Maryland-Annapolis Junction-9020 Junction Drive Lease - Chippewa LP and EarthShell Corp.
Std. Ind. Lease
Revised 1/15/99
LEASE AGREEMENT
THIS LEASE, made this 2nd day of July, 1999, by and between CHIPPEWA
LIMITED PARTNERSHIP, a Maryland limited partnership (hereinafter called
"Landlord"), and EARTHSHELL CORPORATION, a Delaware corporation (hereinafter
called "Tenant"). In consideration of the premises and the covenants, conditions
and rents hereinafter set forth, it is agreed as follows:
1. PREMISES AND TERM:
A. Landlord does hereby lease, demise and let to Tenant, and
Tenant does hereby lease, take and accept from Landlord, the "Premises", being
comprised of approximately 34,956 square feet of space located in a one story
building known as 9020 Junction Drive, Annapolis Junction, Maryland (hereinafter
the "Improvements") as outlined in red on the building and site plan attached
hereto as Exhibit A, which Improvements contain a leasable area of 96,666 square
feet and is located on all that lot of ground in Howard County, Maryland more
fully described in Exhibit B attached hereto, containing 6.3 acres of land more
or less, together with the use in common with other occupants of the
Improvements of the parking areas and the right to use in common with other
occupants of said Improvements any access road serving the Improvements.
B. TO HAVE AND TO HOLD the same for a term commencing on the 1st
day of October, 1999, (hereinafter the "Commencement Date") and terminating on
the 30th day of September, 2004, (hereinafter the "Termination Date"). Reference
in this Lease to the "term" shall include any renewal term, provided for in a
Rider to this Lease, unless the context plainly requires a contrary meaning.
2. TENANT IMPROVEMENTS:
A. Landlord shall install the tenant improvements in a good and
workmanlike manner, set forth in both the Tenant Improvement Specifications
attached hereto as EXHIBIT C-1 and the floor plan attached hereto as EXHIBIT
C-2. Tenant shall reimburse Landlord for a portion of the cost of Landlord's
tenant improvements, shown on EXHIBIT C-I and EXHIBIT C-2. Specifically, Tenant
shall pay to Landlord, as additional rent, within thirty (30) days after
substantial completion of Landlord's tenant improvements, the sum of
Thirty-eight Thousand Five Hundred Thirty-four Dollars ($38,534.00).
Additionally, any additions to or modifications of the work and/or materials
shown on the attached exhibits which result in additional costs shall be handled
as change orders and paid for by Tenant within twenty (20) days after delivery
to Tenant of a reasonably detailed invoice therefore.
B. Notwithstanding the date specified in Paragraph l.B. above for
the commencement of the term of this Lease, such term shall not commence until
the substantial completion of the construction of all tenant improvements as
specified above and Landlord has given notification to Tenant in writing that
the Premises are ready for possession. Possession of the Premises shall be
deemed delivered to Tenant at the date specified in such notification,
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notwithstanding any item of incomplete work set forth on a "punch list" prepared
by Landlord and Tenant in writing at the time of or within forty-five (45) days
after the Commencement Date. Tenant shall have the right to enter the Premises
at least thirty (30) days prior to the Commencement Date for the purpose of
installing Tenant's equipment, fixtures and furnishings, provided, however, that
Tenant first notifies Landlord prior to such entries and receives Landlord's
consent, which shall not be unreasonably withheld, conditioned or delayed and
that Tenant does not, under any circumstances, interfere with or delay the
completion of the tenant improvements being installed by Landlord. No rent shall
be due to Landlord on account of such activities of Tenant. Landlord shall not
be liable to Tenant if Landlord does not deliver possession of the Premises to
Tenant on the date specified in Paragraph l.B. above, and Landlord's
non-delivery of the Premises shall not affect this Lease or the obligations of
Tenant under this Lease. In such event, the term of this Lease shall be extended
for a period equal to the delay in delivery of possession of the Premises to
Tenant, plus the number of days necessary to end the term of this Lease on the
last day of a month and rent at the applicable rate, shall be payable for such
additional portion of the month. If delivery of possession of the Premises to
Tenant is delayed, Landlord and Tenant shall, at the request of either, upon
such delivery, execute an amendment to this Lease setting forth the Commencement
Date and Termination Date of this Lease. In all events (but subject to the
provisions of Paragraph 2.D., below), if Landlord fails, despite the exercise of
its commercially reasonable efforts to substantially complete the tenant
improvements, or for any other reason fails to deliver the Premises to Tenant by
October 31, 1999, then the Tenant, as its sole and exclusive remedy, shall have
the right to elect either to (i) terminate this Lease, by giving written notice
to Landlord no later than November 15, 1999, and if Tenant does so terminate
this Lease, Landlord shall promptly refund to Tenant any security deposit and
any pre-paid rent then being held by Landlord and neither Landlord nor Tenant
shall have any further liability to the other in connection with this Lease
(except with respect to obligations or liabilities which accrued prior to the
date of such termination or which relate to surrender of the Premises), or (ii)
to file suit for specific performance of Landlord's obligations under this Lease
(provided, however, Tenant shall not be entitled to claim or recover any
monetary damages against Landlord).
C. If Tenant occupies or enters the Premises prior to the
Commencement Date, such occupancy or entry shall not advance the Termination
Date of this Lease. All of the terms, covenants and provisions of this Lease
shall apply from the date of occupancy and possession or entry and the rent
shall be paid at the rate herein set forth on a pro rata basis for the early
occupancy period, provided, however, Tenant shall not be required to pay rent if
Tenant, or its agents, contractors or employees, merely enters the premises for
the limited purposes described in Paragraph 2.13. above.
D. If Landlord is delayed in substantially completing tenant
improvements as a result of any of the following, then commencement of the term
of this Lease and the Termination Date of this Lease shall be as stated in
Paragraph 1.B. above; and, Tenant shall not be relieved of its obligations to
pay rent as prescribed in Paragraph 3 below:
(1) Tenant's failure to approve or "approved as noted"
detailed working drawings or other drawings, plans or specifications within five
(5) business days after submission by Landlord.
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(2) The performance by any person, firm or corporation
(other than Landlord's contractor) employed at Tenant's request and the
completion of work by said person, firm or corporation;
(3) Delay in delivery of materials, finishes, or
installations requested by Tenant other than materials, finishes and
installation used as Building Standard items by Landlord's contractors in the
Improvements; and
(4) Any other delay (including, without limitation, delay in
providing necessary approvals or disapprovals required of Tenant) caused
primarily by the action or inaction of Tenant or its employees, agents,
contractors or invitees.
E. Tenant's occupancy of the Premises shall constitute acceptance
thereof and shall be deemed to constitute Tenant's agreement that the Premises
comply with all requirements of Tenant and all obligations of Landlord with
respect to the condition, order and repair thereof, including, but not limited
to, the tenant improvements required to be made by Landlord, pursuant to this
Paragraph 2 or elsewhere in this Lease, except for those matters of which Tenant
notifies Landlord in writing within forty-five (45) days after the Commencement
Date, and except for latent defects which were not manifest within such
forty-five (45) day period and which could not have been ascertained by Tenant
by a reasonably thorough inspection of Landlord's tenant improvements. Tenant
shall have no right whatsoever to raise any objection with respect to the
condition of the Premises, including, but not limited to, Landlord's tenant
improvements, unless set forth in such a written notice timely given.
3. RENT:
A. Tenant covenants to pay to Landlord % Emory Hill Management
Co., Suite 100, 92 Reads Way, New Castle, Delaware 19720, or at such place as
Landlord shall from time to time direct, the basic rent ("Basic Rental") in the
amounts set forth below during the term of this Lease. Such Basic Rental shall
be payable in equal monthly installments, in advance and without demand, on the
first day of each and every month during the term of this Lease, commencing on
the Commencement Date.
The Basic Rental shall be composed of two components, the first of
which is a fixed component as follows:
<CAPTION>
Lease Year Annual Basic Rent Monthly Payment
---------- ----------------- ---------------
1 $166,041.00 $13,836.75
2 $169,536.60 $14,128.05
3 $173,032.20 $14,419.35
4 $176,527.80 $14,710.65
5 $180,023.40 $15,001.95
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In addition to the amount set forth above, Basic Rental shall also
include, and Tenant shall pay to Landlord monthly, on the first day of each and
every month during the term and without demand, commencing with the first
payment of Basic Rental due under the Lease, the sum of Five Thousand
Thirty-nine and 49/100 Dollars ($5,039.49) (the "Amortized Amount"). The
Amortized Amount is the amount obtained by amortizing, for repayment on a
monthly basis, the sum of Two Hundred Thirty-six Thousand Seven Hundred
Seventy-eight Dollars ($236,778.00) (the "Financed Amount") over a period of
five (5) years at an interest rate equal to ten percent (10%) per annum.
Landlord and Tenant have agreed that Landlord shall, in effect, finance for
Tenant up to the amount of Two Hundred Thirty-six Thousand Seven Hundred
Seventy-eight Dollars ($236,778.00) on account of the cost of Landlord's tenant
improvements. The Landlord will also pay the balance of the cost of the
Landlord's tenant improvements described on EXHIBIT C-1 and EXHIBIT C-2, subject
to Tenant's obligation to pay the sum of Thirty-eight Thousand Five Hundred
Thirty-four Dollars ($38,534.00), as described above, and any additional costs
resulting from additions to or modifications of the work and/or materials shown
on those exhibits, as also described above. Thus, the full amount of Basic
Rental for the first month of the Lease will be Eighteen Thousand Eight Hundred
Seventy-six and 24/100 Dollars ($18,876.24), and the full amount of the Basic
Rental for the first month of the second lease year will be Nineteen Thousand
One Hundred Sixty-seven and 54/100 Dollars ($19,167.54), and so on for the
remaining three (3) lease years of the term.
4. LATE PAYMENT:
In the event that any payment required by Tenant under the provisions
of this Lease shall not be paid within five (5) days after the date due, Tenant
shall, upon demand, pay to Landlord (i) a late charge equal to five (5) percent
(5%) of such payment, and (ii) interest on such payment from the date when due
until paid at the rate of eighteen percent (18%) per annum, or, if less, the
highest rate permitted by applicable law. The late charges imposed under this
Paragraph 4 shall be deemed "rent" for all purposes under this Lease, are not
penalties and have been agreed to by Landlord and Tenant as necessary to
compensate Landlord for its additional costs associated with late payment.
5. FIRST MONTH'S BASIC RENTAL:
The first month's Basic Rental in the amount of Eighteen Thousand
Eight Hundred Seventy-six and 24/100 Dollars ($18,876.24) will accompany this
Lease, when submitted for approval by the Landlord. If this Lease is not
approved by the Landlord within thirty (30) days of its submission to the
Landlord, the above sum, as well as any security deposit made pursuant to
Paragraph 6 below, will be refunded in full. If this Lease is approved by
Landlord, the first month's Basic Rental shall be applied against the first full
monthly payment of Basic Rental due under this Lease.
6. SECURITY DEPOSIT:
Tenant has deposited with Landlord Thirty-eight Thousand Nine Hundred
Seventeen and 68/100 Dollars ($38,917.68), which sum shall be held without
payment of interest as security for the performance by Tenant of its obligations
under this Lease. Landlord is authorized to deposit those funds in an account
commingled with Landlord's general funds or otherwise, and Landlord
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shall not be responsible for the solvency of the depository so long as it is
insured by the Federal Deposit Insurance Corporation or similar insurer. If
Tenant shall perform all such obligations, said security deposit shall be
refunded to Tenant within thirty (30) days after termination of this Lease. If
Tenant shall default in any obligation, Landlord shall be entitled to apply any
or all of said security deposit toward Landlord's damages as determined by
Landlord, and Tenant shall, within five (5) days after notice thereof, deposit
with Landlord an amount sufficient to restore said security deposit to its
original amount, which amount shall constitute "rent" under this Lease. The
security deposit shall not bear interest, until after the end of the second full
lease year, at which time the security deposit shall begin to bear interest at
then prevailing money market rates. Reference in this Lease to the "security
deposit" shall include interest, if any, accrued thereon.
7. TAXES:
A. Tenant agrees to pay to Landlord Tenant's proportionate share
of all real estate taxes which are levied, imposed, or assessed, from time to
time, upon or against the Improvements and the real property of which the
Improvements are a part. Such proportionate share shall consist of the ratio
that the square footage of the Premises bears to the square footage of the
Improvements. The parties agree that the square footage of the Premises comprise
thirty-six and two tenths percent (36.2%) of the square footage of the
Improvements. Tenant shall make any such payment to Landlord within twenty (20)
days after Landlord submits a bill therefore to Tenant. If Landlord undertakes
any action to contest the amount of real estate taxes applicable to the
Improvements, or the real property of which the Improvements are a part, the
Tenant shall, within twenty (20) days after Landlord submits a bill therefore
reimburse Landlord for thirty-six and two tenths percent (36.2%) of any and all
reasonable costs, fees and expenses incurred by Landlord in connection with any
such contest, including, but not limited to Landlord's reasonable legal,
accounting and appraisal fees. If Landlord obtains a reduction in real estate
taxes retroactive to any tax year for which Tenant has previously paid Landlord
its proportionate share of real estate taxes pursuant to this Paragraph 7.A.,
then Landlord shall credit Tenant with Tenant's proportionate share of such
reduction, net of the costs, fees and expenses described in the preceding
sentence, against Tenant's proportionate share of real estate taxes next due
under this Lease, all prorated, if the reduction occurred during a year in which
this Lease was not in effect for a full year.
B. For purposes of this Paragraph 7, the term "real estate taxes"
shall include any taxes, assessments and charges against the Improvements or the
land of which the Improvements are a part (including assessments by any City,
County, Municipality, Metropolitan District or Commission), but shall exclude
penalties or interest for late payment and federal, state and local income
taxes.
C. If at any time during the term of this Lease, the present
method of taxation shall be changed so that in lieu of the whole or any part of
any taxes, assessments, levies, or charges levied, assessed or imposed on real
estate and the improvements thereon, there shall be levied, assessed or imposed
on Landlord, a capital levy or other tax directly on the rents received
therefrom and/or a franchise tax assessment, levy, or charge measured by or
based, in whole or in part, upon the rents of the Improvements, then such taxes,
assessments, levies, or charges that
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are in lieu of the present method of taxation shall be deemed to be included
within the term "real estate taxes" for the purposes hereof.
D. Tenant shall be liable for all taxes levied against personal
property and trade fixtures placed by Tenant in the Premises. If any such taxes
based on the personal property or trade fixtures placed by Tenant in the
Premises are levied against Landlord or Landlord's property and if Landlord
elects to pay the same or if the assessed value of Landlord's property is
increased by inclusion of personal property and trade fixtures placed by Tenant
in the Premises and Landlord elects to pay the taxes based on such increase,
Tenant shall pay to Landlord within twenty (20) days after demand (which demand
shall include documentation evidencing such increase) that part of such taxes
for which Tenant is liable hereunder.
