferage insurance on equipment and
materials, rental abatement insurance, and such other insurance as is
deemed necessary or advisable in Landlord's reasonable judgment or is
required by any Mortgagee;
(e) costs incurred in connection with the inspection, servicing,
maintenance and repair (including all outside contracts relating to the
operation and maintenance) of the Project and appurtenances thereto
including, without limitation, janitorial and window cleaning, rubbish
removal, exterminating, landscaping, water treatment, elevator,
electrical, plumbing, and mechanical equipment and the cost of materials,
tools, supplies and equipment (not of a capital nature) used in connection
therewith;
(f) compensation provided in the form of wages, salaries and such
other compensation and benefits (including payroll taxes, federal, state
and local unemployment taxes, social security taxes, welfare, retirement,
vacation, holiday, other paid absences and other fringe benefits) as well
as any adjustments thereto, to the extent relating to persons not above
the level of the on-site Project manager who perform duties connected with
the operation and maintenance of the Project (but only for the portion of
their time allocable to work related to the Project), and further
excluding any time reasonably allocable to leasing or other functions;
(g) expenses reimbursable to the property manager, including the
rent of the property manager's offices in the Project, and all other costs
and expenses incurred by Landlord in maintaining a property management
office in the Project, but excluding the costs of any marketing center or
any other space in the Project which is used primarily for leasing space
to new tenants;
(h) fees for professional services (including accounting and legal
costs), but only to the extent directly related to the operation and
management of the Project and not involving leasing matters or matters
associated with the operation of the business of the entity which
constitutes Landlord such as the preparation of tax returns and internal
financial statements;
(i) any equipment rental;
(j) operating costs relating to skyways;
(k) amortization of the cost, together with reasonable finance
charges, of furnishing and installing capital improvements which are (a)
undertaken by Landlord in the reasonable good faith belief that the
reduction in Operating Costs likely to result from such capital
improvements will equal or exceed the amortized cost of such capital
improvements; (b) required by Landlord's insurance carrier; or (c)
required as a result of any applicable law, rule, regulation or order of
any governmental or quasi-governmental authority having jurisdiction over
the Project which first becomes effective on or after the
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Effective Date (all such costs shall be amortized over the useful life of
the capital improvement items with the useful life and amortization
schedule being determined in accordance with generally accepted accounting
principles, but in no event shall such useful life extend beyond the
remaining useful life of the Project); and
(l) costs of licenses, permits (not including building permits), and
inspection fees for the Project.
Notwithstanding anything contained in the foregoing list, out of
pocket expenses for the following shall be excluded from Operating Costs (unless
offset by a corresponding credit):
(i) costs of repairs or other work occasioned by fire,
windstorm or other casualty, to the extent that such
costs are reimbursed to Landlord by insurers;
(ii) costs of correcting any violations of any Legal
Requirements, except to the extent of what would have
been the costs of compliance in the first instance if
such compliance would have been properly included in
Operating Expenses under Section 7.2;
(iii) costs directly or indirectly resulting from or relating
to (including repairs, restoration, security measures,
emergency or temporary services, inspection and, during
the period of such repair or restoration, any increase
in operating expenses resulting from) the exercise of
rights of eminent domain, regardless of whether paid
for by condemnation proceeds;
(iv) costs of correcting defects in, or the inadequacy of,
the initial design or construction of the Project, or
the materials used in the initial construction of the
Project or in the Project equipment or appurtenances
thereto;
(v) leasing commissions, attorneys' fees and other expenses
incurred in connection with negotiations or disputes
with tenants, other occupants, or prospective tenants
or other occupants of the Project;
(vi) costs incurred in renovating or otherwise improving or
decorating or redecorating space leased to tenants of
the Project or other space leased or held for lease in
the Project;
(vii) Landlord's costs for electricity and other services
sold to tenants or which Landlord is actually
reimbursed by tenants, other than through payment of
Operating Costs, as a separate additional charge or
rental;
(viii) depreciation and amortization, except as provided in
Section 7.2(k) above;
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(ix) costs which under generally accepted accounting
principles, consistently applied, must be capitalized,
except as provided in Section 7.2(k) above;
(x) all amounts paid to subsidiaries or affiliates of
Landlord for services on or to the Project, to the
extent that the costs of such services demonstrably
exceed competitive costs for such services rendered by
persons or entities of similar skill, competence and
experience;
(xi) payments on any Mortgage or any other loan (except as
otherwise permitted with respect to certain capital
improvements as provided in Section 7.2(k) above) and
rental under any ground lease;
(xii) rentals and other related expenses, if any, incurred
in leasing air conditioning systems, elevators or
other equipment ordinarily considered to be of a
capital nature, except equipment which is used in
providing janitorial services and which is not affixed
to the Building and except as provided in Section
7.2(k) above;
(xiii) all items and services for which Landlord actually
receives reimbursement from Tenant (other than through
Tenant paying Tenant's Additional Rent) or for which
Tenant actually pays third parties;
(xiv) costs incurred in advertising for the Project or other
marketing or promotional activity specifically and
primarily designed for marketing space in the Project,
but excluding the costs of amenities provided for the
benefit of existing tenants of the Project;
(xv) any bad debt expense or bad debt reserve, whether for
rent or otherwise, or any fees or penalties charged to
Landlord as a result of not paying any amount
constituting costs or expenses when due;
(xvi) costs (and reserves thereof) of a capital nature
irrespective of the amount thereof, including capital
improvements, capital repairs and replacements and
capital equipment, except as provided in Section
7.2(k) above;
(xvii) costs in connection with services or other benefits of
a type which are not provided, or which are provided
at higher levels or greater amounts than, or to a
degree which is higher than furnished to Tenant, but
which are provided to other Project tenants;
(xviii) except for Tenant's Property Management Fee and as
specifically provided in Sections 7.2(f), 7.2(g) and
7.2(h) above, fees or costs for management of the
Project, including any property management fee paid to
a property management company for the
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Project, or any fees, costs or expenses associated
with any accounting, bill-paying or management
activities;
(xix) costs of entertaining current or prospective Project
tenants, and costs incurred in advertising in respect
of or for the Project or other marketing or
promotional activity;
(xx) all direct costs arising from the operation of the
Parking Garage including costs of operating a ticket
booth, janitorial services, striping, lamp replacement
and repair and replacement of concrete and
reinforcing; provided that Operating Costs shall
include the cost of all Taxes and insurance premiums
allocable to the Parking Garage and any costs and
expenses that relate to the maintenance, repair and
operation of the structural elements of the Project or
Base Building Systems even if such structural elements
or Base Building Systems are located in or about the
Parking Garage;
(xxi) capital costs for sculpture, paintings or other art
objects;
(xxii) contributions to any political or charitable
organizations; and
(xxiii) travel, entertainment and related expenses incurred by
Landlord or its personnel, except for the reasonable
cost of out of state travel and meals, but only if
directly related to, and to the extent of, services
which are being provided to the Project.
Operating Costs shall be "net" only and for that purpose shall be
deemed reduced by the amount of any insurance reimbursement, other
reimbursement, credit or the like received or receivable by Landlord in
connection with such operating expense.
7.3 Landlord may at its sole discretion pay any Taxes in installments
when allowed by law, in which case each installment included in Operating Costs
shall include any interest charged thereon.
7.4 Taxes shall be included in Tenant's Additional Rent in monthly
installments which are computed such that at each date an installment of Taxes
is due to the taxing authorities, the proportion of annual taxes theretofore
included in Tenant's Additional Rental equals the proportion of annual Taxes due
to the taxing authorities at such installment due date, it being understood that
this may necessitate some installments to be included in one year for Taxes
payable in the following year.
7.5 Landlord shall from time to time give Tenant notice of Landlord's
determination of Estimated Operating Costs for the pertinent calendar year. If
Landlord makes a redetermination of Estimated Operating Costs at a time other
than the commencement of a calendar year, then at the time of the next due
monthly installment of Tenant's Additional Rent, such installment shall be
increased or reduced, as the case may be, by the monthly difference in Tenant's
Additional Rent resulting from the redetermination, times the number of months
elapsed in such year prior to the date on which such next monthly installment of
Tenant's
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Additional Rent is due. Landlord agrees to use reasonable efforts to inform
Tenant if, during any calendar year, Landlord believes that the actual amount of
Operating Costs for such calendar year will be significantly greater than the
most recent estimate of such Operating Costs which Landlord has given to Tenant.
7.6 Within one hundred twenty (120) days after the end of each calendar
year, Landlord shall submit to Tenant a statement setting forth (i) the
Operating Costs of the Project actually incurred for such calendar year, (ii)
Tenant's Additional Rent, based on such Operating Costs for such year, and (iii)
the aggregate of Tenant's payments of Tenant's Additional Rent for such year.
Within thirty (30) days after the delivery of such statement (including any
statement delivered after the expiration or termination of the Term of this
Lease), the party in whose favor there exists a difference, if any, between (x)
Tenant's Additional Rent (based on Operating costs actually incurred), and (y)
Tenant's payments of Tenant's Additional Rent, shall pay the amount of such
difference to the other; provided that Landlord shall have the right to offset
any amount owed by Landlord to Tenant pursuant to this Section 7.6 against
amounts which Tenant then owes Landlord.
If Tenant would like more information with respect to one or more specific
line items set forth on the annual statement, Tenant may, within sixty (60) days
after receipt thereof, request such additional information, and Landlord shall,
within thirty (30) days of Tenant's request, provide Tenant with more detailed
information with respect to such line items. Each statement furnished by
Landlord hereunder shall constitute a final determination upon Tenant unless
Tenant shall within ninety (90) days after delivery thereof (or, if Tenant has
requested additional information from Landlord, then sixty (60) days after
Landlord provides such additional information), give written notice to Landlord
that Tenant disputes the accuracy thereof, which notice shall specify in
reasonable detail the inaccuracies of the statement.
7.7 Tenant shall have the right to audit Operating Costs provided such
audit is conducted pursuant to the following terms and conditions: (a) Tenant
shall not have the right to conduct an audit if an Event of Default by Tenant
exists; (b) such audit must be conducted by Tenant's employees or an independent
nationally or regionally recognized accounting or consulting firm that is not
being compensated by Tenant, Tenant's officers, directors, shareholders,
partners or agents on a contingency fee basis, after execution of a
Confidentiality Agreement in the form of Exhibit K attached hereto; (c) such
audit must be commenced within ninety (90) days after Landlord submits to Tenant
the annual statement described in Section 7.6 (or, if Tenant has requested
additional information from Landlord, then sixty (60) days after Landlord
provides such additional information), and once commenced, such audit shall be
completed in a diligent and expeditious manner (and Tenant shall inform Landlord
once such audit is completed); (d) Tenant shall supply Landlord with a copy of
the relevant portion of any audit within fifteen (15) days after Tenant's
receipt of the same (but if Tenant shall fail to provide such copy to Landlord,
such failure shall constitute an Event of Default by Tenant only if such failure
shall continue for fifteen (15) days after written notice of default is given by
Landlord in accordance with Section 20.1(c)); (e) no audit shall be conducted if
Tenant has previously conducted an audit for the same period of time; (f) such
audit shall be conducted during normal business hours, at a mutually agreed upon
time, at Landlord's business address or at such other location as Landlord
normally keeps its books and records of Operating Costs; (g) if Tenant exercises
its audit rights to audit a period of time for which the books and records are
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held by another party that is not affiliated with or controlled by or under
common control with Landlord, such information must be obtained by Tenant, as
Tenant's sole cost and expense, from the keeper of the books and records; (h)
such audit shall be at Tenant's sole cost and expense and any out of pocket
costs or expenses incurred by Landlord in providing Tenant with the information
required to perform such audit, including, but not limited to, copying costs and
delivery fees shall be paid by Tenant to Landlord upon demand; provided,
however, that Landlord shall reimburse Tenant for its actual and reasonable out
of pocket costs of conducting such audit (other than any fees owing to an
auditor or inspector retained on a contingency fee basis) if it is determined
pursuant to such audit that Landlord has overstated the actual amount of
Tenant's Additional Rent for the applicable year by in excess of three percent
(3%); (i) any information obtained by Tenant as a result of such audit shall be
held in strict confidence by Tenant and shall not be disseminated further except
to Tenant's accountants, attorneys and lenders, or in connection with the
enforcement by Tenant of its rights under this Lease; (j) no subtenant shall
have any right to conduct an audit and no assignee shall conduct an audit for
any period during which assignee was not in possession of the Premises; and (k)
if it is determined pursuant to such audit that there has been an overpayment or
underpayment of Tenant's Additional Rent, the parties shall promptly make such
reconciliation payments and/or refunds as are appropriate. Further,
notwithstanding the fact that Tenant has elected to conduct such audit, Tenant
shall not have the right to withhold or offset any part of Tenant's Additional
Rent, which Tenant shall pay to Landlord as and when due and payable in
accordance with the terms of this Lease.
7.8 Landlord may, at its option, by giving thirty (30) days' written
notice to Tenant change its accounting year hereunder from a calendar year to a
fiscal year, making such adjustments from the end of the last calendar year to
the commencement of the first full fiscal year as shall be appropriate pursuant
to generally accepted accounting principles. Upon such change, references in
this Section 7 to a calendar year shall be deemed to be references to a fiscal
year.
7.9 Notwithstanding any other provision herein to the contrary, (i) if
at any time the entire Project is not fully occupied, or if full services are
not provided to all areas of the Project which are leased or available for lease
during all or any portion of a calendar year, then those elements of Operating
Costs and Estimated Operating Costs which vary with occupancy (or for which full
service is not provided to all areas) shall be adjusted to equal the cost which
Landlord would have incurred if the Project were fully occupied and all rentable
areas had received full services; and (ii) if Tenant's use of the Premises or
any portion thereof is ever such that the services furnished thereto are more
than are being furnished to other tenants in the Project, then an adjustment
shall be made to Tenant's Additional Rent to reflect the extra costs incurred by
Landlord as a result thereof.
8. NO PERSONAL LIABILITY.
Tenant will not be obligated to post a security deposit or letter of
credit to secure Tenant's obligations under this Lease. No present or future
partner, shareholder, member or principal of or in Tenant will have any personal
liability for the payment of Rent or other amounts due under this Lease or the
performance of Tenant's other obligations under this Lease.
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9. USE.
9.1 Tenant may use and occupy the Premises solely for general office
purposes and for no other purpose. Tenant shall not occupy or use the Premises
or any part thereof for any business or purpose which is unlawful, and Tenant
shall comply, at Tenant's expense, in all material respects with all present and
future laws, statutes, ordinances, orders, rules, codes, regulations, decrees
and requirements of all governmental units (including any agency, department,
commission, board, bureau or subdivision thereof) (collectively, the "LEGAL
REQUIREMENTS") which relate directly to the specific nature of Tenant's use or
occupancy of the Premises. Landlord shall, at Landlord's expense (subject to the
provisions in Section 7.2(k), comply with all present and future Legal
Requirements which relate to the use, condition or occupancy of the Premises and
the Project for general office purposes, including those required by the
Americans with Disabilities Act. Tenant shall, at Tenant's expense, comply with
all requirements of the Americans with Disabilities Act which arise as a result
of any alterations, additions, or improvements to the Premises which are not
consistent with a build-out for general office occupancy levels. Tenant
acknowledges that it has had a full opportunity to make its own determination
that the configuration and nature of the Premises are suitable for Tenant's
business, and Tenant is not relying upon any implied-by-law warranty as to the
suitability of the Premises for Tenant's particular business.
Notwithstanding anything to the contrary in this Lease, Tenant shall
not use the Premises for any purpose which would (i) adversely affect the
exterior appearance of the Project in Landlord's reasonable judgment, (ii)
offend persons of normal sensibilities by reason of items which are visible from
the elevators in the Project, (iii) adversely affect ventilation in other areas
of the Project (including without limitation, the creation of offensive odors),
(iv) create unreasonable elevator loads, (v) cause structural loads to be
exceeded, (vi) create unreasonable noise levels, or (vii) otherwise unreasonably
interfere with Project operations or other tenants of the Project. In all
events, Tenant shall not engage in any activity which is not in keeping with the
first-class standards of the Project. Tenant also agrees that Tenant will not
(y) use any part of the Premises which may be located on the first or second
floor of the Tower for retail banking purposes; provided, however, such
restriction shall not prohibit Tenant from operating an office to provide
financial aid counseling and services for students and prospective students; or
(z) use any portion of the Premises for health care services, telephone or
telegraph agencies, radio, television stations, employment agencies, public
restaurants or bars, retail, wholesale or discount shops for sale of
merchandise, retail service shops, on site classrooms (other than in a manner
not involving significant portions of the Premises or significant numbers of
non-employee attendees) or governmental or quasi-governmental bureaus,
departments or agencies; provided, however, nothing herein shall prohibit any
broadcasts or other communications to students or prospective students via the
internet or by any other means which are not disruptive to the Project or any
other tenants.
9.2 Tenant shall not conduct or permit to be conducted any activity, or
place any equipment in or about the Premises, which may be hazardous. If any
increase in the rate of fire insurance or other insurance is due to activity or
equipment of Tenant in or about the Premises, Tenant shall be liable for the
full amount of such increase and shall reimburse Landlord therefor and, further,
if such activity or equipment jeopardizes any insurance coverage, Tenant shall
immediately cause the discontinuance of such conduct or shall remove such
equipment.
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9.3 Tenant shall not install, use, generate, store or dispose of in or
about the Premises any Hazardous Material without Landlord's prior written
approval of each Hazardous Material, except that Tenant may use immaterial
quantities of Hazardous Materials customarily used in the ordinary course of
office business operations so long as Tenant uses such Hazardous Materials
strictly in accordance with all Legal Requirements. Tenant shall reimburse
Landlord upon demand for any costs which Landlord incurs as a result of Tenant's
installation, use, generation, storage or disposal of any Hazardous Materials
and Tenant shall indemnify, defend and hold Landlord and any Mortgagee harmless
from and against any claim, damage, loss, liability or expense (including,
without limitation, the fees and disbursements of any attorneys or consultants
incurred by Landlord) arising out of Tenant's installation, use, generation,
storage, or disposal of any Hazardous Materials, regardless of whether Landlord
has approved the activity.
9.4 Tenant shall not allow the use of any tobacco products in any
portion of the Premises or the Project, except at such outdoor areas which
Landlord agrees to reasonably designate for smokers from time to time. Tenant
shall not permit its directors, officers, partners, employees, agents,
contractors or invitees to carry, possess or store a firearm in or about the
Project except strictly in accordance with Legal Requirements.
9.5 Landlord shall not lease any part of the first or second floors of
the Project to a Direct Competitor of Tenant.
10. ASSIGNMENT AND SUBLETTING.
10.1 There shall be no Assignment by Tenant without in each such case
obtaining the prior written consent of Landlord except as provided in Section
10.7, which consent shall not be unreasonably withheld or delayed. No Assignment
by Tenant shall relieve Tenant of any obligation under this Lease, and Tenant
shall remain fully liable hereunder. Any attempted Assignment by Tenant in
violation of the terms and covenants of this Section 10 shall be void. Any
consent by Landlord to a particular Assignment shall not constitute Landlord's
consent to any other or subsequent Assignment, and any proposed Assignment by a
subtenant of Tenant shall be subject to the provisions of this Section 10 as if
it were a proposed Assignment by Tenant. The provisions of this Section 10.1 are
subject to the provisions of Section 10.10.
10.2 It is expressly agreed by Tenant that it shall be reasonable for
Landlord and Landlord shall be entitled to withhold its consent to any proposed
assignment of this Lease or a sublease of all or a portion of the Premises if
any one of the following applies:
(a) the assignee or subtenant is an entity described on or engaged
in a business described on Exhibit M attached hereto;
(b) in Landlord's reasonable business judgment, the assignee or
subtenant is of a character or reputation or engaged in a business which
is not consistent with the quality and reputation of the Project; or
(c) in the case of an assignment of this Lease (as opposed to a
sublease) only, the net worth of the assignee as of the date the notice of
the proposed Assignment is given pursuant to Section 10.3 or as of the
consummation of the Assignment and any
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transactions related thereto, is or will be less than the tangible net
worth of Tenant as of the date of this Lease.
Tenant acknowledges and agrees that the right of Landlord to withhold its
consent reasonably with respect to proposed Assignments under this Section 10 is
for the mutual benefit of Landlord and Tenant, preserves the benefit of this
Lease for Tenant in those circumstances, as contemplated hereby, where such
benefit is appropriate to be preserved, and is appropriate and reasonable, given
the respective interests of Landlord and Tenant in the Project. Landlord may
impose reasonable conditions in respect of any consent to an Assignment.
10.3 If Tenant desires at any time to make an Assignment, Tenant shall
give Landlord written notice of such desire at least thirty (30) days in advance
of the date on which Tenant desires to make such Assignment and shall submit in
writing to Landlord (i) the name of the proposed Assignee, (ii) the nature of
the proposed Assignee's business to be carried on the Premises, (iii) a copy of
the proposed Assignment agreement and any other agreements to be entered into
concurrently with such Assignment, including full disclosure of the rent to be
paid and all other financial terms, and (iv) such financial information as
Landlord may reasonably request concerning the proposed Assignee. Neither the
furnishing of such information nor the payment of attorneys' fees pursuant to
Section 10.9 shall limit any of Landlord's rights or alternatives under this
Section 10.
10.4 Each subtenant or assignee shall fully observe all covenants of this
Lease, including without limitation, the provisions of Section 9 of this Lease,
and no consent by Landlord to an Assignment shall be deemed in any manner to be
a consent to a use not permitted under Section 9.
10.5 Whether or not Landlord has consented to the applicable Assignment,
fifty percent (50%) of the amount by which the consideration (after deducting
from such consideration the amount of any leasehold improvement costs, marketing
costs and any brokerage fees paid by Tenant in connection with such Assignment)
received by Tenant pursuant to any Assignment (other than an Assignment under
Section 10.7) exceeds, in any month, the Base Rent and Tenant's Additional Rent
then required to be paid with respect to such space, shall be payable by Tenant
directly to Landlord as additional rent hereunder on or before the first day of
each such month.
10.6 Landlord shall have the right to transfer and assign, in whole or in
part, all of its rights and obligations hereunder or in the Project or in all
other property referred to herein, and upon any such transfer (any such
transferee to have the benefit of, and be subject to, the provisions of Sections
26 and 27 hereof), and the express written agreement of the transferee to
assume, perform and be bound by all of the terms and conditions of this Lease
applicable to Landlord as if such transferee was an original party to this
Lease, the transferor shall have no further liability hereunder with respect to
the rights and obligations so assigned and transferred other than liability for
payment of the Improvement Allowance and any liability, claim, offset or defense
which such transferee is not subject to or for which such transferee is not
liable to Tenant.
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10.7 Notwithstanding anything to the contrary in this Section 10, upon
written notice to Landlord (which notice shall be accompanied by the information
which Tenant is required to provide under Section 10.3, to the extent
applicable), but without the need for any consent of Landlord and without
applicability of Sections 10.2, 10.5 or 10.10, Tenant may make an Assignment to
any Affiliate, or to any entity (a "SUCCESSOR") resulting from the merger of or
consolidation with Tenant, or to any person or entity which acquires all or a
majority of the stock of Tenant or substantially all of the assets of Tenant as
a going concern (any of such events is referred to as a "PERMITTED TRANSFER");
provided that any such Successor agrees to assume the obligations and
liabilities of Tenant hereunder pursuant to an agreement executed for the
benefit of and in form reasonably acceptable to Landlord.
10.8 Notwithstanding anything to the contrary in this Section 10 and
except as provided in Section 10.7, no Assignment by Tenant shall become
effective until Tenant and any proposed assignee or subtenant have executed and
delivered to Landlord an agreement by which such assignee or subtenant agrees to
assume the obligations and liabilities of Tenant hereunder pursuant to an
agreement executed for the benefit of and in form reasonably acceptable to
Landlord.
10.9 Tenant shall be obligated to promptly reimburse Landlord for any
reasonable attorneys' fees incurred by Landlord in reviewing and preparing any
documents associated with any such proposed Assignment.
10.10 Notwithstanding anything to the contrary in this Section 10, if
Tenant in good faith desires at any time to make (or to seek an opportunity to
make) a Third-Party Assignment, Tenant shall give advance written notice to
Landlord (an "ASSIGNMENT NOTICE") in accordance with this Section 10.10. For
purposes hereof, a "THIRD-PARTY ASSIGNMENT" means a complete assignment of this
Lease or a sublease of all or substantially all of the Premises for all or
substantially all of the then remaining Term, other than any Assignment (a) to
an Affiliate of Tenant, or (b) made in connection with a Permitted Transfer. The
Assignment Notice shall specify the earliest date (the "TARGET DATE") upon which
Tenant may make a Third-Party Assignment; the Target Date may not be earlier
than six (6) months from the date the Assignment Notice is given to Landlord.
