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Exhibit 10.15
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
NATIONAL BUSINESS PARK
THIS AGREEMENT OF LEASE, made this 29th day of May, 1996, by and
between CONSTELLATION REAL ESTATE, INC., a Maryland corporation, Agent for Owner
(hereinafter referred to as "Landlord") and APPLIED SIGNAL TECHNOLOGY, INC. , a
California corporation (hereinafter referred to as "Tenant"), witnesseth that
the parties hereby agree as follows:
1. Premises. Landlord is the owner of that certain real property
situated in ▇▇▇▇ Arundel County, Maryland and known as Lot 6-BR as shown on that
proposed resubdivision plat entitled, "The National Business Park, Lots 6-AR,
6-BR and 7AR," a copy of which is attached hereto as Exhibit "A-I" and by this
reference made a part hereof (the "Real Property"), on which Landlord intends to
construct a three-story office building containing approximately 88,533 rentable
square feet (hereinafter referred to as the "Building"), the said Building and
Real Property to be commonly known as ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇. Notwithstanding the foregoing and anything in this Lease
contained to the contrary, Landlord reserves the right prior to the Building
Permit Deadline Date referenced in Section 2.1.2 hereof to reduce the square
footage of the Building to approximately 60,000 rentable square feet by
eliminating the third floor (thus leaving a two-story office building). Landlord
shall keep Tenant advised with its decision whether to reduce the Building by
eliminating the third floor as set forth in the preceding sentence. In the event
Landlord shall elect to reduce the size of the Building to approximately 60,000
square feet by eliminating the third floor, the parties hereto agree to execute
an amendment to this Lease acknowledging such changes to the size of the
Building.
Landlord hereby leases unto Tenant, and Tenant hereby rents from
Landlord, that portion of the Building to be known as "Suite 100" and comprised
of the following: (i) effective on the Phase 1 Commencement Date as hereafter
defined, that certain area situated on the first floor of the Building
containing the agreed upon equivalent of 20,783 square feet rentable area
(hereinafter referred to as the "Phase 1 Premises") designated as the "Phase 1
Premises" on the schedule attached hereto as Exhibit "A-2" and made a part
hereof; and (ii) commencing on the Phase 2 Commencement Date as hereafter
defined, that certain area situated on the first floor of the Building
containing the agreed upon equivalent of 8,338 square feet of rentable area
(hereinafter referred to as the "Phase 2 Premises") and designated as the "Phase
2 Premises" on Exhibit "A-2."
In each instance in this Lease wherein reference is made to the
Premises, the same shall be construed to mean the Phase 1 Premises for that
period commencing from the execution of this lease until the Phase 2
Commencement Date, and from and after the Phase 2 Commencement Date, the term
"Premises" shall be construed to mean the aggregate Phase 1 Premises and Phase 2
Premises.
In addition to the Premises, Tenant shall have the right to use, on a
non-exclusive basis, and in common with the other tenants of the Building the
Common Areas of the Building (as that term is defined in Section 5.2.6 hereof).
2. Term.
2.1 Phase 1 Premises. This Lease shall commence on the "Phase 1
Commencement Date" (as herein defined) and shall be for a term (herein the
"Term" or the "Lease Term") of seven (7) years, plus the portion of a calendar
month, if any, from the Phase 1 Commencement Date to the last day of the
calendar month in which the Phase 1 Commencement Date occurs. As used in this
Lease, the term "Phase 1 Commencement Date", as advanced or postponed pursuant
to the terms hereof, shall be defined as the earlier to occur of (a) the date on
which Tenant takes possession and occupancy of the Phase 1 Premises, or (b) the
date which is fifteen (15) days following that date which is the first on which
all of the following events have occurred, namely (i) the Phase 1 Premises are
"substantially completed", as defined in Section 2.1.1 following, (ii) Landlord
has given Tenant written notice that the Phase 1 Premises are
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substantially completed", and (iii) the "Phase 1 Target Date" as defined in
Section 2.1.1 following has arrived.
Tenant, at its sole risk, shall be permitted by Landlord to enter the
Phase 1 Premises prior to the Phase 1 Commencement Date solely for the purpose
of installing Tenant's fixtures and equipment, provided that (a) Tenant shall in
each instance coordinate its entry and installation of equipment in the Phase 1
Premises in advance of Tenant's entry, and (b) Tenants activities shall be
conducted so as not to unreasonably interfere with Landlord's Phase 1 Work (as
hereinafter defined.)
2.1.1 Substantial Completion of Phase 1 Premises. Landlord
shall use its best efforts to "substantially complete" the Phase 1 Premises by
March 1, 1997 ("Phase 1 Target Date"). "Substantially complete" means that: (i)
Landlord has completed construction of the Building as contemplated by Section I
hereof, (ii) the construction of the improvements to the Phase 1 Premises
described in Section 7.1 has been completed so that Tenant can use the Phase 1
Premises for their intended purposes without material interference to Tenant
conducting its ordinary business activities, (iii) the Phase 1 Premises have
been approved for occupancy by governmental authorities having jurisdiction,
(iv) the Tenant has ready access to the Building and Phase 1 Premises through
the lobby, hallways and elevators, and (v) the Phase 1 Premises are ready for
installation of any equipment, furniture, fixtures or decoration that Tenant
will install. Landlord shall keep Tenant advised as to its progress with regard
to "substantially completing" the Phase 1 Premises by the Phase 1 Target Date.
2.1.2 Lease Contingencies.
A. Building Permit Contingency. Promptly upon execution of
this Lease, Landlord covenants and agrees to commence and diligently prosecute
the subdivision of the Property in the configuration shown generally on Exhibit
"A-l" attached hereto and the application for building permit(s) for
construction of the Building pursuant to Landlord's site plan(s) and
construction plan(s) therefore to be submitted by Landlord to applicable
governmental authority for approval (the "Building Permit"). If despite
Landlord's diligent efforts, Landlord is unable to obtain the Building Permit by
September 1, 1996 (the "Building Permit Deadline Date") then Landlord or Tenant,
each in their sole and absolute discretion, may terminate this Lease by written
notice to the other given within ten (10) days of the Building Permit Deadline
Date whereupon the rights and obligations of the parties hereunder shall cease
and terminate without need for the execution of any further or other instrument
and Landlord shall promptly return to Tenant the Advance Rent (hereafter
defined); provided, however, if Landlord shall so request, Tenant shall execute
an instrument, in recordable form, whereby Tenant releases and surrenders all
right, title and interest which it may have in and to the Premises under this
Lease or otherwise. If possession of the Building Permit is not obtained by
Landlord by the Building Permit Deadline Date due to delay(s) caused by Tenant,
then the Building Permit Deadline Date shall be extended on a day-for-day basis
corresponding to the days of delay caused by Tenant. Tenant's option to
terminate this Lease shall be void and inoperable if at the time of exercising
such option, Tenant shall be in default under the terms of this Lease beyond the
expiration of any applicable cure period.
B. The Phase 1 Premises Deadline Date.. Notwithstanding any
provision herein to the contrary, if for any reason other than delay caused by
Tenant, the Landlord is unable to deliver possession of the Phase 1 Premises to
Tenant by July 1, 1997 (the "Phase 1 Premises Deadline Date"), then Landlord or
Tenant each in their sole and absolute discretion, may terminate this Lease by
written notice to the other given within ten (10) days of the Phase 1 Premises
Deadline Date whereupon the rights and obligations of the parties hereunder
shall cease and terminate without need for the execution of any further or other
instrument and Landlord shall promptly return to Tenant the Advance Rent
(hereafter defined); provided, however, if Landlord shall so request, Tenant
shall execute an instrument, in recordable form, whereby Tenant releases and
surrenders all right, title and interest which it may have in and to the
Premises under this Lease or otherwise. If possession of the Phase 1 Premises is
not delivered to Tenant by the Phase 1 Premises Deadline Date due to delay(s)
caused by Tenant,
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then the Phase 1 Premises Deadline Date shall be extended on a day-for-day basis
corresponding to the days of delay caused by Tenant. Tenant's option to
terminate this Lease shall be void and inoperable if at the time of exercising
such option, Tenant shall be in default under the terms of this Lease beyond the
expiration of any applicable cure period.