8. FIRE AND EXTENDED COVERAGE AND RENTAL INSURANCE:
A. Tenant shall pay to Landlord Tenant's proportionate share of
all premiums for all fire and extended coverage insurance on the Improvements,
all rental insurance or any other insurance carried by Landlord from time to
time. Tenant's proportionate share shall be thirty-six and two tenths percent
(36.2%).
B. Premiums shall be adjusted and pro-rated to the Commencement
Date or the Termination Date of the term of this Lease, as the case may be.
C. Tenant shall pay its proportionate share of such insurance
premiums as set forth above within twenty (20) days after Landlord submits a
bill, together with a statement of its calculations supported by copies of the
actual billings rendered to Landlord.
D. Tenant will not do, omit to do, or suffer to be done or keep
or suffer to be kept anything in, upon, or about the Premises that will violate
the provisions of Landlord's policies insuring the Premises and the Improvements
against loss or damage by fire or other hazards (including, but not limited to,
public liability), that will materially adversely affect Landlord's fire or
liability insurance premium rating or that will prevent Landlord from procuring
such policies in companies acceptable to Landlord. If anything done, omitted to
be done, or suffered to be done by Tenant, or kept or suffered by Tenant to be
kept in, upon, or about the Premises, shall cause any increase in premiums for
fire and extended coverage insurance, or rental insurance on the Improvements
above the rate in effect as of the date of this Lease, for the uses in existence
as of the date of this Lease, (such uses, including, but not limited to, general
warehouse and the assembly and manufacture of electronic technology components),
Tenant shall pay the additional premiums by reason thereof. Bills for such
additional premiums shall be rendered by Landlord to Tenant at such times as
Landlord may elect and shall be due from and payable by Tenant within twenty
(20) days after the date such bills shall be rendered, and the amount thereof
shall be deemed to be, and be paid as, additional rent. In addition, if
applicable, Landlord may at its option rectify the condition existing on the
Premises that is causing or is a contributing cause of the increased premium
rate in the event that Tenant should fail to do so after thirty (30) days prior
written notice from Landlord, and Landlord may charge the cost of such action to
Tenant as additional rent.
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E. Tenant shall obtain and maintain fire insurance with standard
broad form extended coverage and full replacement cost endorsements covering all
of Tenant's contents, furniture, furnishings, machinery, such equipment as is
not affixed to the Premises, trade fixtures and signs and Tenant's interest in
all of the improvements and alterations installed in the Premises by Tenant. A
certificate evidencing such insurance shall be delivered to Landlord prior to
the Commencement Date and as otherwise reasonably required by Landlord and
evidence of renewals shall be delivered to Landlord annually and as otherwise
reasonably required by Landlord.
F. Notwithstanding anything to the contrary contained in
Paragraph 8.A, if the Property and other properties owned by landlord or its
affiliates are insured under a blanket insurance policy and the loss experience
for one or more of the other properties under such policy result in an increase
in the premium for such policy, then, so long as such loss experience continues
to cause an increase in the premium for such policy, the amount that Tenant is
required to pay pursuant to Paragraph 8.A., may not increase by more than 10%
per year. For instance, if in year 3 of the lease, Tenant paid $1,000 on account
of its obligations pursuant to Paragraph 8.A, and in year 4 of the lease, on
account of an increase in premiums resulting from the loss experience of one or
more of the other properties under landlord's blanket policy, Tenant would,
absent this provision, be required to pay $1,250, Tenant's obligation during
year 4 under Paragraph 8.A., would be capped at $1,100.
9. COMMON AREA:
A. Tenant shall pay to Landlord, within twenty (20) days after
demand, as additional rent, thirty-six and two tenths percent (36.2%) of all
actual costs incurred by Landlord, from time to time, for common area
maintenance, which includes, but is not limited to, snow and ice removal,
parking lot maintenance, grass cutting, grounds maintenance, landscaping,
security, repairs to or replacements of the Improvements or portions thereof and
common area electric and for water and sewer charges for all of the Improvements
during the term of this Lease.
B. Subject to the remaining provisions of this Paragraph 9.B.,
all common areas shall be subject to the exclusive control of Landlord. Landlord
shall operate, manage, equip, police, light and maintain the common areas in a
manner comparable to similar buildings in the Annapolis Junction Business Park.
Landlord shall use commercially reasonable efforts not, in so doing, to
materially adversely affect Tenant's use and occupancy of the Premises. Landlord
hereby expressly reserves the right (but not the obligation) to maintain
security for the common areas; to use and to allow others to use the common
areas for any legal purpose; to change the size, area, level, location and
arrangement of the common areas; to close temporarily all or any portion of the
common areas for the purpose of making repairs, changes, or alterations thereto
or performing necessary maintenance in connection with any emergency or for any
other purpose whatsoever, whether such purpose is similar or dissimilar to the
foregoing. If the size, area, level, location or arrangement of such common
areas or the type of facilities at any time forming a part thereof be changed,
altered, rearranged or diminished, Landlord shall not be subject to any
liability therefor, nor shall Tenant be entitled to any compensation or
diminution or abatement of rent therefor, nor shall such alteration,
rearrangement, revocation, change or diminution of such common areas be deemed a
constructive or actual eviction or otherwise be grounds for terminating or
modifying this Lease, provided, however, if the same shall materially
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adversely affect the ability of Tenant to carry on its business in the
Premises, then, within thirty (30) days after any such change, alteration,
rearrangement or diminution, Tenant, provided Tenant has first given Landlord
prompt written notice of the material, adverse effect upon Tenant and sixty
(60) days to cure, shall have the right to terminate this Lease, in which
event, the Landlord shall return any security deposit to Tenant and Landlord
shall have no further liability to Tenant under this Lease. Tenant shall not
obstruct the common areas or use them for any purpose other than their
customary or intended purposes. Prior to making a material alteration to the
common areas, Landlord will notify Tenant of its proposed alterations or
modifications.
10. UTILITIES:
Tenant shall pay when due all charges for gas, electricity, light,
heat, power and all other utilities and telephone or other communication
services used, rendered or supplied upon or in connection with the Premises.
Tenant shall have the right to install, at its expense, an above-ground propane
storage tank for use in Tenant's operations in the Premises, provided the same
is permitted by applicable laws and restrictive covenants. The tank shall be
located in an area reasonably acceptable to Landlord and Tenant. Tenant shall
cause such tank to be maintained in good condition and appearance. At the
expiration or earlier termination of this Lease, Tenant shall cause such tank to
be removed at Tenant's sole cost and expense. Tenant shall be responsible for
any increased insurance costs related to the installation or use of the tank.
Tenant shall also have the right to use the existing propane tank on the
property for the purpose of supplying propane to the Premises for Tenant's use.
Tenant shall pay the cost for the propane it uses.
11. LIENS OR ENCUMBRANCES:
Tenant shall not do or suffer to be done any act, matter or thing
whereby Landlord's or Tenant's interest in the Premises, or any part thereof,
may be encumbered by any mechanics' lien. Tenant shall discharge or stay the
enforcement by bond or otherwise, within fifteen (15) days after the date of
filing, any final or interlocutory mechanics' liens filed against Landlord's or
Tenant's interest in the Premises, or any part thereof, purporting to be for
labor or material furnished or to be furnished to Tenant. Landlord may, at its
option, discharge by bond or otherwise any such mechanics' lien not discharged
by Tenant within such fifteen (15) day period, and Tenant, within twenty (20)
days after demand, shall reimburse Landlord for any such expense incurred by
Landlord. Any monies expended by Landlord shall be deemed additional rent,
collectible as such by Landlord and the late charge specified in Paragraph 4
shall accrue from the date Landlord pays such expenses. Landlord shall not be
liable for any labor or materials furnished or to be furnished to Tenant upon
credit, and no mechanics' or other lien for labor or materials shall attach to
or affect the reversionary or other estate or interest of Landlord in and to the
Premises or the Improvements.
12. USE OF PREMISES:
A. Tenant shall use and occupy the Premises throughout the term
hereof solely for the purpose of research and administrative offices, the
fabrication of biodegradable container equipment, and general warehouse
purposes. Furthermore, no use of the Premises shall be made or permitted to be
made that shall result in: (i) waste of the Premises or any part
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thereof; (ii) a public or private nuisance that may disturb the quiet enjoyment
of Landlord or other tenants of the Improvements; (iii) unlawful use; or (iv)
noises, vibrations, odors or anything else that may unreasonably disturb the
Landlord or other tenants.
B. Tenant shall not load the Premises beyond their present
carrying capacity of 125 pounds per square foot.
13. ALTERATIONS AND IMPROVEMENTS:
A. Upon completion of the tenant improvements in accordance with
Paragraph 2 hereof, Landlord shall assign to Tenant all warranties relating to
such tenant improvements and shall have no further obligation to make any
alterations or improvements to the Premises except as provided in Paragraph
14.C. hereof.
B. Tenant further covenants that it will at no time or times make
any alterations, improvements or changes of any kind to the Premises (structural
or otherwise) without first submitting the plans thereof and securing the prior
written consent of the Landlord, which consent shall not be unreasonably
withheld. Tenant may either:
1) Contract with Landlord or Landlord's agent to make
alterations and improvements at Tenant's expense, or
2) Contract with any licensed contractor to make alterations
and improvements after first providing the following items to Landlord and
obtaining Landlord's written consent therefore (which consent shall not be
unreasonably withheld):
a) approval of the Fire Marshal of the authority having
jurisdiction (City or State), and
b) copy of a building permit issued by the local
authority having jurisdiction (City or County) or evidence from the authority
that no permit is required, and
c) copy of license of contractor performing the work,
and
d) copy of insurance certificate from contractor naming
the Landlord as an additional insured and showing evidence of coverages as
reasonably required by Landlord, but at least equal to the following:
<CAPTION>
TYPE LIMITS
---- ------
General Liability Each occurrence $1,000,000
general aggregate $2,000,000
Automobile Liability Each accident $1,000,000
Workers Compensation Statutory
e) release of mechanic's liens for all work to be
performed.
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Notwithstanding the foregoing provisions of this Paragraph 13.B.,
Tenant shall not be required to obtain Landlord's prior written consent with
respect to alterations, improvements or changes which are cosmetic in nature
(and are not visible from the exterior of the Premises) or which do not affect
the roof, exterior or structural, mechanical, plumbing or electrical elements or
systems of the Premises.
C. Tenant further covenants that if it makes alterations and
improvements to the Premises that:
1) During the construction period, Landlord or Landlord's
agent will have reasonable access to the Premises at their risk to verify that
all work is in accordance with approved plans. Tenant shall reimburse Landlord
for all reasonable costs incurred for inspection services.
2) Within thirty (30) days of completion of construction,
Tenant will, if required by applicable law or any Mortgagee (defined below),
furnish Landlord copies of a Fire Marshal's Final Inspection Report and a
Certificate of Occupancy or use, issued by the local authority having
jurisdiction.
3) At the end of term of this Lease, at Landlord's sole
option, the Tenant shall remove all alterations and improvements and restore the
Premises to its prior condition at Tenant's sole cost (ordinary wear and tear
excluded).
4) All improvements, alterations, replacements and building
service equipment made or installed by or on behalf of Tenant and permanently
affixed to the Improvements shall immediately upon completion or installment
thereof be and become the property of Landlord without payment therefor by
Landlord, but subject to the provisions of this Lease, including the provisions
of Paragraph 13.C(3) above and Paragraph 24.B. below, provided that all
machinery, equipment (other than building service equipment), trade fixtures,
movable partitions, furniture and furnishings installed by Tenant or maintained
on the Premises, even if permanently affixed thereof, shall remain the property
of Tenant, and Tenant shall be entitled to remove the same or any part thereof
at any time during the term of this Lease, but Tenant shall at its expense,
repair any and all damage to the Premises resulting from or caused by such
removal. The interest of Tenant in any property which is not so removed shall at
the end of the time provided for removal thereof vest in Landlord.
D. Landlord shall have the exclusive right to use all or any part
of the roof and exterior walls of the Improvements for any purpose; to make
alterations to the Improvements and to build adjoining the same; and to erect
and maintain in connection with any construction thereof, temporary scaffolds
and other aids to construction on the exterior of the Improvements, provided
Landlord shall use commercially reasonable efforts not to interfere unreasonably
with Tenant's use of the Premises. Landlord shall have access to the Premises
that may be necessary or desirable to perform such work, and Tenant shall not be
entitled to any abatement of rent on account thereof.
E. Notwithstanding anything to the contrary contained in this
Lease, at any time Tenant requests Landlord's written consent for an alteration
or improvement to the
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Premises, the Tenant may specifically request Landlord to advise Tenant, in
writing, at such time, whether or not Landlord will, at the expiration or
earlier termination of the Lease, require such alteration or such improvement to
be removed and Tenant to restore the Premises to its condition prior to the
installation thereof. If Tenant makes such specific written request, then
Landlord must elect, in writing, whether or not the alteration or improvement
must be removed at the expiration or earlier termination of this Lease and such
election shall be binding upon Landlord.
F. All work done by Tenant, or its agents, contractors or
employees shall be done in a good and workmanlike manner.
14. REPAIRS AND MAINTENANCE:
A. Tenant covenants throughout the term of this Lease, at its
expense, to maintain in good order and repair and replace when necessary the
Premises, including, but not limited to, all window and door glass therein,
interior and exterior, the floor, all interior structural elements, and all
building service equipment therein or exclusively serving the Premises
including, but not limited to, electrical, plumbing, heating, air conditioning
and sprinkler equipment, pipes, wires, ducts, fixtures and appliances, except
where such items are damaged by Landlord or its agents, employees or contractors
(and in the event such items are damaged by Landlord or its agents, employees or
contractors, Tenant shall provide Landlord with all insurance proceeds, if any,
which are available to Tenant on account of such damage). Tenant further
covenants to keep the Premises in a safe, clean and sanitary condition, to
provide for the removal of trash and rubbish; and to surrender the Premises at
the end of the tern in as good condition as when received except for ordinary
wear, tear and use, fire or other unavoidable casualty.
B. Without limiting Tenant's obligations under Paragraph 14.A.
above, Tenant shall, at all times during the term of this Lease, have and keep
in force a maintenance contract, in form and with a contractor reasonably
satisfactory to Landlord, providing for inspection at least once each calendar
quarter of the heating, air conditioning and ventilating equipment (which
inspection shall encompass the work described on Exhibit D attached hereto and
made a part hereof), and providing for necessary repairs thereto. Said contract
shall provide that it will not be cancelable by either party thereto except upon
thirty (30) days' prior written notice to Landlord. Tenant shall send to
Landlord a copy of this contract within thirty (30) days of the Commencement
Date of this Lease, as well as provide Landlord with copies of all service calls
and reports within fifteen (15) days after any service call.
C. Landlord agrees to perform at its expense and in a good and
workmanlike manner, maintenance to the exterior structure of the Improvements
and roof except when such repairs are necessitated by negligence or intentional
or other act of the Tenant or Tenant's agents, servants, contractors, invitees
or licensees.