Following receipt of an Assignment Notice, Landlord shall have the option, which
may be exercised in Landlord's sole discretion by giving written notice to
Tenant within thirty (30) days after Landlord's receipt of the Assignment
Notice, to terminate this Lease effective as of the Termination Date to be
specified by Tenant as herein provided. If within thirty (30) days after
Landlord's receipt of the Assignment Notice Landlord shall by written notice to
Tenant elect to terminate the Lease, Tenant may at any time thereafter send a
supplemental written notice to Landlord (a "TERMINATION DATE NOTICE") specifying
the date upon which this Lease shall terminate (the "TERMINATION DATE");
provided, however, that Tenant may not specify as the Termination Date any date
that is (i) earlier than the Target Date, (ii) later than six months after the
Target Date, and (iii) less than sixty (60) days after the date the Termination
Date Notice is given by Tenant to Landlord. If Tenant shall fail to give a
Termination Date Notice, the Termination Date shall be the date that is six
months after the Target Date. If Landlord fails to notify Tenant in writing of
such election within the thirty (30) day period after Landlord's receipt of the
Assignment Notice, (x) Landlord shall be deemed to have waived its right to
terminate this Lease under this Section 10.10, (y) Tenant need not give a
Termination Date Notice and no Termination Date shall be established pursuant to
this Section
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10.10, and (z) the provisions of this Section 10.10 shall be of no further force
or effect; provided, however, that if Tenant shall send an Assignment Notice to
Landlord and Landlord does not within thirty (30) days of receipt thereof give
written notice terminating this Lease, and if Tenant does not make a Third-Party
Assignment within twenty-four (24) months of the date of such Assignment Notice,
then Landlord's rights under this Section 10.10 shall be reinstated, and
Landlord and Tenant shall have the same rights and obligations under this
Section 10.10 just as though such Assignment Notice had never been given by
Tenant. If Landlord exercises its option to terminate this Lease by giving
written notice to Tenant within the thirty (30) day period after Landlord's
receipt of the Assignment Notice, the Term of this Lease shall end on the
Termination Date and Tenant shall have no obligation to pay any Rent for the
period after the Termination Date.
11. MAINTENANCE.
11.1 Without limiting Landlord's obligation to provide routine janitorial
services as set forth in Section 14, and subject to Section 11.3, Tenant agrees
to maintain, at Tenant's sole cost and expense and in accordance with the
standards of a first class office building in downtown Minneapolis, all
leasehold improvements, fixtures and equipment installed in the Premises; to use
the Premises in a prudent and orderly manner; to suffer no waste or injury to
the Premises or any improvements or fixtures therein; and at the expiration or
other termination of this Lease, to surrender the same with all improvements in
the same order and condition in which they were on the Commencement Date, or in
such better condition as they may thereafter be put, except for (i) Landlord's
maintenance requirements, (ii) ordinary wear and tear, (iii) damage by insured
casualty, and (iv) any other alterations or improvements permitted under this
Lease which under the terms of this Lease Tenant is not required to remove at
the expiration or earlier termination of the Term. Subject to Section 17, any
cost of repairs or improvements to the Project, to the Premises or to any Common
Areas which are occasioned by any act or omission or default of Tenant, its
officers, employees, agents or invitees, or which arise because of Legal
Requirements and the particular nature of Tenant's use and occupancy of the
Premises or because of any leasehold improvements or alterations to the Premises
which are made by or on behalf of Tenant, shall be paid for by Tenant, as
additional rent hereunder, immediately upon billing.
11.2 Landlord agrees, throughout the Lease Term, to maintain the Project
and the Common Areas in a manner consistent with other first class office
projects in the central business district of downtown Minneapolis. Unless
otherwise stipulated herein, including but not limited to Section 9.1, Landlord
shall not be required to make any improvements to or repairs of any kind or
character to the Premises during the Term of this Lease, except such repairs to
the structure of the Project and the Base Building Systems as may be deemed
necessary by Landlord: (i) for normal maintenance operations, (ii) to keep the
Project compliant with the Space Delivery Standards pursuant to Section 14, and
(iii) to maintain the Project in a manner consistent with other first class
office projects in the central business district of downtown Minneapolis.
11.3 Notwithstanding any provisions of this Lease to the contrary, all
repairs, alterations or additions to the Base Building Systems (as opposed to
those involving only Tenant's leasehold improvements), and all repairs,
alterations or additions to Tenant's leasehold improvements which affect the
Base Building Systems or the structural elements of the Project,
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made by, for or on behalf of Tenant shall be made by Landlord or a contractor
approved in writing by Landlord, which approval shall not be unreasonably
withheld or delayed. Tenant shall promptly reimburse Landlord for any reasonable
out of pocket costs incurred by Landlord in having the plans and specifications
for any such alterations or additions reviewed by Landlord's architects or
engineers.
11.4 If Tenant experiences any damage, interruption or disturbance to the
Premises, Tenant's operations, or Tenant's equipment as a result of any
electro-magnetic fields, Tenant shall promptly notify Landlord thereof and
Landlord shall, at Tenant's written request and at Tenant's expense, but subject
to the rights of other tenants of the Project, take such actions as may be
reasonably necessary or desirable to minimize or eliminate such condition.
11.5 Landlord represents and warrants that the Premises and the Project
are substantially in compliance with applicable Legal Requirements.
11.6 Landlord represents and warrants that the Premises and the Project
are free of Hazardous Materials, except for those Hazardous Materials which are
contained in construction materials that are customarily incorporated at the
time of installation in or from time to time typically used in the operation of
first class office buildings or such quantities of Hazardous Materials as are
customarily used in the ordinary course of office business operations and in
accordance with all Legal Requirements.
11.7 Landlord agrees, at Tenant's request, to make a representative of
Landlord available to help Tenant identify any cabling or wiring within the
Premises that serves any other tenants of the Project.
12. ALTERATIONS; EQUIPMENT.
12.1 Tenant will not make or permit anyone to make any alterations,
decorations, additions or improvements, structural or otherwise, in or to the
Premises or the Project, or place safes, vaults or other heavy furniture or
equipment within the Premises, without first obtaining the prior written consent
of Landlord; provided, however, such consent shall not be required for (i) the
Tenant Improvements provided in Exhibit D (which are subject to the consent
requirements contained in Exhibit D), (ii) any recarpeting or redecorating, or
(iii) any alterations, additions or improvements to the Premises that do not
result in a cost to Tenant greater than Fifty Thousand and No/100 Dollars
($50,000) and that do not affect the structural elements of the Project or the
Base Building Systems. Tenant shall nonetheless provide Landlord with reasonable
advance notice as to alterations, decorations, additions and improvements which
Tenant is permitted to make under this Lease without the need for Landlord
consent (which notice from Tenant may be given orally, or by any other means
that are practical under the circumstances, and need not be given in accordance
with the provisions of Section 28, or for any work that is insignificant). An
alteration, addition or improvement shall be deemed to affect the structural
elements of the Project if such alteration, addition or improvement includes any
cuts into the Project structure or the Project walls or floors including,
without limitation, the installation of any escalators or stairways. Landlord's
consent may be conditioned upon such requirements as Landlord may reasonably
impose, including without limitation, the right to approve the plans and
specifications for the alterations and the contractor who will perform such
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alterations. In addition, Landlord shall have the right to require Tenant, prior
to the commencement of any alteration, addition or improvement requiring
Landlord's consent, to deliver such security against mechanics' liens as
Landlord may reasonably require, but only if the financial strength of Tenant is
at such time significantly less than the financial strength of Tenant as of the
Effective Date.
12.2 If any mechanic's lien is filed against any part of the Project for
work claimed to have been done for, or materials claimed to have been furnished
to, Tenant, such mechanic's lien shall be discharged by Tenant within twenty
(20) days after receipt of written notice from Landlord, at Tenant's sole cost
and expense, by the payment thereof or by making any deposit required by law or
by posting a bond with such surety, in such amount and in such form as Landlord
deems proper. Tenant shall immediately notify Landlord of any mechanic's lien or
other lien filed against the Project or any part thereof by a contractor or
subcontractor of Tenant or otherwise by reason of work claimed to have been done
for or materials claimed to have been furnished to Tenant. If Tenant fails to
remove such lien or post such bond within the twenty (20) day period following
the filing thereof, Landlord may, upon not less than twenty (20) days' written
notice to Tenant, at its sole discretion and without waiving its rights and
remedies based on such breach by Tenant and without releasing Tenant from any of
its obligations, cause such lien to be released by any means it shall deem
proper, including payment in satisfaction of the claim giving rise to such lien.
Tenant shall, in such event, pay to Landlord at once, upon notice by Landlord,
any sum paid by Landlord to remove such lien, together with interest at the
Interest Rate from the date of such payment by Landlord. Landlord shall have the
right at all times to post and keep posted on the Premises any notices permitted
or required by Legal Requirements, or that Landlord shall deem proper for the
protection of Landlord, the Premises, the Project and any other party having an
interest therein, from liens. All material suppliers, contractors, artisans,
mechanics, laborers and other parties hereafter contracting with Tenant for the
furnishing of any labor, services, materials, supplies or equipment with respect
to any portion of the Premises are hereby charged with notice that they must
look solely to Tenant for payment of the same and Tenant's purchase orders,
contracts and subcontracts in connection therewith must clearly state this
requirement.
12.3 All alterations, decorations, additions or improvements shall be
made in accordance with all Legal Requirements and insurance guidelines and
shall be performed in a good and workmanlike manner by contractors included on
Landlord's list of approved contractors. Tenant shall deliver to Landlord a copy
of the "as-built" plans and specifications (in both drawn and CAD disc format)
for all alterations or physical additions so made in or to the Premises. Upon
completion of any alterations, decorations, additions or improvements, Tenant
shall cause its architects and contractors to certify that no asbestos
containing materials or other Hazardous Materials are present in such
alterations, additions or improvements except for such Hazardous Materials which
are present in natural substances and typical construction materials used in
first-class office buildings in Minneapolis, Minnesota. Tenant shall use
commercially reasonable efforts in the construction or installation of Tenant's
alterations or fixtures to not cause any disturbance of tenants adjacent to
Tenant or to Landlord, including any labor disturbance. If a labor disturbance
occurs, Landlord may prevent any persons giving rise to the disturbance from
entering the Project. Any core drilling and other activities that may cause
significant noise or vibrations will be performed after normal business hours.
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12.4 Upon completion of any such alterations, decorations, additions or
improvements, Tenant shall deliver to Landlord evidence of payment, contractors'
affidavits and full and final lien waivers for all labor, services, or materials
performed or supplied in connection with such alteration, decoration, addition
or improvement. Tenant shall indemnify, defend (at Landlord's request and with
counsel approved by Landlord) and hold Landlord harmless from and against all
losses, costs, damages, claims, liabilities, causes of action and expenses
(including attorneys' fees and disbursements, whether suit is commenced or not)
arising out of or relating to any alterations, decorations, additions or
improvements that Tenant or any of its contractors make to the Premises,
including any occasioned by the filing of any mechanic's, material supplier's,
construction or other liens or claims (and all costs or expenses associated
therewith) asserted, filed or arising out of any such work. Without limiting the
generality of the foregoing, Tenant shall repair or cause to be repaired at its
expense all damage caused by any of its contractors, subcontractors or their
employees or agents. Tenant shall reimburse Landlord for any costs incurred by
Landlord to repair any damage caused by any of Tenant's contractors or any costs
incurred by Landlord in requiring any of Tenant's contractors to comply with the
rules and regulations of the Project as in effect from time to time. Tenant
shall also reimburse Landlord upon demand for any costs Landlord may incur to
have an engineer review all mechanical, structural, electrical, plumbing and
life safety systems installed by any of Tenant's contractors.
12.5 All alterations, decorations, additions or improvements in or to the
Premises or the Project made by Tenant (not including any of Tenant's trade
fixtures) shall become the property of Landlord upon the expiration or
termination of this Lease and shall remain upon and be surrendered with the
Premises as a part thereof without disturbance or injury, unless, prior to the
installation thereof, Landlord requires, in a written notice delivered to
Tenant, unusual trade fixtures not consistent with a general office use
build-out to be removed by Tenant at Tenant's sole cost and expense, in which
event Tenant shall remove the same prior to the expiration or termination of
this Lease and shall repair any damage caused thereby. Notwithstanding any
provision to the contrary in this Section 12.5, any internal staircases and
vaults installed by or at the request of Tenant shall be removed by Tenant at
its expense prior to the expiration or termination of this Lease and Tenant
shall repair any damages caused thereby. Tenant shall not, however, be required
to remove any of the existing leasehold improvements in the Initial Premises.
12.6 Tenant shall not place or maintain any sign, advertisement or notice
on any part of the outside of the Premises or any area which is readily visible
from outside the Premises unless approved in writing by Landlord (which approval
will not be unreasonably withheld or delayed); except for suite identification
signage and signage which states that Tenant bans guns on the Premises.
12.7 Tenant agrees specifically that no food, soft drink or other vending
machine will be installed within the Premises without the prior written consent
of Landlord, except that Tenant may install vending machines for the sole and
exclusive use by Tenant and Tenant's employees in an area designated by Tenant
and approved by Landlord, provided such machines do not contain any CFC's.
12.8 Tenant shall not install any fixtures or equipment which consume
more than the amount of electricity specified in Section 14 without first
obtaining the prior written consent of
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Landlord. If Tenant requires electrical capacity in excess of that specified in
Section 14, Tenant shall pay to Landlord the cost of the excess electrical usage
plus all costs of installation, operation (including electrical metering) and
maintenance of any and all electrical, ventilation or air conditioning
modifications which Landlord determines to be necessary. Equipment belonging to
Tenant which causes noise or vibration that may be transmitted to the structure
of the Project or to any space therein to such a degree as to be objectionable
to Landlord or to any tenant in the Project shall be installed and maintained by
Tenant, at Tenant's expense, on vibration eliminators or other devices
sufficient to eliminate noise and vibration. Landlord shall have the right at
any time to limit the weight and prescribe the position of safes and other heavy
equipment or fixtures.
13. KEYS; RIGHT OF ENTRY; RESERVED RIGHTS IN COMMON AREAS.
13.1 Subject to the other terms and conditions of this Lease, Landlord
will provide Tenant with access to the Premises, twenty-four (24) hours a day,
seven (7) days per week. Landlord shall manage the Project's card access system,
but Tenant shall be responsible for managing its own card access system for the
Premises. Landlord shall provide audit reports on a semi-annual basis and
additional ad-hoc requests each year without charge. Landlord shall furnish
Tenant with cards for after-hours access to the Project for all of Tenant's
employees and students upon an order signed by Tenant and at Tenant's expense.
All keys and cards furnished by Landlord shall remain the property of Landlord.
No additional locks shall be allowed on any door of the Premises without
Landlord's prior written consent, and Tenant shall not make or permit to be made
any duplicate keys, except those furnished by Landlord. Upon the expiration or
termination of this Lease, Tenant shall immediately surrender to Landlord all
keys to any locks on or within the Premises and all access cards provided by
Landlord, and give to Landlord an explanation of the combination of all locks
for safes, safe cabinets and vault doors, if any, in the Premises. Tenant shall
pay for any locks or access reader card systems installed in the Premises and
the cost of replacing any lost or damaged keys or access cards. Tenant shall
also provide Landlord with a keying schedule for the Premises.
13.2 Tenant shall permit Landlord and Landlord's representatives and
agents, to enter into and upon any part of the Premises, at all reasonable hours
to examine, inspect and protect the Premises, and to make such alterations,
renovations, restorations and/or repairs as Landlord shall deem necessary or
desirable for the Premises, for any other premises in the Project, or the
Project itself (including access to adjacent roof surfaces and to distribution
systems above the ceiling of the Premises), to post notices of
non-responsibility, to provide janitorial services, to perform maintenance work
requested by Tenant or to provide other services required to be performed by
Landlord hereunder, or to exhibit the Premises to prospective tenants during the
last twelve (12) months of the Term, or to prospective purchasers, mortgagees,
investors or lenders at any time. Landlord shall give reasonable advance oral
notice prior to entry except for janitorial service and emergencies and to
perform repairs requested by Tenant. Landlord shall use reasonable efforts to
not unreasonably interfere with the conduct of Tenant's business, but Landlord
shall in no event be liable to Tenant for any damages in connection with such
entry or installation; provided, however, if any of the services to be provided
by Landlord under this Lease are interrupted for three (3) consecutive business
days for any reason as a result of such entry or installation, and Tenant's use
or enjoyment of the Premises is materially affected
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thereby, then all Rent shall abate on a per diem basis with respect to those
portions of the Premises which Tenant is not using from and after said third day
until such services are restored.
13.3 Subject to the provisions of Section 35.15, Landlord reserves the
right to (i) impose such security restrictions in the Common Areas as it deems
appropriate; (ii) close temporarily or restrict the use of any of the Common
Areas for maintenance or repair purposes; (iii) use the Common Areas while
engaged in making additional improvements, repairs or alterations to the Project
or any portion thereof; and (iv) use on an occasional or temporary basis or
allow the occasional, temporary use by others of the atrium and the first and
second floors of the Project, for civic, charitable, cultural, business and
other events.
14. SERVICES AND UTILITIES.
Landlord shall use reasonable efforts to furnish (as part of the
Operating Costs of the Project) Tenant, while Tenant occupies the Premises, the
following services at levels commensurate with the general standards followed by
landlords of first-class office buildings in Minneapolis, Minnesota:
(a) Hot and cold domestic water for restrooms and cold domestic
water at those points of supply provided for general use of other tenants
in the Project.
(b) During Normal Business Hours, and subject to curtailment as
required by Legal Requirements, central heat and air conditioning in
season, at such temperatures and in such amounts as are in keeping with
the standards described in Exhibit F hereto and otherwise in accordance
with the standards of a first class office building. Landlord agrees to
provide the Premises with heating and air conditioning during other than
Normal Business Hours at Tenant's request. The charge for such after hours
services initially shall be at the rate of $35.00 per hour (or partial
hour), for the first floor or partial floor within the Building or Tower,
and $5.00 per hour (or partial hour) for each additional floor or partial
floor in the Building or Tower, which amounts may be increased by Landlord
from time to time, but shall not be greater than the reasonable cost to
Landlord in providing such after hours services (for purposes of computing
the charge for after hours services, each floor in Tower and each floor in
the Building shall be treated as separate floors, so that if Tenant
requests after hours services on a floor in the Tower and on the same
floor in the Building, Tenant's request shall be treated as a request for
two floors). Tenant shall be charged for a minimum of one hour of service
in connection with each such request. Tenant shall give Landlord notice by
telephone for the need for such heating and air conditioning during other
than Normal Business Hours no later than noon of the business day with
respect to services for the evening of such business day, and no later
than noon of the immediately preceding business day with respect to
services for Holidays or weekends.
(c) Routine electric lighting service for all public areas and
special service areas of the Project.
(d) Janitor service on a five (5) day week basis (except for
Holidays as described in Exhibit F hereto) which shall be provided after
9:00 p.m. and prior to 7:30 a.m. on
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Mondays through Fridays pursuant to the cleaning specifications attached
hereto as Exhibit O; provided, however, if Tenant's floor coverings or
other improvements cost more to clean than typical floor coverings or
improvements, Tenant shall pay, as additional rent, the additional costs,
if any, attributable thereto. Landlord represents to Tenant that (i) its
security service provider currently performs criminal background checks
through the Minnesota Bureau of Criminal Apprehension and the Federal
Bureau of Investigation for each of its security personnel servicing the
Premises, and (ii) its janitorial service provider currently performs
background checks through the Minnesota Bureau of Criminal Apprehension
for its personnel servicing the Premises.
(e) Equipment and personnel to limit access to the Project after
Normal Business Hours; provided, however, Landlord will provide Tenant
with access to the Premises, twenty-four (24) hours a day, seven (7) days
per week.
(f) Sufficient electrical capacity for (i) convenience outlets and
equipment such as personal computers, photocopying machines and other
machines of similar low voltage (120/208 volts) requirements; provided,
however, total rated power consumption of 120/208 volt power shall not
exceed two and one-quarter (2.25) watts per square foot of Usable Area (as
defined in Section 3.1); and (ii) fluorescent light fixtures and equipment
of high voltage (277/480 volts) requirements; provided, however, total
rated power consumption of 277/480 volt power shall not exceed three and
four tenths (3.40) watts per square foot of Usable Area. If any
electrical, telephone switching or other equipment requires air
conditioning or electrical usage in excess of the foregoing limitations or
requires modifications to a base building electrical panel, the same shall
be installed or performed at Tenant's expense and Tenant shall pay all
operating costs relating thereto, including metering.
(g) All building standard fluorescent bulb replacement in all areas
and all building standard incandescent bulb replacement in public areas,
toilet and rest room areas and stairwells, together with base building
starters and ballasts as replacement is needed for such lighting.
(h) Non-exclusive passenger elevator service to the Premises
twenty-four (24) hours per day and non-exclusive freight elevator service
during Normal Business Hours.
(i) Base building telephone risers in accordance with Landlord's
rules and regulations with respect to telephone service as they may exist
from time to time. Landlord shall have the right to impose reasonable
charges for the use by third party telecommunications providers of the
Base building telephone risers.
(j) Uniformed guards and/or equipment on a twenty-four (24)
hour-per-day, seven (7) day-per-week basis to maintain security for the
Project.
To the extent the services described in (a), (b), (c), (f) and (h)
require electricity, gas or water supplied by public utilities, Landlord's
covenants thereunder shall only impose on Landlord the obligation to use its
reasonable efforts to cause the applicable public utilities to furnish the same.
Failure by Landlord to furnish the services described in this Section 14 to any
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extent, or any cessation thereof, shall not render Landlord liable in any
respect for damages to either person or property, nor be construed as an
eviction of Tenant, nor, except as explicitly provided below, work an abatement
of any Rent, nor relieve Tenant from fulfillment of any covenant or agreement
hereof. Landlord agrees, however, to use diligent efforts to promptly repair any
Base Building Systems and to restore any services described in this Section 14
which are interrupted during Normal Business Hours.
If any of the services to be provided by Landlord under this Section
14 are interrupted for:
(x) three (3) consecutive business days for any reason within
Landlord's reasonable control (as opposed to generally
prevailing circumstances); or
(y) seven (7) consecutive days for any reason not within
Landlord's control (including generally prevailing
circumstances);
and, in either event, if Tenant's use or enjoyment of the Premises is materially
affected thereby, then if Tenant has promptly notified Landlord in writing of
such interruption, all Rent shall abate on a per diem basis with respect to
those portions of the Premises which Tenant is not using from and after said
third day (or seventh day, as the case may be) until such services are restored.
Landlord reserves the right to require telecommunication connections
and services to be made only pursuant to agreements between Landlord and
telecommunications providers which are satisfactory to Landlord in its
reasonable discretion, provided that any such agreement shall permit Tenant to
obtain the telecommunication services Tenant needs at competitive rates and on
competitive conditions. Tenant shall conserve heat, air conditioning, water and
electricity and shall use due care in the use of the Premises and of the public
areas in the Project. All thermostats within the Premises shall be under the
sole control of Landlord, and Tenant shall not, nor shall it permit any of its
employees, agents, representatives or invitees, to open, change or tamper with
any thermostats.
15. WAIVER AND INDEMNITY.
15.1 Except as expressly provided to the contrary in this Lease, Landlord
and Landlord's Affiliates and each of their partners, directors, officers,
shareholders and employees shall not be liable to Tenant, or those claiming by,
through or under Tenant, for any damage or claims, however caused, arising from
loss or damage to books, records, computer or other electronic equipment, data
or media, files, artwork, money, securities, negotiable instruments or papers,
or any other personal property in the Project, the interruption in the use of
any cellular or wireless communication devices or the interruption in the use of
the Premises, any fire, robbery, theft, assault, or any other casualty, any
leakage or bursting of pipes or water vessels or any roof or wall leakage or
other water damage, in any part or portion of the Premises or the Project.
15.2 Subject to the provisions of Section 17 which shall control if they
conflict with the provisions of this Section 15.2, Tenant shall indemnify,
defend (at Landlord's request and with counsel reasonably approved by Landlord)
and hold Landlord and Landlord's Affiliates (and each of their partners,
directors, officers, shareholders and employees) harmless from and against every
demand, claim, cause of action, judgment and expense, including, but not limited
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to, reasonable attorneys' fees and disbursements of counsel, whether suit is
initiated or not, and all loss and damage arising from or related to any bodily
or personal injury, death or property damage occurring in the Premises, except
to the extent caused by the gross negligence or willful misconduct of Landlord
or Landlord's Affiliates or any of their representatives, agents, contractors or
employees.
15.3 Subject to the provisions of Section 17 which shall control if they
conflict with the provisions of this Section 15.3, Landlord shall indemnify,
defend (at Tenant's request and with counsel reasonably approved by Tenant) and
hold Tenant and Tenant's Affiliates (and each of their governors, members,
partners, directors, officers, shareholders and employees) harmless from and
against every demand, claim, cause of action, judgment and expense, including,
but not limited to, reasonable attorneys' fees and disbursements of counsel,
whether suit is initiated or not, and all loss or damage arising from or related
to any bodily or personal injury, death or property damage occurring in those
portions of the Project which are not leased to Tenant or other tenants, except
to the extent caused by the gross negligence or willful misconduct of Tenant,
Tenant's Affiliates or any of their representatives, agents, contractors or
employees.
16. INSURANCE.
16.1 Landlord shall maintain all risk property insurance on the Project
and the leasehold improvements in the Premises with coverage limits for such
leasehold improvements of $25.00 dollars per square foot of Rentable Area for
such leasehold improvements. Said insurance shall be maintained with an
insurance company authorized to do business in Minnesota, in amounts desired by
Landlord and at the expense of Landlord (but with the same to be included in the
Operating Costs described in Section 7.2) and payments for losses thereunder
shall be made solely to Landlord. If the annual premiums to be paid by Landlord
shall exceed standard rates because of Tenant's operations within or the
contents of the Premises, Tenant shall promptly pay the excess amount of the
premium upon request by Landlord. Tenant shall maintain all risk property
insurance on all of its personal property, including removable trade fixtures,
located in the Premises and on the value of any of Tenant's leasehold
improvements in excess of the coverage limits to be maintained by Landlord as
described above, subject to commercially reasonable deductibles. Prior to the
Commencement Date and prior to the expiration of then-existing policies, Tenant
shall deliver to Landlord certificates evidencing maintenance of the insurance
required herein.