2.2 Phase 2 Premises. Tenant's rental of the Phase 2 Premises shall
commence on the "Phase 2 Commencement Date" (as herein defined) and shall
continue for the remainder of the Term as defined in Section 2.1 hereof. As used
in this Lease, the term "Phase 2 Commencement Date", as advanced or postponed
pursuant to the terms hereof, shall be defined as the earlier to occur of (a)
the commencement of the nineteenth (19th) calendar month of the Term; (b) the
date on which Tenant takes possession and occupancy of the Phase 2 Premises, or
(c) the date which is fifteen (15) days following that date which is the first
on which all of the following events have occurred, namely (i) the Phase 2
Premises is "substantially completed", as defined in Section 2.2.1 following,
(ii) Landlord has given Tenant written notice that the Premises are
"substantially completed", and (iii) the "Phase 2 Target Date" as defined in
Section 2.2.1 following has arrived.
Tenant, at its sole risk, shall be permitted by Landlord to enter the
Phase 2 Premises prior to the Phase 2 Commencement Date solely for the purpose
of installing Tenant's fixtures and equipment, provided that (a) Tenant shall in
each instance coordinate its entry and installation of equipment in the Phase 2
Premises in advance of Tenant's entry, and (b) Tenant's activities shall be
conducted so as not to unreasonably interfere with Landlord's Phase 2 Work (as
hereinafter defined.)
2.2.1 Substantial Completion of Phase 2 Premises. Landlord
shall use its best efforts to "substantially complete" the Phase 2 Premises by
that date which is one hundred and twenty (120) days after that date on which
Tenant shall approve the Phase 2 Final Plans and Specification as set forth in
Section 7.2.1 hereof (the "Phase 2 Premises Target Date"). "Substantially
Complete" means that: (i) the construction of the improvements to the Phase 2
Premises described in Section 7.2 has been completed by Landlord so that Tenant
can use the Phase 2 Premises for their intended purposes without material
interference to Tenant conducting its ordinary business activities, (ii) the
Phase 2 Premises have been approved for occupancy by governmental authorities
having jurisdiction, (iii) the Tenant has ready access to the Building and Phase
2 Premises through the lobby, hallways and elevators, and (iv) the Phase 2
Premises are ready for installation of any equipment, furniture, fixtures or
decoration that Tenant will install. Landlord shall keep Tenant advised as to
its progress with regard to "substantially completing" the Phase 2 Premises by
the Phase 2 Target Date.
2.3. Confirmation of Term. The Landlord and Tenant shall, within thirty
(30) days after, respectively (i) the Phase I Commencement Date, and (ii) the
Phase 2 Commencement Date, confirm by written instrument the commencement and
expiration dates of the Term, the Base Rent (hereafter defined) payable by
Tenant hereunder, and the agreed upon rentable square footage within the
Premises.
3. Tenant's Option to Extend Term. Tenant shall have the option to
extend the Term of this Lease for one (1) additional period of five (5) years
(the "Renewal Term") to commence immediately upon the expiration of the initial
seven-year Term. Tenant's rental of the Premises during the Renewal Term shall
be upon the same terms, covenants and conditions contained in this Lease, except
that Tenant shall pay to Landlord as Base Rent that amount equal to the
"Prevailing Market Rate" (including annual adjustments). For purposes of this
Section 3, the term "Prevailing Market Rate" shall mean the then prevailing
market rate being charged for comparable space in comparable office buildings
within a five (5) mile radius of the Building as reasonably determined by
Landlord (taking into account annual adjustments and rent abatements, cash
allowances, premiums, commissions, improvement allowances, age of building, and
other concessions commonly in use at the time of the renewal). In order to
exercise its option granted herein, Tenant shall so notify Landlord in writing
of its intent to renew not less than one hundred and twenty (120) days prior to
the expiration of the initial seven-year Term. Within ten (10) business days
following the exercise by Tenant of its option to extend the Lease for the
Renewal
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Term, Landlord shall notify Tenant in writing of its determination of the
Prevailing Market Rate for the Renewal Term as reasonably determined by
Landlord. Within ten (10) days of Tenant's receipt of Landlord's notification of
such rate determined by Landlord, Tenant shall notify Landlord in writing of
Tenant's acceptance or rejection of such rate. If by Tenant's written notice to
Landlord given within the aforesaid ten (10) day period, Tenant shall accept
such Prevailing Market Rate, the Landlord and Tenant shall enter into an
amendment to this Lease acknowledging such renewal and setting forth any terms
at variance with the terms of this Lease. If by Tenant's written notice to
Landlord given within the aforesaid ten (10) day period, Tenant shall reject
such Prevailing Market Rate as determined by Landlord for the Renewal Term, then
within ten (10) business days thereafter, Landlord and Tenant shall meet at a
mutually acceptable time and place and shall use their best good faith efforts
to agree upon the Prevailing Market Rate. If Landlord and Tenant shall fail to
agree upon such Prevailing Market Rate within the aforesaid ten (10) business
day period, then Tenant's option to extend the Lease for the Renewal Term shall
be void and inoperable. If Tenant shall fail to respond to Landlord's initial
notice of such Prevailing Market Rate as provided above, then Tenant shall be
deemed to have accepted Landlord's determination of the Prevailing Market Rate.
Tenant's option to renew the Term of this Lease shall be void and
inoperable if Tenant is not in possession of the Premises under this Lease at
the time of exercising its option to renew, if Tenant does not deliver the
requisite notice exercising its option to renew within the time period specified
above, or if at the time of exercising its option to renew, Tenant shall be in
default under the terms of this Lease. The option granted herein shall not be
severed from this Lease or separately sold, assigned or transferred (other than
to Tenant's permitted successors and assigns under this Lease pursuant to the
terms of Section 21).
4. Advance Rent. Upon execution of this Lease, Tenant shall pay
Landlord the sum of Twenty-Two Thousand Eighty-One Dollars and Ninety-Four Cents
($22,081.94) to be held as Advance Rent and security and which Landlord shall be
entitled to retain, without limitation of other remedies, for any defaults of
this Lease by Tenant occurring prior to the commencement of the Term. If no
such defaults occur, the Advance Rent shall be applied by Landlord against the
first installment of Base Rent payable by Tenant hereunder.
5. Use. Tenant expressly agrees that the Premises shall be used and
occupied solely for general office purposes in accordance with applicable zoning
regulations and for no other purpose. Landlord represents and warrants that as
of the date hereof this use is allowed and permitted under applicable zoning and
subdivision rules and regulations.
6. Rent.
6.1 Base Rent. As rent for the Premises during the Term, Tenant shall
pay to Landlord an annual base rent (herein "Base Rent") in that amount
determined by multiplying the number of rentable square feet in the Premises
(with due adjustment being made in the monthly installment of Base Rent for that
Lease Year [hereafter defined) during which the Phase 2 Commencement Date shall
occur) by the following dollar amounts set forth on the schedule below for each
indicated Lease Year, which annual sum shall be payable in equal monthly
installments on the first day of each and every calendar month within each
indicated Lease Year in advance without deduction, setoff or demand:
Lease Year Per Square Foot Base Rent Rate
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Lease Year One $12.75
Lease Year Two $13.13
Lease Year Three $13.53
Lease Year Four $13.93
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Lease Year Per Square Foot Base Rent Rate
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Lease Year Five $14.35
Lease Year Six $14.78
Lease Year Seven $15.22
In addition to the Base Rent, if the Term should commence on a day
other than the first day of a calendar month, Tenant shall pay to Landlord upon
the Original Space Commencement Date, a sum equaling that percentage of the
monthly rent installment which equals the percentage of such calendar month
falling within the Term.
Notwithstanding the foregoing, in the event the Actual Phase 1
Construction Costs (defined in Section 7.1.3 hereof) shall be less than the
Phase 1 Tenant Improvement Allowance (defined in Section 7. 1. 1 hereof), then
the Base Rent, on a per rentable square foot basis, allocable to the Phase 1
Premises only shall be reduced by that amount determined by (a) subtracting
the Actual Phase 1 Construction Costs from the Phase 1 Tenant Improvement
Allowance (the "Phase 1 Construction Savings"), (b) dividing Phase 1
Construction Savings by 20,783 square feet (the "Per Square Foot Phase 1
Construction Savings"), and (c) multiplying the Per Square Foot Phase 1
Construction Savings by twelve percent (12%).
Further, and notwithstanding the foregoing, in the event the Actual
Phase 2 Construction Costs (defined in Section 7.2.3 hereof) shall be less than
the Phase 2 Tenant improvement Allowance (defined in Section 7.2.1 hereof), then
the Base Rent, on a per rentable square foot basis, allocable to the Phase 2
Premises only shall be reduced by that amount determined by (a) subtracting the
Actual Phase 2 Construction Costs from the Phase 2 Tenant improvement Allowance
(the "Phase 2 Construction Savings"), (b) dividing Phase 2 Construction Savings
by 8,338 square feet (the "Per Square Foot Phase 2 Construction Savings"), and
(c) multiplying the Per Square Foot Phase 2 Construction Savings by twelve
percent (12%).