D. The Tenant covenants and agrees that the Landlord shall not be
held responsible for and the Landlord is hereby released and relieved from, and
forever saved harmless from, any liability by reason of or resulting from damage
or injury to person or property of the Tenant or of anyone else, directly or
indirectly caused by
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(1) dampness or water in any part of the Premises or in any
part of any other property of the Landlord or of others and/or
(2) any leak or break in any part of the Premises or in any
part of any other property of the Landlord or of others or in the pipes of the
plumbing or heating works thereof, no matter how caused.
E. Landlord shall have no liability to Tenant by reason of any
inconvenience, annoyance, interruption, or injury to business arising from the
making of any repairs or changes that Landlord is required or permitted by this
Lease to make, or by any other tenant's lease or required by law to make in or
to any portion of the Premises, Improvements or common areas, but Landlord
agrees to act in a commercially reasonable manner when making such repairs or
changes.
15. LIABILITY INSURANCE:
A. Tenant shall obtain and maintain public liability insurance in
form and substance reasonably satisfactory to Landlord or as required by any
Mortgagee, from time to time insuring Landlord and if Landlord so elects, any
Mortgagee and such other person(s) as required by Landlord, against claims for
bodily injury or death or property damage occurring in or about the Premises and
on, in or about the adjoining driveways and passageways, with limits as
reasonably required by Landlord or as required by any Mortgagee, from time to
time, but in no event with combined single limits less than Three Million
Dollars ($3,000,000.00) per occurrence, and in the aggregate. Such liability
insurance shall, in addition, extend, through contractual liability insurance,
to any liability of Tenant arising out of the indemnifications provided in this
Lease and shall be subject to the waiver of subrogation specified in this Lease.
Such policy of insurance shall provide that notwithstanding any negligent act of
Tenant which might otherwise result in its forfeiture, the policy shall not be
canceled without at least thirty (30) days written notice to each named insured.
A copy of (or, if satisfactory to each Mortgagee, a certificate evidencing) said
policy shall be delivered to Landlord, prior to the Commencement Date and as
otherwise reasonably required by Landlord or as required by any Mortgagee, and
evidence of renewals shall be delivered to Landlord annually and as otherwise
reasonably required by Landlord or as required by any Mortgagee. If Tenant is
required to supply a copy of said policy, Landlord shall be responsible for the
copying costs incurred in obtaining a copy of said policy.
B. Landlord agrees to maintain commercially reasonable casualty
insurance with respect to the Improvements throughout the term of this Lease.
16. DAMAGE OR DESTRUCTION:
A. If during the term of this Lease the Premises or the
Improvements are damaged by fire or other casualty, but not to the extent that
Tenant is prevented from carrying on its business in the Premises, Landlord (at
its expense - but in all events subject to the provisions of Paragraph 16.C.
below) shall promptly restore the Premises or the Improvements to their
condition immediately prior to the casualty and the rent and additional rent
shall not be abated.
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B. If during the term of this Lease the Premises are destroyed or
so damaged by fire or other casualty that Tenant is prevented from carrying on
business in the Premises or if more than twenty percent (20%) of the floor area
of the Improvements is destroyed or damaged (whether or not the Premises shall
be affected), Landlord shall have the option either to restore the Premises or
such other portion of the Improvements to their condition immediately prior to
the casualty or to terminate this Lease. Such option shall be exercised by
Landlord by written notice to Tenant within thirty (30) days after the casualty.
C. If Landlord chooses to restore the Premises, it shall prepare
or cause to be prepared a reasonable estimate of the time needed to restore the
Premises to their condition immediately prior to the casualty. Such estimate
shall accompany the written notice to Tenant. If the time period indicated in
the notice exceeds one hundred twenty (120) days, Tenant may terminate this
Lease within ten (10) days of receipt of Landlord's notice, provided, however,
that termination shall not occur unless Landlord's lender has been given notice
and opportunity to cause repairs to be made within a reasonable time. In no
event shall Landlord be obligated to expend for any repairs or reconstruction
pursuant to this Paragraph 16 an amount in excess of the insurance proceeds, if
any, recovered by it and allocable to the damage to the Premises after deducting
therefrom Landlord's reasonable expenses in obtaining such proceeds and any
amounts required to be paid to any lender of Landlord. Landlord shall not be
responsible to repair or restore any alterations or improvements made by Tenant
or any of Tenant's machinery, equipment, trade fixtures, movable partitions,
furniture and furnishings.
D. If the restoration period is less than the period indicated
above or if Tenant agrees to a period in excess of one hundred twenty (120)
days, then Landlord shall promptly commence such repair work and diligently
proceed to complete the same.
E. Rent shall be equitably abated for any period that the
Premises are destroyed or damaged to the extent that Tenant is substantially
prevented from carrying on its business in the Premises.
F. Notwithstanding anything to the contrary contained in this
Paragraph 16, in the event that the Premises shall not be substantially restored
within one hundred eighty (180) days after Landlord provides the written notice
to Tenant described in Paragraph 16.13. above (or, if no such notice is given,
after the last date on which such notice could have been given), then Tenant
shall have the right, at any time within thirty (30) days after the expiration
of such one hundred eighty (180) day period, to terminate this Lease, in which
event Landlord shall return any security deposit to Tenant and neither Landlord
nor Tenant shall have any further liability to the other in connection with this
Lease (except with respect to obligations or liabilities which accrued prior to
the date of such termination or which relate to surrender of the Premises).
17. COMPLIANCE WITH REGULATIONS, ETC.:
Tenant covenants throughout the term of this Lease at its expense to
comply promptly with all laws, codes, ordinances, administrative and court
orders and directives, rules and regulations, whether now in effect or hereafter
promulgated, applicable to the Premises and/or Tenant's use and occupancy of the
Premises and with all recorded covenants, conditions, easements, agreements and
restrictions that affect the Premises; provided, however, that Tenant
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shall have the right to contest the applicability and/or validity of any of the
above so long as by reason of such action, the Premises or the Improvements
would not be in danger of forfeiture or loss and so long as Tenant shall comply
with such reasonable conditions as Landlord may stipulate to protect Landlord,
the Premises and the Improvements from loss, expense or liability.
Notwithstanding anything to the contrary contained in this Paragraph 17, in the
event that some aspect of the Premises is not, as of the day prior to the
Commencement Date in compliance with the Americans With Disabilities Act of
1990, then Tenant shall not be required to take any action to cause such aspect
of the Premises to comply with such Act.
18. CONDEMNATION:
A. If during the term of this Lease all or a substantial part of
the Premises or the Improvements shall be taken by eminent domain, then at the
option of Tenant or Landlord this Lease shall terminate as of, and the rent
shall be apportioned to and abate from and after, the date of taking. Tenant
shall have no claim against Landlord or the condemning authority for the value
of the unexpired term of this Lease and no right to participate in any award or
damages for such taking (except as set forth in sub-paragraph E hereof) and
hereby assigns all of its right, title and interest therein to Landlord. For
purposes of this Paragraph 18, "a substantial part of the Premises or the
Improvements" shall mean a taking which renders Tenant unable or substantially
unable to carry on its business on the Premises in substantially the manner it
was carried on prior to such taking.
B. If during the term of this Lease, less than "a substantial
part of the Premises or the Improvements" shall be taken by eminent domain, this
Lease shall remain in full force and effect according to its terms; and Tenant
shall have no right to participate in any award or damages for such taking and
hereby assigns all of its right, title and interest therein to Landlord;
provided that Landlord shall at its expense promptly make such repairs and
improvements as shall be necessary to restore the Premises to substantially the
same efficiency as before the taking.
C. If the whole or any part of the Improvements shall be so
taken, then in such event notwithstanding that the Premises in whole or in part
is not so taken or conveyed, Landlord shall have the right and power, at its
option to be exercised by written notice to Tenant, to terminate this Lease
effective either the date title vests in the condemning authority or the date
Landlord is required to deliver possession of the part so taken or conveyed. In
any event, Tenant shall have no claim against Landlord or the condemning
authority for the value of any unexpired term of this Lease.
D. For the purpose of this Paragraph 18, "taken by eminent
domain" or "taking under the power of eminent domain" shall include a negotiated
sale or lease and transfer of possession to a condemning authority under bona
fide threat of condemnation for public use, and Landlord alone shall have the
right to negotiate with the condemning authority and conduct and settle all
litigation connected with the condemnation. As hereinabove used, the words
"award of damage" shall, in the event of such sale or settlement, include the
purchase or settlement price of any such negotiated transfer.
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E. Nothing herein shall be deemed to prevent Tenant from
claiming, negotiating and receiving from the condemning authority, if legally
payable, compensation for the taking of Tenant's own tangible property,
improvements upon the Premises constructed at Tenant's sole expense and damages
for Tenant's loss of business, business interruption and/or removal and
relocation. Should the condemnation be effected without a cancellation of this
Lease, there shall be an appropriate reduction in rent commensurate with the
area so taken.
19. LANDLORD'S RIGHT TO PERFORM TENANT'S COVENANTS:
If Tenant shall fail to perform any agreement, covenant or duty
required of it by this Lease or by law, Landlord shall at any time within ten
(10) days after written notice to Tenant (provided, no written notice and/or
cure period shall be required in the event of an emergency) have the right (but
not the duty) to perform the same, including but not limited to the right to
enter the Premises, if necessary, without any liability to Tenant for damage to
the Premises or otherwise, to perform the same, but the reasonable cost thereof
shall be deemed to be additional rent, and shall give the Landlord the same
rights and remedies as though the additional rent were part of the monthly rent
due the Landlord under this Lease.
20. INDEMNIFICATION AND WAIVER OF CLAIM:
A. Except to the extent the claim results from the negligence or
intentional misconduct of Landlord or its agents or employees, Tenant will
defend and will indemnify Landlord and save it harmless from and against any and
all claims, actions, damages, liability, and expense (including, but not limited
to, reasonable attorney's fees) in connection with the loss of life, bodily
injury, or damage to property or business arising from, related to, or in
connection with the occupancy or use by Tenant or any assignee, subtenant,
concessionaire, or licensee of the Premises or the Improvements or occasioned
wholly or in part by any act or omission of Tenant or any assignee, subtenant,
concessionaire, or licensee or its or their contractors, subcontractors, agents,
employees, invitees or other persons on the Premises. Tenant shall also pay all
costs, expenses, and reasonable attorney's fees that may be expended or incurred
by Landlord in enforcing or defending against the enforcement of the covenants
and agreements of this Lease.
B. Landlord shall not be liable for, and Tenant, in consideration
of Landlord's execution of this Lease, hereby releases all claims against
Landlord for loss or damage that may be occasioned by or through the acts or
omissions of other tenants, their contractors and subcontractors and their
agents, employees or invitees, or for loss of life, bodily injury, or damage to
property or business sustained by Tenant or any person claiming through Tenant
or on the Premises resulting from any fire, accident, occurrence, or any other
condition in or upon the Premises or any part thereof including, but not limited
to, such claims for loss of life, bodily injury, or damage resulting from (a)
any defect in or failure of plumbing or plumbing fixtures, heating equipment,
electrical wiring or installation thereof, water pipes, stairs, elevators,
railings, or walks; (b) any equipment or appurtenances being out of repair; (c)
the bursting, leaking, or running of any tank, washstand, water closet, waste
pipe, drain, or any other pipe or tank in, upon, or about the Premises; (d) the
backing up of any sewer pipe; (e) the escape of steam or hot water; (f) water,
snow, or ice being upon or coming through the roof or any other place upon or
near the Premises or the Improvements or otherwise; (g) the falling of any
fixture, plaster, brick,
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mortar, or stucco; (h) broken glass; and (i) any act or omission of other
tenants or other occupants of the Premises.
C. Notwithstanding anything to the contrary contained in this
Lease, Landlord and Tenant do mutually each release and discharge the other, and
all persons against whom their insurance company or companies would have a right
or claim by virtue of subrogation, of and from all suits, claims, and demands
whatsoever, for loss or damage to the property of the other, even if caused by
or occurring through or as a result of any negligent act or omission of the
party released hereby or its contractors, subcontractors, agents, or employees,
so long as and to the extent that such loss or damage is covered by insurance
benefiting the party suffering such loss or damage or was expressly required to
be so covered under this Lease. Each party further agrees that each will cause
its policies of insurance for fire and extended coverage to be so written as to
include a waiver of subrogation by causing such policies to contain a clause in
substantially the following form:
It is hereby stipulated that this insurance shall not be
invalidated should the insured or any of them waive in writing
prior to a loss any or all right of recovery against any person
or entity for loss occurring to the property described herein.
D. The provisions of this Paragraph 20 shall survive the
termination or earlier expiration of the Term of this Lease.
21. DEFAULT PROVISIONS: Tenant shall have breached this Lease and
shall be considered in default hereunder if:
(1) Tenant fails to pay any installment of Basic Rental or
additional rent when due and payable and such failure continues for five (5)
days after notice thereof is sent to Tenant;
(2) Tenant fails to perform any of the other covenants or
conditions of this Lease on the part of Tenant to be performed (other than those
described elsewhere in this Paragraph 21) and such failure continues for fifteen
(15) days after notice thereof is sent to Tenant provided, however, if such
failure is of such a nature that it cannot be cured within fifteen (15) days,
then Tenant shall not have breached this Lease and shall not be considered in
default hereunder so long as Tenant commences cure within such fifteen (15) day
period and thereafter continuously and diligently pursues cure and attempts to
complete cure as promptly as possible;
(3) Tenant makes an assignment for the benefit of its
creditors or any guarantor of Tenant's obligations under this Lease (a
"Guarantor") makes an assignment for the benefit of such Guarantor's creditors;
(4) a receiver or trustee is appointed for all or part of
the property of Tenant or any Guarantor, provided, however, if such receiver or
trustee is appointed on the motion of a party other than Tenant or such
Guarantor, then Tenant shall not have breached this Lease and shall not be
considered in default hereunder so long as such receiver or trustee is dismissed
within sixty (60) days of the date of its appointment;
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(5) Tenant or any Guarantor files a petition in bankruptcy;
(6) there is filed against Tenant or any Guarantor a
petition in bankruptcy or for its reorganization or for an arrangement under any
bankruptcy law or other law and the same is not dismissed within sixty (60) days
after the date filed;
(7) Tenant or any Guarantor becomes insolvent;
(8) the Premises shall be abandoned, deserted or become
vacant, unless Tenant shall have first given Landlord not less than thirty (30)
days prior written notice, specifying the date upon which Tenant intends to
abandon, desert or vacate the Premises; or
(9) Any final or interlocutory lien is established against
the Premises or Tenant's interest in this Lease or any lien or levy is
established or made against any of Tenant's property or assets and the same is
not discharged or bonded within ten (10) days after the date it is established.