16.2 Landlord shall maintain a policy of commercial liability insurance
with the premium thereon fully paid on or before the due date, issued by and
binding upon an insurance company authorized to do business in Minnesota, such
insurance to afford minimum protection (which may be effected by primary and/or
excess coverage) of not less than $5,000,000 combined single limit. Tenant shall
maintain a policy of commercial liability insurance with the premium thereon
fully paid on or before the due date, issued by and binding upon an insurance
company acceptable to Landlord that is authorized to do business in Minnesota,
such insurance to afford minimum protection (which may be effected by primary
and/or excess coverage) of not less than $5,000,000 combined single limit.
Landlord and Landlord's property manager shall be named as additional insureds
on Tenant's liability policy. Prior to the Commencement Date and prior to the
expiration of then-existing policies, Tenant shall deliver to Landlord a
certificate of insurance in form satisfactory to Landlord evidencing maintenance
of the insurance required
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herein together with a copy of the endorsement to Tenant's commercial liability
policy which adds Landlord and Landlord's property manager as additional
insureds. Upon Landlord's request, Tenant shall also promptly deliver to
Landlord a certified copy of the insurance policy which Tenant is required to
maintain hereunder.
17. WAIVER OF CLAIMS AND SUBROGATION.
Notwithstanding anything to the contrary in this Lease, Landlord and
Tenant each hereby waives any and all rights of recovery, claim, action or cause
of action, against the other and their Affiliates and each of their partners,
shareholders, officers, employees and contractors for any loss or damage that
may occur to the Premises or the Project, or any improvements thereto, or any
personal property of such party therein, by reason of fire, the elements, or any
other cause which could be insured against under the terms of the all risk
property insurance policies referred to in Section 16 hereof (whether or not
actually insured) or which is actually insured against by the party in question,
regardless of cause or origin, including negligence of the other party hereto or
its Affiliates or any of their partners, shareholders, officers, employees and
contractors, and covenants that to the extent of such waiver no insurer shall
hold any right of subrogation against the other party hereto. In addition,
Tenant hereby waives all rights of recovery with respect to property damage
against all other tenants of the Project that have, prior to any loss by Tenant,
executed a reciprocal waiver of recovery rights for the benefit of Tenant.
18. DAMAGE.
In the event of a fire or other casualty in the Premises, Tenant
shall immediately give notice thereof to Landlord. If the Premises shall be
damaged by fire or other casualty so as to render the Premises untenantable in
whole or in part, the Rent provided for herein shall abate thereafter as to the
portion of the Premises rendered untenantable until the earlier of (a) such time
as the Premises are made tenantable, or (b) five (5) business days after
Landlord substantially completes the restoration of the Premises. If damage by
fire or other casualty results in the Premises being untenantable in whole or in
substantial part for a period reasonably estimated by a responsible contractor
selected by Landlord to be one (1) year or longer after Landlord's insurance
settlement, and if Landlord shall decide not to rebuild, then either party may
terminate this Lease upon such date as written notice is provided to the other
party and all Rent owed up to the time of such destruction or termination shall
be paid by Tenant. Landlord shall give Tenant written notice of its decisions,
estimates or elections under this Section 18 within sixty (60) days after any
such damage or destruction. If this Lease is not terminated, Landlord shall
commence and prosecute with all due diligence restoration of the Premises.
Notwithstanding anything contained in this Section 18 to the contrary, Landlord
shall only be obligated to restore the Premises to the extent of the insurance
proceeds actually received, but if the insurance proceeds actually received do
not permit Landlord to restore the Premises, Landlord shall so notify Tenant and
either Landlord or Tenant may terminate this Lease by written notice given
within sixty (60) days after Landlord's notice. If Landlord restores the
Premises or the Project in accordance with the provisions of this Section 18,
then Tenant shall not have any right to terminate this Lease because of such
damage pursuant to (i) any common law rights, (ii) Minnesota Statutes Section
504B.131 as now in effect or as it may be hereafter amended or supplemented, or
(iii) any comparable right established by a similar statute.
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19. CONDEMNATION.
If (a) any material portion of the Premises shall be permanently
taken or condemned, this Lease shall, upon written notice from either party,
terminate as of the date of such condemnation or taking, or (b) more than
fifteen percent (15%) of the Building or the Tower, or such lesser portion as is
necessary for the commercially reasonable operation of the Project, shall be
permanently taken or condemned, this Lease shall, upon written notice from
Landlord or Tenant, terminate as of the date of such taking. If not terminated
as provided above, this Lease shall continue in full force and effect and Rent
shall be partially abated based on the number of square feet of Rentable Area
taken. All proceeds payable on account of any interest in the Premises and/or
the Project to either or both parties to this Lease from any taking or
condemnation of the Premises shall belong to and be paid to Landlord. Nothing
contained herein shall prevent Tenant from seeking and retaining a separate
award from the condemning authority in any proceeding involving a taking or a
sale in lieu of a taking, for Tenant's trade fixtures, equipment or relocation
expenses.
20. DEFAULT.
20.1 Any one of the following events shall constitute an event of default
("EVENT OF DEFAULT") by Tenant:
(a) Tenant shall fail to pay any installment of Rent within five (5)
days after receiving written notice of such failure from Landlord;
(b) Tenant shall fail to execute and deliver a subordination
instrument or an estoppel certificate within twenty (20) days after a
request therefor, as required respectively by Sections 23 and 29, if such
failure continues for more than ten (10) days after Tenant has received
written notice of such failure from Landlord;
(c) Tenant shall violate or fail to perform any of the other
conditions, covenants or agreements herein made by Tenant and such default
shall continue for fifteen (15) days after written notice from Landlord;
provided, however, that if the nature of such default is such that Tenant
can cure the default, but Tenant can not reasonably cure such default
within fifteen (15) days, then the Event of Default shall be suspended if
Tenant promptly commences to cure the default and thereafter diligently
and continuously prosecutes the curing of the default to completion, but
only if the continuation of such default does not create material risk to
the Project or substantial interference to other tenants of the Project;
(d) If (1) the interest of Tenant under this Lease shall be levied
upon under execution or other legal process, (2) any petition shall be
filed by or against Tenant to declare Tenant bankrupt or to delay, reduce
or modify Tenant's debts or obligations, (3) Tenant shall be declared
insolvent according to law, or (4) any assignment of Tenant's property
shall be made for the benefit of creditors, or a receiver or trustee is
appointed for Tenant or its property (provided that no such levy,
execution, legal process or petition filed against Tenant shall constitute
a breach of this Lease if Tenant shall vigorously
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contest the same by appropriate proceedings and shall remove or vacate the
same within thirty (30) days from the date of its creation, service or
filing); or
(e) If Tenant is a partnership or other entity and Tenant shall be
dissolved or otherwise liquidated, except in connection with a merger,
consolidation or other reorganization resulting in the continuation of
Tenant's business substantially as previously conducted and such merger,
consolidation or other reorganization is an Assignment to which Landlord
has given its consent in accordance with Section 10.
20.2 If an Event of Default shall have occurred and be continuing:
(a) Landlord may terminate this Lease and forthwith repossess the
Premises and be entitled to recover forthwith as damages a sum of money
equal to the total of (i) the cost of recovering the Premises (including
attorneys' fees, disbursements of counsel and any costs of suit), (ii) the
unpaid Rent earned at the time of termination, plus interest thereon at
the Interest Rate, (iii) the present value (discounted at the then current
reference rate of interest published from time to time by U.S. Bancorp, or
its successors) of the balance of the Rent for the remainder of the Term
less the present value (discounted at the same rate) of the amount Tenant
reasonably demonstrates that Landlord would in all likelihood receive from
leasing the Premises to another tenant for said period, taking into
account the cost of reletting, the then-current market conditions, the
time the Premises was vacant and other similar costs, and (iv) any other
sum of money and damages owed by Tenant to Landlord.
(b) Landlord may terminate Tenant's right of possession (but not
this Lease) and may repossess the Premises or any portion thereof by
eviction action or otherwise by process of law, without thereby releasing
Tenant from any liability hereunder and without demand or notice of any
kind to Tenant and without terminating this Lease, in which event Landlord
may, but shall be under no obligation to do so, relet the same for the
account of Tenant for such rent and upon such terms as shall be
satisfactory to Landlord. For the purpose of such reletting Landlord is
authorized to decorate or to make any repairs, changes, alterations or
additions to the Premises as may be reasonably necessary or desirable in
Landlord's judgment, and (i) if Landlord does not relet the Premises, or
(ii) if the same are relet and the amounts received from such reletting
(after first deducting therefrom, for retention by Landlord, the unpaid
Rent due hereunder earned but unpaid at the time of reletting plus
interest thereon at the Interest Rate, the cost of recovering possession
(including attorneys' fees, disbursements of counsel and any costs of
suit), all of the costs and expenses of such decorations, repairs,
changes, alterations and additions, the expense of such reletting and the
cost of collection of the rent accruing therefrom), are not equal to or
greater than the Rent provided for in this Lease to be paid, then (y)
Tenant shall pay to Landlord as damages if the Premises are not relet, a
sum equal to the amount of the Rent reserved in this Lease for such period
or periods, plus the cost of recovering possession of the Premises
(including attorneys' fees and any costs of suit), the unpaid Rent earned
at the time of repossession plus interest thereon at the Interest Rate,
and the costs incurred in any attempt by Landlord to relet the Premises,
or (z) if the Premises have been relet, the Tenant shall satisfy and pay
any such deficiency. Any such payments due Landlord shall be made upon
demand therefor from time to time
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and Tenant agrees that Landlord may file suit to recover any sums falling
due under the terms of this Section 20 from time to time. No delivery to
or recovery by Landlord of any portion due Landlord hereunder shall be any
defense in any action to recover any amount not theretofore reduced to
judgment in favor of Landlord, nor shall such reletting be construed as an
election on the part of Landlord to terminate this Lease unless a written
notice of such intention be given to Tenant by Landlord. Notwithstanding
any such reletting without termination, Landlord may at any time
thereafter elect to terminate this Lease for such previous breach.
20.3 In the event of a breach by either party of any of the agreements,
conditions, covenants or terms hereof, the non breaching party shall have the
right of injunction to restrain the same and the right to invoke any remedy
allowed by law or in equity whether or not other remedies, indemnities or
reimbursements are provided in this Lease. The rights and remedies given to
Landlord and Tenant in this Lease are distinct, separate and cumulative
remedies, and no one of them, whether or not exercised by Landlord or Tenant,
shall be deemed to be in exclusion of any of the others.
20.4 Intentionally omitted.
20.5 If either party hereto initiates litigation to enforce the
provisions of this Lease against the other party, the prevailing party in such
litigation shall be entitled to reimbursement from the non-prevailing party of
all reasonable and documented costs and expenses, including reasonable
attorneys' fees, paid or incurred by the prevailing party in connection with
such litigation. For purposes of this Section 20, the term "prevailing party"
shall be defined to mean the party whose position in such litigation is
substantially upheld.
20.6 Any one of the following events shall constitute an Event of Default
by Landlord:
(a) Landlord's failure to pay any amount which is properly due and
payable to Tenant within ten (10) business days' after written notice from
Tenant that the same was not paid when due; or
(b) Landlord's failure to perform any of Landlord's obligations
under this Lease, within thirty (30) days after Landlord has received
written notice of such failure from Tenant; provided, however, that if the
nature of such default is such that Landlord can cure the default, but not
within thirty (30) days, then such default shall not constitute an Event
of Default so long as Landlord commences cure within thirty (30) days and
thereafter diligently and continuously prosecutes the curing of the
default to completion, but only if continuation of the default does not
create substantial interference to Tenant's enjoyment of the Premises.
21. LANDLORD'S RIGHT TO CURE DEFAULTS; LATE PAYMENTS.
If Tenant defaults in the making of any payment, or in the doing of
any act herein required to be made or done by Tenant, or does or suffers any act
prohibited herein, then Landlord may, but shall not be required to, make such
payment or do such act, or correct any damage caused by such prohibited act and
enter the Premises as appropriate in connection
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therewith. Tenant shall reimburse Landlord on demand for all costs and expenses
incurred by Landlord in curing any such default plus a charge of ten percent
(10%) to cover Landlord's overhead in curing any non-monetary default, together
with interest thereon at the Interest Rate from the date such sums are incurred
by Landlord. Notwithstanding the foregoing, the making of any such payment or
the doing of any such act by Landlord shall not operate to cure such default or
to estop Landlord from the pursuit of any remedy to which Landlord would
otherwise be entitled. If any installment of Rent is not paid by Tenant when due
and payable: (i) Tenant shall pay Landlord a one-time late charge in the amount
of five percent (5%) of the delinquent installment as compensation to Landlord
for administrative costs provided that such one-time late charge shall be waived
for the first time only during any consecutive twelve (12) month period that any
installment of Rent is not paid by Tenant when due; and (ii) the unpaid balance
due Landlord shall bear interest at the Interest Rate from the date such
installment became due and payable to the date of payment thereof by Tenant, and
such interest shall constitute additional rent hereunder which shall be
immediately due and payable.
22. WAIVER.
Waiver by a party of any breach of any covenant, condition or
agreement herein contained will not operate as a waiver of such covenant,
condition, or agreement itself, or of any subsequent breach thereof. Failure of
a party to declare any default immediately upon occurrence thereof, or delay in
taking any action in connection therewith, will not waive such default nor
constitute a waiver of any future default, but such party shall have the right
to declare any such default at any time and take such action as might be lawful
or authorized hereunder, either in law or in equity. Receipt by a party of a
lesser amount of money than it is due and any endorsement or statement on any
check or letter accompanying a check for payment of money will not be deemed an
accord and satisfaction, and such party may accept such check or payment without
prejudice to its right to recover the balance of such money due or to pursue any
other remedy available under this Lease. Re-entry by Landlord, and/or acceptance
by Landlord of keys from Tenant, shall not be considered an acceptance of a
surrender of this Lease.
23. SUBORDINATION.
This Lease is subject and subordinate to each Mortgage which may now
or subsequently affect Landlord's interest in the Project, and to all renewals,
modifications, consolidations, replacements and extensions thereof; provided
that the holder of any such Mortgage (a "MORTGAGEE") agrees in writing not to
disturb Tenant's rights under this Lease during any period that an Event of
Default does not exist hereunder. Tenant agrees, however, that any Mortgagee,
may at its option, unilaterally elect to subordinate, in whole or in part, by an
instrument in form and substance satisfactory to such party, such Mortgage to
this Lease. Tenant agrees to execute promptly and to deliver to Landlord an
instrument or instruments in substantially the form attached hereto as Exhibit N
or another form to which Tenant has no reasonable objection, to confirm the
foregoing if requested by Landlord within twenty (20) days after written request
thereof by Landlord, but such failure or refusal shall in no way affect the
validity or enforceability of this Section 23. In the event of the enforcement
by the Mortgagee of the remedies provided for by law or by such Mortgage, Tenant
shall, upon request of any person succeeding to the interest of the Landlord
automatically become the tenant of such successor in interest, without change in
the terms or provisions of this Lease, provided that such successor in
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interest shall not be (i) bound by any payment of Rent for more than one month
in advance except prepayments in the nature of security for the performance by
Tenant of its obligations under this Lease; (ii) bound by any amendment to or
modification of this Lease made without the consent of the Mortgagee if Tenant
has received notice of the existence of such Mortgagee; (iii) liable for any
act, warranty or omission of the prior Landlord under this Lease; (iv) subject
to any offsets, deductions or defenses which Tenant might have arising out of
acts or omissions of the prior Landlord; or (v) liable for the breach of any
warranties or obligations relating to construction of improvements for the
Project or leasehold improvements in the Premises performed or to have been
performed by the prior Landlord; provided, however, that such successor in
interest shall be subject to any offset right against Rent that Tenant may have
in case Landlord shall fail to pay any portion of the Phase I & II Space
Improvement Allowance or the Phase III Space Improvement Allowance pursuant to
Exhibit D; the Second Extension Term Allowance pursuant to Exhibit G; the
Expansion Space Improvement Allowance pursuant to Exhibit I, or the Available
Space Improvement Allowance pursuant to Exhibit J. At the request of Landlord, a
Mortgagee or any such successor in interest, Tenant shall, within twenty (20)
days after written request therefor, execute and deliver to Landlord, such
Mortgagee or successor in interest a written instrument whereby Tenant confirms
the foregoing attornment.
Tenant agrees to give to each Mortgagee who has given Tenant written
notice of its address a copy of any default notice sent by Tenant to Landlord
pursuant to this Lease which would entitle Tenant to terminate or cancel this
Lease or abate the Rent payable hereunder, and agrees that, notwithstanding any
provision of this Lease to the contrary, no rental abatement or notice of
termination of this Lease by Tenant shall be effective unless all such
Mortgagees have received said notice and have failed for thirty (30) days after
receipt thereof to cure Landlord's default, or if the default cannot be cured
within thirty (30) days, have failed to promptly commence and to diligently
pursue the cure of Landlord's default which gave rise to such right of
termination or abatement.
Landlord represents and warrants to Tenant that Landlord owns fee
simple title to the Project, subject only to a Mortgage in favor of The
Northwestern Mutual Life Insurance Company ("NWML"). Landlord agrees to obtain
and deliver to Tenant as soon as reasonably possible, but in no event later than
thirty (30) days after the Effective Date, a Non-Disturbance Agreement executed
by NWML and Landlord in the form attached hereto as Exhibit N, or with such
changes thereto as are approved by Tenant. If Landlord shall fail to deliver
such Non-Disturbance Agreement to Tenant within said thirty (30) day period,
Tenant may by written notice to Landlord terminate this Lease, and upon any such
termination Landlord shall reimburse Tenant for out-of-pocket costs and expenses
incurred by Tenant in connection with this Lease, including, without limitation,
design fees, construction costs and expenses, attorneys' fees and consultants'
fees.
24. RULES AND REGULATIONS.
Tenant shall comply with, and Tenant shall cause its visitors,
employees, contractors, agents and invitees to comply with, all Legal
Requirements and with the reasonable rules and regulations of the Project
adopted, altered and consistently enforced on a non-discriminatory basis by
Landlord from time to time for the safety, care and cleanliness of the Premises
and Project and for preservation of good order therein, all of which will be
sent by
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Landlord to Tenant in writing and shall be thereafter carried out and observed
by Tenant, its employees, contractors, agents, invitees and visitors. The
initial rules and regulations of the Project are attached hereto as Exhibit E.
25. COVENANT OF QUIET ENJOYMENT.
Landlord covenants that it has the right to make and enter into this
Lease for the Term aforesaid and covenants that if Tenant shall pay the Rent and
all other sums due by Tenant hereunder and perform all of the covenants, terms
and conditions of this Lease to be performed by Tenant, Tenant shall, during the
Term hereby created, freely, peaceably and quietly occupy and enjoy the
Premises. It is understood and agreed by Tenant that this covenant and any and
all other covenants of Landlord contained in this Lease shall be binding upon
Landlord and its successors only with respect to breaches occurring during its
and their respective ownership of the Landlord's interest hereunder.
26. LIMITED LIABILITY.
Tenant specifically agrees to look solely to Landlord's interest in
the Project and the Land for the recovery of any judgment against Landlord, it
being agreed that Landlord (and its partners and shareholders) shall never be
personally liable for any such judgment. The provision contained in the
foregoing sentence is not intended to, and shall not, limit any right that
Tenant might otherwise have to obtain injunctive relief against Landlord or
Landlord's successors in interest or any suit or action in connection with
enforcement or collection of amounts which may become owing or payable under or
on account of insurance maintained by Landlord.
27. NO REPRESENTATIONS OR WARRANTIES BY LANDLORD.
Neither Landlord nor any agent or employee of Landlord has made any
representations or promises with respect to the Premises or the Project except
as herein expressly set forth, and no right, privileges, easements or licenses
are acquired by Tenant except as herein expressly set forth. Tenant has no right
to light or air over any premises adjoining the Project. This Lease (including
all Exhibits hereto) constitutes the entire agreement of the parties with
respect to the subject matter hereof and all prior and contemporaneous written
and oral agreements are merged herein.
28. NOTICES.
All notices or other communications hereunder shall be in writing
and shall be hand delivered or sent by United States Mail, registered or
certified, return receipt requested or by courier service, to the appropriate
address indicated below, or at such other place or places as either Landlord or
Tenant may, from time to time, respectively, designate in a written notice given
to the other. Any notice by Tenant to Landlord shall be addressed to the
Landlord at:
601 Second Avenue Limited Partnership
c/o Hines Interests Limited Partnership
225 South Sixth Street, Suite 2590
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Minneapolis, MN 55402
Attention: Property Manager
With a copy to:
601 Second Avenue Limited Partnership
c/o Hines Interests Limited Partnership
Three First National Plaza, Suite 440
Chicago, Illinois 60602
Attention: C. Kevin Shannahan
and if requested in writing by Landlord or required under the terms of this
Lease, given or served simultaneously to each Mortgagee at the address specified
in a written request by such party. Any notice by Landlord to Tenant shall be
addressed to the Tenant at:
Before the Phase I & II Rent Commencement Date:
Capella Education Company
222 South 9th Street
20th Floor
Minneapolis, Minnesota 55402
Attention: Chief Financial Officer
with a copy to:
Capella Education Company
222 South 9th Street
20th Floor
Minneapolis, Minnesota 55402
Attention: Vice President/General Counsel
On or after the Phase I & II Rent Commencement Date:
Capella Education Company
225 South 6th Street
8th Floor
Minneapolis, Minnesota 55402
Attention: Chief Financial Officer
with a copy to:
Capella Education Company
225 South 6th Street
8th Floor
Minneapolis, Minnesota 55402
Attention: Vice President/General Counsel
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Any notice mailed shall be deemed to have been given on the regular business day
next following the date of deposit of such item in a depository of the United
States Postal Service in the continental United States. Notice effected other
than by mail shall be deemed to have been given at the time of actual delivery.
Each party reserves the right to designate up to four additional parties to
receive copies of any notice to be given to such party under this Lease.
29. ESTOPPEL CERTIFICATES.
Tenant agrees at any time and from time to time, within twenty (20)
days after receipt of a written request from Landlord, to execute, acknowledge
and deliver to Landlord or a party designated by Landlord a statement in writing
(i) certifying (if true) that this Lease is unmodified and in full force and
effect, or if there have been modifications, that the Lease is in full force and
effect as modified and stating the modifications, (ii) stating the Commencement
Date and the expiration date of the Term of this Lease, (iii) stating the dates
to which the Rent and other charges hereunder have been paid by Tenant, (iv)
stating whether or not, to Tenant's actual knowledge, Landlord is in default in
the performance of any covenant, agreement or condition contained in this Lease,
and, if Landlord is in default, specifying each such default, (v) agreeing that
Tenant and Landlord will not thereafter modify the Lease without the approval of
any Mortgagee identified by Landlord, (vi) agreeing that Tenant shall not prepay
any Rent more than one month in advance, and (vii) stating any extension,
renewal, expansion, contraction or termination rights or rights of first offer
or refusal with respect to the Premises or any other space in the Project which
have been granted to Tenant. Any such statement delivered pursuant hereto may be
relied upon by any owner of the Project, any prospective purchaser of the
Project, any present or prospective Mortgagee of the Project or of Landlord's
interest, or any prospective assignee of any such Mortgagee.
30. SURRENDER, HOLDING OVER.
Upon the expiration of this Lease or the earlier termination of
Tenant's right to possession, Tenant shall immediately vacate the Premises,
remove all of its personal property therefrom and leave the Premises in the
condition required by this Lease. Any property required to be removed pursuant
to the terms of this Lease and not removed shall be deemed abandoned, and Tenant
shall be liable for all costs of removal and disposal. If Tenant continues to
occupy the Premises or any part thereof, after the expiration or termination of
the Term, whether with or without the consent of the Landlord, such tenancy
shall be at will (except that Landlord shall have the right, by giving written
notice thereof to Tenant at time while Tenant remains in possession of any
portion of the Premises, to convert such holdover to a month-to month tenancy)
and Tenant shall continue to be bound by all of the terms and conditions of this
Lease except that the monthly rent shall be one and one-half (1-1/2) times the
Base Rent and Tenant's Additional Rent payable immediately prior to such
expiration or termination. No holding over by Tenant after the Term shall be
construed to extend this Lease. The entitlement to the holdover rental amount
will be Landlord's exclusive right and remedy against Tenant for any holdover
not in excess of sixty (60) days and will be deemed to cover all liabilities,
obligations or charges which may be incurred by Landlord because of a holdover
by Tenant which does not exceed sixty (60) days, but neither this Section 30 nor
the acceptance of any rent shall prevent Landlord from exercising any remedy to
regain immediate possession of the Premises. If Tenant holds over for a period
in excess of sixty (60) days, Tenant shall be liable to Landlord for all
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damages which Landlord sustains because of such hold over including all claims
for damages by any tenant to whom Landlord may have leased all or any part of
the Premises effective upon the termination of this Lease and for any other
liability, loss, cost, damage or expense (including attorneys' fees,
disbursements of counsel and any costs of suit) incurred by Landlord as a result
of such holding over.
31. TENANT'S TAXES.
At least ten (10) days prior to delinquency, Tenant shall pay all
taxes levied or assessed upon Tenant's equipment, furniture and other personal
property located in or about the Premises. If any such taxes are imposed upon
Landlord, Tenant shall pay to Landlord, at least twenty (20) days before the
date each installment is due to the taxing authority, the portion allocable to
Tenant pursuant to this Section 31.
32. NO MERGER.
The voluntary or other surrender of this Lease by Tenant, or a
termination thereof, shall not constitute a merger, and shall, at the option of
Landlord, operate as an assignment to Landlord of any or all subleases or
subtenancies affecting the Premises.