6.2 Definitions. For the purposes hereof, the following definitions
shall apply:
6.2.1 "Property" shall mean the Building, the Real Property,
and all fixtures and equipment thereon or therein, all commonly owned or shared
appurtenances, including but not limited to, parking areas, walkways,
landscaping and utilities, whether located on the land upon which the Building
is situated or elsewhere.
6.2.2 "Building Expenses" shall be all those directly related
expenses paid or incurred by Landlord in connection with the owning,
maintaining, operating and repairing of the Property or any part thereof, in a
manner deemed reasonable and appropriate by Landlord and shall include, without
limitation, the following:
1. All costs and expenses of operating, repairing, lighting,
cleaning, and insuring (including liability for personal injury, death and
property damage and workers' compensation insurance covering personnel) the
Property or any part thereof, as well as all costs incurred in removing snow,
ice and debris therefrom and of policing and regulating traffic with respect
thereto, and depreciation of all machinery and equipment used therein or
thereon, replacing or repairing of pavement, roofing, parking areas, curbs,
walkways, drainage, lighting facilities, landscaping (including replanting and
replacing flowers and other planting);
2. Electricity, steam and fuel used in lighting, heating,
ventilating and air conditioning for Common Areas only;
3. Maintenance and repair of Common Area mechanical and
electrical equipment including Common Area heating, ventilating and air
conditioning equipment;
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4. Common Area window cleaning and janitor service, including
equipment, uniforms, and supplies and sundries;
5. Maintenance of stairways, rest rooms, lobbies, hallways and
other Common Areas (and Common Area elevators to the extent Tenant shall
exercise its right of first option as to all or any portion of the Expansion
Space pursuant to the provisions of Section 51 hereof);
6. Repainting and redecoration of all Common Areas;
7. Sales or use taxes on supplies or services;
8. Management fees (not to exceed five percent of annual gross
rents from the Building but in no event less than $36,000.00/annually), as well
as wages, salaries and compensation of all persons engaged in the maintenance,
operation or repair of the Property (including Landlord's share of all payroll
taxes);
9. Legal, accounting and engineering fees and expenses, except
for those related to disputes with tenants or which are a result of and/or are
based on Landlord's negligence or other tortious conduct;
10. Costs and expenses that may result from compliance with
any governmental laws or regulations that were not applicable to the Common
Areas at the time same were originally constructed; and
11. All other expenses which under generally accepted
accounting principles would be considered as an expense of owning, maintaining,
operating, or repairing the Common Areas of the Property. Notwithstanding the
foregoing, all expenses (whether or not such expenses are enumerated in items 1
through 10 above) which would be considered capital in nature under generally
accepted accounting principles shall be excluded from "Building Expenses."
6.2.3. "Taxes" shall mean all real estate taxes, assessments,
sewer rents, ad valorem charges, water rates, rents and charges, front foot
benefit charges, and all other governmental imposition in the nature of any of
the foregoing. If at any time during the Term the method of taxation prevailing
at the commencement of the Term shall be altered so as to cause the whole or any
part of the items listed in the first sentence of this subparagraph 6.2.3 to be
levied, assessed or imposed, wholly or partly as a capital levy, or otherwise,
on the rents received from the Building, wholly or partly in lieu of imposition
of or in addition to the increase of taxes in the nature of real estate taxes
issued against the Property, then the charge to the Landlord resulting from
such altered additional method of taxation shall be deemed to be within the
definition of "Taxes."
6.2.4 "Common Areas" shall mean those areas and facilities of
the Building customarily available in first class suburban office buildings and
as specially designated by Landlord for the non-exclusive general common use of
tenants and other occupants of the Building, their officers, agents, employees,
and invitees, including (without limitation) the hallways, stairs, parking
facilities, washrooms, and elevators. "The Common Areas shall be maintained by
Landlord in a condition comparable to other first class suburban office
buildings in the Baltimore-Washington corridor area.
6.2.5 "Lease Year" shall mean the first twelve (12) month
period following the Phase 1 Commencement Date and each succeeding twelve (12)
month period thereafter up to the end of the Term; provided, however, that if
the Phase 1 Commencement Date shall occur on a day other than the first day of a
calendar month, then the first Lease Year shall include that portion of a
calendar month from the Phase 1 Commencement Date to the last day of the
calendar month in which the Phase 1 Commencement Date occurs, and shall expire
twelve (12) months after the first day of the first full calendar month of the
Term.
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6.3 Rent Adjustments for Taxes.
6.3.1. At the time Landlord shall receive from applicable taxing
authority notice of its tax ▇▇▇▇ for the Property for the subject Tax Year,
Landlord shall total the Taxes. Tenant shall pay a proportionate share of said
Taxes as additional rent hereunder. Tenants proportionate share of said Taxes
shall be computed by multiplying the amount of such Taxes by a fraction, the
numerator of which shall be the total rentable square feet in the Premises as
defined in Section 1, and the denominator of which shall be the total rentable
square feet within the Building.
6.3.2. Any additional rent due Landlord under this Section 6.3 shall be
due and payable within thirty (30) days after Landlord shall have submitted a
written statement to Tenant showing the amount due. For Tenant's obligation for
Tenant's proportionate share of Taxes for a partial tax year falling within the
first or last Lease Years of the Term, including any renewal or extension
thereof, see Section 6.5. Landlord may, in its discretion, make a reasonable
estimate of such additional rent with respect to Taxes, and require Tenant to
pay each month during such year 1/12 of such amount, at the time of payment of
monthly installments of Base Rent. In such event, Tenant shall pay, or Landlord
shall refund or credit to Tenants account, any underpayment or overpayment of
such additional rent within thirty (30) days of Landlord's annual written
statement of Taxes due. Tenant shall have the right to examine, at Tenant's sole
expense, Landlord's records with respect to any such increases in rent;
provided, however, that unless Tenant shall have given Landlord written notice
of exception to any such statement within one hundred and twenty (120) days
after delivery thereof, the same shall be conclusive and binding on Tenant.
As of the date of this Lease, the Tax Year is a fiscal year commencing
July 1. If the appropriate authorities shall hereafter change the tax year to a
calendar year, or to a fiscal year commencing on a date other than July 1,
appropriate adjustments shall be made in the computation of any additional rent
due hereunder. All reasonable expenses incurred by Landlord (including
attorneys, appraisers' and consultants' fees, and other costs) in contesting any
increase in Taxes or any increase in the assessment of the Property shall be
included as an item of Taxes for the purpose of computing additional rent due
hereunder.
6.4 Rent Adjustments for Operating Expenses.
6.4.1. After the end of each calendar year, Landlord shall
compute the Building Expenses for such year. Tenant shall pay a proportionate
share of said Building Expenses as additional rent hereunder. Tenant's
proportionate share of Building Expenses for the subject period shall be
computed by multiplying the amount of such Building Expenses by a fraction, the
numerator of which shall be the total rentable square feet in the Premises as
set forth in Section 1, and the denominator of which shall be the total rentable
square feet within the Building.
6.4.2. Landlord shall make a reasonable estimate of Tenant's
proportionate share of Building Expenses with respect to each calendar year or
any portion thereof occurring within the Term as renewed or extended, and
require Tenant to pay each month during such year 1/12 of such amount, at the
time of payment of monthly installments of Base Rent. In such event, Tenant
shall pay, or Landlord shall refund or at Tenant's election, credit to Tenant's
account, any underpayment or overpayment of Tenants proportionate share of
Building Expenses within thirty (30) days of Landlords written statement of
actual Building Expenses for the calendar year, provided, however that in the
event of an underpayment in Tenant's proportionate share of Building Expenses,
the amount due and owing from Tenant shall be, at Tenant's election, paid in one
lump sum installment due and payable within thirty (30) days of Landlord's
written statement of actual Building Expenses, or due and payable in six (6)
consecutive equal monthly installments commencing on the first day of the first
calendar month after Tenant shall receive Landlord's written statement of actual
Building Expenses. Tenant shall have the right to examine and copy, at Tenant's
expense, at Landlord's office during Landlord's business hours the Landlord's
records with respect to any such increases in rent; provided, however, that
unless
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Tenant shall have given Landlord written notice of exception to any such
statement within one hundred and twenty (120) days after delivery thereof, the
same shall be conclusive and binding on Tenant. Notwithstanding anything to the
contrary contained herein Landlord shall use diligent efforts to keep Building
Expenses at reasonable amounts, while maintaining the Building as a first class
suburban office building.