22. REMEDIES OF LANDLORD:
A. In the event of a breach (beyond applicable grace or cure
periods) of this Lease as set forth in Paragraph 21 above, Landlord shall have
the option to do any of the following in addition to and not in limitation of
any other remedy permitted by law or by this Lease: (i) to re-enter the Premises
to dispossess Tenant and all other occupants from the Premises and to remove any
or all of Tenant's property at the Premises, (ii) to store Tenant's property in
a public warehouse or elsewhere at the cost, risk, and expense of Tenant,
without Landlord's being deemed guilty of trespass or becoming liable for any
loss or damage which may occur on Tenant's property, and (iii) upon ten (10)
days' written notice to Tenant, which the parties agree is commercially
reasonable, to sell at public or private sale any or all of said property,
whether exempt or not from sale under execution or attachment, with the proceeds
of sale to be applied: first, to the costs and expenses of retaking, removal,
storage, preparing for sale, and sale of the property (including reasonable
attorneys' fees); and second, to the payment of any sum due hereunder to
Landlord (including rent, charges, and damages, both theretofore and thereafter
accruing); and, third, any surplus to Tenant or the person otherwise entitled
thereto.
B. Further, upon the occurrence of any such breach (beyond
applicable grace or cure periods), Landlord, in addition to any other remedies
it may have at law, in equity, by statute, or under any other provision of this
Lease, shall have the right to terminate this Lease, as well as all right,
title, and interest of Tenant hereunder, by giving to Tenant not less than five
(5) days' advance written notice of Landlord's election to cancel and to
terminate this Lease. Upon the expiration of the time fixed in the notice of
termination, this Lease and the balance of the term of this Lease then
remaining, as well as all of the right, title, and interest of Tenant under this
Lease, shall expire in the same manner and with the same force and effect
(except for the Tenant's liability as hereinafter set forth) as if the
expiration of the time fixed in the notice of termination were the date upon
which the term of this Lease would normally have expired. Tenant shall then
immediately quit and surrender the Premises and each and every part thereof to
Landlord, and Landlord may enter upon the Premises by summary proceedings or
otherwise. In
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any of such events, Landlord shall be entitled to the benefit of all provisions
of the ordinances and public local laws of the city or county where the Property
is located and of the Public General Laws of the State of Maryland dealing with
the speedy recovery of lands and tenements held over by tenants or proceedings
in forcible entry and detainer. Upon any entry or re-entry by Landlord, with or
without legal process, Landlord shall also have the right (but not the
obligation) to relet all or any part of the Premises, from time to time, at the
risk and expense of Tenant. No re-entry by Landlord with or without a
declaration of termination shall be deemed to be an acceptance or a surrender of
this Lease or as a release of Tenant's liability for damages under the
provisions of this Paragraph 22. Tenant hereby forever waives and relinquishes
(i) any and all rights of redemption or reinstatement now or hereafter existing
at law or in equity or provided by statute, and (ii) any right to bring a
counterclaim in any action brought by Landlord for nonpayment of rent or any
other summary proceedings thereon or in any action for recovery of the Premises.
Landlord agrees that if Tenant fails to bring a counterclaim in any action
brought by Landlord for nonpayment of rent, or any other summary proceedings
thereon, or in any action for recovery of the Premises, Landlord shall not
thereafter assert a defense based upon res adjudicata or collateral estoppel,
with respect to any such counterclaim or the elements thereof, which was not
brought by Tenant on account of its compliance with the provisions of the
preceding sentence.
C. Tenant further agrees (i) notwithstanding re-entry by Landlord
with or without termination pursuant to the provisions of subpart A or B of this
Paragraph 22, or (ii) if this Lease is otherwise terminated by reason of
Tenant's default, or (iii) if Landlord retakes possession with or without
process of law and/or re-enters with or without a declaration of termination, or
(iv) if Landlord, following any of the foregoing events, elects to let or relet
the Premises (whether once or more than once during the remainder of the term of
this Lease, and upon such conditions as are satisfactory to Landlord) that
Tenant shall, nevertheless, in each instance, remain liable for the performance
of any covenant of this Lease then in default and for all rent and all other
charges and damages that may be due or sustained before and after the date of
default and/or termination, together with the cost of seizure and repossession
of the Premises and attorney's fees incurred by Landlord as a result of the
breach of this Lease.
D. In any of the events described above, Tenant agrees that it
will remain liable to Landlord for liquidated damages to be calculated and paid,
at Landlord's option, in either of the following ways:
(i) the rent that, but for the termination of this Lease,
would have become due during the remainder of the term of this Lease, less the
amount or amounts of rent, if any, that Landlord shall receive during such
period from others to whom the Premises may be rented net of all costs and
expenses incurred by Landlord in connection with Tenant's default, including,
but not limited to, the cost to repair, restore, renovate, or decorate the
Premises for a new tenant, attorney's fees, real estate commissions, the cost of
any legal actions brought against Tenant, in which case liquidated damages shall
be computed and payable in monthly installments, in advance, on the first day of
each calendar month following the termination of this Lease and shall continue
until the date on which the term of this Lease would have expired but for such
termination; or
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(ii) the rent that, but for the termination of this Lease,
would have become due during the remainder of the term of this Lease, less the
fair rental value of the Premises, as determined by an independent real estate
appraiser selected by Landlord. Such amount shall then be discounted to present
value at a rate of interest equal to the then applicable Federal Funds Rate
announced from time to time by the Federal Reserve Bank facility nearest the
Premises. Such liquidated damages shall be payable to Landlord in one lump sum,
on demand, and shall bear interest at the rate specified in Paragraph 4 hereof
until paid. In no event shall Landlord be required to account to Tenant for any
amounts by which the fair rental value shall have exceeded the stipulated rent
at the time of such termination.
E. Suit or suits for the recovery of such deficiency or damages
or for a sum equal to any installment of rent and other charges payable
hereunder may be brought by Landlord from time to time, at Landlord's election.
Nothing herein contained shall be deemed to require Landlord to await the date
when this Lease or the term of this Lease would have normally expired had there
been no such default by Tenant or no such termination by Landlord, nor shall
Landlord be barred by any claim involving a statute of limitations or other
defense should Landlord delay in filing suit.
F. In connection with any reletting(s) of the Premises, Landlord
shall have the absolute right, without such action's being or being deemed to be
a surrender of its rights or as a termination of this Lease or as a release of
the Tenant's liability hereunder for the balance of the term of this Lease to
let or relet the Premises for a longer or shorter term than that remaining after
Tenant's default, to lease more or less area than that contained in the
Premises, to lease the Premises together with other premises or property owned
or controlled by Landlord, and to change the character or use of the Premises.
G. No entry or re-entry by Landlord, whether had or taken under
summary proceedings or otherwise, nor any letting or reletting shall absolve or
discharge Tenant from liability hereunder. Tenant's liability hereunder, even if
there is no letting or reletting, shall survive the issuance of any dispossess
warrant, order of court terminating this Lease, or any other termination based
upon Tenant's default.
H. No payment received by Landlord from Tenant after re-entry or
the termination of this Lease in any manner shall reinstate, continue, or extend
the term of this Lease or affect any notice theretofore given to Tenant by
Landlord or operate as a waiver of the right of Landlord to recover possession
of the Premises by proper suit, action, proceedings, or other remedy.
I. In the event Tenant fails to vacate the Premises at any time
after termination of this Lease as provided above, Tenant shall pay one and
one-half (1 1/2) times the annual rent and additional rent for such holdover
period.
J. Nothing in this Paragraph 22 shall limit or prejudice the
right of Landlord to prove and to obtain, as liquidated damages by reason of a
termination arising out of the provisions of this Paragraph 22, an amount equal
to the maximum allowed by any statute or rule of law in effect as of the time
when, and governing the proceedings in which, such damages are
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to be proved, whether or not such amount be greater, equal to, or less than the
amount of liquidated damages computed under this Paragraph 22.
K. Notwithstanding anything to the contrary contained in this
Paragraph 22, in the event Tenant defaults (beyond applicable grace or cure
periods) under this Lease and vacates the Premises and removes all of its
property therefrom and otherwise returns the Premises to Landlord in the
condition which the Premises are required to be returned to Landlord at the
expiration of the term of this Lease and notifies Landlord, in writing, of
Tenant's desire that Landlord re-let the Premises, then Landlord will agree to
exercise commercially reasonable efforts to re-rent the Premises, provided,
however, that in no event shall Landlord be required to exert any efforts
whatsoever to re-rent the Premises at any time or times that Landlord is
attempting to lease any other space in the Improvements.
23. RELOCATION: Intentionally omitted.
24. SURRENDER OF PREMISES:
A. At the expiration or earlier termination of the term of this
Lease, Tenant shall peaceably surrender the Premises in broom clean condition
and good order and repair and otherwise in the same condition as the Premises
was upon the commencement of this Lease, except ordinary wear and tear, fire or
other unavoidable casualty.
B. If Landlord elects to require that alterations, installations,
changes, replacements, additions or improvements made by Tenant to the Premises
be removed at the termination of this Lease, Tenant hereby agrees to cause the
same to be removed at its sole cost and expense. If Tenant fails to remove the
same, Landlord may cause them to be removed at Tenant's expense, and Tenant
hereby agrees to reimburse Landlord for the reasonable cost of such removal
together with all and any damages which Landlord may suffer and sustain by
reason of the failure of Tenant to remove the same. At Landlord's election, any
or all of the alterations, installations, changes, replacements, additions to,
or improvements made by Tenant upon the Premises shall remain at the termination
of this Lease and not be removed. Tenant shall surrender to Landlord all keys
for the Premises at the place then fixed for the payment of rent and shall
notify Landlord in writing of all combinations of locks, safes, and vaults, if
any, in the Premises. Tenant's obligation to observe and perform the covenants
set forth in this Paragraph 24 shall survive the expiration or earlier
termination of this Lease.
C. At the expiration or earlier termination of this Lease, Tenant
shall immediately remove all property that it owns and is permitted to remove
from the Premises under the provisions of this Lease, and, failing to do so,
Landlord at its option may either (i) cause that property to be removed at the
risk and expense of Tenant (both as to loss and damage), and Tenant hereby
agrees to pay all costs and expenses incurred thereby, including sums paid to
store the property elsewhere and the cost of any repairs to the Premises caused
by the removal of the property, or (ii) upon ten (10) days' written notice to
Tenant, which the parties agree is commercially reasonable, sell at public or
private sale any or all of such property, whether exempt or not from sale under
execution or attachment, with the proceeds to be applied as set forth in
Paragraph 22.A., or (iii) at Landlord's option, title shall pass to Landlord.
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25. RIGHT TO ASSIGN AND SUBLEASE:
A. Tenant shall not make or permit an Assignment (defined below)
of this Lease or of the Premises or any interest of Tenant herein or therein, in
whole or in part, by operation of law or otherwise, without first obtaining in
each and every instance the prior written consent of Landlord, which consent
shall not be unreasonably withheld, conditioned or delayed. No less than fifteen
(15) days prior to the effective date of a proposed Assignment, Tenant shall
offer to reconvey to Landlord, as of the effective date, that portion of the
Premises which is the subject of the proposed Assignment, which offer shall
contain an undertaking by Tenant to accept, as full and adequate consideration
for the reconveyance, Landlord's release of Tenant from all fixture Basic Rental
and other obligations under this Lease with respect to the Premises or the
portion thereof so reconveyed. Landlord, in its absolute discretion, shall
accept or reject the offered reconveyance within fifteen (15) days of the offer,
and, if Landlord accepts, the reconveyance shall be evidenced by an agreement in
form and substance acceptable to Landlord. If Landlord fails to accept or reject
the offer within the fifteen (15) day period, Landlord shall be deemed to have
rejected the offer; however, no such rejection by Landlord shall be deemed to be
a consent to an Assignment. As used in this Lease, "Assignment" shall mean any
assignment, transfer, mortgage or encumbrance, whether voluntary, involuntary or
by operation of law, in whole or in part, of Tenant's interest in this Lease,
any sublease or license by Tenant of all or part of the space in the Premises,
or any agreement by Tenant giving any other person the right to use all or any
part of the Premises or any other event deemed an Assignment elsewhere in this
Lease.
B. Any consent by Landlord to an Assignment shall be held to
apply only to the specific transaction thereby authorized and shall not
constitute a waiver of the necessity for such consent to any subsequent
Assignment, including, but not limited to, a subsequent Assignment by any
trustee, receiver, liquidator, or personal representative of Tenant.
C. If this Lease or any interest herein be assigned in whole or
in part or if the Premises or any part thereof be sublet, used, or occupied by
anyone other than Tenant without Landlord's prior written consent having been
obtained thereto, Landlord may nevertheless collect rent (including additional
rent) from the assignee, sublessee, user, or occupant and apply the net amount
collected to the rents herein reserved. Furthermore, in the event of any
Assignment of this Lease or of the Premises or any interest of Tenant herein or
therein, in whole or in part, by operation of law or otherwise, Tenant shall pay
to Landlord monthly, as additional rent, fifty percent (50%) of the excess of
the net consideration received during such month for such Assignment (whether or
not denoted as rent) over the Basic Rental reserved for such month in this Lease
applicable to the portion of the Premises or of this Lease so assigned, sublet,
or occupied. In determining "net consideration", there shall be deducted from
the consideration received by Tenant during such month customary leasing
commissions paid to unrelated third parties by Tenant in connection with such
Assignment, reasonable concessions to unrelated third parties granted by Tenant
in connection with such Assignment, and any other reasonable out-of-pocket
expenses of Tenant paid to unrelated third parties in connection with such
Assignment. No such Assignment or collection shall be deemed a waiver of the
covenant herein against Assignment by others, or the acceptance of the assignee,
subtenant, user, or occupant as Tenant hereunder, or constitute a release of
Tenant from the further performance by Tenant of the terms and provisions of
this Lease. If this Lease or any interest of Tenant herein be assigned or if the
whole or any part of the Premises be sublet or used or occupied by others, after
having obtained
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Landlord's prior written consent thereto, Tenant shall nevertheless remain fully
liable for the full performance of all obligations under this Lease to be
performed by Tenant, and Tenant shall not be released therefrom in any manner.
D. If Tenant is a corporation and if at any time during the Term
of this Lease any part or all of the corporate shares of Tenant, or of a parent
corporation of which the Tenant is a direct or indirect subsidiary, shall be
transferred by sale, assignment, bequest, inheritance, operation of law, or
other disposition so as to result in a change in the present effective voting
control of Tenant or of such parent corporation by the person or persons owning
or controlling a majority of the shares of Tenant or of such parent corporation
on the date of this Lease, Tenant shall promptly notify Landlord in writing of
such change, and such change in voting control shall constitute an Assignment of
this Lease for all purposes of this Lease; provided, however, that this
provision shall not apply in the event that as of the date of this Lease over
fifty percent (50%) of the voting power of the Tenant corporation or of such
parent corporation is held by fifty (50) or more unrelated shareholders or
distributed to such number of unrelated shareholders in a public distribution of
securities. The foregoing provisions of this Paragraph 25.D., shall be of no
force or effect while the stock of Tenant is publicly traded and Tenant is
listed on a national stock exchange.