33. GRAPHICS; BUILDING DIRECTORY.
No signs, numerals, letters or other graphics shall be used or
permitted on any part of the outside of the Premises or any area which is
readily visible from outside the Premises, unless approved in writing by
Landlord (which approval shall not be unreasonably withheld or delayed); except
for suite identification signage and signage which states that Tenant bans guns
on the Premises. Prior to the Commencement Date, Landlord shall install, at
Landlord's expense, two (2) strips on the Project directory board to be placed
in the main lobby of the Building or Tower listing Tenant's name and as many
lines on the Project's electronic directory as Tenant may request from time to
time. Any subsequent modifications to the identification of Tenant on either
Project directory shall be subject to Landlord's consent, which shall not be
unreasonably withheld, and, if such consent is granted, shall be made, at
Tenant's expense, by Landlord at Landlord's then current charges for such
modifications.
34. Intentionally omitted.
35. MISCELLANEOUS.
35.1 This Lease shall be strictly construed neither against Landlord or
Tenant; the captions in this Lease are for convenience only and are not a part
of this Lease; each provision hereof shall be deemed both a covenant and a
condition running with the Land; except as otherwise expressly provided in this
Lease and its Exhibits and other attachments, the singular includes the plural
and the plural includes the singular; "or" is not exclusive; a reference to an
agreement or other contract includes supplements and amendments thereto to the
extent permitted by this Lease; a reference to any laws includes any amendment
or supplement to such laws; a reference to a person or other entity includes its
permitted successors and assigns; accounting provisions have the meanings
assigned to them by generally accepted accounting principles applied on a
consistent basis; the words "such as," "include," "includes" and
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"including" are not limiting; except as specifically agreed upon in this Lease,
any right may be exercised at any time and from time to time and all obligations
are continuing obligations throughout the Term of this Lease, and in calculating
any time period, the first day shall be excluded and the last day shall be
included and all days are calendar days unless otherwise specified.
35.2 This is a Minnesota contract and shall be construed according to the
laws of Minnesota.
35.3 Wherever in this Lease any terms, covenants or conditions are
required to be kept or performed by Landlord, Landlord shall be deemed to have
kept and performed such terms, covenants and conditions notwithstanding any act
or omission of Landlord, if such act or omission is pursuant to any Legal
Requirement.
35.4 Whenever in this Lease there is imposed upon Landlord or Tenant the
obligation to use its best efforts, reasonable efforts or diligence, Landlord or
Tenant, as the case may be, shall be required to do so only to the extent the
same is economically feasible and otherwise will not impose upon Landlord or
Tenant, as the case may be, unreasonable financial or other burdens.
35.5 If more than one person or entity shall sign this Lease as Tenant,
the obligations set forth herein shall be deemed joint and several obligations
of each such party.
35.6 Time is of the essence with respect to this Lease and each and every
provision hereof.
35.7 If any term or provision of this Lease, the deletion of which would
not adversely affect the receipt of any material benefit by either party
hereunder, shall be held invalid or unenforceable to any extent, the remaining
terms, conditions and covenants of this Lease shall not be affected thereby, and
each of said terms, covenants and conditions shall be valid and enforceable to
the fullest extent permitted by law.
35.8 If any action or proceeding is brought by Landlord or Tenant to
interpret the provisions hereof, or to enforce either party's respective rights
under this Lease or to collect any sums owing by a party, the prevailing party
shall be entitled to recover from the unsuccessful party therein, in addition to
all other remedies, all costs incurred by the prevailing party in such action or
proceeding, including reasonable attorneys' fees and disbursements of counsel to
be fixed by the court having jurisdiction thereof.
35.9 If Tenant is a corporation, partnership or other entity, Tenant
warrants that all consents or approvals (copies of which shall be delivered to
Landlord on the execution of this Lease by Tenant) required of third parties
(including but not limited to its Board of Directors or partners) for the
execution, delivery and performance of this Lease have been obtained, that
Tenant has the right and authority to enter into and perform its covenants
contained in this Lease, and that this Lease is binding upon Tenant in
accordance with its terms.
35.10 Tenant warrants that it has not engaged or dealt with any broker in
connection with this Lease other than Landlord, Landlord's affiliates and CRESA
Partners. Tenant agrees to
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indemnify, defend and hold Landlord harmless from and against any claim for
broker's fees or finder's fees asserted on account of any dealings with Tenant
by any broker other than those specified herein. Landlord warrants that it has
not engaged or dealt with any broker in connection with this Lease other than
Landlord, Landlord's affiliates and CRESA Partners. Landlord agrees to
indemnify, defend and hold Tenant harmless from and against any claim for
broker's fees or finder's fees asserted on account of any dealings with Landlord
by any broker other than those specified herein. Landlord agrees to pay or cause
to be paid to CRESA Partners a commission of $4.00 per square foot of the
Rentable Area of the Initial Premises; with fifty percent (50%) of such
commission to be paid within thirty (30) days of the date on which this Lease
has been fully executed and delivered, thirty seven percent (37%) of such
commission to be paid within thirty (30) days of the Phase I & II Rent
Commencement Date, and thirteen percent (13%) of such commission to be paid
within thirty (30) days of the Phase III Rent Commencement Date. If Tenant
exercises its First Extension Option, Landlord agrees to pay a brokerage
commission to Tenant or Tenant's broker of $2.00 per square foot of the Rentable
Area of the Premises (based upon such Rentable Area as of the date on which the
First Extension Term commences) within thirty (30) days after the date on which
the First Extension Term commences. If Tenant exercises its Second Extension
Option, Landlord agrees to pay Tenant or Tenant's broker a commission of $4.00
per square foot of the Rentable Area of the Premises (based upon such Rentable
Area as of the date on which the Second Extension Term commences) within thirty
(30) days after the date on which the Second Extension Term commences. Lastly,
if Tenant exercises an Expansion Option, or if any Available Space is added to
the Premises (as defined in the Right of Offer) pursuant to the Right of Offer
during the Initial Scheduled Term, Landlord agrees to pay Tenant or Tenant's
broker a commission of (i) $4.00 per square foot of the Rentable Area of the
Expansion Space, or (ii) $2.00 per square foot of the Rentable Area of the
Available Space, in either event within thirty (30) days after the applicable
Expansion Space Rent Commencement Date or Available Space Rent Commencement
Date, as the case may be.
35.11 All rights and remedies of Landlord under this Lease shall be
cumulative and none shall exclude any other rights or remedies allowed by law.
35.12 The provisions of this Lease which relate to periods subsequent to
the expiration of the Term shall survive the expiration of the Term.
35.13 Either party will, upon the written request of the other party,
execute a short form lease ("MEMORANDUM OF LEASE") regarding this Lease, in a
form suitable for recording with the Registrar of Titles and/or the County
Recorder for Hennepin County, Minnesota. The party requesting the execution of
such Memorandum of Lease will bear all costs of the Memorandum of Lease,
including any recording fees. Upon the execution of an amendment to this Lease
and the written request of either party, the parties shall execute a
corresponding amendment to the Memorandum of Lease.
35.14 Either party will, following any termination of this Lease and upon
the written request of the other party, execute a document setting forth the
date of such termination, in a form suitable for recording with the Registrar of
Titles and/or the County Recorder for Hennepin County, Minnesota. Failure of a
party to execute such a document shall not affect the termination, and in such
event the party requesting the document may execute and file an
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affidavit setting forth the date of termination. The party requesting the
execution of such document shall bear all costs thereof, including any recording
fees.
35.15 No Exhibit attached to this Lease nor any other materials provided
by Landlord shall constitute a warranty or agreement as to the configuration of
the Project. Landlord reserves the right from time to time to modify the
Project, including Common Areas, appurtenances and rentable areas, and to change
the name of the Project, the Building and the Tower (subject to Tenant's rights
under Section 36.2) without in any case reducing the obligations of Tenant
hereunder; provided, however, that all such modifications shall be consistent
with the standards of a first class office building in downtown Minneapolis and
no such modification of the Common Areas shall diminish in any material respect
Tenant's right to use and enjoy the Common Areas.
35.16 Subject to the provisions in Section 36.2, Tenant shall not use the
name of the Project or any part thereof for any purpose whatsoever, except to
identify the location of the Premises in Tenant's address. Landlord reserves the
right to change the name of the Project or any part thereof at any time and
Landlord shall have no liability whatsoever to Tenant by reason of any such
change.
35.17 This Lease shall be binding upon and inure to the benefit of the
parties hereto and, subject to the restrictions and limitations herein
contained, their respective heirs, successors and assigns.
35.18 This Lease may not be altered, changed or amended, except by an
instrument in writing executed by all parties hereto.
35.19 The terms and provisions of Exhibits A through O, inclusive,
attached hereto are hereby made a part of this Lease for all purposes.
35.20 This Lease may be executed in any number of counterparts, all of
which shall be considered one and the same Lease notwithstanding that all
parties hereto have not signed the same counterpart. Signatures of this Lease
which are transmitted by facsimile shall be valid for all purposes. Any party
shall, however, deliver an original signature for this Lease to the other party
upon request.
36. ADDITIONAL RIGHTS OF TENANT
36.1 MONUMENT SIGNAGE. Prior to the Phase I & II Rent Commencement Date,
Landlord shall, upon Tenant's request and at Tenant's expense, install Tenant's
name in the top position on the Project's monument sign at the Sixth Street and
Second Avenue entry way (the "SECOND AVENUE MONUMENT SIGN") to the Project (such
right being referred to herein as "TENANT'S TOP MONUMENT SIGNAGE RIGHT").
Tenant's Top Monument Signage Right shall remain in effect in all events through
January 1, 2006, and thereafter only for so long as Tenant, its Affiliates
and/or Successors are Directly Occupying at least 200,000 square feet of the
Rentable Area of the Project. For so long as Tenant, its Affiliates and/or
Successors, however, are Directly Occupying at least 100,000 square feet of
Rentable Area in the Project, Tenant shall have the right to have Tenant's name
installed, at Tenant's expense, in a prominent manner on, but not at the top of,
the Second Avenue Monument Sign ("TENANT PROMINENT MONUMENT
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SIGNAGE RIGHT"). Tenant's Top Monument Signage Right and Tenant's Prominent
Monument Signage Right are collectively referred to herein as "TENANT'S MONUMENT
SIGNAGE RIGHTS". Tenant's Monument Signage Rights shall be personal to Capella
Education Company, its Affiliates and Successors, and may not be assigned other
than to an Affiliate or Successor of Capella Education Company. If, at any time,
Tenant, its Affiliates and/or Successors are not Directly Occupying at least
200,000 square feet of Rentable Area in the Project, Landlord shall have the
right, at Tenant's expense, to remove Tenant's sign from the top of the Second
Avenue Monument Sign and to permit the top of the Second Avenue Monument Sign to
be used to identify any tenant of the Project that is leasing more space in the
Project than Tenant. If, at any time, Tenant, its Affiliates and/or Successors
are not Directly Occupying at least 100,000 square feet of Rentable Area in the
Project, then all of Tenant's Monument Signage Rights under this Section shall
forever terminate and Landlord may, at Tenant's expense, remove Tenant's name
from the Second Avenue Monument Sign. For purposes of this Article 36, Tenant
shall be deemed to be "DIRECTLY OCCUPYING" all space in the Project that Tenant
leases directly from Landlord (whether under this Lease or any other direct
lease with Landlord) which Tenant has not subleased to a Third Party Subtenant.
A "THIRD PARTY SUBTENANT" is any person or entity that is not an Affiliate of or
Successor to Tenant. Tenant's rights under this Section 36.1 may not be assigned
apart from the Lease.
36.2 NAMING RIGHTS. At such time, if any, as Tenant, its Affiliates
and/or Successors are Directly Occupying over 400,000 square feet of Rentable
Area in the Project and for so long thereafter as Tenant, its Affiliates and/or
Successors are Directly Occupying at least 300,000 square feet of Rentable Area
in the Project, Tenant shall have the exclusive right to name the Tower (i)
"Capella Tower," or (ii) any other name which identifies Tenant (or an Affiliate
of Tenant occupying significant space in the Project) that is selected by Tenant
and approved by Landlord, which approval shall not to be unreasonably withheld
or delayed (the "NAMING RIGHT"); provided that if Tenant, its Affiliates and/or
Successors are Directly Occupying less than 350,000 square feet, but more than
300,000 square feet of Rentable Area in the Project, then Landlord may terminate
the Naming Right, but only if the exclusive right to name the Tower is going to
be granted by Landlord to a tenant that will be or is leasing more space in the
Project than Tenant. For so long as Tenant's Naming Right is in effect, Tenant
shall have the exclusive right, at Tenant's expense, to install and maintain one
monument sign with the name Capella Tower (or other name as discussed above) at
the Sixth Street and Second Avenue entry way to the Project, subject to
Landlord's reasonable approval as to the design, size and actual location of the
same and compliance with all applicable Legal Requirements. Tenant shall pay all
costs which are incurred by Landlord in connection with so identifying the Tower
and all costs which Landlord is required to pay as reimbursement to any tenants
of the Tower because of such name change and all costs incurred by Landlord to
remove existing Project signage and replace any such removed signage with
signage of comparable quality. The Naming Right shall be personal to Capella
Education Company and may not be assigned other than to an Affiliate or
Successor. If, at any time, (i) Tenant, its Affiliates and/or Successors are not
Directly Occupying at least 300,000 square feet of Rentable Area in the Project,
(ii) Landlord terminates the Naming Right in order to grant the right to name
the Tower to a larger tenant as permitted above, or (iii) this Lease is
terminated, then (x) Tenant's Naming Right shall forever terminate and Landlord
may change the name of the Tower, (y) Landlord may remove, at Tenant's expense,
any signage with the name that Tenant has chosen for the Tower, and (z) Landlord
may grant rights to name the Tower to any third party in the case of clause (i)
and (iii) above. Nothing in this Section shall
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preclude Landlord from granting, and Landlord shall have the right, at any time
and from time to time, to grant naming rights with respect to the Building to
any third party and Landlord shall have the right, at any time prior to the date
on which Tenant would otherwise become entitled to the Naming Right, to grant
the exclusive right to name the Tower to any tenant of the Project that leases
more Rentable Area in the Project than Tenant. Notwithstanding anything to the
contrary in this Lease, for so long as Tenant, its Affiliates and/or Successors
are Directly Occupying at least 100,000 square feet of Rentable Area in the
Project, Landlord shall not grant the exclusive right to name the Tower or the
Building to a Direct Competitor of Tenant or change the name of the Tower or the
Building to reflect the name of a Direct Competitor of Tenant. Tenant's rights
under this Section 36.2 may not be assigned apart from the Lease.
36.3 EMERGENCY GENERATOR. Tenant shall have the right, at Tenant's sole
cost and expense, and subject to Landlord's reasonable approval with respect to
the type and location thereof, to install and maintain an emergency generator on
the B1 Level of the Project for the exclusive use of Tenant throughout the Lease
Term. Alternatively, Tenant shall have the right, which must be exercised by
giving Landlord written notice thereof not less than sixty (60) days prior to
the Phase I & II Rent Commencement Date, to use the emergency generator which is
owned by Landlord and located on the B1 Level of the Project to supply emergency
power for Tenant's use; provided that Tenant shall be responsible for all costs
incurred in operating, repairing, maintaining and replacing Landlord's emergency
generator.
36.4 SATELLITE DISH. Landlord grants to Tenant the non-exclusive right to
install one (1) satellite dish, at the location on the roof of the Building
designated by Landlord, together with associated wiring from the antenna to the
Premises (collectively, the "Antenna"), at any time during the Term of this
Lease (including any extension or renewal thereof) and to use the Antenna solely
in connection with the conduct of Tenant's business subject to the terms of this
Lease and to the following additional terms:
(a) The Antenna shall be installed at Tenant's sole expense at such
specific location, in such manner, and by such contractors as shall be
approved in writing by Landlord and Landlord's Antenna Site Manager;
provided, however, that in no event shall the approval by the Antenna Site
Manager be unreasonably withheld, delayed or conditioned. Tenant shall be
responsible for all costs and expenses of Landlord relating to the
installation of the Antenna, including the costs of any consultant or
supervision necessary in connection with such installation, payable as
Additional Rent within thirty (30) days after Landlord's invoice.
(b) The functional characteristics, size, design, color and general
appearance of the Antenna shall be subject to prior approval in writing by
Landlord and Landlord's Antenna Site Manager, which approval shall not be
unreasonably withheld or delayed by either party. Such approval shall not
create any warranty by or impose any liability for Landlord.
(c) Tenant shall at its expense repair and maintain the Antenna in
good and safe condition and in compliance with applicable laws, and
Landlord shall have no responsibility for any damage to or interference
with the Antenna from any cause whatsoever. Tenant shall be responsible
for and shall at its sole expense repair any
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damage caused by the installation, maintenance, operation, condition, or
use of the Antenna, and any related roof or wall penetrations, including,
without limitation, any water damage or other damage to the Building or
Landlord's or other tenant's premises or personal property. Tenant shall
be responsible for all utilities, expenses, taxes or assessments in
connection with the Antenna and shall obtain and keep in effect any and
all licenses, permits and other governmental approvals which are or may
become required for the operation and use of the Antenna. All work to be
done by Tenant pursuant to this Section shall otherwise be subject to the
terms and conditions of this Lease.
(d) Tenant shall indemnify and hold harmless Landlord from any
losses, costs, claims, actions, causes of action, expenses (including
reasonable attorney's fees) or liabilities of any sort whatsoever arising
by reason of the installation, maintenance, operation, condition, use or
removal of the Antenna or the exercise of any of Tenant's rights under
this Section.
(e) Upon the expiration or termination of this Lease, or the
termination of Tenant's right to possession of the Premises, Tenant shall
remove the Antenna and repair any damage resulting from such removal at
Tenant's sole expense.
(f) Landlord may relocate the Antenna on not less than ninety (90)
days' prior written notice to Tenant to another location at the Building
suitable for Tenant's purposes. The expense of such relocation shall be
paid by Landlord, except that all such expenses shall be paid by Tenant if
the relocation is necessitated by applicable legal or insurance
requirements as reasonably determined by Landlord. Landlord may interrupt
or turn off the Antenna, on reasonable prior notice to Tenant, in the
event of an emergency or as reasonably necessary in connection with
repairs to the Building.
(g) Tenant shall not cause or permit the Antenna to interfere with
other communication devices now or hereafter installed at the Building. In
case of any such interference, Tenant shall at its expense use best
efforts to promptly eliminate such interference. Tenant shall not allow
other tenants of the Building or any other person to utilize the Antenna
without first obtaining Landlord's written consent. The rights granted in
this Section relating to the Antenna may not be transferred by Tenant
except in connection with an assignment permitted by this Lease. The
obligations of Tenant contained in this Section shall survive the
termination of this Lease.
(h) Tenant shall not be obligated to pay any separate rental for the
right to install and operate the Antenna.
(i) Upon the occurrence of any default under this Section, in
addition to Landlord's other rights and remedies, Landlord may,
immediately and without further notice or legal process, terminate
Tenant's rights under this Section and disconnect, remove and store the
Antenna at Tenant's expense.
36.5 JANITORIAL SERVICES. Notwithstanding anything to the contrary in this
Lease, Tenant shall have the right to contract separately for any special
janitorial services which are not then included in the standard janitorial
services being provided by Landlord pursuant to
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Section 14 of this Lease; provided that Tenant first obtains Landlord's written
approval of the contractor selected by Tenant to perform any such special
janitorial services, which approval shall not be unreasonably withheld by
Landlord. Landlord also agrees to cooperate with Tenant regarding the scheduling
of the janitorial services to be provided by Landlord pursuant to Section 14 of
this Lease.
IN WITNESS WHEREOF, Landlord has executed this Lease to be effective
as of the date first above set forth.
[SIGNATURE PAGES FOLLOW]
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SIGNATURE PAGE
FOR
OFFICE LEASE
BETWEEN
601 SECOND AVENUE LIMITED PARTNERSHIP
AND
CAPELLA EDUCATION COMPANY
LANDLORD:
601 SECOND AVENUE LIMITED PARTNERSHIP,
a Texas limited partnership
By: Minneapolis 601 Limited Partnership, a Texas
limited partnership, its sole general partner
By: Hines Acquisitions No. 2 Limited
Partnership a Texas limited partnership, its
sole general partner
By: Hines Interests Limited Partnership,
a Delaware limited partnership, its
sole general partner
By: Hines Holdings, Inc., a Texas
close corporation, its sole
general partner
By: /s/ C.K. Shannahan
Name: C. Kevin Shannahan
Title: Executive Vice
President
<PAGE>
SIGNATURE PAGE
FOR
OFFICE LEASE
BETWEEN
601 SECOND AVENUE LIMITED PARTNERSHIP
AND
CAPELLA EDUCATION COMPANY
TENANT:
CAPELLA EDUCATION COMPANY
a Minnesota corporation
By: /s/ Joe Gaylord
---------------------------------------
Name: Joe Gaylord
Title: CFO
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EXHIBIT B
LEGAL DESCRIPTION
Lot 6, Block 219, Town of Minneapolis, according to the plat thereof on file or
of record in the office of the Register of Deeds in and for Hennepin County.
The Northeasterly 7 feet of Lots 1, 2, and 3; the Northeasterly 7 feet of the
Northwesterly half of Lot 4; the Southeasterly half of Lot 4; and Lots 5, 6, 7,
8, 9 and 10;
all in Block 219, Brown and Jackins' Addition to Minneapolis, according to the
plat thereof on file or of record in the office of the Register of Deeds in and
for Hennepin County.
B-1
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EXHIBIT C
FORM OF DECLARATION OF
COMMENCEMENT DATE
This Declaration is made as of February ___, 2004, by and between
601 Second Avenue Limited Partnership, a Texas limited partnership ("LANDLORD")
and Capella Education Company, a Minnesota corporation ("TENANT").
Landlord and Tenant are parties to that certain Office Lease (the
"LEASE") dated as of February ___, 2004.
In accordance with the Lease, Landlord and Tenant hereby memorialize
that:
1. The **[INSERT COMMENCEMENT DATE, PHASE I & II RENT COMMENCEMENT
DATE OR PHASE III RENT COMMENCEMENT DATE, AS APPROPRIATE]** is
-------------------------.
2. The expiration date of the Initial Scheduled Term is October 31,
2010.
TENANT:
CAPELLA EDUCATION COMPANY,
a Minnesota corporation
By: _______________________________________
Name: _____________________________________
Title: ____________________________________
C-1
<PAGE>
LANDLORD:
601 SECOND AVENUE LIMITED PARTNERSHIP,
a Texas limited partnership
By: Minneapolis 601 Limited Partnership, a Texas
limited partnership, its sole general partner
By: Hines Acquisitions No. 2 Limited
Partnership a Texas limited partnership, its
sole general partner
By: Hines Interests Limited Partnership,
a Delaware limited partnership, its
sole general partner
By: Hines Holdings, Inc., a Texas
close corporation, its sole
general partner
By:_________________________________
Name: C. Kevin Shannahan
Title: Executive Vice
President
C-2
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EXHIBIT D
WORKLETTER
PART I. SCHEDULE OF CRITICAL DATES.
Set forth below is a schedule of certain critical dates relating to
Landlord's and Tenant's respective obligations with respect to construction of
those leasehold improvements (including all cabling and wiring) which Tenant
desires to make to the Initial Premises (the "TENANT IMPROVEMENTS"). These dates
and the respective obligations of Landlord and Tenant are more fully described
in Part II below.
Date Due Responsible Party
-------- -----------------
A. Space Plan Delivery Date May 1, 2004, or as soon thereafter as is Tenant
reasonably possible
B. Landlord Review Date Within seven (7) business days after Landlord
Landlord receives the Tenant Space Plan
All references to days mean calendar days, not working or business days. If
Tenant delivers the Tenant Space Plan prior to the date set forth above, the
same nevertheless shall be deemed delivered on the date set forth above for
purposes of the foregoing schedule.
PART II. LANDLORD AND TENANT PRE-CONSTRUCTION OBLIGATIONS.
1. Tenant will deliver to Landlord no later than the Space Plan Delivery Date
(described in Part I above) a detailed space plan containing the information
described in Part VI below, together with other relevant information and written
instructions relating thereto which are required to prepare the Tenant Working
Drawings (defined below) for the Tenant Improvements (said space plan and other
information and instructions being called the "TENANT SPACE PLAN").
2. Landlord will review the Tenant Space Plan to determine if it satisfies the
requirements listed in Part VI below, and Landlord shall report any
non-conformity to Tenant on or before the Landlord Review Date (described in
Part I above).
3. Tenant shall cause working drawings (the "TENANT WORKING DRAWINGS") of the
Tenant Improvements shown on the Tenant Space Plan to be prepared and delivered
to Landlord. The Tenant Working Drawings shall consist of the (a) complete sets
of plans and specifications in the form of working drawings or construction
drawings identifying Tenant's interior layout of the Initial Premises, including
complete sets of detailed architectural, structural, mechanical, electrical, and
plumbing working drawings for any and all Tenant Improvements, and (b) any
design materials prepared in collaboration with a subcontractor for any portion
of the Tenant Improvements being constructed on a design-build basis. The Tenant
Working Drawings shall include such written instructions or specifications as
may be necessary or required to secure a building permit from the City of
Minneapolis for the Tenant Improvements to commence in due course. The Tenant
Working Drawings shall be prepared by architects, engineers and
D-1
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design/build subcontractors selected by Tenant and approved by Landlord, which
approval will not be unreasonably withheld or delayed.
4. Landlord shall have ten (10) business days to review the initial submittal of
the Tenant Working Drawings and seven (7) business days to review any
resubmittal of the Tenant Working Drawings and notify Tenant whether Landlord
approves the same (which approval shall not be unreasonably withheld or delayed)
or the reasons Landlord does not approve them.