6.5 Additional Rent Payments. Tenant's obligation to pay any additional
rent accruing during the Lease Term pursuant to Sections 6.3 and 6.4 hereof
shall apply pro rata to the proportionate part of a Tax Year as to Taxes, and
calendar year, as to Building Expenses, in which this Lease begins or ends, for
the portion of each such year during which this Lease is in effect. Such
obligation to make payments of such additional rent shall survive the expiration
or sooner termination of the Lease Term, whether or not this Lease is superseded
by a subsequent lease of the Premises or of any other space or Tenant leaves the
Building; any such superseding lease shall not serve to supersede Tenant's
obligation for any such additional rent unless it makes express reference
thereto and recites that such additional rent is abated in consideration of the
superseding lease.
6.6 Payments. All payments or installments of any rent hereunder and
all sums whatsoever due under this Lease (including but not limited to court
costs and attorneys fees) shall be deemed rent, shall be paid to Landlord at the
address designated by Landlord, and if not paid within ten (10) days of the date
when due, shall be subject to a late charge of $35.00 for each late payment and
shall bear interest at the rate of 18% per annum. (but not more than the maximum
allowable legal rate applicable to Tenant) until paid. Additionally, if any of
Tenant's checks for payment of rent or additional rent are returned to Landlord
for insufficient funds, Tenant shall pay to Landlord as additional rent $50.00
for each such check returned for insufficient funds, and if two or more of
Tenant's checks in payment of rent or additional rent due hereunder are returned
for insufficient funds in any calendar year, Landlord reserves the right upon
ten (10) days advance written notice to Tenant to thereafter require Tenant to
pay all rent and additional rent and other sums whatsoever due under this Lease
by money order or by certified check or cashier's check. If an attorney is
employed to enforce Landlord's rights under this Lease, Tenant shall pay all
reasonable fees and expenses of such attorney whether or not legal proceedings
are instituted by Landlord. Time is of the essence in this Lease.
7. Improvements to the Premises.
7.1. Improvements to Phase 1 Premises.
7.1.1. Phase 1 Premises Plans and Specifications. Attached
hereto as Exhibit "C" and made a part hereof are preliminary plans and
specifications showing generally the floor plan of the Phase 1 Premises as
agreed upon by Landlord and Tenant. Tenant agrees to furnish Landlord, within
ninety (90) days from the date hereof, such specifications reasonably acceptable
to Landlord as may be required to enable Landlord to prepare final plans and
specifications for the build-out of the interior of the Phase 1 Premises. Upon
receipt of Tenant's specifications as above provided, Landlord agrees to
promptly prepare final plans and specifications and submit the same to Tenant
for approval, which approval by Tenant shall not be unreasonably withheld,
conditioned or delayed. Such final plans and specifications will be deemed
accepted by Tenant unless Tenant shall have given written notice to the
contrary to Landlord within ten (10) days of Tenant's receipt of the same,
stating the respects in which same fail to conform with Tenant's requirements.
When Landlord and Tenant have agreed upon said plans and specifications
(hereafter the "Phase 1 Final Plans and Specifications"), Landlord shall
construct and complete improvements to the Phase 1 Premises as shown on and
pursuant to the Phase 1 Premises Plans and Specifications.
7.1.2 Completion of Landlord's Phase 1 Work. Landlord shall
construct and install improvements to the interior of the Phase 1 Premises in
accordance with the Phase 1 Final Plans and Specifications ("Landlords Phase 1
Work") subject only to those minor changes, modifications or deviations as
hereafter accepted and approved by Landlord and Tenant. Landlord will cause all
work necessary to complete the Phase 1 Premises in accordance with the
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Phase 1 Final Plans and Specifications to be commenced with reasonable
promptness after the acceptance of the Phase 1 Plans and Specifications as
provided in Section 7.1.1 hereof and Landlord's completion of construction of
the Building in accordance with appropriate governmental approvals. All
alterations, modifications or deviations to the Phase 1 Final Plans and
Specifications requested by Tenant (excluding those minor changes, modifications
or deviations accepted by Landlord and Tenant as above-provided) shall be made
in the form of a written change order(s) prepared at Tenant's sole cost and
expense by Landlord and shall be subject to the prior approval of Landlord,
which approval of Landlord shall not be unreasonably withheld. "The costs of
work performed by Landlord pursuant to Tenant's written change orders approved
by Landlord shall include all costs of labor and materials plus ten percent
(10%) for overhead and ten percent (10%) for profit. At Tenant's request,
Landlord shall fully cooperate with Tenant to establish such costs or estimates
thereof in advance of performing the work.
7.1.3 Cost of improvements to the Phase 1 Premises. "The
actual costs (including preparation of plans and specifications, permit costs,
labor, materials, and overhead and profit charges as set forth above) of
Landlord's Phase 1 Work, including but not limited to (i) all costs related to
the preparation of Phase 1 Final Plans and Specifications, and (ii) construction
and installation of all improvements to be constructed or installed by Landlord
pursuant to the Phase 1 Final Plans and Specifications (hereafter the "Actual
Phase 1 Construction Costs") shall be paid by Landlord up to but not exceeding
Four Hundred Twenty-Six Thousand Fifty-One Dollars and Fifty Cents ($426,051.50)
(hereafter the "Phase 1 Tenant Improvement Allowance"). Tenant shall reimburse
Landlord that amount of Actual Phase 1 Construction Costs which exceed the Phase
1 Tenant Improvement Allowance (hereafter "Tenant's Share of Phase 1 Completion
Costs") as additional rent hereunder in the manner set forth below.
Tenant's Share of Phase 1 Completion Costs shall be fully
amortized over the initial Term of the Lease (seven years) and shall be paid by
Tenant to Landlord as additional rent hereunder, together with interest thereon
as below-described, in consecutive monthly installments commencing with the
Phase 1 Commencement Date, and continuing on the first day of each month until
such time as Tenant's Share of Phase 1 Completion Costs, together with interest
accrued thereon, shall be paid in full. The amount of monthly installments shall
be initially calculated on the Phase 1 Commencement Date, and shall be
recalculated on each Phase 1 Payment Calculation Date (as that term is defined
in the succeeding paragraph) until Tenant's Share of Phase 1 Completion Costs,
together with all interest accrued thereon, shall be paid in full.
During the Term of this Lease, interest on Tenant's Share of
Phase 1 Completion Costs shall be charged at a variable rate until Tenant's
Share of Phase 1 Completion Costs are paid in full. The interest rate shall
equal the sum of one (1) whole percentage point plus the fluctuating prime rate
in effect from time to time as established and declared by NationsBank, N.A. as
its prime commercial lending rate of interest, but in no event less than eight
percent (8%) annually (herein the "Completion Costs Interest Rate"). Interest
shall accrue at the applicable interest rate applied to the unpaid portion of
Tenant's Share of Phase 1 Completion Costs. All interest shall be computed on
the premise that a year contains 360 days, and is composed of twelve (12)
months, each of which contains thirty (30) days. The Completion Costs Interest
Rate used for purposes of determining Tenant's monthly installment of Tenant's
Share of Phase 1 Completion Costs shall initially equal that rate of interest
(as determined pursuant to the formula set forth above in effect on the Phase 1
Commencement Date, and thereafter, the Completion Costs Interest Rate used for
purposes of determining Tenant's monthly installment shall be recalculated at
the commencement of each Lease Year (individually referred to as a "Payment
Calculation Date") using the interest rate (as determined pursuant to the
formula set forth above) in effect on each respective Payment Calculation Date.
Tenant's monthly installment of the unpaid portion of Tenant's
Share of Phase 1 Completion Costs together with interest thereon shall be
adjusted on each Payment Calculation Date as follows:
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(a) Any portion of the Actual Phase 1 Construction Costs not
invoiced to Tenant prior to the preceding Payment Calculation Date shall be
added to Tenant's Share of Phase 1 Completion Costs then remaining unpaid.
(b) The unpaid portion of Tenant's Share of Phase 1 Completion
Costs together with interest thereon shall be increased or decreased as follows
on each Payment Calculation Date as applicable: (i) by the excess, if any, of
the amount of interest that has accrued during the preceding twelve-month period
over the amount of the monthly interest payments payable by Tenant during such
preceding twelve-month period, or (ii) by the excess, if any, of the amount of
the monthly interest payments payable during such preceding twelve-month period
over the amount of interest that has accrued during such preceding twelve-month
period.