E. If Tenant is a partnership and if at any time during the Term
of this Lease any person or entity which at the time of the execution of this
Lease owns a general partner's interest ceases to own such general partner's
interest, such cessation of ownership shall constitute an Assignment of this
Lease for all purposes of this Lease, and Tenant shall promptly notify Landlord
in writing of such change.
26. INSPECTION BY LANDLORD. ETC.:
A. Landlord and its contractors and subcontractors, and its or
their agents and employees may at all reasonable times during the term of this
Lease enter to inspect the Premises and/or may show the Premises and
Improvements to others, provided that, except in the event of an emergency, such
entrance is with the prior notice to Tenant. Landlord shall also have the right
to display the customary "For Sale" and, during the last one hundred eighty
(180) days of the term, "For Rent" signs on the Premises.
B. Landlord also reserves the right, after notice of intention to
so enter (except that in the event of an emergency, no notice shall be
required), to enter the Premises at any time and from time to time to make such
repairs, additions, or alterations or remedy any contamination as it may deem
necessary for the safety, improvements, preservation, or condition thereof, or
of the Improvements, but Landlord assumes no obligation to do so, and the
performance thereof by Landlord shall not constitute a waiver of Tenant's
default in failing to perform the same. Landlord shall in no event be liable for
any inconvenience, disturbance, loss of business, or other damage to Tenant by
reason of the performance by Landlord of any work in, upon, above, under, or
outside the Premises. If during the last month of the term, Tenant has vacated
the Premises and removed all or substantially all of its personal property,
Landlord may immediately enter and alter, renovate, and redecorate the Premises.
The exercise of any such reserved right by Landlord shall not be deemed an
eviction or disturbance of Tenant's use and
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possession of the Premises and shall not render Landlord liable in any manner to
Tenant or to any other person, nor shall the same constitute any grounds for an
abatement of rent hereunder.
C. Whenever Landlord enters the Premises pursuant to the
provisions of this Paragraph 26, Landlord shall use commercially reasonable
efforts, under the circumstances, not to unduly interfere with or interrupt
Tenant's activities on or about the Premises.
27. ASSIGNMENT OF LANDLORD'S INTEREST:
If Landlord should ever assign this Lease or the rents hereunder to a
creditor as security for a debt, Tenant shall, after written notice of such
assignment and upon written demand by Landlord or the assignee, pay all sums
thereafter becoming due Landlord hereunder to the assignee (from and after the
time Tenant is furnished in writing with such assignee's address) and furnish
such evidence of insurance coverages required hereunder as the lender may
reasonably require so as to protect the assignee's interest as it may appear and
furnish such assurances to the assignee.
28. SUBORDINATION:
This Lease shall be subject and subordinate to the lien of any present
or future mortgage or mortgages upon the Premises or any property of which the
Premises are a part irrespective of the time of execution or the time of
recording of any such mortgage or mortgages, provided, however, with respect to
mortgages which are recorded among the Land Records after the date of this
Lease, the foregoing subordination shall be effective only if the holder of the
beneficial interest in such mortgage agrees that, as long as Tenant is not in
default beyond any applicable grace or cure period in the payment of rent or in
the performance of any of the other terms or conditions of the Lease, and so
long as Tenant executes such holder's standard Subordination, Non-Disturbance
and Attornment Agreement, Tenant's possession of the Premises will not be
disturbed by such holder following acquisition of title to the Improvements (a)
by the holder of such beneficial interest or the purchaser at a foreclosure sale
pursuant to any action or proceeding to foreclose such mortgage, or (b) by the
holder of such beneficial interest, pursuant to acceptance of a deed in lieu of
foreclosure. Additionally, upon Tenant's written request, Landlord agrees to
request any Mortgagee, having an interest in a mortgage which is a lien on the
Premises as of the date of this Lease, to enter into such Mortgagee's standard
Subordination, Non-Disturbance and Attornment Agreement with Tenant (provided,
however, Landlord shall have no liability to Tenant and none of Tenant's
obligations under this Lease shall in any way be diminished if such Mortgagee
shall refuse to do so). The word "mortgage" as used in this Lease includes
mortgages, deeds of trust or other similar instruments and modifications,
extensions, renewals and replacements thereof and any and all advances
thereunder.
29. ATTORNMENT:
In the event the Premises are sold at any foreclosure sale or sales,
by virtue of any judicial proceedings or otherwise, this Lease shall continue in
full force and effect and Tenant agrees upon request of any purchaser to attorn
to and acknowledge the foreclosure purchaser or purchasers at such sale as
Landlord hereunder.
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30. SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT:
The Tenant shall, within ten (10) days after at the request of the
Landlord or the holder of any mortgage (herein referred to as "Mortgagee"), from
time to time execute, acknowledge and deliver such further instrument or
instruments to, among other things, confirm the agreements contained in
Paragraphs 28 and 29 above, including, but not limited to an instrument
substantially in the form attached hereto as Exhibit E. Notwithstanding the
foregoing, the provisions of Paragraphs 28 and 29 shall be self-operative and no
further instrument shall be required to implement them.
31. MORTGAGEE PROTECTION CLAUSE:
Tenant agrees to give any Mortgagees, by certified mail, a copy of any
notice of default served upon the Landlord, provided that prior to such notice,
Tenant has been notified in writing (by way of Notice of Assignment of Rents and
Leases, or otherwise) of the addresses of such Mortgagees. Tenant further agrees
that if Landlord shall have failed to cure such default, then the Mortgagees
shall have thirty (30) days from the date of receiving notice within which to
cure such default or if such default cannot be cured by such Mortgagee within
that time, then such additional time as may be reasonably necessary if within
such thirty (30) days any Mortgagee has commenced and is diligently pursuing the
remedies necessary to cure such default (including but not limited to
commencement of foreclosure proceedings if necessary to effect such cure), in
which event this Lease shall not be terminated while such remedies are being so
diligently pursued.
32. TENANT HOLDING OVER:
A. In the event that Tenant holds over at the expiration of the
original term of this Lease or at the earlier termination thereof, Landlord
shall be entitled to all the remedies now or hereafter provided by the current
or future ordinances and public local laws of the City or County where the
Premises are located and the public general laws of the State of Maryland
relating to the speedy recovery of possession of lands and damages for wrongful
detention.
B. Any holding over after the expiration of the term hereof,
without the written consent of Landlord shall be construed to be a tenancy from
month to month at one and one-half (1-1/2) times the monthly rent hereinbefore
specified, and shall otherwise be on the terms and conditions hereinbefore
specified. Such tenancy from month to month shall continue until either party
shall give at least thirty (30) days notice in writing to the other terminating
such tenancy.
33. UTILITY LINES AND FACILITIES:
Landlord reserves the right to place (or permit any other tenant
in the Improvements so to place) in, over, below and upon the Premises (in such
manner as to not unreasonably interfere with Tenant's use, occupancy or
enjoyment of the Premises), utility lines, conduits, pipes, tunneling and the
like to service the Premises and any other premises in the Improvements and to
use, replace, repair and maintain (or permit any other tenant so to do) such
utility lines, conduits, pipes, tunneling and the like, in, over, below and upon
the Premises in
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such manner as will not unreasonably interfere with Tenant's use, occupancy or
enjoyment thereof, provided that Landlord shall use reasonable efforts to see
that such work does not unreasonably interfere with the ongoing business and
operations of Tenant, that such work shall be done expeditiously and in a good
and workmanlike manner, and further that the Premises shall, upon conclusion of
the work, be promptly restored to substantially the same conditions as they were
prior to the commencement of the work.
34. HAZARDOUS MATERIALS:
A. Tenant shall not cause or permit any Hazardous Material
(defined below) to be brought upon, kept or used in or about the Premises by
Tenant, its agents, employees, contractors or invitees, except for such
Hazardous Material as is necessary or useful to Tenant's business.
B. Any Hazardous Material permitted on the Premises as provided
in Paragraph 34.A. above, and all containers therefore, shall be used, kept,
stored and disposed of in a manner that complies with all Federal, state and
local laws or regulations applicable to any such Hazardous Material.
C. Tenant shall not discharge, leak or emit, or permit to be
discharged, leaked or emitted, any material into the atmosphere, ground, sewer
system or any body of water, if such material (as reasonably determined by
Landlord, or as determined by any governmental authority) does or may, pollute
or contaminate the same, or may adversely affect (a) the health, welfare or
safety of persons, whether located on the Premises or elsewhere, or (b) the
condition, use or enjoyment of the Improvements or any other real or personal
property.
D. At the commencement of each calendar year, Tenant shall
disclose to Landlord the names and approximate amounts of all Hazardous Material
which Tenant intends to store, use or dispose of on the Premises in the coming
calendar year. In addition, at the commencement of each calendar year during the
terms of this Lease, beginning with the second lease year, Tenant shall disclose
to Landlord the names and amounts of all Hazardous Materials which were actually
used, stored or disposed of on the Premises if such materials were not
previously identified to Landlord at the commencement of the previous calendar
year.
E. As used herein, the term "Hazardous Material" means (a) any
"hazardous waste" as defined by the Resource Conservation and Recovery Act of
1976, as amended from time to time, and regulations promulgated thereunder; (b)
any "hazardous substance" as defined by the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended from time to time,
and regulations promulgated thereunder; (c) any "oil, petroleum products, and
their by-products"; and (d) any substance which is or becomes regulated by any
Federal, State or local governmental authority.
F. Tenant hereby agrees that it shall be fully liable for all
costs and expenses related to the use, storage and disposal of Hazardous
Material kept on the Premises by Tenant, and Tenant shall give immediate notice
to Landlord of any violation or potential violation of the provisions of
Paragraph 34.B. above and shall deliver to Landlord immediately after receipt by
Tenant from time to time copies of any correspondence or any written documents
sent to Tenant
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by (and from Tenant to) any Federal, State and local authorities, agencies, or
bodies relating to Hazardous Materials at or on the Premises. Tenant shall
defend, indemnify and hold harmless Landlord and its agents, from and against
any claims, demands, penalties, fines, liabilities, settlements, damages, costs,
or expenses (including, without limitation, reasonable attorney and consultant
fees, court costs and litigation expenses) of whatever kind or nature, known or
unknown, contingent or otherwise, arising out of or in any way related to (a)
the presence, disposal, release, or threatened release of any Hazardous Material
which is on, from, or affecting the soil, water, vegetation, buildings, personal
property, persons, animals, or otherwise; (b) any personal injury (including
wrongful death) or property damage (real or personal) arising out of or related
to Hazardous Material; (c) any lawsuit brought or threatened, settlement reached
or government order relating to Hazardous Material; and/or (d) any violation of
any laws applicable thereto. Notwithstanding anything to the contrary contained
in this Paragraph 34.F., Tenant shall not be required to indemnify Landlord with
respect to any Hazardous Material which was on the Premises prior to the date of
this Lease, unless Tenant handles or disposes of such Hazardous Material in a
negligent manner or in violation of applicable law. The provisions of this
Paragraph 34.F shall be in addition to any other obligations and liabilities
Tenant may have to Landlord at law or equity and shall survive the transactions
contemplated herein and shall survive the expiration or earlier termination of
this Lease.
35. SPRINKLER:
Landlord represents a wet sprinkler system has been installed in the
Premises, which is designed to meet NFPA Ordinary Group Three System. Any
additional sprinkler work, I.E., in rack sprinklers, additional heads, etc.,
required to meet any other standards or county requirements to satisfy Tenant's
material or use classification, shall be at the sole cost and expense of the
Tenant.
36. SIGNS:
Tenant shall not place any signs on the exterior of the Premises
without the written consent of Landlord, which consent shall not be unreasonably
withheld, conditioned or delayed. With respect to the Junction Business Park
only, the Rules and Regulations in Rider #1 to Lease Agreement shall apply to
Tenant and the Premises.
37. ACCORD AND SATISFACTION, ETC.:
No payment by Tenant or receipt by Landlord of a lesser amount
than any payment of rent herein stipulated shall be deemed to be other than on
account of the earliest stipulated rent due and payable, nor shall any
endorsement or statement on any check or any letter accompanying any check or
payment as rent be deemed an accord and satisfaction. Landlord may accept such
check or payment without prejudice to Landlord's right to recover the balance of
such rent or pursue any other remedy provided in this Lease, at law or in
equity. It is agreed that, for the purpose of any suit brought or based on this
Lease, this Lease shall be construed to be a divisible contract, to the end that
successive actions may be maintained on this Lease as successive periodic sums
shall mature under this Lease, and it is further agreed that failure to include
in any suit or action any sum or sums then matured shall not be a bar to the
maintenance of any suit or action, for the recovery of said sum or sums so
omitted, and the
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Tenant agrees that it will not in any suit or suits brought on this Lease for a
matured sum for which judgment has not previously been received, plead, rely on
or urge as a bar to said suit or suits, the defenses of res adjudicata, former
recovery extinguishment, merger, election of remedies or other similar defense.
38. BROKERAGE COMMISSION:
Each of Tenant and Landlord represents and warrants to the other
that it has had no dealings, negotiations, or consultations with respect to the
Premises, the Improvements, or this transaction with any real estate agent,
broker, or finder other than Ryan Commercial Real Estate Services and Colliers
Pinkard (collectively, the "Broker") and that no real estate agent, broker, or
finder, other than Broker, called the Premises or any other space in the
Improvements to Tenant's attention for lease. In the event that either party has
breached the foregoing representation or warranty, the breaching party will be
responsible for and will defend, indemnify, and save the other party harmless
from and against all costs, fees (including, without limitation, reasonable
attorneys' fees), expenses, liabilities, and claims incurred or suffered by the
other party as a result of or related to such breach.
39. CUMULATIVE REMEDIES:
Any and all remedies available to Landlord for the enforcement of
the provisions of this Lease are cumulative and not exclusive, and Landlord
shall be entitled to pursue any of the rights enumerated in this Lease or
remedies authorized by law or available in equity, or all of the foregoing. In
the event of any litigation arising out of or in connection with this Lease, the
party that does not prevail in any such litigation shall pay the reasonable
attorneys' fees and the court costs of the party that does prevail in such
litigation, through all appeals.
40. NOTICES:
All notices to Tenant under this Lease shall be conclusively
presumed to have been delivered, one day after mailing by United States mail,
first class, certified or registered, and postage prepaid, addressed to
Tenant, at Earthshell Corporation, Attn: President, 111 South Calvert Street,
Baltimore, Maryland 21202 with a copy to Kevin L. Shepherd, Esquire, Venable,
Baetjer & Howard, LLP, 1800 Mercantile Bank & Trust Building, Two Hopkins
Plaza, Baltimore, Maryland 21201-2978, or to such other address as Tenant may
in writing from time to time designate. All notices to Landlord hereunder
shall be conclusively presumed to have been delivered one (1) business day
after mailing by United States mail, first class, certified, and postage
prepaid, addressed to Landlord, c/o Emory Hill Management Co., 92 Read's Way,
Suite 100, New Castle, Delaware 19720 or to such other address as Landlord
may in writing from time to time designate.