5. Upon receipt of the final, mutually approved Tenant Working Drawings, Tenant
agrees to submit for pricing by its contractors and subcontractors the Tenant
Improvements (any contractor selected by Tenant with Landlord's approval to
supervise the construction of the Tenant Improvements is hereinafter called the
"GENERAL CONTRACTOR"). Tenant shall then enter into a Construction Contract with
the General Contractor. LANDLORD SHALL NOT BE OBLIGATED TO, AND DOES NOT, MAKE
ANY WARRANTIES, EXPRESS OR IMPLIED WITH RESPECT TO THE TENANT IMPROVEMENTS WORK
NOR SHALL LANDLORD BE OBLIGATED FOR ANY OF THE WARRANTIES FROM TENANT'S
ARCHITECT OR THE GENERAL CONTRACTOR TO TENANT. ALL IMPLIED WARRANTIES WITH
RESPECT THERETO, INCLUDING BUT NOT LIMITED TO THOSE OF MERCHANTABILITY AND
FITNESS FOR A PARTICULAR PURPOSE, ARE EXPRESSLY NEGATED AND WAIVED.
6. Tenant shall pay and be responsible for the architectural and engineering
fees incurred in preparing the Tenant Space Plan and the Tenant Working Drawings
or otherwise relating to the making of all of the Tenant Improvements.
7. Tenant shall be solely responsible for the compliance of the Tenant Space
Plan, the Tenant Working Drawings and all of the Tenant Improvements with
applicable Legal Requirements and building rules and regulations.
8. If in the exercise of Landlord's reasonable judgment it would be prudent to
have those aspects of the Tenant Working Drawings which affect the structural
elements of the Project or Base Building Systems reviewed by Landlord's
architects or engineers, Tenant shall promptly reimburse Landlord for any
reasonable out-of-pocket costs incurred by Landlord in connection with such
review.
PART III. CERTAIN PROVISIONS RELATING TO THE TENANT IMPROVEMENTS.
1. Upon execution of the Construction Contract between Tenant and the General
Contractor, Tenant agrees to use diligence to cause the General Contractor to
complete the installation of the Tenant Improvements on or before the estimated
finish date shown therein, subject to typical excused delay events. Tenant shall
pay all costs incurred in connection with the Tenant Improvements work including
the costs of the materials and labor therefor and associated architectural and
engineering fees.
2. The Construction Contract between Tenant and the General Contractor shall
contain an estimate of the date the Tenant Improvements will be Substantially
Complete. "SUBSTANTIALLY COMPLETE" means the date on which (i) a certificate of
occupancy has been issued for the
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Premises, and (ii) the Tenant Improvements have been substantially completed in
accordance with the Tenant Working Drawings, with a punch-list of uncompleted
items which do not interfere in any material respect with the use or enjoyment
of the Premises.
3. Tenant may make changes in the Tenant Improvements with the prior approval of
Landlord and as otherwise provided for in the Construction Contract between
Tenant and the General Contractor; provided, however, that Landlord's approval
shall not be required for changes relating to decorating or finishes, or for
change orders of $50,000 or less that do not affect structural elements of the
Project or Base Building Systems. Any change which Tenant desires to make in the
Tenant Improvements requiring Landlord's approval shall be described in a
written change order that shall be submitted for Landlord's approval, which
approval shall not be unreasonably withheld or delayed. All change orders,
whether or not requiring Landlord's approval shall, however, be delivered to
Landlord within twenty four (24) hours after execution by Tenant (but if Tenant
shall fail to so deliver copies to Landlord, such failure shall constitute an
Event of Default by Tenant only if such failure shall continue for fifteen (15)
days after written notice of default is given by Landlord in accordance with
Section 20.1(c)) and all changes shall be reflected on the "as-built" plans and
specifications (in both drawn and CAD disc format) which shall be delivered by
Tenant to Landlord after the Tenant Improvements have been completed.
4. If for any reason the Initial Premises are not ready for occupancy by the
estimated finish date stated in the Construction Contract between Tenant and the
General Contractor, Landlord shall not be liable or responsible for any claims,
damages or liabilities in connection therewith or by reason thereof, unless such
delay is directly caused by (i) Landlord's failure to respond to any submittal
or resubmittal of the Tenant Working Drawings within the time periods required
in Section 4 of Part II to this Exhibit D, or (ii) an act or omission of
Landlord (except for actions taken to enforce Landlord's rights under this
Lease) related to the construction of the Tenant Improvements, but only if, in
either case, Tenant has promptly notified Landlord in writing that Tenant
reasonably believes that any act or omission of Landlord may delay substantial
completion of the Tenant Improvements for the Phase I Space and the Phase II
Space beyond November 1, 2004, or if Tenant reasonably believes that any act or
omission of Landlord may delay substantial completion of the Tenant Improvements
for the Phase III Space beyond November 1, 2005 (such delays are referred to
herein as "LANDLORD CAUSED DELAYS"). If the Tenant Improvements for the Phase I
Space and the Phase II Space are not completed on or before November 1, 2004,
because of Landlord Caused Delays, the Phase I & II Rent Commencement Date shall
be delayed by one day for each day of such delay. If the Tenant Improvements for
the Phase III Space are not completed on or before November 1, 2005, because of
Landlord Caused Delays, the Phase III Rent Commencement Date shall be delayed by
one day for each day of such delay.
5. David Spillman is hereby designated the individual who Landlord agrees shall
be available to meet and consult with Tenant as Landlord's representative
respecting the matters which are the subject of this Exhibit, and who, as
between Landlord and Tenant, shall have the power to legally bind Landlord
("LANDLORD'S DESIGNATED REPRESENTATIVE"). Carla Bustrom is hereby designated as
the individual who Tenant agrees shall be available to meet and consult with
Landlord as Tenant's representative respecting the matters which are subject to
this Exhibit, and who, as between Tenant and Landlord, shall have the power to
legally bind Tenant ("TENANT'S
D-3
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DESIGNATED REPRESENTATIVE"). Landlord and Tenant shall each have the right to
change their respective representatives, and such representatives'
responsibilities, upon notice to the other party given pursuant to the terms of
the Lease. All inquiries or instructions from Tenant's Designated Representative
or Tenant's architect pertaining to the Tenant Improvements shall be directed in
writing to the Landlord's Designated Representative.
6. Landlord's Designated Representative shall at all times have access to and
the right to inspect the Tenant Improvements.
7. Landlord's Designated Representative shall have authority to reject any of
the Tenant Improvements which do not conform to the Contract Documents (as
defined in the Construction Contract between Tenant and the General Contractor)
if such non-conforming Tenant Improvements would adversely affect the structural
elements of the Project or the Base Building Systems.
PART IV. GENERAL CONTRACTOR.
1. The General Contractor shall: (i) conduct its work in such a manner so as not
to unreasonably interfere with any other construction occurring on or in the
Project or the Premises; (ii) comply with all ru1es and regulations relating to
the construction activities in or on the Project, as may be reasonably
promulgated from time to time by Landlord; and (iii) maintain such insurance and
bonds in force and effect as may be reasonably requested by Landlord or as
required by applicable law. As a condition precedent to Landlord's approving the
General Contractor, Tenant and the General Contractor shall deliver to Landlord
such assurances or instruments to evidence the General Contractor's compliance
or agreement to comply with the provisions of this paragraph as may be
reasonably requested by Landlord.
2. Tenant shall indemnify, defend (with counsel acceptable to Landlord) and hold
Landlord, harmless from and against any and all losses, damages, costs
(including costs of suit and attorneys' fees), liabilities, or causes of action
arising out of or relating to the work of the General Contractor, including but
not limited to mechanics', materialmen's or other liens or claims (and all costs
or expenses associated therewith) asserted, filed or arising out of any such
work, except to the extent such liens arise by reason of Landlord's failure to
timely advance the Phase I and II Space Improvement Allowance or the Phase III
Space Improvement Allowance, as provided herein. All materialmen, contractors,
artisans, mechanics, laborers and other parties hereafter contracting with
Tenant or any of Tenant's contractors or subcontractors for the furnishing of
any labor, services, materials, supplies or equipment with respect to any
portion of the Premises are hereby charged with notice that they must look
solely to Tenant for payment for same. Without limiting the generality of the
foregoing, Tenant shall repair or cause to be repaired at its expense all damage
caused by the General Contractor, its subcontractors or their employees.
PART V. CONSTRUCTION COORDINATION FEE.
If Tenant retains the services of Landlord to serve as Tenant's construction
coordinator, Tenant shall pay Landlord a construction coordination fee equal to
three percent (3%) of the actual construction costs for the Tenant Improvements,
which fee shall be paid to Landlord at the same
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time that Landlord pays Tenant the Improvement Allowance as provided in Part VII
of this Exhibit D.
PART VI. MINIMUM INFORMATION REQUIRED OF TENANT SPACE PLAN.
FLOOR PLANS INDICATING:
1. Location and type of all partitions.
2. Location and types of all doors.
3. Location and type of glass partitions, windows and doors - indicate framing
if not building standard.
4. Location of telephone equipment room.
5. Location of all building standard electrical items - outlets, switches,
telephone outlets, lights.
6. Location and type of all non-building standard electrical items including
lighting and security systems.
7. Location and type of equipment that will require special electrical
requirements.
8. Location, weight per square foot and description of any exceptionally heavy
equipment or filing system exceeding 50 psf live load.
9. Requirements for special air conditioning or ventilation.
10. Type and color of floor covering.
11. Location and type of wall covering.
12. Location and type of building standard and non-building standard paint or
finishes.
13. Location and type of plumbing, including special sprinkling requirements.
14. Location and type of kitchen equipment.
DETAILS SHOWING:
All millwork with verified dimensions and dimensions of all equipment to be
built-in.
15. Corridor entrance.
16. Bracing or support of special walls, glass partitions, etc., if required.
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PART VII. IMPROVEMENT ALLOWANCE.
1. To help defray the costs of the Tenant Improvements for the Phase I Space and
the Phase II Space and the costs incurred in moving into the Phase I Space and
Phase II Space, Landlord agrees to make available to Tenant an allowance in an
amount of up to Thirty Dollars ($30.00) times the Rentable Area of the Phase I
Space and the Phase II Space (the "PHASE I & II SPACE IMPROVEMENT ALLOWANCE").
The Phase I & II Space Improvement Allowance shall be payable on account of
costs incurred in designing and constructing the Tenant Improvements (including
all consultant fees which directly relate to the Tenant Improvements,
construction costs, permits, cabling, architectural engineering plans) for the
Phase I Space and the Phase II Space and for moving costs. For so long as Tenant
is not in default under this Lease, Landlord shall pay the Phase I & II Space
Improvement Allowance on a monthly basis all in accordance with customary
construction disbursement procedures and upon receipt of a sworn construction
statement and draw request, with supporting lien waivers from all material
contractors and subcontractors delivered one month in arrears. Landlord shall be
permitted to offset against the Phase I & II Space Improvement Allowance any
amounts past due to Landlord by Tenant under this Lease. If the actual costs of
the Tenant Improvements for the Phase I Space and the Phase II Space plus the
costs incurred in moving into the Phase I Space and Phase II Space exceed the
amount of the Phase I & II Space Improvement Allowance, Tenant shall pay the
excess costs without reimbursement from Landlord as and when such excess costs
become due and payable. If the actual costs of the Tenant Improvements for the
Phase I Space and the Phase II Space plus the costs incurred in moving into the
Phase I Space and Phase II Space are less than the Phase I & II Space
Improvement Allowance, Landlord shall credit up to but not more than $5.00 per
square foot of the Phase I & II Space Improvement Allowance against the first
installments of Base Rent which are due and payable under this Lease for the
Phase I Space and the Phase II Space. Landlord's obligation to make the Phase I
& II Space Improvement Allowance available (other than in the form of a credit
against Base Rent in an amount not to exceed $5.00 per square foot) to Tenant
shall expire with respect to any portion of the Phase I & II Space Improvement
Allowance that is not used by Tenant on or before January 1, 2006.
2. To help defray the costs of the Tenant Improvements for the Phase III Space
and the costs incurred in moving into the Phase III Space, Landlord agrees to
make available to Tenant an allowance in an amount of up to Thirty Dollars
($30.00) times the Rentable Area of the Phase III Space (the "PHASE III SPACE
IMPROVEMENT ALLOWANCE"). The Phase III Space Improvement Allowance shall be
payable on account of costs incurred in designing and constructing the Tenant
Improvements (including all consultant fees which directly relate to the Tenant
Improvements, construction costs, permits, cabling, architectural engineering
plans) for the Phase III Space plus the costs incurred in moving into the Phase
III Space. For so long as Tenant is not in default under this Lease, Landlord
shall pay the Phase III Space Improvement Allowance on a monthly basis all in
accordance with customary construction disbursement procedures and upon receipt
of such documentation as is required by title insurance companies and
institutional construction lenders. Landlord shall be permitted to offset
against the Phase III Space Improvement Allowance any amounts past due to
Landlord by Tenant under this Lease. If the actual costs of the Tenant
Improvements for the Phase III Space plus the costs incurred in moving into the
Phase III Space exceed the amount of the Phase III Space Improvement Allowance,
Tenant shall pay the excess costs without reimbursement from Landlord as and
when such excess costs become due and payable. If the actual costs of the Tenant
Improvements for
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the Phase III Space plus the costs incurred in moving into the Phase III Space
are less than the Phase III Space Improvement Allowance, Landlord shall credit
up to but not more than $5.00 per square foot of the Phase III Space Improvement
Allowance against the first installments of Base Rent which are due and payable
under this Lease for the Phase III Space. Landlord's obligation to make the
Phase III Space Improvement Allowance available to Tenant shall expire (other
than in the form of a credit against Base Rent in an amount not to exceed $5.00
per square foot) with respect to any portion of the Phase III Space Improvement
Allowance that is not used by Tenant on or before March 1, 2007.
3. The Phase I & II Space Improvement Allowance and the Phase III Space
Improvement Allowance shall be treated by Landlord and Tenant as a tenant
improvement allowance and all of the leasehold improvements that are constructed
as part of the Tenant Improvements and paid for with the Phase I & II Space
Improvement Allowance and the Phase III Space Improvement Allowance shall be
owned by Landlord.
4. If Landlord fails to pay any portion of the Phase I & II Space Improvement
Allowance or the Phase III Space Improvement Allowance which is properly due and
payable, the unpaid amount shall bear interest until paid at the Interest Rate,
and if Landlord fails to pay such properly due and payable amount within ten
(10) business days after receiving written from Tenant that such amount was not
paid when due, then Tenant shall be entitled to offset said amounts (including
interest) against Rent due and payable under the Lease.
PART VIII. LANDLORD SERVICES; DELIVERIES.
1. CABLE RUNS; FLOOR REINFORCEMENT. Landlord will use reasonable efforts,
subject to the rights of other tenants of the Project, to facilitate: (i)
Tenant's placement of horizontal cable runs above the ceiling grid on floors
immediately below the lowest floor in each of the Tower and the Building
included within the Premises from time to time, and (ii) Tenant's reinforcement
of the lowest floor in each of the Tower and the Building included within the
Premises from time to time.
2. ACCESS. During the course of the Tenant Improvement Work, Landlord will also
provide, at no cost to Tenant (i) space to accommodate a trash dumpster of a
size and at a location in the loading dock area, each of which has been approved
by Landlord, which approval shall not be unreasonably withheld or delayed, and
(ii) access to Tenant's Contractor and subcontractors (and each other person
engaged by Tenant to provide design, construction, installation or move-in
services) to the Project and designated construction floors of the Premises
twenty four (24) hours a day, seven (7) days a week, subject to compliance with
standard building procedures.
3. CHARGES. Neither Tenant nor its Contractor will be charged for, and Landlord
will provide at no cost, electricity, water, toilet facilities, HVAC, loading
docks, dumpster space or freight elevators during the construction of the Tenant
Improvements. Tenant may contract on a monthly basis at Landlord's usual rates
for parking (if available) for Tenant's architects, designers, contractors and
subcontractors. Landlord will, subject to the rights of other tenants of the
Project, make other areas of the Project that are necessary for the construction
of the Tenant Improvements (such as risers and closets) available to Tenant.
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4. EXISTING DESIGN MATERIALS. Landlord has provided Tenant with a copy of its
current Project Design Manual (the "PROJECT DESIGN MANUAL") and shall provide to
Tenant copies of all existing drawings and floor plans for the Premises to the
extent available, including current wiring schematics and riser capacities for
voice and data communications.
PART IX. TIME OF THE ESSENCE.
It is stipulated that time is of the essence in connection with Tenant's
compliance with the terms of this Exhibit D.
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EXHIBIT E
RULES AND REGULATIONS OF THE PROJECT
Except as otherwise specifically provided in the Lease or any other
Exhibits thereto:
1. Tenant shall not inscribe, display, print or affix any sign, placard, banner,
picture, advertisement, name or notice on or to any part of the outside or
inside of the Building, Tower or Project without the written consent of
Landlord. Landlord shall have the right to remove any such sign, placard,
banner, picture, advertisement, name or notice, unless Landlord has given
written consent, without notice to and at the expense of Tenant. Landlord shall
not be liable in damages for any such removal.
2. All approved signs or lettering on doors and walls to the Premises shall be
printed, painted, affixed or inscribed at the expense of Tenant by a person
approved by Landlord in a manner and style acceptable to Landlord.
3. Tenant shall not use any blinds, shades, awnings, or screens in connection
with any exterior window or door of the Premises unless approved in writing by
Landlord. Tenant shall not use any drape or window covering facing any exterior
glass surface visible from outside of the Building, the Tower or the Project
other than the standard drape or window covering established by Landlord. Tenant
shall not place any bottles, parcels or other articles on the window sills.
4. The sidewalks, halls, vestibules, passages, exits, entrances, elevators,
stairways, and Common Areas of the Project shall not be used for the disposal of
trash or be obstructed by Tenant or used by Tenant for any purpose other than
for ingress to and egress from the Premises. The halls, passages, exits,
entrances, elevators, stairways, balconies and roof are not for the use of the
general public and Landlord shall in all cases retain the right to control and
prevent access thereto by all persons whose presence in the judgment of Landlord
shall be prejudicial to the safety, character, reputation and interests of the
Project and its tenants, provided that nothing herein contained shall be
construed to prevent such access to the Premises by persons with whom Tenant
normally deals in the ordinary course of Tenant's business unless such persons
are engaged in illegal activities. Tenant may not place any items on the
balconies of the Building without obtaining Landlord's prior written consent,
which may be withheld or given in Landlord's sole discretion.
5. Tenant shall not go upon the roof of the Building, the Tower or the Project.
Tenant shall not throw anything out of the doors or windows or down the
passageways. Landlord shall have the right to control and operate all Common
Areas of the Project (including, without limitation, the Parking Garage, ramps,
stairs, plazas and park) in the best interests of tenants generally.
6. Tenant, upon the termination of its tenancy, shall deliver to Landlord the
keys and access cards for any offices, rooms and toilet rooms which shall have
been furnished to Tenant or which Tenant shall have made, and in the event of
loss of any keys so furnished, shall pay Landlord therefor.
7. Tenant shall not use the toilet rooms, toilets, urinals, wash bowls, and
other plumbing fixtures and similar apparatus for any purpose other than that
for which they were constructed
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and no foreign substance of any kind whatsoever (including without limitation
any sweepings, rubbish, rags or similar materials) shall be thrown, discarded or
disposed of therein and the expense of any breakage, stoppage, or damage
resulting from the violation of this rule shall be borne by Tenant.
8. Tenant shall not overload any floor of the Premises.
9. All routine deliveries (other than by courier personnel) to Tenant's Premises
during 8:00 a.m. to 5:00 p.m. weekdays shall be made through the freight
elevators. Tenant shall not use hand trucks or vehicles (other than a wheelchair
or similar personal motorized vehicle for an individual) in passenger elevators.
Passenger elevators are to be used only for the movement of persons (including
mail clerks using push carts and courier personnel so long as they shall not
unreasonably interfere with elevator traffic), unless an exception is approved
by the Building management office. Tenant shall be solely responsible to have a
person present at the loading dock to receive all deliveries made to Tenant at
the loading dock and to deliver same from the loading dock to the Premises;
Landlord has no responsibility or liability for receiving deliveries.
10. All moving of furniture, bulky packages, cartons, supplies, large quantities
of food or beverages, merchandise, freight or equipment of any kind by Tenant
into or out of the Building, the Tower or other areas of the Project shall be
via the freight handling facilities, unless otherwise directed by Landlord, at
such time and in such manner as Landlord shall prescribe. Advance written notice
of intent to move such items must be made to the building management office. Any
hand trucks or vehicles permitted must be equipped with soft rubber tires and
side guards. Tenant is to assume all risks for (i) damage to articles moved;
(ii) injury to any persons arising from or related to such movement; or (iii)
any damage to Landlord's equipment or property. Landlord will not be liable for
any acts of any person(s) engaged in, or any damage or loss to any of said
property or person(s) resulting from any act in connection with such movement by
or on behalf of Tenant.
11. Landlord shall have the right to prescribe the weight, size and position of
heavy equipment brought into the Project and also the times and manner of moving
the same in and out of the Project. Safes or other heavy objects shall, if
considered necessary by Landlord, stand on a platform of such thickness as is
necessary to properly distribute the weight. Landlord will not be responsible
for loss of or damage to any such safe or property from any cause, and all
damage done to the Building, the Tower or other areas of the Project by moving
or maintaining any such safe or other property shall be repaired at the expense
of Tenant.
12. Tenant space that is visible from public areas must be kept neat and clean.
All freight elevator lobbies are to be kept neat and clean. Tenant shall not
employ any person or persons other than the janitor of Landlord for the purpose
of cleaning the Premises unless otherwise agreed to by Landlord. Window cleaning
shall be done only by Landlord.
13. Tenant shall not commit any nuisance, or use, keep or permit to be used or
kept any foul or noxious gas or substance in the Premises, or permit or suffer
the Premises to be occupied or used in any manner offensive or objectionable to
Landlord or other occupants of the Project by reason of noise, odors and/or
vibrations, or interfere in any way with other tenants or those having business
therein. Without limitation to the foregoing, no smoking or other use of tobacco
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products shall be allowed in any portion of the Premises or the Project, except
in the areas designated by Landlord pursuant to Section 9.4 of the Lease.
14. Tenant shall not bring or keep in or about the Premises, the Building, the
Tower or other areas of the Project any animals (other than as required for
handicapped persons), including without limitation any birds or fish, fish tanks
or aquariums. No bicycles shall be brought into or kept in or about the
Premises.
15. Neither Tenant nor any other occupant (including without limitation,
Tenant's servants, employees, agents, visitors or licensees) shall at any time
(i) use or keep in the Premises, the Building, the Tower or other areas of the
Project any gasoline or other flammable, explosive or combustible fluid,
chemical, gas or substance, except immaterial quantities of normal office
products typically found in a first-class office building, provided such
products are stored and used in areas approved by Landlord and in accordance
with all applicable building and fire codes or other laws; (ii) install any
chemical storage tanks in the Premises; or (iii) use any method of heating or
air-conditioning other than that supplied by Landlord.
16. Tenant shall not lay linoleum, tile, carpet or other similar floor covering
so that the same shall be affixed to the floor of the Premises in any manner
except as approved by Landlord. The expenses of repairing any damage resulting
from a violation of this rule or removal of any floor covering shall be borne by
Tenant.
17. Tenant will comply with all security procedures during Normal Business Hours
and after hours and on weekends. On Saturdays, Sundays and legal holidays, and
on other days between the hours of 6:00 p.m. and 7:00 a.m. the following day,
access to the Project or to the halls, corridors, elevators or stairways in the
Project, or to the Premises, may be refused unless the person seeking access (a)
is known to the person or employee of the Project in charge and has a pass or
(b) is properly identified. Any person whose presence in the Project at any time
shall, in the sole judgment of Landlord, be prejudicial to the safety,
character, reputation and interests of the Project or its tenants may be denied
access to the Project or may be ejected therefrom. Landlord may require any
person leaving the Project with any package or other object to exhibit a pass
from the tenant from whose premises the package or object is being removed, but
the establishment and enforcement of such requirement shall not impose any
responsibility on Landlord for the protection of any tenant against the removal
of property from the premises of the tenant. The Landlord shall in no case be
liable to Tenant for damages for any error with regard to the admission to or
exclusion from the Project of any person. In case of invasion, mob, riot, public
excitement, or other commotion, Landlord reserves the right to prevent access to
the Project during the continuance of the same by closing of the doors or
otherwise, for the safety of the tenants and protection of property in the
Project.
18. Tenant shall see that the exterior doors of the Premises are closed when not
in use and closed and securely locked before leaving the Project and must
observe strict care and caution that all water apparatus are entirely shut off
before Tenant or Tenant's employees leave the Project and that all electricity,
gas or air shall likewise be carefully shut off, so as to prevent waste or
damage.
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19. Additional services requested by Tenant shall be attended to only upon
application to the building manager at the office of the Project, and employees
of Landlord will not perform any work or do anything outside of their regular
duties upon such application by Tenant unless under special instructions from
Landlord.
20. Tenant shall cooperate with Landlord in obtaining maximum effectiveness of
the cooling system by closing the blinds when the sun's rays fall directly on
windows of the Premises. Tenant shall not obstruct, alter or in any way impair
the efficient operation of Landlord's heating, ventilating and air-conditioning
system and shall not place bottles, machines, parcels or other articles on any
induction unit enclosure so as to interfere with air flow. Tenant shall not
tamper with or change the setting of any thermostats or temperature control
valves. Any damage caused by tampering will be repaired at Tenant's expense.