Tenant shall have the right to prepay in whole or in part
during the Term hereof Tenant's Share of Phase 1 Completion Costs, together with
interest accrued thereon to the date of such prepayment upon ten (10) days prior
written notice to Landlord.
7.2. Improvements to Phase 2 Premises.
7.2.1. Phase 2 Premises Plans and Specifications. Tenant
agrees to furnish Landlord, within one hundred and eighty (180) days prior to
Tenant's anticipated occupancy of the Phase 2 Premises such specifications
reasonably acceptable to Landlord as may be required to enable Landlord to
prepare final plans and specifications for the build-out of the interior of the
Phase 2 Premises. Upon receipt of Tenant's specifications as above provided,
Landlord agrees to promptly prepare final plans and specifications and submit
the same to Tenant for approval, which approval by Tenant shall not be
unreasonably withheld, conditioned or delayed. Such final plans and
specifications will be deemed accepted by Tenant unless Tenant shall have given
written notice to the contrary to Landlord within ten (10) days of Tenant's
receipt of the same, stating the respects in which same fail to conform with
Tenant's requirements. When Landlord and Tenant have agreed upon said plans and
specifications (hereafter the "Phase 2 Final Plans and Specifications"),
Landlord shall construct and complete improvements to the Phase 2 Premises as
shown on and pursuant to the Phase 2 Final Plans and Specifications.
7.2.2 Completion of Landlords Phase 2 Work. Landlord shall
construct and install improvements to the interior of the Phase 2 Premises in
accordance with the Phase 2 Final Plans and Specifications ("Landlord's Phase 2
Work") subject only to those minor changes, modifications or deviations as
hereafter accepted and approved by Landlord and Tenant. Landlord will cause all
work necessary to complete the Phase 2 Premises in accordance with the Phase 2
Final Plans and Specifications to be commenced with reasonable promptness after
the acceptance of the Phase 2 Premises Plans and Specifications as provided in
Section 7.2.1 hereof. All alterations, modifications or deviations to the
Phase 2 Final Plans and Specifications requested by Tenant (excluding those
minor changes, modifications or deviations accepted by Landlord and Tenant as
above-provided) shall be made in the form of a written change order(s) prepared
at Tenant's sole cost and expense by Landlord and shall be subject to the prior
approval of Landlord, which approval of Landlord shall not be unreasonably
withheld. The costs of work performed by Landlord pursuant to Tenant's written
change orders approved by Landlord shall include all costs of labor and
materials plus ten percent (10%) for overhead and ten percent (10%) for profit.
At Tenant's request, Landlord shall fully cooperate with Tenant to establish
such costs or estimates thereof in advance of performing the work.
7.2.3 Cost of Improvements to the Phase 2 Premises. The actual
costs (including preparation of plans and specifications, permit costs, labor,
materials, and overhead and profit charges as set forth above) of Landlord's
Phase 2 Work, including but not limited to (i) all costs related to the
preparation of Phase 2 Final Plans and Specifications, and (ii) construction and
installation of all improvements to be constructed or installed by Landlord
pursuant to the Phase 2 Final Plans and Specifications (hereafter the "Actual
Phase 2 Premises Construction Costs") shall be paid by Landlord up to but not
exceeding One Hundred Seventy Thousand Nine Hundred Twenty-Nine Dollars
($170,929.00) (hereafter the "Phase 2 Tenant
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Improvement Allowance"); provided, however, that in the event that date on which
the Phase 2 Premises shall be Substantially Complete (as defined in Section
2.2.1 hereof) shall occur on a date subsequent to the commencement of the
twenty-fourth (24th) calendar month of the Term, then the aforesaid $170,929.00
Phase 2 Tenant Improvement Allowance shall be reduced on a monthly basis
thereafter for each calendar month beyond the 24th calendar month of the Term
until the calendar month during which the Phase 2 Premises shall be
Substantially Complete by that amount determined by multiplying the $170,929.00
Phase 2 Tenant Improvement Allowance by a fraction of 1/60th. Tenant shall
reimburse Landlord that amount of Actual Phase 2 Premises Construction Costs
which exceed the Phase 2 Tenant Improvement Allowance, as adjusted if required
in accordance with the preceding sentence (hereafter "Tenant's Share of Phase 2
Completion Costs") as additional rent hereunder in the manner set forth below.
Tenant's Share of Phase 2 Completion Costs shall be fully
amortized over that period of the initial Term of this Lease commencing with the
Phase 2 Commencement Date until the expiration of the initial seven-year Term of
the Lease (the "Phase 2 Completion Costs Term"), and shall be paid by Tenant to
Landlord as additional rent hereunder, together with interest thereon as
below-described, in consecutive monthly installments commencing with the Phase 2
Commencement Date, and continuing on the first day of each month until such time
as Tenant's Share of Phase 2 Completion Costs, together with interest accrued
thereon, shall be paid in full. The amount of monthly installments shall be
initially calculated on the Phase 2 Commencement Date, and shall be
recalculated on each Payment Calculation Date (as that term is defined in
Section 7.1.3 hereof) until Tenant's Share of Phase 2 Completion Costs, together
with all interest accrued thereon, shall be paid in full.
During the Phase 2 Completion Costs Term, interest on Tenant's
Share of Phase 2 Completion Costs shall be charged at the Completion Costs
Interest Rate defined in Section 7.1.3 above until Tenant's Share of Phase 2
Completion Costs are paid in full. Interest shall accrue at the applicable
interest rate applied to the unpaid portion of Tenant's Share of Phase 2
Completion Costs. The Completion Costs Interest Rate used for purposes of
determining Tenant's monthly installment of Tenant's Share of Phase 2 Completion
Costs shall initially equal the Completion Costs Interest Rate in effect on the
Phase 2 Commencement Date, and thereafter, the interest rate used for purposes
of determining Tenant's monthly installment shall be recalculated on the Payment
Calculation Date (defined in Section 7.1.3 above) using the Completion Costs
Interest Rate in effect on each respective Payment Calculation Date.
Tenant's monthly installment of the unpaid portion of Tenant's
Share of Phase 2 Completion Costs together with interest thereon shall be
adjusted on each Payment Calculation Date as follows:
(a) Any portion of the Actual Phase I Construction Costs not
invoiced to Tenant prior to the preceding Payment Calculation Date shall be
added to Tenant's Share of Phase 2 Completion Costs then remaining unpaid.
(b) The unpaid portion of Tenant's Share of Phase 2 Completion
Costs together with interest thereon shall be increased or decreased as follows
on each Payment Calculation Date as applicable: (i) by the excess, if any, of
the amount of interest that has accrued during the preceding twelve-month period
over the amount of the monthly interest payments payable by Tenant during such
preceding twelve-month period, or (ii) by the excess, if any, of the amount of
the monthly interest payments payable during such preceding twelve-month period
over the amount of interest that has accrued during such preceding twelve-month
period.
Tenant shall have the right to prepay in whole or in part
during the Term hereof Tenant's Share of Phase 2 Completion Costs, together with
interest accrued thereon to the date of such prepayment upon ten (10) days prior
written notice to Landlord.
8. Tenants Improvements. Tenant may make non-structural alterations,
installations, additions or improvements (excluding alterations, installations,
additions or improvements to the
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mechanical and/or electrical systems serving the Premises) each valued at Five
Thousand Dollars ($5,000.00) without the prior written consent of Landlord which
shall not be unreasonably withheld or delayed. Other than as set forth in the
immediately preceding sentence, Tenant shall not make any alterations,
decorations, installations, additions or improvements to the Premises, including
but not limited to, the installation of any fixtures, amenities, equipment,
appliances, or other apparatus, without Landlord's prior written consent (which
consent shall not be unreasonably withheld, conditioned or delayed), and then
only by contractors or mechanics employed and/or approved by Landlord (which
consent shall not be unreasonably withheld, conditioned or delayed).
Notwithstanding the terms of this Section 8, Tenant shall be permitted to
install its telecommunications equipment within the Premises subject to the
terms of Section 26 hereof. All such work, alterations, decorations,
installations, additions or improvements shall be done at Tenant's sole expense.