41. REVIEW OF LEASE:
Tenant and Landlord hereby acknowledge that the terms of this
Lease must be reviewed and .approved by Landlord's lender, which approval is
conclusively presumed unless Landlord shall notify Tenant in writing or by
facsimile within five (5) business days of the date a fully signed copy of this
Lease is received by Landlord, that the approval was not granted. In the
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event of rejection by Landlord's lender this Lease shall be deemed null and
void, Tenant shall have no right to terminate this Lease on account of this
Paragraph.
42. TENANT ESTOPPEL CERTIFICATE:
From time to time during the term of this Lease Tenant agrees to
submit to Landlord and/or to any Mortgagee, within ten (10) business days
following written demand therefor, a certificate substantially in the form
attached hereto as Exhibit E. The failure of Tenant to execute, acknowledge, and
deliver to Landlord and/or any Mortgagee a statement in accordance with the
provisions of this Paragraph 42 within the period set forth herein shall
constitute an acknowledgment by Tenant that may be relied upon by any person
holding or intending to acquire any interest whatsoever in the Premises or the
Improvements, that this Lease has not been assigned, amended, changed, or
modified, is in full force and effect, and that the rent has been duly and fully
paid not beyond the respective due dates immediately preceding the date of the
request for such statement. Such failure shall also constitute as to any persons
entitled to rely on such statements a waiver of any defaults by Landlord or
defenses, set-offs, recoupments, or counterclaims against the enforcement of
this Lease by Landlord that may exist prior to the date of the written request
and of such other matters as recited in such statement.
43. CONDITION OF TITLE AND PREMISES:
Tenant agrees that the Premises and the Improvements, the title
thereto, all encumbrances thereon, the zoning thereof, the street or streets,
sidewalks, parking areas, curbs and access ways adjoining them, any surface or
subsurface conditions thereof, the presence of any Hazardous Material therein or
thereon, and the permitted usage and restrictions on the uses thereof, have been
examined by, and/or are known to Tenant, and the Tenant accepts the Premises and
the balance of the same without representation, warranty or covenant, express or
implied, in fact or in law, except to the extent otherwise expressly set forth
in this Lease. Landlord represents that as of April 13, 1999, the zoning
designation of the Premises was M-2.
44. MISCELLANEOUS:
The captions and headings throughout this Lease are for
convenience and reference only, and the words contained therein shall in no way
be held or deemed to define, limit, describe, explain, modify, amplify or add to
the interpretation, construction or meaning of any provision of or the scope or
intent of this Lease nor in any way affect this Lease. Time is of the essence in
all provisions of this Lease. This Lease contains the entire agreement between
the parties and all agreements relating to this Lease and the Premises have been
integrated herein. This Lease cannot be changed or modified except by a written
instrument signed by the parties hereto. If any term, clause or provision of
this Lease is declared invalid by a court of competent jurisdiction, the
validity of the remainder of this Lease shall not be affected thereby but shall
remain in fill force and effect. This Lease shall be governed by, construed
under and enforced under the laws of the State of Maryland. Except as
hereinabove expressly otherwise provided, this Lease shall bind and inure to the
benefit of Landlord and Tenant and their respective personal representatives,
heirs, successors and assigns. Reference in this Lease to the term "person"
shall include a corporation, partnership, limited liability company, trust,
governmental body and other legal entity. Whenever Tenant is required by this
Lease to defend or indemnify
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Landlord, Tenant shall also be required to defend and indemnify each principal,
partner or member of Landlord and Landlord's management company. This Lease may
be executed in two (2) or more counterparts, each of which shall be deemed an
original, but all of which, taken together, shall constitute one (1) and the
same instrument. Transmission by facsimile of an executed counterpart copy of
this Lease shall be deemed to be effective delivery of such counterpart copy for
all purposes.
45. NON-WAIVER OF FUTURE ENFORCEMENT:
It is agreed that the failure of any party to insist in any one
or more instances upon a strict performance of any covenant of this Lease or to
exercise any right herein contained shall not be construed as a waiver or
relinquishment for the fixture of such covenant or right, but the same shall
remain in fill force and effect, unless the contrary is expressed in writing by
such party.
46. RIGHTS OF AND CLAIMS AGAINST LANDLORD:
A. Landlord may transfer all or part of its interest in the
Premises and this Lease without the consent of Tenant, at any time and from time
to time. If Landlord transfers its estate in the Premises, or if Landlord
further leases the Premises subject to this Lease, then Landlord shall be
relieved of all obligations of "Landlord" thereafter arising expressed in this
Lease or implied by law. Landlord and its successors shall be relieved of their
obligation to refund the security deposit and other similar finds to Tenant that
they have received from Tenant or a predecessor Landlord to the extent they
transfer such amounts to their respective transferees.
B. If Tenant obtains a money judgment against Landlord or its
successors or assigns under any provisions of, or with respect to this Lease or
on account of any matter, condition, or circumstance arising out of the
relationship of the parties under this Lease, Tenant's occupancy of the
Premises, or Landlord's ownership of the Premises, Tenant shall be entitled to
have execution upon such judgment only upon Landlord's estate in the
Improvements and not out of any other assets of Landlord, any of its
shareholders, members or partners, or its or their successors or assigns; and
Landlord shall be entitled to have any such judgment so qualified as to
constitute a lien only on Landlord's estate.
47. RULES AND REGULATIONS:
Landlord reserves the right, from time to time, to adopt and
promulgate reasonable rules and regulations applicable to the Premises and
Tenant agrees to be bound thereby. Notices of such rules and regulations shall
be given to Tenant, and Tenant agrees thereupon to comply with and observe all
such rules and regulations, so long as the rule or regulation in question is
enforced to substantially the same extent with respect to all other tenants of
the Improvements. A breach of any of such rules and regulations shall be deemed
a breach of this Lease, if not cured within the period specified in Paragraph 21
of this Lease.
48. WAIVER OF TRIAL BY JURY:
Landlord and Tenant hereby knowingly and voluntarily waive trial
by jury in any action or proceeding or counterclaim brought by either party
hereto against the other party on
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any and every matter, directly or indirectly, arising out of or with respect to
this Lease or the Premises.
49. RIDERS:
Attached hereto and incorporated into this Lease are Riders
numbered 1 through 3.
AS WITNESS the hands and seals of the parties hereto the date
first above written.
CHIPPEWA LIMITED PARTNERSHIP
ATTEST/WITNESS: Landlord
By: Emory Holdings II Limited
Partnership, its General Partner
/s/ [Illegible] By: /s/ R. Clayton Emory (SEAL)
----------------------------- ------------------------------
R. Clayton Emory, General Partner
EARTHSHELL CORPORATION
Tenant
/s/ William F. Spengler By: /s/ Michael M. Hagerty (SEAL)
----------------------------- ------------------------------
Michael M. Hagerty
Name: Michael M. Hagerty
Title: VP & CTO
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RIDER #1 TO LEASE AGREEMENT
JUNCTION BUSINESS PARK
RULES AND REGULATIONS
1. SIGNAGE:
PERMANENT SIGNAGE: Exterior signage in Junction Business Park shall be for
identification only and may not be treated as an advertising device. Signage
text is limited to company name and/or logo. All signs must be submitted to
Landlord for approval (which shall not be unreasonably withheld) prior to
installation.
A. PERMITTED SIGN LOCATIONS
Single Tenant Building: Unless otherwise noted in site specific
criteria, each single tenant building will be permitted one free standing sign
at a point near the building entrance, and one building mounted sign.
Multi-Tenant Building: Unless otherwise noted in site specific
criteria, each multi-tenant building will have one free-standing sign with the
building or address only at a point near the building entrance, and a building
mounted tenant identification system.
B. PERMITTED SIGN TYPES
Free Standing Sign: Maximum size is limited to 24 square feet. Maximum
height is four feet above grade.
Sign shall be substantial and constructed of durable materials (wood signs will
not be allowed). Sign illumination, if desired, must be internal with
translucent letters and an opaque background. Sign must be mounted on a
substantial base.
C. BUILDING MOUNTED SIGN
Sign location on building must be compatible with the architectural design of
the building. No signs may extend above the roof or parapet line of the
building. Building mounted signs must be individual metal pinned-off letters.
Maximum letter size is 30". The scale of the building shall determine the
permitted letter size. The pinned-off letters shall have a return or depth in
proportion to their size (I.E., a 6" smaller letter shall have a minimum 1"
return, and maximum return, required will be 4" for the 30" letter.
Illumination, if desired, may be internal through a translucent letter face
or opaque letters projected lightly off the wall and back lit from a source
concealed within the letter.
D. PERMITTED SIGN COLORS
Color for signs shall be limited to one color for the background. Where an
additional color is necessary because it is a part of the firm's logo, this will
be considered.
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The background color MUST be darker than the message and graphics.
E. PROHIBITED SIGNS INCLUDE THE FOLLOWING:
1. No sign may be erected which does not have the written approval of Emory Hill
(which approval shall not be unreasonably withheld). No sign may be erected
without the necessary Howard County approvals. No flashing or moving signs will
be permitted. No exposed neon or other exposed light source will be permitted.
No signs using vacuum formed plastic letters will be permitted. No signs using
applied wood letters will be permitted. No permanent building identification
signs will be permitted where letters are painted in the sign face and do not
project.
2. No awnings, curtains, blinds, shades or screens shall be attached to or hung
in, or used in connection with any window or door of the Premises without the
prior consent of the Landlord (which consent shall not be unreasonably withheld)
and including approval by the Landlord (which approval shall not be unreasonably
withheld) of the quality, type, design, color and manner attached.
3. Tenant agrees that its use of electrical current shall never exceed the
capacity of existing feeders, risers or wiring installation. Any additional
electrical wiring shall be done by Landlord's electrician or supervised by such
electrician, and Tenant shall bear the expense of such additional materials and
installation.
4. The Tenant shall not do or permit to be done in or about the Premises or the
Improvements anything which shall increase the rate of insurance on the
Improvements or its property, or obstruct or interfere with the rights of other
tenants of Landlord, including but not limited to, using any musical instrument,
making loud or unseemly noises, or singing, etc., nor use the Premises for
sleeping, lodging, or cooking by any person at any time except with permission
of Landlord. Tenant will be permitted to use for its own employees within the
Premises a conventional coffee maker. No part of the Improvements or Premises
shall be used for gambling, immoral or other unlawful purposes. No intoxicating
beverage shall be sold or used in the Improvements or the Premises without prior
written consent of the Landlord. No area outside of the Premises shall be used
for storage purposes at any time.
5. No birds or animals of any kind shall be brought into the Improvements or
kept in or about the Premises.
6. The sidewalks, entrances, passages, corridors, halls, elevators, and
stairways in the Improvements shall not be obstructed by Tenant or used for any
purposes other than those for which same were intended as ingress and egress. No
windows, floors, or skylights that reflect or admit light into the Improvements
shall be covered or obstructed by Tenant. Toilets, wash basins, and sinks shall
not be used for any purpose other than those for which they were constructed,
and no sweeping, rubbish, or other obstructing substances shall be thrown
therein. Any damages resulting to them, or to heating apparatus, from misuse, by
Tenant or its employees, shall be borne by Tenant.
7. Only one key for each office in the Premises will be furnished Tenant without
charge. No additional lock, latch or bolt of any kind shall be placed upon any
door nor shall any changes be made in existing locks or mechanisms thereof
without written consent of Landlord. At the
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termination of this Lease, Tenant shall return to Landlord all keys furnished to
Tenant by Landlord, or otherwise procured by Tenant, and in the event of loss of
any keys so furnished, Tenant shall pay to Landlord the cost thereof.
8. Intentionally omitted.
9. Tenant shall not cause or permit any unusual or objectionable gases, liquids
or odors to be produced upon or permeate from the Improvements, and no
flammable, combustible or explosive fluid, chemical or substances except gas and
electricity for lighting the Premises shall be brought into the Improvements.
10. Intentionally omitted.
11. Intentionally omitted.
12. Except as otherwise expressly permitted by the Lease, no painting shall be
done, nor shall any alterations be made, to any part of the Improvements by
putting up or changing any partitions, doors or windows, nor shall there be any
nailing, boring or screwing into the woodwork or plastering, nor shall any
connection be made to the electric wires or gas or electric fixtures, without
the consent in writing on each occasion of Landlord (such consent not to be
unreasonably withheld). All glass, locks and trimmings in or upon the doors and
windows of the Improvements shall be kept whole and in good repair. Tenant shall
not injure, overload or deface the Improvements, the woodwork or the walls of
the Premises, nor carry upon the Premises any unreasonably noisy business.
13. Tenant and occupants shall observe and obey all parking and traffic
regulations as imposed by Landlord on the lot on which the Improvements are
located. Landlord in all cases retains the power to designate "no parking"
zones, traffic right-of-ways, and general parking area procedures.
14. Landlord shall have the right, exercisable without notice and without
liability to Tenant, to change the name and street address of the Improvements.
15. Landlord may waive any one or more of these Rules and Regulations for the
benefit of any particular Tenant, but no such waiver by Landlord shall be
construed as a waiver of such Rules and Regulations in favor of any other
tenant, nor prevent Landlord from thereafter enforcing any such Rules and
Regulations against any or all of the tenants of the Improvements.
16. These Rules and Regulations are in addition to, and shall not be construed
to in any way modify or amend, in whole or in part, the terms, covenants,
agreements and conditions of the Lease.
17. Landlord reserves the right to make such other reasonable Rules and
Regulations as in its judgment may from time to time be needed for the safety,
care and cleanliness of the Improvements, and for the preservation of good order
therein.
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ATTEST/WITNESS: CHIPPEWA LIMITED PARTNERSHIP
Landlord
By: Emory Holdings II Limited
Partnership, its General Partner
/s/ [Illegible] By:/s/ R. Clayton Emory (SEAL)
------------------------------ ----------------------------------
R. Clayton Emory, General Partner
EARTHSHELL CORPORATION
Tenant
/s/ William F. Spengler By:/s/ Michael M. Hagerty (SEAL)
--------------------------- ----------------------------------
Michael M. Hagerty
Name: Michael M. Hagerty
Title: VP & CTO
34
<PAGE>
(Market)
RIDER #2 TO LEASE AGREEMENT
OPTION TO RENEW
THIS RIDER is attached to and forms apart of a certain Lease dated July
2nd, 1999 between CHIPPEWA LIMITED PARTNERSHIP, a Maryland limited partnership
(hereinafter called "Landlord"), and EARTHSHELL CORPORATION, a Delaware
corporation (hereinafter called "Tenant").