Landlord shall adjust thermostats as required to maintain Building standard
temperature as set forth in Exhibit F.
21. Tenant shall cooperate to prevent canvassing, soliciting and peddling within
the Project.
22. The Premises shall in no event be used for manufacturing, storage (except as
such storage may be incidental to permitted uses under the Lease), cooking
(except in an employee lunchroom on cooking equipment approved by Landlord) or
sleeping, lodging or living quarters.
23. Tenant shall not conduct any auction, fire, bankruptcy, going out of
business, liquidation or similar sales.
24. Installing of wire or cabling within the Project shall follow all applicable
codes and Landlord's reasonable telecommunication rules.
25. Except as may be permitted by the Lease or as may otherwise be agreed in
writing by Landlord or Landlord's Antenna Site Manager, Tenant shall not place
any radio or television antennae on the roof of the Project or on any exterior
part of the Premises or the Project, nor shall Tenant place a microwave or
satellite dish or other transmitting device anywhere in the Premises.
26. The exterior walls of the Project shall not be punctured, penetrated or
otherwise adversely affected by wall hangings or other improvements or property
located in, on or about the Premises. No nails, hooks or screws will be inserted
in the exterior walls of the Project without the express written consent of the
Landlord.
27. Any alterations, additions or improvements to any premises in the Project
shall be of a quality at least equal to building standards per the Tenant Design
Manual for the Project in effect from time to time.
28. All contractors invited to perform work within the Project, whether at the
direction of Landlord or a Project tenant, shall be required to sign in at the
lobby courtesy desk, indicate who they will be working for, describe the scope
of services to be performed, provide an estimate of the amount of time required
to perform the services, and deposit picture identification in exchange for an
authorized contractor identification badge prior to commencing their work. Any
contractor found in the Project without an identification badge will be escorted
to the lobby courtesy desk to complete the sign-in process. No contractor will
be allowed to check out keys
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from the property management office without presenting an authorized contractor
identification badge. Prior to leaving the Project, all contractors shall be
required to sign out at the lobby courtesy desk, indicate the status of their
work, and return the authorized contractor identification badge in exchange for
their identification. Landlord reserves the right to deny access to the Project
to any contractor who does not comply with this rule.
29. Tenant shall not permit any of its partners, directors, officers, employees,
agents, contractors or invitees to carry, possess or store any firearms or other
weapons in any portion of the Project other than strictly in accordance with all
Legal Requirements.
Landlord reserves the right to rescind any of these rules and regulations and to
make such other and further rules and regulations as in its reasonable judgment
shall, from time to time, be required for the safety, protection, care and
cleanliness of the Building and/or the Project, the operation thereof, the
preservation of good order therein and the protection and comfort of the tenants
and their agents, employees and invitees. Such rules and regulations, when made
and written notice thereof is given to a tenant, shall be binding upon it in
like manner as if originally herein prescribed.
For purposes of these rules and regulations, the term "TENANT" shall include
Tenant and Tenant's employees, agents, licensees, visitors and invitees.
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EXHIBIT F
AIR CONDITIONING AND HEATING SERVICES
Subject to the provisions of Section 14, Landlord will furnish
building standard air conditioning and central heating during Normal Business
Hours. Upon request of Tenant made in accordance with the rules and regulations
for the Building, Landlord will furnish air conditioning and heating at other
times (that is, at times other than during Normal Business Hours) in which event
Tenant shall reimburse Landlord for furnishing such services to the Premises
based upon an hourly rate, as adjusted from time to time, reflecting the cost to
Landlord (which cost may include, but not be limited to, overhead expenses) for
providing said after hours services.
The Building standard heating, ventilating and air conditioning
system shall meet the following design conditions, at the stated outside design
conditions, based on one person per 100 square feet of Usable Area:
1. Summer - Outdoor conditions 92 degrees Fahrenheit dry bulb, 75
degrees Fahrenheit wet bulb; indoor conditions 78 degrees Fahrenheit dry bulb
(per Minneapolis energy code), 50% relative humidity at design condition.
2. Winter - Outdoor conditions minus 16 degrees Fahrenheit dry bulb;
indoor conditions 72 degrees Fahrenheit dry bulb (per Minneapolis energy code).
The following dates shall constitute "HOLIDAYS" as said term is used
in this Lease:
(1) New Year's Day
(2) Memorial Day
(3) Independence Day
(4) Labor Day
(5) Thanksgiving Day
(6) Christmas
(7) Any other holiday recognized and taken by tenants occupying at
least one-half (-1/2) of the net Rentable Area of office space in the Project.
If in the case of any Holiday described in (1) through (6) above, a different
day shall be observed than the respective day above-described, then that day
which constitutes the day observed by national banks in Minneapolis, Minnesota,
on account of such Holiday shall constitute the Holiday under this Lease.
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EXHIBIT G
EXTENSION OPTION
1. Subject to the provisions of this Exhibit G, Tenant is hereby granted the
option to extend the Term of this Lease (the "EXTENSION OPTIONS") as to all (but
not part) of the Premises for two (2) periods of five (5) years each (the
"EXTENSION TERMS"); except that the term of the First Extension Term may be less
than five (5) years if the Initial Scheduled Term of this Lease is extended (a)
as provided in Section 2 of Exhibit I-1 to the Lease (providing for extension
under certain circumstances if Tenant exercises an Expansion Option during the
Initial Scheduled Term), or (b) as provided in Section 5 of Exhibit J to the
Lease (providing for extension under certain circumstances if Tenant exercises a
Right of Offer during the Initial Scheduled Term).
2. Each Extension Term shall commence at the expiration of the then present Term
of the Lease.
3. Not earlier than eighteen (18) months and not later than fifteen (15) months
prior to the expiration of the First Extension Term, Landlord shall notify
Tenant in writing as to Landlord's reasonable estimate of the Market Base Rental
Rate for the Premises during the Second Extension Term (the "EXTENSION TERM RATE
NOTICE").
4. If Tenant desires to exercise an Extension Option, Tenant must give Landlord
written notice of such exercise ("TENANT'S EXERCISE NOTICE")
(a) in the case of the First Extension Option, no earlier than
fifteen (15) months prior to the expiration of the Initial Extended Term,
and no later than the later of (i) twelve (12) months prior to the
expiration of the Initial Extended Term, and (ii) thirty (30) days after
written notice from Landlord inquiring whether Tenant intends to exercise
the Extension Option for the First Extension Term, which notice may be
given by Landlord no earlier than sixteen (16) months prior to the
expiration of the Initial Extended Term; and
(b) in the case of the Second Extension Term, no later than the
later of (i) fifteen (15) months prior to the expiration of the First
Extension Term, and (ii) thirty (30) days after Tenant's receipt of the
Extension Term Rate Notice described in Section 3 of this Exhibit G. Any
Tenant's Exercise Notice given with respect to the Second Extension Term
shall be subject to rescission as provided in Section 11 of this Exhibit
G.
Time is of the essence and timely notice is an express condition of valid
exercise of the Extension Option.
5. The extension of this Lease pursuant to the exercise of the First Extension
Option shall be upon the same terms and conditions of this Lease (including,
without limitation, Tenant's obligation to pay Tenant's Additional Rent),
except:
(a) the monthly Base Rent for the Premises (except for any Available
Space that is added to the Premises after the Initial Scheduled Term, the
Base Rent for which shall be established pursuant to the Right of Offer)
during the First Extension Term (and for
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any extension of the Initial Scheduled Term as provided in Section 2 of
Exhibit I-1 to the Lease or Section 5 of Exhibit J to the Lease) shall be
equal one-twelfth of the product of:
(i) Eleven and 25/100 Dollars ($11.25) times the number of
square feet of Rentable Area of the Premises for the
period beginning on November 1, 2010, and ending on
October 31, 2011;
(ii) Eleven and 50/100 Dollars ($11.50) times the number of
square feet of Rentable Area of the Premises for the
period beginning on November 1, 2011, and ending on
October 31, 2012;
(iii) Twelve and 25/100 Dollars ($12.25) times the number of
square feet of Rentable Area of the Premises for the
period beginning on November 1, 2012, and ending on
October 31, 2013;
(iv) Twelve and 50/100 Dollars ($12.50) times the number of
square feet of Rentable Area of the Premises for the
period beginning on November 1, 2013, and ending on
October 31, 2014;
(v) Twelve and 75/100 Dollars ($12.75) times the number of
square feet of Rentable Area of the Premises for the
period beginning on November 1, 2014, and ending on
October 31, 2015; and
(b) Tenant shall not be entitled to any construction, buildout or
other allowances with respect to the Premises during the First Extension
Term.
6. The renewal of this Lease pursuant to the exercise of the Second Extension
Option shall be upon the same terms and conditions of this Lease (including,
without limitation, Tenant's obligation to pay Tenant's Additional Rent),
except:
(a) the Base Rent for the Premises during the Second Extension Term
shall be equal to ninety percent (90%) of the Market Base Rental Rate for
the Second Extension Term as of the commencement of the Second Extension
Term;
(b) Tenant shall have no option to renew this Lease beyond the
Second Extension Term provided for herein;
(c) the leasehold improvements will be provided in their
then-existing condition (on an "as is" basis) at the time the Second
Renewal Term commences, except that Landlord shall make an allowance
available to Tenant for refurbishment of the Premises in an amount of up
to Five Dollars ($5.00) per square foot of the Rentable Area of the
Premises as of the date on which the Second Extension Term commences (the
"SECOND EXTENSION TERM ALLOWANCE"). For so long as Tenant is not in
default under this Lease, Landlord shall pay the Second Extension Term
Allowance on a monthly basis all in accordance with customary construction
disbursement procedures and upon receipt of a sworn construction statement
and draw request, with supporting lien waivers from all material
contractors and subcontractors delivered one month in arrears. Landlord
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shall be permitted to offset against the Second Extension Term Allowance
any amounts past due to Landlord by Tenant under this Lease;
(d)The Second Extension Term Improvement Allowance shall be treated
by Landlord and Tenant as a tenant improvement allowance and all of the
leasehold improvements that are constructed and paid for with the Second
Extension Term Improvement Allowance shall be owned by Landlord; and
(e)If Landlord fails to pay any portion of the Second Extension Term
Improvement Allowance which is properly due and payable, the unpaid amount
shall bear interest until paid at the Interest Rate, and if Landlord fails
to pay such properly due and payable amount within ten (10) business days
after receiving written notice from Tenant that such amount was not paid
when due, then Tenant shall be entitled to offset said amounts (including
interest) against Rent due and payable under the Lease.
7. Tenant shall have no right to exercise the Extension Option if Capella
Education Company has assigned this Lease other than in connection with a
Permitted Transfer (as defined in Section 10.7 of the Lease) or subleased more
than twenty percent (20%) of the Rentable Area of the Premises other than in
connection with a Permitted Transfer.
8. If Tenant fails to duly and timely exercise the First Extension Option,
Tenant's Extension Option for the Second Extension Term shall thereupon
automatically terminate and expire.
9. Tenant shall not have the right to exercise a Extension Option if an Event of
Default exists under this Lease on the date Tenant's notice is sent under
Section 3 above, and if, at any time thereafter until the commencement of the
Extension Term, an Event of Default exists under this Lease, Landlord shall, in
addition to any other rights which Landlord may have under this Lease, have the
right to terminate this Lease effective as of the scheduled expiration date of
the then current Term of this Lease and prior to the commencement of the
Extension Term.
10. For the purpose of this Exhibit G, the term "MARKET BASE RENTAL RATE" shall
mean the amount of cash which a landlord would receive annually by then renting
the space in question assuming the landlord to be a prudent person willing to
lease but being under no compulsion to do so, assuming the tenant to be a
prudent person willing to lease but being under no compulsion to do so, and
assuming a lease containing the same terms and provisions as those herein
contained. Market Base Rental Rate shall take into consideration all relevant
factors including the condition of the space and the Second Extension Term
Allowance.
11. During the sixty (60) day period (the "Negotiation Period") commencing on
the later of (i) the date that is fifteen (15) months prior to the expiration of
the First Extension Term, or (ii) the date of Landlord's delivery to Tenant of
the Extension Term Rate Notice, Landlord and Tenant shall each be available to
meet with the other on a regular basis to determine whether they can agree on
the Market Base Rental Rate for the Premises for the Second Extension Term. If
they fail to reach agreement, Tenant may, by written notice to Landlord given at
any time prior to the date that is twenty (20) days after the last day of the
Negotiation Period (a) elect to rescind any Tenant's Exercise Notice theretofore
given by Tenant with respect to the Second Extension Term, in which case the
rights of Landlord and Tenant under the Lease shall continue just as
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though Tenant's Exercise Notice had never been given for the Second Extension
Term, and the Term of the Lease shall expire at the end of the First Extension
Term; or (b) elect to have the Market Base Rental Rate for the Second Extension
Term determined by arbitration in accordance with this Exhibit G; if within said
20-day period Tenant does not in writing elect option (b), Tenant will be
conclusively deemed to have elected option (a).
12. If Tenant and Landlord cannot agree to the Market Base Rental Rate for the
Second Extension Term (it being agreed that both Landlord and Tenant will be
reasonable in their attempt to determine the Market Base Rental Rate), and if
such rate is to be determined by arbitration in accordance with this Exhibit G,
the following procedures shall apply:
The determination of the Market Base Rental Rate will be determined
by an arbitration board consisting of three reputable real estate professionals
with experience with first-class office buildings in the Minneapolis-St. Paul
metropolitan area, each of whom shall be a Member of the Appraisal Institute
with the designation of "MAI." Within twenty (20) days after initiation of
arbitration, each party shall appoint one arbitrator who shall have no material
financial or business interest in common with the party making the selection and
shall not have been employed by such party for a period of three years prior to
the date of selection. If a party fails to give notice of appointment of its
arbitrator within the 20-day period provided above, then upon two (2) business
days notice the other party may appoint the second arbitrator. The arbitrators
selected by the parties shall attempt to agree upon a third arbitrator. If the
first two arbitrators are unable to agree on a third arbitrator within thirty
(30) days after the appointment of the second arbitrator, then such third
arbitrator shall be appointed by the presiding judge of the Hennepin County
District Court, or by any person to whom such presiding judge formally delegates
the matter or, if such methods of appointment fail, by the American Arbitration
Association. The parties will submit to the arbitrators the definition of the
Market Base Rental Rate, each party will be entitled to present to the
arbitrators evidence concerning the Market Base Rental Rate at a hearing
scheduled not earlier than thirty (30) and not later than sixty (60) days after
the final arbitrator has been selected, and each arbitrator shall submit his or
her determination in a sealed envelope by the 20th day following the date of
such hearing, and any determination not submitted by such time shall be
disregarded. The parties shall meet on said 20th day (or if it is not a business
day, on the first business day thereafter) at 11:00 a.m. at the office of
Landlord, or such other place as the parties may agree and simultaneously
deliver the determinations. If the determinations of at least two of the
arbitrators shall be identical in amount such amount shall be deemed the Market
Base Rental Rate. If the determination of the three arbitrators shall be
different in amount, the Market Base Rental Rate shall be determined as follows:
(a)If neither the highest or lowest determination differs from the
middle determination by more than ten percent (10%) of such middle
determination, then the Market Base Rental Rate shall be deemed to be the
average of the three determinations; and
(b)If clause (a) does not apply, then the Market Base Rental Rate
shall be deemed to be the average of the middle determination and the
determination closest in amount to such middle determination.
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The decision of the arbitrators, determined as above set
forth, will be final and non-appealable. Except where specifically provided
otherwise in this Lease, each party shall bear its own expenses in connection
with the arbitration and the costs of its arbitrator, and the cost of the third
arbitrator shall be shared equally by Landlord and Tenant. The costs of all
counsel, experts and other representatives that are retained by a party will be
paid by such party.
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EXHIBIT H
PARKING
1. Commencing as of the Phase I & II Rent Commencement Date and continuing
thereafter throughout the Term, Landlord agrees to make available to Tenant and
Tenant shall have the right to use up to eighty (80) parking contracts ("PARKING
CONTRACTS") for unreserved parking in the general parking area of the parking
facility in the Project (the "PARKING GARAGE"), but only if Tenant gives written
notice to Landlord at least sixty (60) days prior to the Phase I & II Rent
Commencement Date that Tenant desires to use Parking Contracts and the number of
such Parking Contracts which Tenant desires to use. Notwithstanding the
foregoing, if Tenant (a) exercises its Contraction Option (as defined in Section
5.3 of the Lease), the number of Parking Contracts which Landlord is obligated
to make available to Tenant shall be reduced (as of the Contraction Date) by one
Parking Contract for each 2,500 square feet of the Rentable Area of the
Contraction Space effective as of the Contraction Date, or (b) exercises an
Expansion Option (as defined in Exhibit I-1) or acquires space pursuant to its
Right of Offer (as defined in Exhibit J), the number of Parking Contracts which
Landlord is obligated to make available to Tenant shall be increased by one
Parking Contract for each 2500 square feet of Rentable Area which is thereby
added to the Premises. If at any time Tenant is using less than the maximum
number of Parking Contracts to which it is entitled under this Exhibit G, Tenant
may thereafter obtain, upon sixty (60) days' prior notice, additional Parking
Contracts (up to the maximum number to which Tenant is entitled), but only to
the extent that contracts are available as determined by Landlord on a "first
come first served basis"; provided that in determining whether Parking Contracts
are available for use by Tenant, Landlord shall terminate any short term Parking
Contracts which are then being used by parties who are not affiliated with a
tenant of the Project. Tenant may from time to time on not less than sixty (60)
days written notice to Landlord reduce the number of Parking Contracts that it
desires to use, except that in any six (6) month period Tenant may not reduce by
more than twenty (20) the number of Parking Contracts that it desires to use.
2. Tenant shall pay as rent for each of the Parking Contracts (i) ninety percent
(90%) of the then-current market rate as charged from time to time by Landlord,
plus any applicable tax, during the Initial Scheduled Term (as the same may be
extended pursuant to Exhibit I-1 or Exhibit J) and during the First Extension
Term, and (ii) one hundred percent (100%) of the then-current market rate as
charged from time to time by Landlord, plus any applicable tax, during the
Second Extension Term. The use of the Parking Contracts shall be subject to such
terms and conditions as are generally imposed from time to time by the operator
of the Parking Garage. Tenant shall pay such rent to Landlord in a single
monthly payment for all of the Parking Contracts on the first day of each
calendar month during the Term of the Lease, and the failure of Tenant to timely
pay the same shall constitute an Event of Default under the Lease.
3. Tenant waives any claims for damage, theft or other loss, however caused, to
vehicles using Parking Contracts hereunder, it being agreed that any user of any
Parking Contract shall look exclusively to the vehicle's insurance in the event
of such loss. Landlord may require each user to sign such a waiver agreement as
a condition to use of a Parking Contract.
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4. Tenant may permit use of its Parking Contracts only by Tenant, Tenant's
officers, employees, partners, guests and visitors, or by a permitted assignee
or subtenant of the Premises or its officers, employees, partners, guests and
visitors.
5. Landlord may from time to time establish reasonable rules for the safe and
efficient operation of the Parking Garage, and Tenant shall cause all users of
the Parking Contracts to comply with such rules.
6. During the continuance of an Event of Default (as defined in Section 20.1 of
the Lease), Landlord may at its option terminate all rights with respect to the
Parking Contracts.
7. In the event of any misuse of any of the Parking Contracts by any individual
user thereof or upon Tenant's failure to pay rental for any Parking Contract
within five (5) days after receiving written notice of such failure from
Landlord, Landlord shall have the right to suspend all rights of such user with
respect to such Parking Contract without affecting or limiting any of Tenant's
or such user's obligations with respect thereto, including, but not limited to,
the payment of the rent applicable to any such Parking Contract, or Landlord
shall have the right to terminate such Parking Contract by delivering written
notice of such termination to Tenant.
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EXHIBIT I-1
EXPANSION OPTIONS
1. Subject to the terms and conditions set forth in this Exhibit I-1,
Landlord hereby grants Tenant the options (individually, an "EXPANSION OPTION"
and collectively, the "EXPANSION OPTIONS") to add the following expansion spaces
(each an "EXPANSION SPACE") to the Premises:
(a)"FIRST EXPANSION OPTION" shall mean the entire Rentable Area on
either one or two full floors (as determined by Tenant) in the Tower or
the Building (as determined by Landlord), which floors shall be contiguous
to the Premises (after giving effect to the First Expansion Option) and
selected by Landlord if available for lease to Tenant as determined by
Landlord and if a contiguous floor is not available for lease to Tenant,
then such floor or floors shall be selected by Landlord from the floors
identified on the stacking plan which is attached to this Exhibit I-1 as
Exhibit I-2; with possession of the First Expansion Space being delivered
to Tenant on February 1, 2007, plus or minus six (6) months (with the
exact date being specified in the Landlord's Expansion Notice that will be
delivered to Tenant in accordance with Section 3 of this Exhibit I-1);
provided that if all or any part of the 5th floor in the Tower and/or the
4th floor of the Tower is added to the Premises pursuant to Tenant's
exercise of a Right of Offer or otherwise, then Landlord's obligation to
deliver Expansion Space pursuant to the First Expansion Option shall be
reduced by the amount of space on the 5th floor and/or the 4th floor so
added to the Premises; and
(b)"SECOND EXPANSION OPTION" shall mean the entire Rentable Area on
either one or two full floors (as determined by Tenant) in the Tower or
the Building (as determined by Landlord), which floors shall be contiguous
to the Premises (after giving effect to the Second Expansion Option) and
selected by Landlord if available for lease to Tenant as determined by
Landlord and if a contiguous floor is not available for lease to Tenant,
then such floor or floors shall be selected by Landlord from the floors
identified on the stacking plan which is attached to this Exhibit I-1 as
Exhibit I-2; with possession of the Second Expansion Space being delivered
to Tenant on February 1, 2008, plus or minus six (6) months (with the
exact date being specified in the Landlord's Expansion Notice that will be
delivered to Tenant in accordance with Section 3 of this Exhibit I-1).
2. Notwithstanding anything to the contrary in this Lease, if there would
be less than five years remaining on the Lease Term as of an Expansion Space
Rent Commencement Date (as defined below): (a) the Term of this Lease shall be
automatically extended by virtue of Tenant's exercise of the Expansion Option so
that the then current Term of this Lease for all of the Premises shall expire on
the day prior to the fifth anniversary of the applicable Expansion Space Rent
Commencement Date, and (b) the Base Rent for the Premises during the period
beginning on the day after the last day of the Initial Scheduled Term and ending
on the last day of the Initial Extended Term shall be in the amounts, and with
the adjustments specified in, Section 4 of Exhibit G to this Lease.
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3. Not earlier than sixteen (16) months and not later than thirteen (13)
months prior to the earliest date on which Landlord is entitled to deliver
possession of the applicable Expansion Space to Tenant, Landlord shall give
Tenant written notice ("LANDLORD'S EXPANSION NOTICE") of (i) the floor or floors
on which such Expansion Space will be located, and (ii) the date Landlord will
deliver all of such Expansion Space to Tenant if Tenant exercises such Expansion
Option.
4. Tenant must exercise each Expansion Option, if at all, by delivering
written notice of Tenant's exercise of the Expansion Option ("TENANT'S EXPANSION
NOTICE") not later than the later of (i) twelve (12) months prior to the
earliest date on which Landlord is entitled to deliver possession of the
applicable Expansion Space to Tenant, and (ii) thirty (30) days after the date
on which Landlord provides Tenant with Landlord's Expansion Notice, time being
of the essence and timely notice being an express and agreed condition of such
exercise. Failure by Tenant to give timely notice of its exercise of either
Expansion Option shall constitute Tenant's decision not to exercise the
applicable Expansion Option, which shall thereupon automatically terminate.
Tenant's Expansion Notice shall identify whether Tenant desires to add one or
two full floors to the Premises.
5. Each Expansion Space shall be added to the Premises and leased to
Tenant upon the same terms and conditions of this Lease (including, without
limitation, Tenant's obligation to pay Additional Rent), except:
(a) Tenant shall not be obligated to pay any Base Rent or Additional
Rent for the Expansion Space until the earlier of (i) the date which is
sixty (60) days after the date on which possession of the Expansion Space
is delivered to Tenant, and (ii) the date on which Tenant takes occupancy
of any portion of the applicable Expansion Space for the conduct of its
business (the "EXPANSION SPACE RENT COMMENCEMENT Date"); provided that
from and after the date on which possession of the Expansion Space is
delivered to Tenant, the Expansion Space shall be part of the Premises for
all purposes of this Lease other than Tenant's obligation to pay Base Rent
and Additional Rent and Tenant shall be bound by and shall comply with all
of the provisions of this Lease (including those terms and conditions
pertaining to acts or omissions of Tenant or Tenant's representatives,
employees, agents, and contractors);
(b) the Base Rent for each Expansion Space shall be the same as the
Base Rent as Tenant is obligated to pay from time to time for the Initial
Premises;
(c) Tenant shall accept each Expansion Space in its "as is"
condition on the date that possession of the Expansion Space is delivered
to Tenant; except that the Expansion Space shall be delivered in
accordance with the Space Delivery Standards, and except that Landlord
shall make an allowance available to Tenant in an amount of up to Thirty
Dollars ($30.00) per square foot of the Rentable Area of the Expansion
Space to pay for those costs which are incurred by Tenant in designing and
constructing those leasehold improvements which Tenant desires to make to
the Expansion Space (the "EXPANSION SPACE IMPROVEMENT ALLOWANCE"). For so
long as Tenant is not in default under this Lease, Landlord shall pay each
Expansion Space Improvement Allowance on a monthly basis in accordance
with customary construction disbursement procedures and upon
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receipt of a sworn construction statement and draw request, with
supporting lien waivers from all material contractors and subcontractors
delivered one month in arrears. Landlord shall be permitted to offset
against each Expansion Space Improvement Allowance any amounts past due to
Landlord by Tenant under this Lease. If the actual cost of designing and
constructing improvements to the Expansion Space plus the cost of moving
into the Expansion Space shall be less than the Expansion Space
Improvement Allowance, Landlord shall credit up to but not more than $5.00
per square foot of the Expansion Space Improvement Allowance against the
Rent next coming due under the Lease;
(d) The term of this Lease shall expire for the Expansion Space upon
the expiration of the Lease Term or Extension Term for the balance of the
Premises;
(e) Each Expansion Space Improvement Allowance shall be treated by
Landlord and Tenant as a tenant improvement allowance and all of the
leasehold improvements that are constructed and paid for with an Expansion
Space Improvement Allowance shall be owned by Landlord;
(f) If Landlord fails to pay any portion of an Expansion Space
Improvement Allowance which is properly due and payable, the unpaid amount
shall bear interest until paid at the Interest Rate, and if Landlord fails
to pay such properly due and payable amount within ten (10) business days
after receiving written from Tenant that such amount was not paid when
due, then Tenant shall be entitled to offset said amounts (including
interest) against Rent due and payable under the Lease.