Landlord's consent to and/or approval of Tenant's plans and specifications for
the aforesaid improvements shall create no responsibility or liability on the
part of Landlord for their completeness, design sufficiency, or compliance with
all applicable laws. Unless otherwise specifically provided in this Lease, all
alterations, decorations, installations, additions or improvements made by
either of the parties hereto upon or serving the Premises, except movable office
furniture and trade fixtures put in at the expense of Tenant shall at the
expiration or earlier termination of the Term of this Lease (as renewed or
extended) be the property of Landlord and unless otherwise specifically provided
for in this Lease or unless Landlord's consent to such alterations, decorations,
installations, additions or improvements was conditioned on Tenant's removal of
the same at the expiration or earlier termination of the Term, same shall remain
upon and be surrendered with the Premises at the termination of this Lease
without molestation or injury. If Landlord shall require Tenant's removal of
alterations, modifications, decorations, installations or additional
improvements at the time of approving Tenant's plans and specifications
therefor, then such removal, and all restoration of the Premises required due to
the installation and removal of the same, shall be performed promptly upon the
expiration or earlier termination of the Term by Tenant at Tenant's sole cost
and expense.
9. Requirements of Applicable Law. Landlord warrants that on the Phase
1 Commencement Date, the Phase 1 Premises will comply with all applicable laws,
ordinances, rules and regulations of governmental authorities having
jurisdiction over the Property ("Applicable Laws"). Similarly, Landlord warrants
that on the Phase 2 Commencement Date, the Phase 2 Premises will comply with all
Applicable Laws. After delivery of possession of the Premises to Tenant, Tenant
shall at its sole cost and expense, comply promptly with all Applicable Laws now
in force or which may hereafter be in force, which impose any duty upon Landlord
or Tenant with respect to the use, occupancy or alteration of the Premises or
any part thereof and for the prevention of fires; provided, however, that
Landlord and not Tenant shall correct all structural defects in the Building
necessary to comply with Applicable Laws, and make all repairs, changes or
alterations necessary because the Building was not constructed in compliance
with any of said Applicable Laws.
10. Certificate of Occupancy. Tenant will not use or occupy the
Premises in violation of any certificate of occupancy, permit, or other
governmental consent issued for the Building. If any governmental authority,
after the commencement of the Lease Term, shall contend or declare that the
Premises are being used for a purpose which is in violation of such certificate
of occupancy, permit, or consent, then Tenant shall, upon five (5) days' written
notice from Landlord, immediately discontinue such use of the Premises. If
thereafter the governmental authority asserting such violation threatens,
commences or continues criminal or civil proceedings against Landlord for
Tenant's failure to discontinue such use, in addition to any and all rights,
privileges and remedies given to Landlord under this Lease for default therein,
Landlord shall have the right to terminate this Lease forthwith. Tenant shall
indemnify and hold Landlord harmless of and from any and all liability for any
such violation or violations.
11. Contest-Statute, Ordinance, Etc. Tenant may, after notice to
Landlord, by appropriate proceedings conducted promptly at Tenant's own expense
in Tenant's name and whenever necessary in Landlord's name, contest in good
faith the validity or enforcement of any such statute, ordinance, law, order,
regulation or requirement and may similarly contest any assertion of violation
of any certificate of occupancy, permit, or any consent issued for the Building.
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Tenant may, pending such contest, defer compliance therewith if, in the
reasonable opinion of counsel for Landlord, such deferral will not subject
either the Landlord or the Premises or the Property (or any part thereof) to any
penalty, fine or forfeiture, and if Tenant shall post a bond with corporate
surety approved by Landlord sufficient, in Landlord's opinion, fully to
indemnify Landlord from loss.
12. Maintenance and Repairs
12.1. Maintenance and Repairs to be Made by Tenant. During the
Term as renewed or extended, Tenant at its sole cost and expense shall keep the
Premises and the improvements and appurtenances serving the Premises in good
order and condition as is necessary to maintain the Premises in a condition
consistent with other suburban first-class office buildings. In furtherance of
the foregoing, Landlord, at Tenant's expense, will maintain, repair and/or
replace the heating, ventilating and air-conditioning system serving the
Premises (and if requested by Tenant in writing any supplemental HVAC system
serving Tenant's SCIF facility installed within the Premises) and Tenant shall
pay to Landlord within thirty (30) days after Landlord's invoice(s) therefor, as
additional rent, the reasonable cost of such maintenance, repair and/or
replacement. In this regard Landlord agrees that it will have competent HVAC
maintenance firms to perform the necessary work at reasonably commercial prices
and that at Tenant's request the contracts for such work, as well as invoices
and other appropriate documentation will be made available for review by Tenant.
Tenant shall cause the Premises to be cleaned daily using only
those janitorial contractors approved by Landlord, which approval shall not be
unreasonably withheld. Further, Tenant shall cause all trash emanating from the
Premises to be removed from the Premises daily and placed within the Common
Area wash receptacles for the Building. If at any time during the Term and any
extension or renewal thereof, Landlord shall, after reasonable investigation
determine that trash and similar waste generated by Tenant and/or emanating from
the Premises is in excess of that of other standard office tenants within the
Building (as computed on a per rentable square foot basis), Landlord shall ▇▇▇▇
Tenant and Tenant shall pay to Landlord as additional rent hereunder within
thirty (30) days of the date of Landlord's invoice for the same, those costs and
expenses of trash removal which are reasonably attributable to such excess trash
and similar waste generated by Tenant and/or emanating from the Premises.
Further, Tenant shall not place a load upon any floor of the Premises exceeding
the floor load per square foot area which such floor was designed to carry and
which may be allowed under Applicable Laws. Landlord reserves the right to
prescribe the weight and position of all heavy equipment brought onto the
Premises and prescribe any reinforcing required under the circumstances, all
such reinforcing to be at Tenant's expense.
All non-structural repairs to the Premises or any
installations, equipment or facilities serving the Premise, including but not
limited to sprinkler systems and HVAC and related electrical systems, shall be
made by Tenant at its expense using only licensed and professional contractors
approved by Landlord (which approval by Landlord shall not be unreasonably
withheld, conditioned or delayed). Without limiting the generality of the
foregoing, Tenant will keep the interior of the Premises, together with all
electrical distribution apparatus and service, plumbing and other mechanical
installations serving the Premises in good order and repair and will make all
replacements from time to time required thereto at its expense; and will
surrender the Premises at the expiration of the Term or at such other time as
it may vacate the Premises in as good condition as when received, excepting
depreciation caused by ordinary wear and tear, damage by casualty (other than
such damage by casualty which is caused by the negligence of Tenant, its agents,
concessionaires officers, employees, contractors, licensees or invitees, and
which is not wholly covered by Landlord's hazard insurance policy), unavoidable
accident or Act of God. Tenant will not overload the electrical wiring or HVAC
system(s) serving the Premises, and will install at its expense, any additional
electrical wiring or HVAC system(s) which may be required in connection with
Tenant's apparatus. Any damage or injury sustained by any person because of
mechanical, electrical, plumbing or any other equipment or whose maintenance and
repair shall be the responsibility of Tenant shall be paid for by Tenant, and
Tenant shall indemnify and hold Landlord harmless from and against all claim,
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actions, damages and liability in connection therewith, including, but not
limited to attorney's and other professional fees, and any other cost which
Landlord might reasonably incur.
12.2 Repairs To Be Made By Landlord. Landlord, at its expense,
will make, or cause to be made structural repairs to roof, foundation, exterior
walls, interior structural walls, and all structural components of the Premises
provided Tenant shall give Landlord notice of the necessity for such repairs.
Landlord shall maintain, and shall make all repairs and replacements to the
Common Areas of the Building and Property (including Building Common Area
fixtures and equipment) as shall be reasonably deemed necessary to maintain the
Building in a condition comparable to other first class suburban office
buildings in the Baltimore-Washington corridor area. The costs associated with
such repairs shall be deemed a part of Building Expenses; provided, however,
that costs of all of such repairs which would be considered capital in nature
under generally accepted accounting principles shall be paid by Landlord.
Notwithstanding the foregoing, if the necessity for such repairs shall have
arisen from or shall have been caused by the negligence or willful acts of
Tenant, its agents, concessionaires, officers, employees, licensees, invitees or
contractors, Landlord may make or cause the same to be made, but shall not be
obligated to do so, and Tenant agrees to pay to Landlord promptly upon
Landlord's demand, as additional rent, the cost of such repairs, if made, until
paid. There shall be no allowance to Tenant for a diminution of rental value, no
abatement of rent, and no liability on the part of Landlord by reason of
inconvenience, annoyance or injury to business arising from Landlord, Tenant or
others making any repairs or performing maintenance as provided for herein
unless caused by Landlord's negligence.
12.3 Time for Repairs. Repairs or replacements required
pursuant to Section 12.1 and 12.2 above shall be made within a reasonable time
(depending on the nature of the repair or replacement needed - generally no more
than fifteen (15) days) after receiving notice or having actual knowledge of the
need for a repair or replacement.