Tenant shall have the Option to Renew the Lease for one (1) additional
five (5) year term upon giving written notice of intention to renew to Landlord
not less than one hundred eighty (180) days prior to the expiration of the
initial term of the Lease. In order to be effective, any such written notice
must advise Landlord of Landlord's obligation, described in below in this Rider,
to make an initial determination of the "Market Rate" for the renewal term. All
terms and conditions of the Lease shall remain in full force and effect during
the renewal term, except that there shall be no further rights of renewal and
the Basic Rental for the renewal term shall be ninety percent (90%) of the
"Market Rate," as defined below, effective the first day of the renewal term.
The following procedure shall be used to determine the Market Rate, for
the renewal term. Not less than one hundred fifty (150) days prior to the
commencement of the renewal term, Landlord shall send to Tenant a written notice
specifying its determination of the Market Rate. Within twenty (20) days after
receipt of such notice from Landlord, Tenant shall send Landlord a written
notice of Tenant's acceptance or challenge of Landlord's determination of such
Market Rate; provided, however, that in the event that Tenant fails to respond
within such twenty (20) day period, Tenant shall be deemed to have accepted
Landlord's determination of the Market Rate.
In the event that Tenant challenges Landlord's determination of the
Market Rate and Landlord and Tenant are not able to agree on such Market Rate
within fifteen (15) days (hereinafter referred to as the "Negotiation Period")
after Landlord receives Tenant's initial rejection of Landlord's determination
of such Market Rate, then Landlord and Tenant shall each, within ten (10) days
after the expiration of the Negotiation Period, select an appraiser, each of
whom shall be an MAI-certified real estate appraiser with at least five (5)
years' experience in the Columbia, Maryland market who shall determine the
Market Rate in accordance with this paragraph. The appraisers shall be
instructed to complete the appraisal procedure independently and to submit their
written determinations to Landlord and Tenant within thirty (30) days after
their appointment.
In the event that the higher determination of the Market Rate submitted
by one of the appraisers is equal to or less than one hundred fifteen percent
(115%) of the determination of the Market Rate submitted by the other appraiser,
the Market Rate shall be the average of such determinations. If the
determination of the Market Rate submitted by one of the appraisers is greater
than one hundred fifteen percent (115%) of the determination of the Market Rate
submitted by the other appraiser, the appraisers shall, within five (5) days of
notice from either
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Landlord or Tenant, appoint a third appraiser with similar qualifications to
make a determination of the Market Rate. The third appraiser shall be instructed
to complete the appraisal procedure and to subnut a written determination of the
Market Rate to Landlord and Tenant within thirty (30) days after such
appraiser's appointment.
The determination which is neither the highest nor the lowest of the
three determinations shall be binding upon Landlord and Tenant as the Market
Rate unless two determinations are the same, in which event the Market Rate
shall be such amount. Landlord and Tenant shall each bear the costs of their
respective appraisers. The expenses of the third appraiser shall be borne
one-half (1/2) by Landlord and one-half (1/2) by Tenant. "Market Rate" shall
mean what a Landlord under no compulsion to lease the Premises and a Tenant
under no compulsion to lease the Premises would determine as the Basic Rental,
given the other provisions of the Lease which remain applicable to the parties.
Notwithstanding anything to the contrary contained in this Rider, in no event
shall the Basic Rental for the renewal term be less than the Basic Rental for
the last full year of the initial term of the Lease. In the event the Market
Rate has not been determined by the commencement of the renewal term, Tenant
shall pay Basic Rental equal to one hundred twenty percent (120%) of the Basic
Rental in effect during the last full year of the initial term of this Lease,
until the Market Rate is determined and promptly after such determination, the
parties shall make an appropriate adjustment to reconcile any overpayments or
under payments of Basic Rental made prior to the determination of the Market
Rate.
The Option to Renew granted to Tenant in this Lease is personal to
Tenant (or an affiliate of Tenant), and may not be exercised or be assigned by
or to any person or entity other than Tenant (or an affiliate of Tenant),
without the prior written consent of Landlord, which shall not be unreasonably
withheld. The Option to Renew does not extend to any subtenant.
At the Landlord's election, the foregoing Option to Renew may not be
exercised and will not be effective if, either at the time of the exercise or at
the time the renewal term is to commence, the Tenant is in default of any of its
obligations under the Lease, beyond any applicable grace or cure period.
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AS WITNESS the hands and seals of the parties hereto the date first
above written.
ATTEST/WITNESS: CHIPPEWA LIMITED PARTNERSHIP
Landlord
By: Emory Holdings II Limited
Partnership, its General Partner
/s/ [Illegible] By:/s/ R. Clayton Emory (SEAL)
------------------------------- --------------------------------
R. Clayton Emory, General Partner
EARTHSHELL CORPORATION
Tenant
/s/ William F. Spengler By:/s/ Michael M. Hagerty (SEAL)
------------------------------- ---------------------------------
Michael M. Hagerty
Name: Michael M. Hagerty
Title: VP & CTO
37
<PAGE>
RIDER #3 TO LEASE AGREEMENT
RIGHT OF REFUSAL
THIS RIDER is attached to and forms a part of a certain Lease dated
July 2nd, 1999 between CHIPPEWA LIMITED PARTNERSHIP, a Maryland limited
partnership (hereinafter called "Landlord"), and EARTHSHELL CORPORATION, a
Delaware corporation (hereinafter called "Tenant").
Landlord agrees that during the term of the Lease, Tenant, subject to
the provisions of this Rider, shall be offered the right of refusal to lease all
or any spa (herein the "Expansion Space") in the Improvements, as it may become
available from time to time. As used in this Rider "available" means that the
prior lease of such space has expired or otherwise terminated and the prior
occupant of such space has vacated and surrendered possession of such space and
Landlord has the right to lease such space to others. This right of refusal
shall be subject and subordinate to any currently existing rights to renew,
rights of refusal or expansion, or similar options or rights of persons or
entities that are tenants of some portion of the Improvements on the date of
this Lease, as well as to any extension of a lease, whether such lease is in
existence on the date hereof or is entered into after the date hereof. Subject
to the terms of the preceding sentence, at anytime prior to ten (10) days after
any portion of the Improvements becomes available, Landlord shall provide Tenant
with written notice of such availability, which notice shall include the date
when Tenant would begin occupancy of such Expansion Space. Tenant shall have ten
(10) days after Landlord's written notice to respond to such offer in writing
and either unconditionally accept or reject such Expansion Space. Tenant's
failure to respond timely in writing to such offer (or to accept such offer with
or subject to any condition) shall be construed as a rejection of Landlord's
offer. Tenant's rejection of any Expansion Space in any one instance shall
terminate Tenant's rights to be offered the same Expansion Space or any portion
thereof as it may become available again at some later date, it being agreed
that should Tenant reject an offer to lease any particular Expansion Space when
offered, Landlord shall have the right to lease all or any part of such
Expansion Space to other prospective tenants, without having to re-offer the
Expansion Space to the Tenant. If Tenant unconditionally accepts Landlord's
offer, such acceptance shall be binding upon Landlord and Tenant, provided,
however, at the request of either, Landlord and Tenant shall each execute an
amendment of this Lease to reflect the addition of the Expansion Space to the
Premises, in accordance with the terms of this Rider. Additionally, at the time
of Tenant's acceptance, Tenant shall request Landlord to advise Tenant of
Landlord's obligation, described below in this Rider, to make an initial
determination of the "Market Rent" for the Expansion Space.
In the event Tenant timely unconditionally accepts, in writing,
Landlord's offer to lease the Expansion Space. Then the following shall apply:
(i) Tenant may elect only to lease all of the Expansion
Space offered by Landlord and shall have no right to elect to lease less than
all of such Expansion Space.
(ii) Tenant's leasing of the Expansion Space shall
commence upon the date Landlord makes such Expansion Space available to Tenant.
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(iii) The Expansion Space shall be delivered in its then
"AS IS" condition and Tenant shall be deemed to have accepted the same in its
then "AS IS" condition, and Landlord shall have no obligation to make any
repair, refurbishing or improvement to the Expansion Space.
(iv) If Tenant does elect to lease the Expansion Space,
the Expansion Space shall become a part of the Premises for all purposes of the
Lease and subject to all of the terms and conditions of the Lease; the term of
the Lease, as it relates to the Expansion Space, shall expire on the same day
that the term of the Lease, as it relates to the balance of the Premises,
expires and the Expansion Space shall be considered a part of the Premises for
purposes of any renewal options available to Tenant; Tenant's proportionate
share, for purposes of the Lease (including, but not limited to, for purposes of
paragraphs 7, 8 and 9 of the Lease) shall be increased so that Tenant's
proportionate share shall consist of the ratio that the square footage of the
Premises (as increased by the addition of the Expansion Space) bears to the
square footage of the Improvements; and the Basic Rental for the Expansion Space
shall be the greater of (1) the then-current Basic Rental being paid by Tenant
for the balance of the Premises, on a per square foot basis (subject to increase
whenever the Basic Rental for the balance of the Premises increases), or (2) the
Market Rate for the Expansion Space. For purposes of this clause (2), "Market
Rate" means when a landlord under no compulsion to lease the Premises and a
tenant under no compulsion to lease the Premises, would determine as Basic
Rental, given the other provisions of this Lease that remain applicable to the
parties and after taking into account the specific variables that influence the
determination of a rental rate, including the base expenses set forth in this
Lease for real estate taxes, insurance premiums and common area maintenance
expenses, the level of interior leasehold improvements to be provided at
landlord's expense, and the commencement date of the Lease for the Expansion
Space. The Market Rental is to be determined in the manner described in Rider #2
above. For purposes of computing the Market Rate for the Expansion Space,
Landlord's initial written notice specifying its determination of the Market
Rate shall be sent to Tenant no later than fifteen (15) days after Tenant has
elected to lease the Expansion Space and requested, in writing, Landlord to
stipulate the Market Rate for the Expansion Space.
The Right of Refusal granted to Tenant in this Lease is personal to
Tenant (or an affiliate of Tenant), and may not be exercised or be assigned by
or to any person or entity other than Tenant (or an affiliate of Tenant),
without the prior written consent of Landlord, which shall not be unreasonably
withheld. The Right of Refusal does not extend to any subtenant and may only be
exercised by the same entity that leases the balance of the Premises.
At the Landlord's election, the foregoing Right of Refusal may not be
exercised and will not be effective if, either at the time of the exercise or at
the time the Expansion Space is to become a part of the Premises, the Tenant is
in default of any of its obligations under the Lease, beyond any applicable
grace or cure period.
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<PAGE>
AS WITNESS the hands and seals of the parties hereto the date first
above written.
ATTEST/WITNESS: CHIPPEWA LIMITED PARTNERSHIP
Landlord
By: Emory Holdings II Limited
Partnership, its General Partner
/s/ [Illegible] By:/s/ R. Clayton Emory (SEAL)
--------------------------------- ---------------------------------
R. Clayton Emory, General Partner
EARTHSHELL CORPORATION
Tenant
/s/ William F. Spengler By:/s/ Michael M. Hagerty (SEAL)
--------------------------------- ---------------------------------
Michael M. Hagerty
Name: Michael M. Hagerty
Title: VP & CTO
40
<PAGE>
EXHIBIT "A"
BUILDING AND SITE PLAN
[GRAPHIC]
BUILDING SIZE ONE STORY, 97,000 SQ. FT. SPRINKLERS WET
UNIT SIZE UNITS FROM 4,753 TO OFFICE AREA TO SUIT
97,000 SQ. FT. (BAY SIZES
8,000 SQ. FT.)
LOT SIZE 6.3 ACRES ELECTRIC 1,600 AMPS, 4 WIRE, 3
PHASE BALTIMORE GAS &
ELECTRIC
CONSTRUCTION MASONRY AND STEEL PARKING 188 SPACES
TRUSS HEIGHT 20' CLEAR ZONING INDUSTRIAL
LIGHTING METAL HALIDE HEATING AND AIR GAS UNIT HEATERS AND
CONDITIONING ENERGY EFFICIENT HEAT
PUMPS
LOADING FACILITIES TAILGATE LOADING LEASE TERM 3/5 YEARS
WATER HOWARD COUNTY
SEWER HOWARD COUNTY
9060 JUNCTION DRIVE
ANNAPOLIS JUNCITON, MD 20701
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EXHIBIT "B"
LEGAL DESCRIPTION
BEING all that certain parcel of real property located in the 6" Election
District of Howard County, State of :Maryland, and designated as Parcel "C-2" on
that certain subdivision plat entitled "The Junction Industrial Park Parcels B-2
and C-2 Resubdivision of section 1 Area 1 Sheet 1 of 1 ", dated December 27,
1985 and recorded among the Land Records of Howard County, Maryland, as Plat No.
6555, being also described by metes and bounds as follows:
BEGINNING for the same at an iron pipe on the northerly right of way line of
Junction (80'R/W) Drive, said point being the southwesterly corner of Parcel
"C-2" as shown on the aforedescribed subdivision plat, thence with the westerly
property line North 19 degrees 30 minutes 30 seconds East, 335.00 feet to an
iron pipe; thence South 70 degrees 29 minutes 40 seconds East, 820.12 feet to an
iron pipe; thence South 19 degrees 30 minutes 20 seconds West, 335.00 feet to an
iron pipe; said point being on the northerly right of way line of Junction (80'
R/W) Drive; thence with the said right of way line North 7 0 degrees 29 minutes
= 10 seconds West 820.12 feet to the point of beginning; containing 6.3071 acres
of land.
Together with the right to use in common with others entitles thereto a 30 foot
Common Drive Easement as more fully described in the Common Drive Easement by
and between Chippewa Limited Partnership and D & E Junction Limited Partnership,
dated November 22, 1988 and recorded among the Land Records of Howard County in
Liber 1919, folio 204.
BEING the same lot of ground described in a Deed, dated January 28, 1988 and
recorded among the Land Records of Howard County in Liber No. 1787, folio 718,
from Lucas Management Services Company, a General Partnership to Chippewa
Limited Partnership.
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EXHIBIT "C-1"
TENANT IMPROVEMENT SPECIFICATIONS
DRYWALL
* 926 LF Type B-9' standard interior partition-to underside of grid
* 294 LF Type D-Full Ht Office/Warehouse separation wall-Drywall &
insulated to 10 ft. on office side.