6. Tenant shall have no right to exercise an Expansion Option if Capella
Education Company has exercised the Contraction Option (as defined in Section
5.3 of the Lease) or if Capella Education Company has assigned this Lease other
than in connection with a Permitted Transfer (as defined in Section 10.7 of the
Lease) or if Capella Education Company has subleased more than twenty percent
(20%) of the Rentable Area of the Premises other than in connection with a
Permitted Transfer.
7. Tenant shall have no right to exercise an Expansion Option if on the
date Tenant delivers a Tenant's Expansion Notice an Event of Default exists
under this Lease and, if at any time after Tenant exercises an Expansion Option
until the date on which Landlord is scheduled to deliver possession of the
Expansion Space to Tenant, an Event of Default exists under this Lease, Landlord
shall, in addition to any other rights which Landlord may have under this Lease,
have the right to terminate Tenant's right to lease the Expansion Space by
giving Tenant written notice of such termination.
8. Landlord shall promptly after any Expansion Space Rental Commencement
Date prepare a declaration confirming the Expansion Space Rental Commencement
Date and the Rentable Area of the Expansion Space and deliver such declaration
to Tenant. If such declaration is complete and correct, Tenant shall execute and
return such declaration within thirty (30) days after submission, failing which,
Tenant shall be conclusively deemed to have agreed that the information in the
declaration is accurate and Tenant shall have thereby waived
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any right to object to the accuracy of such information unless within such
thirty (30) day period Tenant notifies Landlord of its reasons for objecting to
the declaration.
9. Landlord shall not be liable for any delay in delivering or any failure
to deliver possession of any Expansion Space to Tenant by reason of any holding
over by any previous tenants or occupants of same, nor shall such failure impair
the validity of the Lease. Landlord shall, however, use all reasonable efforts
to deliver possession of any Expansion Space in accordance with the provisions
of this Exhibit I-1.
10. Subject to the provisions in Section 1(a) of this Exhibit I-1,
Tenant's Expansion Options shall be independent of Tenant's Right of Offer and
no failure by Tenant to exercise its Right of Offer with respect to any
Available Space shall affect either Expansion Option.
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EXHIBIT J
RIGHT OF OFFER
1. Tenant shall have the continuous right ("RIGHT OF OFFER") during the Term of
this Lease to elect to lease any Available Space which is located on a floor
which is then contiguous to a floor of the Premises (other than 15th floor of
the Tower) on and subject to the terms and conditions set forth in this Exhibit
J. In addition, Tenant shall have a one time Right of Offer to lease the 3rd and
4th floors of the Building (the "3RD AND 4TH FLOOR SPACE") if the current tenant
occupying such floors in the Building does not exercise its existing renewal
right.
2. "AVAILABLE SPACE" means space described in Section 1 of this Exhibit J upon
the expiration of the rights of existing tenants to such space. As of the
Effective Date, Landlord represents to Tenant that, as to the following floors
which are now or which later may constitute Available Space, the only rights of
existing tenants are as follows: (i) as to the 10th and 11th floors of the Tower
and the 5th, 6th and 10th floors of the Building, all rights of American Express
Financial Corporation to such space under its current lease, which lease is
currently scheduled to expire on June 30, 2008; (ii) as to the 3rd and 4th Floor
Space, all rights of International Business Machines Corporation under its
current lease, which lease is currently scheduled to expire on December 31, 2006
(subject to a right to extend for a five-year period ending December 31, 2011);
(iii) as to the 5th floor of the Tower, there are no currently existing rights;
and (iv) as to the 4th floor of the Tower, all rights of ePredix under its
current lease, which lease is currently scheduled to expire on July 31, 2005
(subject to a right to extend for a two-year period ending July 31, 2007).
Tenant's Right of Offer is subject to (a) the existing rights in favor of other
tenants specified in this Section 2, (b) any rights hereafter granted by
Landlord with respect to space on any floor that is not contiguous to the
Premises at the time such rights are granted by Landlord, and (c) any rights
granted by Landlord with respect to space on any floor that is contiguous to the
Premises which Landlord has offered to Tenant pursuant to this Exhibit J but as
to which Tenant has not exercised its Right of Offer hereunder. The date
following the expiration of all of such rights to lease any such space shall be
deemed to be the date on which such space becomes available for lease pursuant
to this Exhibit J.
3. Landlord shall use reasonable efforts to give notice to Tenant as and when
Landlord anticipates that any Available Space will become available; provided
that Landlord shall notify Tenant prior to July 31, 2005, if the 3rd and 4th
Floor Space will become available for lease by Tenant. Landlord shall state in
each notice (an "AVAILABLE SPACE NOTICE") hereunder (i) the space available,
(ii) the date Landlord anticipates that such space will be available for
delivery, (iii) the term that the Available Space is available for lease by
Tenant (if less than for all of the remaining Lease Term), and (iv) with respect
to any Available Space which would be added to the Premises after the expiration
of the Initial Scheduled Term, Landlord's reasonable estimate of the Market Base
Rental Rate with respect to such space. Landlord shall not give Tenant an
Available Space Notice (i) more than eighteen (18) months prior to the date on
which Landlord anticipates that such space shall become available with respect
to the space currently under lease to American Express Financial Corporation, or
(ii) more than eighteen (18) months prior to the date on which Landlord
anticipates that any other space not currently leased to American Express
Financial Corporation shall become available with respect to the space unless
prior thereto Landlord has in good faith entered into substantive discussions
with respect to leasing all
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or a significant portion of such space with a specific third party. If an
Available Space Notice from Landlord identifies Available Space on more than one
(1) floor or two (2) or more non-contiguous spaces on the same floor, Tenant may
exercise its Right of Offer as to all of such spaces or on a floor-by-floor
basis (when the Available Space is on more than one floor) and on a
space-by-space basis (when the Available Space includes non-contiguous spaces on
the same floor).
4. Tenant may elect to lease all (but, except as provided in Section 3 above,
not less than all) of any individual Available Space by giving Landlord written
notice of such election on or before the date that is thirty (30) days after
Tenant's receipt of the Available Space Notice given by Landlord with respect to
such Available Space, which notice from Tenant shall specify the Available Space
which Tenant desires to lease (if Tenant is entitled to lease less than all of
such Available Space under Section 3 above) and whether Tenant accepts
Landlord's reasonable estimate of the Market Base Rental Rate for such Available
Space. If Tenant fails to respond within the time required, Tenant's rights
under this Exhibit J with respect to such space shall automatically terminate,
and Tenant shall have no further right under this Exhibit J to lease such space
unless Landlord leases such space and such lease expires or is terminated;
provided, however, if at any time Landlord offers, and Tenant declines to take,
any Available Space, and within six (6) months after the latest date that Tenant
could have elected to lease such Available Space pursuant to this Right of Offer
Landlord wishes to make such space available to a third party on economic terms
more favorable (determined in accordance with Landlord's customary method of
calculating the net effective rent in lease transactions) than those contained
in Landlord's initial Available Space Notice, Landlord will by written notice
re-offer such space to Tenant a second time in accordance with this Exhibit J.
If Landlord re-offers any Available Space to Tenant, then Tenant shall have 15
(instead of 30) days in which to give Landlord written notice of Tenant's
election to lease such Available Space; if Tenant fails to respond to Landlord's
re-offer of such space within said 15 day period, Tenant's rights under this
Exhibit J with respect to such space shall automatically terminate, and Tenant
shall have no further right under this Exhibit J to lease such space unless
Landlord leases such space and such Lease expires or is terminated.
5. Notwithstanding anything to the contrary in this Lease, if Tenant is
exercising a Right of Offer during the Initial Scheduled Term and there would be
less than five (5) years remaining on the Lease Term as of the applicable
Available Space Rent Commencement Date (as defined below): (a) the Term of this
Lease shall be automatically extended by virtue of Tenant's exercise of the
Right of Offer for all of the Premises so that the then current Term of this
Lease shall expire on the day prior to the fifth anniversary of the applicable
Available Space Rent Commencement Date, and (b) the Base Rent for the Premises
during the period beginning on the day after the last day of the Initial
Scheduled Term and ending on the last day of the Initial Extended Term shall be
in the amounts, and with the adjustments specified in Section 4 of Exhibit G to
this Lease. Tenant may not elect to lease any Available Space under this Exhibit
J during the last year of the First Extension Term, unless Tenant has then
exercised the Extension Option for the Second Extension Term, or during the last
year of the Second Extension Term. For purposes of this Exhibit J, Available
Space shall be deemed to have been "ADDED TO THE PREMISES" on the Available
Space Rent Commencement Date.
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6. Any space for which Tenant elects to exercise its Right of Offer under this
Exhibit J shall become part of the Premises, and except to the extent expressly
provided to the contrary in this Exhibit J (including without limitation, this
Section 6), shall be subject to the terms of this Lease applicable thereto,
without modification, and the Term of this Lease shall commence for such
Available Space on the earlier of (i) sixty (60) days after the date such space
is delivered to Tenant in an "as is" broom clean condition, and (ii) the date on
which Tenant takes occupancy of any portion of the Available Space for the
conduct of its business (the "AVAILABLE SPACE RENT COMMENCEMENT DATE"); provided
that from and after the date on which possession of the Available Space is
delivered to Tenant, the Available Space shall be part of the Premises for all
purposes of this Lease other than Tenant's obligation to pay Base Rent and
Additional Rent and Tenant shall be bound by and shall comply with all of the
provisions of this Lease (including those terms and conditions pertaining to
acts or omissions of Tenant or Tenant's representatives, employees, agents, and
contractors).
7. The Base Rent for any Available Space (the "AVAILABLE SPACE RENT") which is
added to the Premises (i) during the Initial Scheduled Term shall be the same as
the Base Rent which is payable from time to time for the Initial Premises, and
(ii) for any Available Space which is added to the Premises after the Initial
Scheduled Term shall (unless Tenant accepts Landlord's reasonable estimate of
the Market Base Rental Rate for such space, as set forth in the applicable
Available Space Notice) be computed at the Market Base Rental Rate determined by
arbitration in accordance with this Exhibit J.
8. The Market Base Rental Rate for any Available Space that is added to the
Premises after the Initial Scheduled Term shall be determined as of the
applicable Available Space Rent Commencement Date. Tenant shall also be
obligated to pay Additional Rent for any Available Space. As provided in Section
3 (and, for re-offered space, Section 4) above, Landlord shall give Tenant
notice of Landlord's reasonable estimate of the Market Base Rental Rate for any
Available Space that will be added to the Premises after the Initial Scheduled
Term. If Tenant does not accept Landlord's reasonable estimate, and if Landlord
and Tenant cannot agree upon the determination of the Market Base Rental Rate
within thirty (30) days after Landlord's Available Space Notice is given, and if
Tenant nonetheless timely exercises its Right of Offer for the Available Space,
the determination of the Market Base Rental Rate will be submitted to
arbitration in accordance with this Exhibit J. If the arbitration has not been
completed on the applicable Available Space Rent Commencement Date, Tenant will
pay, in monthly installments (and in addition to and not in lieu of the Rent due
with respect to the Premises [exclusive of such Available Space]), one-twelfth
of Landlord's reasonable determination of the Available Space Rent, plus
Additional Rent for such Available Space. Upon determination of the Market Base
Rental Rate by arbitration, Landlord shall pay to Tenant or Tenant shall pay to
Landlord, as appropriate, the amount equal to the overpayment or underpayment of
the Available Space Rent from the applicable Available Space Rent Commencement
Date until the determination of the Market Base Rental Rate by arbitration,
together with interest accrued thereon during such period at a rate of interest
equal to the Interest Rate. Commencing as of the later of the determination of
such Market Base Rental Rate or the applicable Available Space Rent Commencement
Date, and on the first day of each and every month thereafter, Tenant shall pay
to Landlord in addition to the Rent then in effect with respect to the Premises
(exclusive of such Available Space), an amount equal to one-twelfth (1/12th) of
the per annum Available Space Rent, plus Additional Rent with respect to such
Available Space.
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9. The term of this Lease for all Available Space shall expire upon the
expiration of the Term for the balance of the Premises, unless, as specified in
Landlord's notice, such space is not available to be leased to Tenant through
the expiration of the Term for the balance of the Premises (in which event such
shorter term specified in the Landlord's notice shall apply to any such
Available Space).
10. Tenant shall accept any Available Space or permitted portion thereof in its
"as is" condition as of the applicable Available Space Rent Commencement Date
and Tenant shall not be entitled to any construction, build-out or other
allowances with respect to the Available Space, unless Landlord agrees, in
Landlord's sole discretion, to make an improvement allowance available to
Tenant; except that the Available Space shall be delivered in accordance with
the Space Delivery Standards, and except that if the Available Space will be
added to the Premises during the Initial Scheduled Term, then, in such case
only, Landlord shall make an allowance available to Tenant in an amount of up to
Thirty Dollars ($30.00) per square foot of the Rentable Area of the Available
Space to pay for those costs which are incurred by Tenant in designing and
constructing those leasehold improvements which Tenant desires to make to the
Available Space (the "AVAILABLE SPACE IMPROVEMENT ALLOWANCE"). For so long as
Tenant is not in default under this Lease, Landlord shall pay any Available
Space Improvement Allowance on a monthly basis in accordance with customary
construction disbursement procedures and upon receipt of a sworn construction
statement and draw request, with supporting lien waivers from all material
contractors and subcontractors delivered one month in arrears. Landlord shall be
permitted to offset against any Available Space Improvement Allowance any
amounts past due to Landlord by Tenant under this Lease. If the actual cost of
designing and constructing improvements to the Available Space plus the cost of
moving into the Available Space shall be less than the Available Space
Improvement Allowance, Landlord shall credit up to but not more than $5.00 per
square foot of the Available Space Improvement Allowance against the Rent next
coming due under the Lease.
11. Each Available Space Improvement Allowance shall be treated by Landlord and
Tenant as a tenant improvement allowance and all of the leasehold improvements
that are constructed and paid for with an Available Space Improvement Allowance
shall be owned by Landlord.
12. If Landlord fails to pay any portion of an Available Space Improvement
Allowance which is properly due and payable, the unpaid amount shall bear
interest until paid at the Interest Rate, and if Landlord fails to pay such
properly due and payable amount within ten (10) business days after receiving
written from Tenant that such amount was not paid when due, then Tenant shall be
entitled to offset said amounts (including interest) against Rent due and
payable under the Lease.
13. Landlord shall promptly after any Available Space Rent Commencement Date
prepare a declaration confirming the Available Space Rent Commencement Date and
the Rentable Area of the Available Space. If the declaration is complete and
correct, Tenant shall execute and return such declaration within thirty (30)
days after submission, failing which Tenant shall be conclusively deemed to have
agreed that the information in the declaration is accurate and Tenant shall have
thereby waived any right to object to the accuracy of such information unless
within such thirty (30) day period Tenant notifies Landlord of its reasons for
objecting to the declaration.
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14. This Exhibit J shall in no event constitute a covenant or guarantee by
Landlord that any Available Space will be available for lease by Tenant at any
time.
15. Tenant shall have no right to exercise the Right of Offer if an Event of
Default exists under this Lease at the time Landlord gives an Available Space
Notice under Section 3 above and, if at any time thereafter until the date
Landlord is to deliver the Available Space in question to Tenant, an Event of
Default exists under this Lease, Landlord shall, in addition to any other rights
which Landlord may have under this Lease, have the right to terminate Tenant's
right to lease such Available Space by giving Tenant written notice of such
termination.
16. If at the time Landlord would be required to provide Tenant with an
Available Space Notice pursuant to Section 3 above, Capella Education Company
has exercised the Contraction Option (as defined in Section 5.3 of the Lease),
Capella Education Company has assigned this Lease other than to an Affiliate or
in connection with a Permitted Transfer (as defined in Section 10.7 of the
Lease), or Capella Education Company has subleased more than twenty percent
(20%) of the Rentable Area of the Premises other than to an Affiliate or in
connection with a Permitted Transfer, then Landlord shall not be obligated to
provide Tenant with notice of such Available Space and Tenant's Right of Offer
to lease such Available Space shall, upon the occurrence of any such event,
automatically terminate and have no further force or effect.
17. Landlord shall not be liable for failure to give possession of any Available
Space by reason of any holding over or retention of possession by any previous
tenants or occupants of same, nor shall such failure impair the validity of this
Lease. However, Landlord does agree to use reasonable diligence to deliver
possession of the Available Space on the date specified in Landlord's Available
Space Notice.
18. For the purpose of this Exhibit J, the term "MARKET BASE RENTAL RATE" shall
mean the amount of cash which a landlord would receive annually by then renting
the space in question assuming the landlord to be a prudent person willing to
lease but being under no compulsion to do so, assuming the tenant to be a
prudent person willing to lease but being under no compulsion to do so, and
assuming a lease containing the same terms and provisions as those herein
contained. Market Base Rental Rate shall take into consideration all relevant
factors including the condition of the space.
19. If Tenant elects to lease Available Space offered to Tenant in accordance
with this Exhibit J, but does not accept Landlord's reasonable estimate of the
Market Base Rental Rate for such space, and if Tenant and Landlord cannot agree
to the Market Base Rental Rate on or before the date that is thirty (30) days
after Tenant's receipt of the Available Space Notice given by Landlord with
respect to such Available Space, either party may by written notice to the other
initiate the determination of such rate by arbitration in accordance with the
following provisions:
The determination of the Market Base Rental Rate will be determined
by an arbitration board consisting of three reputable real estate
professionals with experience with first-class office buildings in the
Minneapolis-St. Paul metropolitan area, each of whom shall be a Member of
the Appraisal Institute with the designation of "MAI." Within twenty (20)
days after initiation of arbitration, each party shall appoint one
arbitrator who shall have no material financial or business interest in
common with the
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party making the selection and shall not have been employed by such party
for a period of three years prior to the date of selection. If a party
fails to give notice of appointment of its arbitrator within the twenty
(20) day period specified above, then upon two (2) business days notice
the other party may appoint the second arbitrator. The arbitrators
selected by the parties shall attempt to agree upon a third arbitrator. If
the first two arbitrators are unable to agree on a third arbitrator within
thirty (30) days after the appointment of the second arbitrator, then such
third arbitrator shall be appointed by the presiding Judge of the Hennepin
County District Court, or by any person to whom such presiding judge
formally delegates the matter or, if such methods of appointment fail, by
the American Arbitration Association. The parties will submit to the
arbitrators the definition of the Market Base Rental Rate from this
Exhibit J each party will be entitled to present to the arbitrators
evidence concerning the Market Base Rental Rate at a hearing scheduled not
earlier than thirty (30) and not later than sixty (60) days after the
final arbitrator has been selected, and each arbitrator shall submit his
or her determination in a sealed envelope by the 20th day following such
hearing, and any determination not submitted by such time shall be
disregarded. The parties shall meet on said 20th day (or if it is not a
business day, on the first business day thereafter) at 11:00 a.m. at the
office of Landlord, or such other place as the parties may agree and
simultaneously deliver the determinations. If the determinations of at
least two of the arbitrators shall be identical in amount, such amount
shall be deemed the Market Base Rental Rate. If the determination of the
three arbitrators shall be different in amount, the Market Base Rental
Rate shall be determined as follows:
(1) If neither the highest or lowest determination differs from the
middle determination by more than ten (10) percent of such middle
determination, then the Market Base Rental Rate shall be deemed to be the
average of the three determinations; and
(2)If clause (1) does not apply, then the Market Base Rental Rate
shall be deemed to be the average of the middle determination and the
determination closest in amount to such middle determination.
The decision of the arbitrators, determined as above set forth, will
be final and non-appealable. Except where specifically provided otherwise in
this Lease, each party shall bear its own expenses in connection with the
arbitration and the costs of its arbitrator, and the cost of the third
arbitrator shall be shared equally by Landlord and Tenant. The costs of all
counsel, experts and other representatives that are retained by a party will be
paid by such party.
20. Subject to the provisions of Section 1(a) of Exhibit I-1, Tenant's Right of
Offer shall be independent of Tenant's Expansion Options and no failure by
Tenant to exercise an Expansion Option shall affect any Right of Offer to which
Tenant is entitled under this Exhibit J.
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EXHIBIT K
FORM OF CONFIDENTIALITY AGREEMENT
This Confidentiality Agreement ("Agreement") is entered into
effective as of _____________, 200__ by Capella Education Company, a Minnesota
corporation ("Tenant") and where an outside auditor is being used by Tenant to
perform audit services, by _________________("Auditor").
RECITALS
A. 601 Second Avenue Limited Partnership, a Texas limited
partnership, as Landlord ("Landlord"), and Tenant are parties to an Office Lease
(the "Lease") dated as of ______________, 2004 (as amended, the "Lease") with
respect to certain premises within the project commonly known as 225 South
Sixth, located in downtown Minneapolis, Minnesota, and more particularly
described in the Lease.
B. Section 7.7 of the Lease requires that any audit of Operating
Costs under the Lease may be conducted only by Tenant or its representatives
after the execution of a Confidentiality Agreement.
C. Auditor has been retained by Tenant to conduct such an audit.
NOW THEREFORE, in consideration of the agreements contained herein
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, Tenant and Auditor agree as follows:
1. DEFINITIONS. Capitalized terms used herein and not otherwise
defined shall have the meanings given in the Lease.
2. PROTECTED MATERIAL. Tenant and Auditor agree to treat
confidentially in accordance with terms of this Agreement all information
furnished by Landlord or its property manager or their respective employees,
contractors and agents in connection with the audit, including, without
limitation, (i) the books and records of Landlord and its property manager, (ii)
any other information regarding the operation of the Project furnished to Tenant
by Landlord or its property manager and their respective employees, contractors
and agents and (iii) any analysis, compilations, studies or other documents or
records prepared by the Tenant, or their respective principals, officers,
employees, agents, advisors, affiliates or representatives (collectively,
"Representatives") which contain or otherwise reflect or are generated from such
information. The information and materials contained in clauses (i), (ii) and
(iii) is sometimes hereinafter collectively referred to as the "Material".
3. DISSEMINATION OF MATERIAL. Auditor and Tenant agree that the
Material shall (i) not be used other than in connection with the conducting of
the audit of Operating Expenses for the Premises, and any arbitration or other
proceeding in connection therewith, and (ii) shall be kept confidential and
shall not be disclosed by Auditor, Tenant or their respective Representatives,
except as may be required by legal process or applicable law.
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4. PROCEDURES. Auditor and Tenant shall (i) maintain adequate
procedures, including, without limitation, written agreements, disclosure to
employees on a need to know basis only, segregation of the Material from the
material of others and accountability of written information, to ensure the
continuing confidentiality of the material and (ii) shall notify Landlord
immediately of any unauthorized use, disclosure, publication or reproduction of
any Material by any person or entity whatsoever.
5. TERM. The agreements of Auditor as set forth herein shall survive
the relationship between Auditor and Tenant.
6. ATTORNEYS' FEES. If Landlord, Tenant or Auditor retains an
attorney or initiates any litigation or other proceeding to enforce the
provisions of this Agreement, the prevailing party in such litigation or other
proceeding shall be entitled to recover all reasonable and documented costs and
expenses, including reasonable attorneys' fees, paid or incurred by such party
in connection therewith from the non-prevailing party. For purposes of this
Section, the term "prevailing party" shall be defined to mean the party whose
position in such litigation is substantially upheld
7. INJUNCTIVE RELIEF. Tenant and Auditor hereby acknowledge that the
damages to be sustained by Landlord because of any breach by Tenant or Auditor
of their obligations under this Agreement may be difficult if not impossible not
establish and that Landlord shall be entitled to an order for injunctive relief
to compel Tenant and Auditor to comply with their obligations under this
Agreement.
8. GOVERNING LAW. This Agreement shall be constructed in accordance
with the laws of the State of Minnesota.
9. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, all of which will be considered one and the same Agreement
notwithstanding that all parties hereto have not signed the same counterpart.
Signatures on this Agreement which are transmitted by facsimile shall be valid
for all purposes. Any party shall, however, deliver an original signature for
this Agreement to the other party upon request.
In Witness Whereof, the parties have executed this Agreement to be
effective as of the date first above written.
TENANT:
CAPELLA EDUCATION COMPANY
By: ________________________________
Name:_______________________________
Title: _____________________________
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<PAGE>
AUDITOR:
By: ________________________________
Name:_______________________________
Title: _____________________________
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<PAGE>
EXHIBIT L
STORAGE SPACE
This Exhibit L forms a part of the attached Lease and is governed by
the attached Lease except as expressly provided to the contrary in this Exhibit.