12.4 Surrender of the Premises. Upon the termination of this
Lease, Tenant shall surrender the Premises and all mechanical, plumbing and
electrical systems serving the Premises to Landlord broom clean condition and in
good order, condition and repair except for:
(i) ordinary wear and tear,
(ii) damage by the elements, fire, and other casualty unless
Tenant would be required to repair under the provisions of this Lease;
(iii) damage arising from any cause not required to be
repaired or replaced by Tenant; and
(iv) alterations as permitted by this Lease unless consent was
conditioned on their removal. Any items not removed by Tenant as required above
shall be considered abandoned. Landlord may dispose of abandoned items as
Landlord chooses and ▇▇▇▇ Tenant for the cost of their disposal.
13. Tenant's Failure to Repair. In the event that Tenant fails after
reasonable prior written notice from Landlord, to keep the Premises in a good
state of condition and repair pursuant to Section 12 above, or to do any act or
make any payment required under this Lease or otherwise fails to comply
herewith, Landlord may, at its option (but without being obliged to do so)
immediately, or at any time thereafter and without notice, perform the same for
the account of Tenant, including the right to enter upon the Premises at all
reasonable hours to make such repairs, or do any act or make any payment or
compliance which Tenant has failed to do, and upon demand, Tenant shall
reimburse Landlord for any such expense incurred by Landlord including but not
limited to any costs, damages and counsel fees. Any moneys expended by Landlord,
as aforesaid, shall be deemed additional rent, collectible as such by Landlord.
AU rights given to Landlord in this section shall be in addition to any other
right or remedy of Landlord herein contained.
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14. Conduct on Premises. Tenant shall not do, or permit anything to be
done in the Premises, or bring or keep anything therein which will, in any way,
increase the rate of fire insurance on the Building, or invalidate or conflict
with the fire insurance policies on the Building, fixtures or on property kept
therein, or obstruct or interfere with the rights of the Landlord or of other
tenants, or in any other way injure or annoy Landlord or the other tenants, or
subject Landlord to any liability for injury to persons or damage to property,
or interfere with the good order of the Building, or conflict with Applicable
Laws, or the Maryland Fire Underwriters Rating Bureau. Tenant agrees that any
increase of fire insurance premiums on the Building or contents directly caused
by the occupancy of Tenant and any expense or cost incurred in consequence of
negligence or carelessness or the willful action of Tenant, Tenants employees,
agents, servants, or invitees shall, as they accrue be added to the rent
heretofore reserved and be paid as a part thereof; and Landlord shall have all
the rights and remedies for the collection of same as are conferred upon the
Landlord for the collection of rent provided to be paid pursuant to the terms of
this Lease.
15. Insurance.
15.1 Tenant's Insurance. Tenant will keep in force at its own expense,
so long as this Lease remains in effect, (a) public liability insurance,
including insurance against assumed or contractual liability under this Lease,
with respect to the Premises, to afford protection with limits, per person and
for each occurrence, of not less than Two Million Dollars ($2,000,000), combined
single limit, with respect to personal injury and death and property damage,
such insurance to provide for only a reasonable deductible, (b) all-risk
property and casualty insurance, including theft, written at replacement cost
value and with replacement cost endorsement, covering all of Tenant's personal
property in the Premises and all improvements and installed in the Premises by
or on behalf of Tenant whether pursuant to the terms of Section 7, Section 8, or
otherwise, such insurance to provide for only a reasonable deductible, (c) if,
and to the extent, required by law, workmen's compensation or similar insurance
offering statutory coverage and containing statutory limits, and (d) shall
insure all plate and other interior glass in the Premises for and in the name of
the Landlord. Such policies will be maintained in companies and in form
reasonably acceptable to Landlord and will be written as primary policy coverage
and not contributing with, or in excess of, any coverage which Landlord shall
carry. Tenant will deposit the policy or policies of such required insurance or
certificates thereof with Landlord prior to the Phase I Commencement Date, which
policies shall name Landlord or its designee and, at the request of Landlord,
its mortgagees, as additional named insured and shall also contain a provision
stating that such policy or policies shall not be canceled except after thirty
(30) day's written notice to Landlord or its designees. All such policies of
insurance shall be effective as of the date Tenant occupies the Premises and
shall be maintained in force at all times during the Term of this Lease and all
other times during which Tenant shall occupy the Premises. In addition to the
foregoing insurance coverage, Tenant shall require any contractor retained by it
to perform work on the Premises to carry and maintain, at no expense to
Landlord, during such times as contractor is working in the Premises, a
non-deductible (i) comprehensive general liability insurance policy, including,
but not limited to, contractor's liability coverage, contractual liability
coverage, completed operations coverage, broad form property damage endorsement
and contractor's protective liability coverage, to afford protection with limits
per person and for each occurrence, of not less than Two Hundred Thousand
Dollars ($200,000.00), combined single limit, with respect to personal injury
and death and property damage, such insurance to provide for no deductible, and
(ii) workmen's compensation insurance or similar insurance in form and amounts
as required by law. In the event of damage to or destruction of the Premises and
the termination of this Lease by Landlord pursuant to Section 17 herein, Tenant
agrees that it will pay Landlord all of its insurance proceeds relating to
improvements made in the Premises by or on behalf of Tenant whether pursuant to
the terms of Section 7, Section 8, or otherwise. If Tenant fails to comply with
its covenants made in this Section, if such insurance would terminate or if
Landlord has reason to believe such insurance is about to be terminated,
Landlord may at its option cause such insurance as it in its sole judgment
deems necessary to be issued, and in such event Tenant agrees to pay promptly
upon Landlord's demand, as additional rent the premiums for such insurance.
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15.2 Landlord's Insurance. Landlord will keep in force at its
own expense (a) contractual and comprehensive general liability insurance,
including public liability and property damage, with a minimum combined single
limit of liability of Two Million Dollars ($2,000,000.00) for personal injuries
or death of persons occurring in or about the Building and Premises, and (b)
all- risk property and casualty insurance written at replacement cost value
covering the Building and all of Landlord's improvements in and about same.
15.3 Waiver of Subrogation. Each party hereto waives claims
arising in any manner in its favor and against the other party and agrees that
neither party hereto shall be liable to the other party or to any insurance
company (by way of subrogation or otherwise) insuring the other party for any
loss or damage to the Building, the Premises or other tangible property, or any
resulting loss of income, or losses under worker's compensation laws and
benefits, or against liability on or about the Building, even though such loss
or damage might have been occasioned by the negligence of such party, its agents
or employees if any such loss or damage is covered by insurance benefiting the
party suffering such loss or damage as was required to be covered by insurance
carried pursuant to this Lease. Landlord shall cause each insurance policy
carried by it insuring against liability on or about the Building or insuring
the Premises and the Building or income resulting therefrom against loss by fire
or any of the casualties covered by the all-risk insurance carried by it
hereunder to be written in such a manner as to provide that the insurer waives
all right of recovery by way of subrogation against Tenant in connection with
any loss or damage covered by such policies. Tenant will cause each insurance
policy carried by it insuring against liability or insuring the Premises
(including the contents thereof and Tenant's Improvements installed therein by
Tenant or on its behalf) against loss by fire or any of the casualties covered
by the all-risk insurance required hereunder to be written in such a manner as
to provide that the insurer waives all right of recovery by way of subrogation
against Landlord in connection with any loss or damage covered by such policies.
16. Rules and Regulations. Tenant agrees to be bound by the miles and
regulations set forth on the schedule attached hereto as Exhibit "B" and made a
part hereof. Landlord shall have the right, from time to time, to issue
additional or amended rules and regulations regarding the use of the Building,
so long as said rules shall be reasonable and non-discriminatory between
tenants. When so issued the same shall be considered a part of this Lease and
Tenant covenants that said additional or amended rules and regulations shall
likewise be faithfully observed by Tenant, the employees of Tenant and all
persons invited by Tenant into the Building, provided, that said additional or
amended rules are made applicable to all office tenants similarly situated as
Tenant. Landlord shall not be liable to Tenant for the violation of any of the
said rules and regulations, or the breach of any covenant or condition in any
lease, by any other tenant in the Building.
17. Mechanics' Liens. Tenant shall not do or suffer to be done any act,
matter or thing whereby Tenant's interest in the Premises, or any part thereof,
may be encumbered by any mechanics' lien. Tenant shall discharge, within ten
(10) days after the date of filing, any mechanics' liens filed against 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 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 Property.