* 256 LF Type C-1 Perimeter condition (1/2" drywall on 1-5/8 metal
studs-insulated)
* 2-Column Boxes
* 26 Type A-1 Demising wall
* 120 SF Drywall ceiling at receiving office (in lieu of full Ht
walls)
* Infill-Demising wall as shown @ one place
* Patching where demolition occurs
* 294 LF Type E-14' office/warehouse separation wall-6" stud on top
of masonry
CEILINGS
* 2x4 Lay-in Type at 9 feet A.F.F. tile to be U.S.G. Omni
Fissured-White
* Grid - Standard non-rated white
CARPENTRY/MILLWORK
* 10 LF Wire Closet Rod & Shelf Unit
* 2-4x8 Fire rated plywood @ phone room
* Blocking and support for overhead doors and strip door
MASONRY
* 134 LF 12" CMU 10 FT high Dyrowall @ 16" O.C.V., #6 vertical
dowels @ corners filled solid
OVERHEAD DOORS/DOCK EQUIPMENT
* 2-10'x10' full vertical lift doors
* 1-10'x 10' strip curtain
DOORS AND HARDWARE
* 40 ea Standard 3'0"x6'8" Interior door, Birch veneer in hollow
metal frame, with lever latch set & wall stop
* 1 ea Standard 6'0"x6'8" Interior closet, pair door, Birch veneer
in hollow metal frame with lever latch set, flush bolts & wall
stop
* 3 ea Standard 3'0"x6'8" Office to Warehouse door, Birch veneer in
hollow metal frame with lever lock set, closer and wall stop
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* 1 ea Standard 3'0" x6'8" Lunch Room Door, Birch veneer in hollow
metal frame with push/pull set, closer and wall stop
* 3 ea Standard 6'0'x6'8" Office to Warehouse Pair door, Birch
veneer in hollow metal frame with lever lock set, closet flush
bolts and wall stop
* 2 ea Replace lockset on existing hollow metal doors with lever
lock set
* Existing Overhead doors to remain
PAINTING & WALLCOVERING
* All new walls to receive 2 coats Latex Flat Paint
* All existing walls in warehouse - EXCLUDED
* Lunch Room and Bath Room to be Semi-Gloss
* Door Frames 2 coats Alkyd Semi-Gloss
* Doors - 1 coat sanding sealer, 2 coats clear polyurethane
FLOORING
* Carpet 26 oz Nylon Level Loop with vinyl cove base throughout
except as noted below
* V.C.T. in lunch room, computer, storage, new bath room
* Existing floors to remain in warehouse, bath rooms, existing
rooms
* Patch V.C.T. where demo occurs
DEMOLITION
* 465 LF Partitions demolish and dispose of
* Strip, neutralize and prep VCT for carpet overlay at office area.
* 15 LF-Masonry
MINI-BLINDS
* Existing to Remain
CASEWORK/BUILT-INS
* 12 LF Upper and Lower Cabinets with counter (Merrilatt-Omni)
PLUMBING
* Add Kitchen sink, ADA bath room fixtures, and rough-in
* Cutting and patching of concrete
* 12 LF trench drain in mix room
* 1- side by side two compartment sink with cold water feed
44
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HVAC
* An allowance has been made for adding duct drops diffusers to
existing units #15 and #17 re-balancing and reworking existing
ducts, common central return systems or plenum return, pending
further evaluation
SPRINKLERS
* An allowance has been made for relocation or adding heads per
N.F.P.A. 13 and pending ceiling layout by the architect and
review by Fire Marshall
ROOFING
* 1 vent through roof for plumbing stack
ELECTRICAL/LIGHTING
* 88 ea 120 volt duplex receptacles for general use
* 4 ea dedicated 120v 20amp circuits
* 2 ea dedicated circuit with three duplexes
* 37 light switches
* 4 pairs three way switches
* 2-four way switches
* 109 building standard 2x4 fluorescent light fixtures
* 35 rings and strings for telephone
* 8 exit lights
* 10 emergency lights
* demolition as required
* remove existing cord drops and blankoff junction boxes
* Existing warehouse lighting to Remain, Relocate as necessary
* Demolish 51-Two light fixtures over office
* Other than lighting, no electrical work is to be provided in mix
& dry room
FIRE EQUIPMENT
* 7 Five pound ABC wall hung extinguishers for office ara
* 2 Ten pound ABC wall hung extinguishers for mix & dry rooms
SPLIT GAS SERVICE
* Reconnect gas piping for new meter
UPGRADE ELECTRICAL SERVICE
* Eightway duct bank to transformer pad
* 2000 amp 480 volt 3 phase control cabinet
* 2000 amp 277/480 volt 3 phase 4 wire bolted pressure switch
* 2000 amp 277/480 volt 4 wire main distribution panel
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* Install 800 amp feeder from new service equipment to existing
HV-1 Panel
* One new 75 KVA transformer
* Two new 400 amp 3 phase 4 wire 277/480 volt MLO 42 circuit panels
* Two new 200 amp 3 phase 4 wire 120/208 volt 42 circuit panels
* Ground service per N.E.C. Code
* Asphalt cutting, trenching, backfill and compaction included
* POWER COMPANY CHARGES ARE EXCLUDED
GENERAL CONDITIONS & MISC. ITEMS
Permits, supervision, daily clean-up, final construction cleaning of
office prior to tenant move in, broom sweep warehouse area, removal of debris,
landfill fees, scheduling and project management.
JOB CONDITIONS
Costs are based on the following conditions: Normal working hours,
nonunion labor, use of electric, water, bathroom, H.V.A.C. at no charge to
Landlord's Contractor or its subcontractors
EXCLUDED
Premium time, telephone systems, alarm systems, painting of existing
walls, mini-blinds, removal of items left by previous tenant, repair to dock
equipment doors, liquidated damages or penalties due to delays caused by
government agencies, availability of materials, war, strikes, weather, acts of
God or other causes beyond the control of Landlord's contractor. Additional work
required by County, or other governing agencies, items not specifically included
above.
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EXHIBIT "D"
The following work will be required in accordance with the maintenance
contract required in the attached Lease under the Paragraph entitled "Repairs
and Maintenance".
1. Check performance of all major components.
2. Lubricate moving parts as required.
3. Check refrigerant charges (during cooling season).
4. Inspect for oil and refrigerant leaks.
5. Check operating and safety controls.
6. Check pressures and temperatures.
7. Inspect condensers.
8. Inspect fans, motors and starters.
9. Tighten electrical connections at equipment.
10. Test amperages and voltages.
11. Check belts and drives.
12. Change oil and filters, or dryers, as required (at least four times
per year).
13. Check temperature on control system.
14. Thoroughly inspect heat exchanger.
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EXHIBIT "E"
SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT
This Subordination, Non-disturbance and Attornment ("Agreement") is
made as of the ____ day of ______________, ____, between _______________________
("Tenant") and _______________________________ ("Lender").
Recitals:
A. Lender is the owner and holder or will be the owner and holder of a
mortgage, deed of trust or similar instrument (collectively, as the same may
from time to time be extended, amended, restated, supplemented or otherwise
modified, a "Mortgage") recorded or to be recorded among the appropriate Land
Records, encumbering property (the "Property") more particularly described
therein (the mortgage and all increases, renewals, recastings, modifications,
consolidations, participation, replacements and/or extensions thereof are
hereinafter collectively called the "Mortgage").
B. The owner of the Property, ______________________, a Maryland
limited partnership ("Landlord"), and Tenant entered into a lease dated as of
_________, ____, covering Premises of approximately ________ rentable square
feet (the "Premises") within the Property.
C. The Lease is subject and subordinate to the lien, operation and
effect of the Mortgage, and Tenant wishes to obtain from Lender assurances that
Tenant's possession of the Premises will not be disturbed in certain
circumstances, and Lender is willing to provide such assurances to Tenant, upon
and subject to the terms and conditions of this Agreement.
NOW, THEREFORE, for $10.00 and other valuable consideration exchanged
between Lender and Tenant, the receipt and sufficiency of such consideration
being hereby acknowledged, Lender and Tenant agree as follows:
1. Subordination. The Lease is and will remain subject and subordinate
in all respects to the lien, operation and effect Mortgage and all voluntary and
involuntary advances made thereunder, in accordance with the terms and
conditions hereof.
2. Non-Disturbance Agreement. As long as Tenant is not in default
beyond any applicable grace period in the payment of rent, additional rent or
other charges or in the performance of any of the terms or conditions of the
Lease, Tenant's rights under the Lease and its possession of the Premises will
not be interfered with or disturbed by Lender during the term of the Lease
(including any renewal or extension term) following acquisition of title to the
Property (a) by Lender or the purchaser at a foreclosure sale pursuant to any
action or proceeding to foreclose the Mortgage, or (b) by Lender pursuant to
acceptance of a deed in lieu of foreclosure (in either case, a "Transfer of
Ownership").
3. Attornment Agreement. If a Transfer of Ownership occurs, Lender and
Tenant will, unless Lender elects otherwise in writing, be bound to each other,
as landlord and tenant, respectively, under all of the terms and conditions of
the Lease for the balance of the term
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thereof (including any renewal or extension term), and Tenant hereby attorns to
Lender as its landlord, such attornment to be effective and self-operative,
without the execution of any other instruments on the part of either party
hereto, immediately upon a Transfer of Ownership. As used in this paragraph and
in the subsequent provisions hereof, whenever the context allows the term
"Lender" will also include a purchaser of the Property at a foreclosure sale.
4. Lender's Liability. Notwithstanding any other provision of this
Agreement, Lender will not in any way be: (a) liable for acts or omissions of
any prior landlord (including Landlord); (b) subject to any offsets or defenses
that Tenant might have had against any prior landlord (including Landlord); (c)
bound by any rent, additional rent or other charges that Tenant might have paid
for more than 30 days in advance to any prior landlord (including Landlord); (d)
bound by any amendment or modification of the Lease made without Lender's prior
written consent; (e) responsible for any money or other security delivered to
Landlord pursuant to the Lease but not subsequently received by Lender; or (f)
obligated to pay Tenant any construction allowance or other payment referred to
in the Lease, all such payment obligations being personal to Landlord.
5. Condemnation Awards and Insurance Proceeds. Without limiting any
other provision of this Agreement, until a Transfer of Ownership occurs the
provisions of the Mortgage regarding Lender's rights in and to insurance
proceeds and awards or other compensation made for the taking by eminent domain
(or conveyance in lieu thereof) will be superior to, and will govern and control
over, any contrary provision of the Lease. Notwithstanding anything contained in
the Lease that may require Landlord to repair or restore damage to the Premises
caused by fire or other casualty or by exercise of eminent domain, if a Transfer
of Ownership occurs Lender will have no obligation for such repair or
restoration.
6. No Lease Modification or Claims. Tenant hereby confirms that the
Lease has not been modified or amended and is in full force and effect without
any claims or default, offset or deduction by Tenant.
7. Recognition of Mortgage and Collateral Assignment. To the extent
that the Lease entitles Tenant to notice of any mortgage affecting the Premises,
this Agreement constitutes such notice with respect to the Mortgage, and Tenant
also acknowledges Landlord's collateral assignment of the Lease to Lender.
8. Lender's Right to Cure Default. Notwithstanding any provision of the
Lease, no notice by Tenant to Landlord of any breach or default by Landlord
under the Lease will be effective unless and until (a) a copy of the notice is
received by Lender, and (b) a reasonable period of time has elapsed following
Lender's receipt of such copy, during which period Lender will have the right,
but will not be obligated, to cure the breach or default.
9. Notices. To be effective, any notice or other communication given
pursuant to this Agreement must be in writing and sent postpaid by United States
certified mail with return receipt requested. Rejection or other refusal to
accept, or inability to deliver because of changed address of which no notice
has been given, will constitute receipt of the notice or other communication.
For purposes hereof, Lender's address is:
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_______________________________________
_______________________________________
_______________________________________
Attn:_______________________________________
and Tenant's address is
_______________________________________
_______________________________________
_______________________________________
Attn:_______________________________________
At any time(s), each party may change its address for the purposes hereof by
giving the other party a change of address notice in the manner stated above.
10. Entire Agreement, Etc. This Agreement (a) is to be construed and
enforced in accordance with the laws of the State of Maryland, (b) contains the
entire understanding of Lender and Tenant regarding matters dealt with herein
(any prior written or oral agreements between them as to such matters being
superseded hereby), (c) can be modified or waived in whole or in part only by a
written instrument signed on behalf of the party against whom enforcement of the
modification or waiver is sought, and (d) will bind and inure to the benefit of
the parties hereto and their respective successors and assigns.
IN WITNESS WHEREOF, this Agreement has been duly signed as of the date
first above written.
(The foregoing shall be signed, witnessed, and notarized on behalf of
Lender and Tenant.)
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EXHIBIT "F"
TENANT ESTOPPEL CERTIFICATE
Landlord:_____________________________________________________
Tenant:_______________________________________________________
Identification of Leased Premises:
Approximately _______ square feet within a warehouse and office
building on land known as____________________________________, as more fully set
forth in the Lease.
Date of Original Lease:_______________________________________
Date(s) of any amendments:____________________________________
The undersigned, Tenant named above of the Premises identified above
(the "Premises") to induce _____________________________________ (the "Lender")
to make a loan to Landlord or to induce _______________________________________
(the "Buyer") to purchase the property in which the Premises is located from
Landlord hereby certifies, represents, warrants and agrees with and to Lender
and/or the Buyer the following:
1. The undersigned has accepted and is in possession of and occupies
the Premises under the Lease, which is in full force and effect. The initial
term of the Lease commenced on _______________, __ and expires on __________,
____. [Or if applicable, the current renewal term commenced on ___________,
_____ and expires on _____________, _____.]
2. There have been no modifications or changes in the Lease, except by
those amendments listed above. A true, complete and correct copy of the Lease,
with all amendments, is attached hereto as EXHIBIT A.
3. The undersigned is paying the full Basic Rental, which as of the
monthly rental payment due on _____________, _____ is $_____________ per month,
and is also paying its proportionate share (____%) of taxes and other expenses.
Tenant has paid to Landlord a security deposit of $_____________.
4. No rent or other sum payable under the Lease has been paid for more
than thirty (30) days in advance of its due date.
5. To the best of Tenant's knowledge, information and belief, Landlord
is not in default under the Lease and the undersigned has no defense, set-off or
counterclaim against Landlord under the Lease or otherwise.
6. The undersigned has not assigned, mortgaged or encumbered Tenant's
interest under the Lease or sublet all or any portion of the Premises.
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7. Neither the undersigned nor any of its principals or affiliates is
the subject of any bankruptcy or insolvency proceeding and neither the
undersigned nor any of its principals or affiliates is insolvent or
contemplating the filing of any bankruptcy or insolvency proceeding.
8. To the best of Tenant's knowledge, information and belief, all
conditions and agreements under the Lease to be satisfied or performed by
Landlord have been satisfied and performed (including, without limitation, any
Tenant Improvements or other construction or work to be performed by Landlord).
9. Tenant acknowledges receipt of notice that all of Landlord's
interest in the Lease has been or is being assigned to Lender as further
security for one or more loans to Landlord and/or that the Premises and the
improvements of which they are a part have been or are being sold to Buyer.
10. These agreements, representations, warranties and certifications
shall bind the undersigned, its personal representatives, heirs, successors and
assigns and the undersigned shall deliver a copy hereof to any assignee of its
interest in the Lease. The Lender and/or the Buyer and its or their respective
personal representatives, heirs, successors and assigns may rely upon all of the
foregoing agreements, representations, warranties and certifications.
IN WITNESS WHEREOF, the undersigned has caused this Estoppel
Certificate to be duly executed this ____ day of ________________, ____.
WITNESS/ATTEST: __________________________________
______________________________ By:_______________________________(SEAL)
Name:
Title:
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