Capitalized terms used in this Exhibit have the meaning set forth in the Lease.
1. Commencing as of the Phase I & II Commencement Date and continuing thereafter
throughout the Term, Landlord agrees to provide to Tenant and Tenant agrees to
pay for storage space in an area designated by Landlord in the storage area of
the Project consisting of not less than 250 square feet and not more than 2,000
square feet (the "Storage Space"); but only if Tenant gives written notice to
Landlord at least sixty (60) days prior to the Phase I & II Rent Commencement
Date that Tenant desires to use Storage Space and the approximate square footage
of the Storage Space which Tenant desires to use. The Storage Space is not part
of the Premises, unless expressly stated to the contrary in this Exhibit.
2. Upon not less than thirty (30) days written notice to Tenant, Landlord may
from time to time relocate the Storage Space to a different location within the
Project. The costs of any such relocation shall be borne by Landlord and
Landlord shall schedule any such relocation at a time reasonably acceptable to
Tenant, so that Tenant may monitor the relocation work.
3. Tenant acknowledges that the Storage Space shall be delivered to Tenant in
its "as is" condition, and that Landlord shall have no obligation with respect
to the improvement of such space, except that the Storage Space shall have
locking doors.
4. The Storage Space shall be accessible by Tenant twenty four (24) hours a day,
seven (7) days a week, subject to compliance with standard building procedures.
5. Tenant agrees to pay the annual sum of Ten Dollars ($10.00) per square foot
of area in the Storage Space, which shall be due and payable in twelve equal
monthly installments in advance on or before the first day of each month
throughout the Term. Such amount shall be a "gross rent" for the Storage Space
and Tenant shall not be obligated to pay any Operating Costs for the Storage
Space. From and after the end of the Initial Scheduled Term, the rent for the
Storage Space, expressed as a monthly charge, may be changed by Landlord not
more than once during any calendar year to reflect the then market rate as
charged by Landlord by giving not less than thirty (30) days advance written
notice thereof to Tenant. In the event Tenant objects to the revised rent for
the Storage Space as established by Landlord, it may by written notice to
Landlord cancel this Storage Space lease effective upon the adjustment date
provided such written notice of cancellation is given to Landlord within fifteen
(15) days after receipt by Tenant of the notice of the escalation by Landlord.
6. The Storage Space may be used for self-service storage only. If Tenant uses
the Storage Space for any other purpose, then in lieu of the rent set forth in
this Exhibit L, Tenant shall pay Base Rent and Tenant's Additional Rent with
respect to the Storage Space at the same rates as are applicable to the
Premises. Landlord shall have no obligation (i) to provide HVAC service to the
Storage Space or (ii) to provide to the Storage Space any other services
(including, without limitation, the services described in Section 14 of the
Lease) other than minimal lighting or fulfill
L-1
<PAGE>
with respect to the Storage Space any other obligations under the Lease except
as specifically provided herein. If Tenant, subject to the terms and conditions
of the Lease, installs any HVAC or other equipment Tenant shall be solely
responsible for maintaining same. Tenant shall, at its sole cost and expense,
replace and pay for all replacement lighting bulbs, tubes, ballasts and starters
required for the Storage Space and shall provide its own Janitorial services and
any other services including heating, ventilation and air conditioning necessary
for Tenant's use of and operations in the Storage Space.
7. Upon the occurrence of an Event of Default (as defined in Section 20.1 of the
Lease), Landlord may at its option terminate Tenant's rights with respect to the
Storage Space.
8. Landlord and its agents and employees shall not be liable for loss or damage
to any personal property stored by Tenant or under Tenant's rights herein caused
by fire, theft, water or any other cause whatsoever and Tenant (i) waives any
claim against Landlord for and in respect thereto; (ii) hereby agrees to
indemnify and defend Landlord against all claims against Landlord or any loss or
damage to any such personal property from any cause; and (iii) Tenant agrees
that it shall look solely to its insurance in the event of any loss or damage to
the same. Landlord recommends that Tenant store its personal property located
within the Storage Space on pallets. It is further expressly understood that the
relationship between Landlord and Tenant in this Exhibit constitutes an
agreement to use said Storage Space subject to the terms and conditions herein
only, and that neither such relationship nor the storage of any such personal
property thereunder shall constitute a bailment or create the relationship of
bailor and bailee.
9. If the Storage Space shall be damaged by fire or other casualty rendering it
unusable by Tenant or if all or any part of the Storage Space is taken by
eminent domain proceedings, the rights and remedies of Landlord or Tenant shall
be determined pursuant to the terms of the Lease; provided, however,
notwithstanding anything to the contrary in the Lease, Tenant shall in no event
have the right to terminate the Lease in the event of damage by fire or other
casualty to the Storage Space or any taking of the Storage Space by eminent
domain.
10. Tenant covenants not to suffer any waste or damage or disfigurement or
injury to the Storage Space or any other part of said Project, and Tenant
specially covenants not to store in the Storage Space any flammable liquids, any
other Hazardous Materials, or any other materials which in Landlord's judgment
are likely to impose an undue risk or result in higher premiums for the casualty
insurance carried by Landlord, as owner of the Project. Tenant agrees to comply
with all applicable laws, ordinances and regulations relating to its use of the
Storage Space.
11. Landlord reserves the following rights (in respect to use of such Storage
Space) exercisable without notice and without liability to Tenant and without
effecting an eviction, constructive or actual, or disturbance of Tenant's use or
possession, or giving rise to claim for setoff or abatement of Tenant hereunder:
(a) To retain at all times and to use in appropriate instances keys
to all doors within and into the Storage Space. No locks shall be changed
without the prior written consent of Landlord. This provision shall not
apply to Tenant's safes or other areas maintained by Tenant for the safety
and security of monies, securities, negotiable instruments or like items
or areas containing proprietary items or information.
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(b) To make repairs, alterations, additions or improvements, whether
structural or otherwise, in and about said Project, or any part thereof,
and for such purposes to enter upon the Storage Space and, during the
continuation of any of said work, to temporarily close doors, entryways,
public spaces and corridors in said Project and to interrupt or
temporarily suspend services and facilities without liability, cost or
abatement of rent.
(c) To enter the Storage Space in a lawful manner for any other
lawful purpose.
12. If a key or keys is supplied by Landlord to Tenant in connection with the
rights granted herein, Tenant shall surrender such key or keys to Landlord upon
expiration or earlier termination of the Lease or this Exhibit. Upon the
expiration of the Lease or the earlier termination hereof, Tenant shall
immediately vacate the Storage Space, remove all of its property therefrom and
leave the Storage Space in the same condition as the Storage Space was in at the
Commencement Date, reasonable wear and tear excepted.
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EXHIBIT M
ASSIGNMENT LIMITATIONS
1. Governmental or quasi-governmental entity
2. Child care facility
3. Health care, dental or personal counseling office
4. Retail travel agency
5. Entity primarily engaged in political or lobbying activities
6. Entity engaged in commerce in "X rated" media
7. Broadcasting studios for TV or radio (but nothing herein shall prohibit
equipment or facilities used in connection with broadcasts or other
communications to students of Tenant or prospective students of Tenant via
the internet or by any other means)
8. Retail sale or rental of products or materials
9. Employment agency (but nothing herein shall prohibit educational
counseling or placement services to students of Tenant)
10. Beauty services
11. Schools or other training or educational operations with onsite
classrooms, other than onsite classrooms which are used in a manner which
is incidental to their primary business activities, and other than on-site
classrooms not involving significant portions of the Premises or a
significant number of non-employee attendees
12. Operation primarily engaged in clerical support, data processing or
messenger services
Nothing in this Exhibit shall prohibit an Assignment of this Lease for use as
the regional, executive, corporate or headquarters office or offices of
businesses engaged in the activities described in 2, 3, 4, 7, 8, 9, 10 and 11
above so long as in such regional, executive, corporate or headquarters office
in the Premises the Assignee does not conduct the operation or activity or type
of facility described in the list above.
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EXHIBIT N
FORM OF NON DISTURBANCE AGREEMENT
NON-DISTURBANCE AND ATTORNMENT AGREEMENT
THIS AGREEMENT is entered into effective as of the ___ day of February,
2004, between CAPELLA EDUCATION COMPANY, a Minnesota corporation, whose mailing
address is Capella Education Company, 222 South 9th Street, 20th Floor,
Minneapolis, Minnesota 55402 Attention: Vice President/General Counsel
("Tenant"), 601 SECOND AVENUE LIMITED PARTNERSHIP, a Texas limited partnership,
whose mailing address is c/o Hines Interests Limited Partnership, 225 South
Sixth Street, Suite 2590, Minneapolis, Minnesota 55402 ("Borrower"), and THE
NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY, a Wisconsin corporation ("Lender"),
whose address for notices is 720 East Wisconsin Avenue, Milwaukee, WI 53202,
Attention: Real Estate Investment Department, Reference Loan No.C-331830.
RECITALS
A. Tenant is the lessee, and Borrower is the lessor under a certain lease
dated February, 2004 (the "Lease").
B. Lender has made a mortgage loan secured by a mortgage, deed to secure a
debt or deed of trust from Borrower for the benefit of Lender recorded as
Document No. 2027651 (as it may be amended, restated or otherwise modified from
time to time, the "Lien Instrument") encumbering the fee title to and/or
leasehold interest in the land described in Exhibit A attached hereto and the
improvements thereon (collectively, the "Property"), wherein the premises
covered by the Lease (the "Demised Premises") are located.
C. Borrower and Lender have executed an Absolute Assignment of Leases and
Rents (the "Absolute Assignment"), pursuant to which (i) the Lease is assigned
to Lender and (ii) Lender grants a license back to Borrower permitting Borrower
to collect all rents, income and other sums payable under the Lease until the
revocation by Lender of such license, at which time all rents, income and other
sums payable under the Lease are to be paid to Lender.
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D. Lender has required the execution of this Agreement by Borrower and
Tenant as a condition to Lender making the requested mortgage loan or consenting
to the Lease, and Tenant has required the execution of this Agreement by Lender
and Borrower as a condition to Tenant entering into the Lease.
E. Tenant acknowledges that, as its consideration for entering into this
Agreement, Tenant will benefit by entering into an agreement with Lender
concerning Tenant's relationship with any purchaser or transferee of the
Property (including Lender) in the event of foreclosure of the Lien Instrument
or a transfer of the Property by deed in lieu of foreclosure (any such purchaser
or transferee and each of their respective successors or assigns is hereinafter
referred to as "Successor Landlord").
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing, the mutual covenants
and agreements contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Tenant, Borrower and
Lender agree as follows:
1. Tenant and Borrower agree for the benefit of Lender that:
(a) Tenant shall not pay, and Borrower shall not accept, any rent or
additional rent more than one month in advance;
(b) Except as specifically provided in the Lease, Tenant and Borrower
will not enter into any agreement for the cancellation of the Lease
or the surrender of the Demised Premises without Lender's prior
written consent;
(c) Tenant and Borrower will not enter into any agreement amending or
modifying the Lease without Lender's prior written consent, except
for amendments or modifications specifically contemplated in the
Lease for confirming the lease commencement date, the rent
commencement date, the term, the square footage leased, the renewal
or extension of the Lease, the leasing of additional space at the
Property, or as otherwise specifically contemplated in the Lease;
(d) Tenant will not terminate the Lease because of a default thereunder
by Borrower unless Tenant shall have first given Lender written
notice and a reasonable opportunity to cure such default;
(e) Tenant, upon receipt of notice from Lender that it has exercised its
rights under the Absolute Assignment and revoked the license granted
to Borrower to collect all rents, income and other sums payable
under the Lease, shall pay to Lender all rent and other payments
then or thereafter due under the Lease, and any such payments to
Lender shall be credited against the rent or other obligations due
under the Lease as if made to Borrower; and
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(f) Tenant will not conduct any dry cleaning operations on the Demised
Premises using chlorinated solvents nor will Tenant use any
chlorinated solvents in the operation of their business on the
Demised Premises.
2. Subject to the terms of this Agreement, the Lease is hereby
subordinated in all respects to the Lien Instrument and to all renewals,
modifications and extensions thereof, subject to the terms and conditions
hereinafter set forth in this Agreement, but Tenant waives, to the fullest
extent it may lawfully do so, the provisions of any statute or rule of law now
or hereafter in effect that may give or purport to give it any right or election
to terminate or otherwise adversely affect the Lease or the obligations of
Tenant thereunder by reason of any foreclosure proceeding.
3. Borrower, Tenant and Lender agree that, unless Lender shall otherwise
consent in writing, the fee title to, or any leasehold interest in, the Property
and the leasehold estate created by the Lease shall not merge but shall remain
separate and distinct, notwithstanding the union of said estates either in
Borrower or Tenant or any third party by purchase, assignment or otherwise.
4. If the interests of Borrower in the Property are acquired by a
Successor Landlord:
(a) If Tenant shall not then be in default in the payment of rent or
other sums due under the Lease or be otherwise in material default
under the Lease (in each case, beyond the expiration of applicable
notice and cure periods), the Lease shall not terminate or be
terminated and the rights of Tenant thereunder shall continue in
full force and effect except as provided in this Agreement;
(b) Tenant agrees to attorn to Successor Landlord as its lessor; Tenant
shall be bound under all of the terms, covenants and conditions of
the Lease for the balance of the term thereof, including any
Extension Options which are exercised in accordance with the terms
of the Lease;
(c) The interests so acquired shall not merge with any other interests
of Successor Landlord in the Property if such merger would result in
the termination of the Lease;
(d) If, notwithstanding any other provisions of this Agreement, the
acquisition by Successor Landlord of the interests of Borrower in
the Property results, in whole or part, in the termination of the
Lease, there shall be deemed to have been created a lease between
Successor Landlord and Tenant on the same terms and conditions as
the Lease, except as modified by this Agreement, for the remainder
of the term of the Lease with Extension Options, if any; and
(e) Successor Landlord shall be bound to Tenant under all of the terms,
covenants and conditions of the Lease, and Tenant shall, from and
after Successor Landlord's acquisition of the interests of Borrower
in the real estate, have the
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same remedies against Successor Landlord for the breach of the Lease
that Tenant would have had under the Lease against Borrower if the
Successor Landlord had not succeeded to the interests of Borrower;
provided, however, that Successor Landlord shall not be:
(i) Liable for the breach of any representations or warranties set
forth in the Lease or for any act, omission or obligation of
any landlord (including Borrower) or any other party occurring
or accruing prior to the date of Successor Landlord's
acquisition of the interests of Borrower in the Demised
Premises, except for any repair and maintenance obligations of
a continuing nature as of the date of such acquisition;
(ii) Subject to any offsets or defenses which Tenant might have
against any landlord (including Borrower) prior to the date of
Successor Landlord's acquisition of the interests of Borrower
in the Demised Premises except to the extent that such offsets
(a) were used to fund the Improvement Allowance (as defined in
the Lease), including interest, or to fund the repairs,
maintenance or other actions which would otherwise be an
obligation of Successor Landlord upon its acquisition of the
interests of Borrower in the Property and (b) are otherwise
expressly provided for under the Lease;
(iii) Liable for the return of any security deposit under the Lease
unless such security deposit shall have been actually
deposited with Successor Landlord;
(iv) Bound to Tenant for any claims arising subsequent to the date
upon which Successor Landlord transfers its interest in the
Demised Premises to any third party;
(v) Liable to Tenant under any indemnification provisions set
forth in the Lease arising prior to Successor Landlord's
acquisition of the interests of Borrower in the Property; or
(vi) Liable for any damages in excess of Successor Landlord's
equity in the Property.
The provisions of this paragraph shall be effective and self-operative
immediately upon Successor Landlord succeeding to the interests of Borrower
without the execution of any other instrument.
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5. Tenant represents and warrants that Tenant, to its actual knowledge:
(i) is not a person or entity with whom Lender is restricted from doing business
with under regulations of the Office of Foreign Asset Control ("OFAC") of the
Department of the Treasury (including, but not limited to, those named on OFAC's
Specially Designated and Blocked Persons list) or under any statute, executive
order (including, but not limited to, the September 24, 2001 Executive Order
Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten
to Commit, or Support Terrorism), or other governmental action; (ii) is not
knowingly engaged in, and shall not knowingly engage in, any dealings or
transaction or knowingly be otherwise associated with such persons or entities
described in (i) above; and (iii) is not a person or entity whose activities
violate the International Money Laundering Abatement and Financial
Anti-Terrorism Act of 2001 or the regulations or orders thereunder.
6. This Agreement may not be modified orally or in any other manner except
by an agreement in writing signed by the parties hereto or their respective
successors in interest. In the event of any conflict between the terms of this
Agreement and the terms of the Lease, the terms of this Agreement shall prevail.
This Agreement shall inure to the benefit of and be binding upon the parties
hereto, their respective heirs, successors and assigns, and shall remain in full
force and effect notwithstanding any renewal, extension, increase, or refinance
of the indebtedness secured by the Lien Instrument, without further
confirmation. Upon recorded satisfaction of the Lien Instrument, this Agreement
shall become null and void and be of no further effect.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
[SIGNATURE PAGES FOLLOW]
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TENANT: CAPELLA EDUCATION COMPANY,
a Minnesota corporation
By:_________________________________
Its:________________________________
STATE OF MINNESOTA )
)ss.
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this _____ day of February,
2004, by ___________________________ the _______________ of Capella Education
Company, a Minnesota corporation, on behalf of the corporation.
_____________________________________
Notary Public
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BORROWER: 601 SECOND AVENUE LIMITED PARTNERSHIP,
a Texas limited partnership
By: Minneapolis 601 Limited Partnership, a Texas
limited partnership, its sole general partner
By: Hines Acquisitions No. 2 Limited
Partnership, a Texas limited partnership, its
sole general partner
By: Hines Interests Limited Partnership,
a Delaware limited partnership, its
sole general partner
By: Hines Holdings, Inc., a Texas
close corporation, its sole
general partner
By:__________________________________
Name:C. Kevin Shannahan
Its: Executive Vice
President
STATE OF _____________)
) SS.
COUNTY OF _____________)
The foregoing instrument was acknowledged before me this day of February,
2004, by C. Kevin Shannahan, the Senior Vice President of Hines Holdings, Inc. a
Texas close corporation, as sole general partner of Hines Interests Limited
Partnership, a Delaware limited partnership, as sole general partner of Hines
Acquisitions No. 2 Limited Partnership, a Texas limited partnership, as sole
general partner of Minneapolis 601 Limited Partnership, a Texas limited
partnership, as sole general partner of 601 Second Avenue Limited Partnership, a
Texas limited partnership, on behalf of the corporation and partnerships.
_____________________________________
Notary Public
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LENDER: THE NORTHWESTERN MUTUAL LIFE INSURANCE
COMPANY, a Wisconsin corporation
By: Northwestern Investment Management Company, LLC, a Delaware limited
liability company, its wholly owned affiliate and authorized
representative
By:__________________________________________
Managing Director
Attest:______________________________________
Assistant Secretary
STATE OF WISCONSIN )
) SS.
COUNTY OF MILWAUKEE )
The foregoing instrument was acknowledged before me this _________________
day of February, 2004 by ________________and __________________ the Managing
Director and Assistant Secretary respectively, of Northwestern Investment
Management Company, LLC on behalf of THE NORTHWESTERN MUTUAL LIFE INSURANCE
COMPANY, a Wisconsin corporation, and acknowledged the execution of the
foregoing instrument as the act and deed of said corporation.
__________________________________________________
Notary Public
My commission expires:
This instrument was prepared by Fred W. Bessette, Attorney, for The Northwestern
Mutual Life Insurance Company, 720 East Wisconsin Avenue, Milwaukee, WI 53202.
WHEN RECORDED MAIL TO
The Northwestern Mutual Life Ins. Co.
720 East Wisconsin Ave. - Rm N16WC
Milwaukee, WI 53202
Attn: Kathleen A. Evanson
LOAN NO. C-331830
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EXHIBIT "A"
Lot 6, Block 219, Town of Minneapolis, according to the plat thereof on file or
of record in the office of the Register of Deeds in and for Hennepin County.
The Northeasterly 7 feet of Lots 1, 2, and 3; the Northeasterly 7 feet of the
Northwesterly half of Lot 4; the Southeasterly half of Lot 4; and Lots 5, 6, 7,
8, 9 and 10;
all in Block 219, Brown and Jackins' Addition to Minneapolis, according to the
plat thereof on file or of record in the office of the Register of Deeds in and
for Hennepin County.
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EXHIBIT O
JANITORIAL SPECIFICATIONS
225 South Sixth Street
I. PUBLIC AREAS
A. Public Areas G & L - Plaza & Dock
NIGHTLY
Sweep all floors G & L
Spot sweep plaza
Clean door glass G & L
Clean metal and painted doors
Vacuum elevators
Damp wipe metal and glass in elevators (also freight)
Clean escalator steps
Clean escalator stainless
Clean escalator glass
Clean elevator tracks
Spot clean inner and outer perimeter glass
Spot clean metal planters
Vacuum entry grates and walk off mats
Clean public telephone stations
Dust and damp wipe (as needed) window mullions
Clean directory
Clean guards stations
Empty ash/waste urns and wipe as needed
Vacuum - 2nd floor lobby
Spot lobby carpets
Spot granite and terrazzo floors and walls
Automatic scrub G & L terrazzo floors
Wipe window frames (as needed)
MONTHLY
Damp wipe all granite walls (as needed)
Machine sweep and scrub plaza (as needed)
Shampoo elevators
Shampoo lobby and entries
Squeegee door and perimeter glass (as needed)
B. Public Areas - Lobbies and Halls
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NIGHTLY
Vacuum carpets
Spot small spills
Dust baseboards (as needed)
Wipe tenant signs (as needed)
Spot walls
Wipe doors
Clean glass (as needed)
Empty ash/waste urns
MONTHLY
Edge vacuum
Shampoo carpets (as needed)
C. Connecting Skyways
NIGHTLY
Spot sweep/Spot spills/spots on carpet
Vacuum carpets
Clean door glass
Dust window ledges
Clean railing glass if applicable
Clean spills
SEMI-ANNUAL
Shampoo carpets (or as needed)
Clean all glass
II. TENANT AREAS
NIGHTLY
Empty all waste receptacles and remove waste paper and rubbish from
the Premises nightly
Dust desks, tables, credenzas, counters, file tops and other
horizontal surfaces (provided they are clear of papers and
other materials - the janitorial staff will not remove any
materials left on desks and tabletops)
Dust plastic chair mats
Remove fingerprints and smudges from doors, door frames, light
switch plates and private entrance glass
Dust mop tile floors on a nightly basis; damp mop stains as
needed
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Spot clean small stains in carpeting as needed (there
may be a charge to tenant for excessive stains)
Spot clean walls
Vacuum all traffic lanes of carpeted areas on a daily basis;
vacuuming to include entire carpeted surface area on a weekly
basis
Spot clean office glass (there may be a charge to tenant for
this work)
MONTHLY
Brush chairs or vacuum on a monthly basis; such cleaning not
to include the use of upholstery cleaning solvent
Spray buff resilient tile floors monthly (there may be a
charge to tenant for this work)
QUARTERLY
Dust diffusers (as needed)
Dust building standard mini-blinds twice a year
SEMI-ANNUAL
Strip and refinish floor tile semi-annually (there may be a
charge to tenant for this work)
Dust ceiling light fixtures (as needed)
Perimeter windows (exterior panels) washed two times a year
Perimeter windows (interior panels) washed once a year
AS NEEDED
Edge vacuuming is done on an as needed basis
Dust wall coverings as needed (there may be a charge to tenant for
this work)
Spot clean all glass furniture as needed (there may be a charge to
tenant for this work)
EXTRA CLEANING
Any janitorial services beyond the specific services identified
above, except as noted, shall be subject to an additional
charge reflecting Landlord's actual cost
III. UNDERGROUND PARKING
A. May - October
Ramp
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NIGHTLY
Spot sweep debris between cars
Machine sweep all accessible areas and drive lanes on
one level alternating nightly
Apply oil-dry to any car fluid puddles
Dust signs on one level alternating nightly
Clean outside of attendant's booth
Police parking level stairways for debris
Clean access control equipment
Wipe fire extinguisher boxes (as needed)
Spot all doors
Machine scrub the floor of one level alternating nightly
WEEKLY
Sweep and damp mop as needed one flight of stairs, alternating
weekly.
Wash as needed one level of signs, alternating levels weekly
Perform routine equipment maintenance checks and wash all floor
machines
Ramp Elevators Lobbies
NIGHTLY
Vacuum nightly
Spot clean door glass
Spot carpet and walls
Clean waste/ash urns (as needed)
Police garage levels for debris
Vacuum standing water as needed
B. November - April
NIGHTLY
Vacuum standing water (as needed)
Spot sweep debris between cars and open areas
Machine sweep as time permits
Police parking level stairways for debris
Clean outside of attendant's booth
Clean mechanical equipment (as needed)
Wipe fire extinguisher boxes (as needed)
Spot all doors
Machine scrub the floor of one level alternating nightly
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WEEKLY
Sweep and damp mop as needed one flight of stairs, alternating
weekly
Damp wipe as needed all signs on one level
Perform routine equipment maintenance checks and wash all floor
machines
ANNUALLY
Dust pipes and ductwork as needed
IV. REST ROOMS
NIGHTLY
Clean and sanitize porcelain fixtures
Spot clean walls
Clean mirrors
Polish chrome and stainless
Sweep floors
Wet mop floors
Stock paper products and cloth towels
Empty trash
Fill soap dispensers
MONTHLY
Inspect for repairs/additional cleaning
QUARTERLY
Dust vents
Machine scrub floors
Linseed oil door kickplates
ANNUALLY
Wash walls
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