18. Property - Loss, Damage. Landlord, its agents and employees shall
not be liable to Tenant for (i) any damage or loss of property of the Tenant
placed in the custody of persons employed to provide services for or stored in
or about the Premises and/or the Building, unless such damage or loss is the
result of the negligence of Landlord, and (ii) interference with the light, air,
or other incorporeal hereditaments of the Premises.
19. Destruction - Fire or Other Casualty. In case of partial damage to
the Premises by fire or other casualty insured against by Landlord, Tenant
shall give immediate notice thereof to Landlord, who shall thereupon cause
damage to all property owned by it to be repaired with
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reasonable speed at expense of Landlord (provided that Landlord shall not be
obligated to perform any work beyond the work included as a part of Landlord's
Phase I Work and Landlord's Phase 2 Work described in Section 7 hereof), due
allowance being made for reasonable delay which may arise by reason of
adjustment of loss under insurance policies on the part of Landlord and/or
Tenant, and for reasonable delay on account of "labor troubles" or any other
cause beyond Landlord's control, and to the extent that the Premises are
rendered untenantable the rent shall proportionately ▇▇▇▇▇ from the date of such
casualty, provided the damage above mentioned occurred without the fault or
neglect of Tenant, Tenant's servants, employees, agents or visitors. If such
partial damage is due to the fault or neglect of Tenant, or Tenant's servants,
employees, agents, or invitees, the damage shall be repaired by Landlord to the
extent of Landlord's insurance coverage, but there shall be no apportionment or
abatement of rent. In the event the damage shall be so extensive to the whole
Building as to render it uneconomical, in Landlord's opinion, to restore for its
present uses and Landlord shall decide not to repair or rebuild the Building,
this Lease, at the option of Landlord, shall be terminated upon written notice
to Tenant and the rent, shall, in such event, be paid to or adjusted as of the
date of such damage, and the terms of this Lease shall expire by lapse of time
and conditional limitation upon the third day after such notice is mailed, and
Tenant shall thereupon vacate the Premises and surrender the same to Landlord,
but no such termination shall release Tenant from any liability to Landlord
arising from such damage or from any breach of the obligations imposed on Tenant
hereunder, or from any obligations accrued hereunder prior to such termination.
20. Eminent Domain. If (1) the whole or more than fifty percent (50%)
of the floor area of the Premises shall be taken or condemned by Eminent Domain
for any public or quasi-public use or purpose, and either party shall elect, by
giving written notice to the other, or (2) more than twenty-five percent (25%)
of the floor area of the Building shall be so taken, and Landlord shall elect,
in its sole discretion, by giving written notice to the Tenant, any said written
notice to be given not more than sixty (60) days after the date on which title
shall vest in such condemnation proceeding, to terminate this Lease, then, in
either such event, the Term of this Lease shall cease and terminate as of the
date of title vesting. In case of any taking or condemnation, whether or not the
Term of this Lease shall cease and terminate, the entire award shall be the
property of Landlord, and Tenant hereby assigns to Landlord all its right, title
and interest in and to any such award, except that Tenant shall be entitled to
claim, prove and receive in the proceedings such awards as may be allowed for
moving expenses, loss of profit and fixtures and other equipment installed by it
which shall not, under the terms of this Lease, be or become the property of
Landlord at the termination hereof, but only if such awards shall be made by the
condemnation, court or other authority in addition to, and be stated separately
from, the award made by it for the Property or part thereof so taken.
21. Assignment. So long as Tenant is not in default of any of the terms
and conditions hereof, and further provided that Tenant has fully and faithfully
performed all of the terms and conditions of this Lease, Landlord will not
unreasonably withhold its consent to an assignment of this Lease or sublease of
the Premises for any of the then remaining portion of the unexpired Term
provided: (i) the financial strength and net worth of the proposed subtenant or
assignee must be at least sufficient, in Landlord's reasonable determination
based on certified financial statements prepared and certified in accordance
with generally accepted accounting principles, to meet the financial obligations
of the tenant hereunder; (ii) in the event of an assignment, such assignee shall
assume in writing all of Tenant's obligations under this Lease; (iii) in the
event of a sublease, such sublease shall in all respects be subject to and in
conformance with the terms of this Lease; and (iv) in all events Tenant
continues to remain liable on this Lease for the performance of all terms,
including but not limited to, payment of all rent due hereunder. Landlord and
Tenant acknowledge and agree that it shall not be unreasonable for Landlord to
withhold its consent to an assignment if in Landlord's sole business judgment,
the assignee lacks sufficient business experience or net worth to successfully
operate its business within the Premises in accordance with the terms, covenants
and conditions of this Lease. If this Lease be assigned, or if the Premises or
any part thereof be underlet or occupied by anybody other than Tenant, Landlord
may, after default by Tenant, collect rent from the assignee, undertenant or
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occupant and apply the net amount collected to the rent herein reserved, but no
such collection shall be deemed a waiver of this covenant, or the acceptance of
the assignee, undertenant or occupant as tenant, or a release of Tenant from the
further observance and performance by Tenant of the covenants herein contained.
For purposes of the foregoing, a transfer by operation of law or transfer of a
controlling interest in Tenant as same exists as of the date hereof, shall be
deemed to be an assignment of this Lease. No assignment or sublease, regardless
of whether Landlord's consent has been granted or withheld, shall be deemed to
release Tenant from any of its obligations nor shall the same be deemed to
release any person guaranteeing the obligations of Tenant hereunder from their
obligations as guarantor.
22. Default: Remedies: Bankruptcy of Tenant. Any one or more of the
following events shall constitute an "Event of Default" hereunder, at Landlord's
election: (a) the sale of Tenant's interest in the Premises under attachment,
execution or similar legal process or, the adjudication of Tenant as a bankrupt
or insolvent, unless such adjudication is vacated within thirty (30) days; (b)
the filing of a voluntary petition proposing the adjudication of Tenant (or any
guarantor of Tenant's obligations hereunder) as a bankrupt or insolvent, or the
reorganization of Tenant (or any such guarantor), or an arrangement by Tenant
(or any such guarantor) with its creditors, whether pursuant to the Federal
Bankruptcy Code or any similar federal or state proceeding, unless such petition
is filed by a party other than Tenant (or any such guarantor) and is withdrawn
or dismissed within thirty (30) days after the date of its filing; (c) the
admission, in writing, by Tenant (or any such guarantor) of its inability to pay
its debts when due; (d) the appointment of a receiver or trustee for the
business or property of Tenant (or any such guarantor), unless such appointment
is vacated within thirty (30) days of its entry; (e) the making by Tenant (or
any such guarantor) of an assignment for the benefit of its creditors, or if, in
any other manner, Tenant's interest in this Lease shall pass to another by
operation of law; (f) the failure of Tenant to pay any rent, additional rent or
other sum of money when due and such failure continues for a period of seven (7)
days after receipt of written notice that the same is past due hereunder; (g)
the Tenant shall fail to move into or take possession of the Premises within
thirty (30) days after commencement of the Lease Term or having taken
possession shall thereafter abandon and/or vacate the Premises for a period
longer than 120 days, and (h) the default by Tenant in the performance or
observance of any covenant or agreement of this Lease (other than a default
involving the payment of money), which default is not cured within thirty (30)
days after the giving of notice thereof by Landlord, unless such default is of
such nature that it cannot be cured within such thirty (30) day period, in which
case no Event of Default shall occur so long as Tenant shall commence the curing
of the default within such thirty (30) day period and shall thereafter
diligently prosecute the curing of same.
Upon the occurrence and continuance of an Event of Default, Landlord,
with such notice to Tenant as provided for by law or as expressly provided for
herein, may do any one or more of the following: (a) sell, at public or private
sale, all or any part of the goods, chattels, fixtures and other personal
property belonging to Tenant which are or may be put into the Premises during
the Lease Term, whether or not exempt from sale under execution or attachment
(it being agreed that said property shall at all times be bound with a lien in
favor of Landlord and shall be chargeable for all rent and for the fulfilment of
the other covenants and agreements herein contained), and apply the proceeds of
such sale, first, to the payment of all costs and expenses of conducting the
sale or caring for or storing said property; second, toward the payment of any
indebtedness, including, without limitation, indebtedness for rent, which may be
or may become due from Tenant to Landlord; and third, to pay the Tenant, on
demand in writing, any surplus remaining after all indebtedness of Tenant to
Landlord has been fully paid; (b) perform, on behalf and at the expense of
Tenant, any obligation of Tenant under this Lease which Tenant has failed to
perform and of which Landlord shall have given Tenant notice, the cost of which
performance by Landlord, together, with interest thereon at the rate of eighteen
percent (18%) per annum, from the date of such expenditure, shall be deemed
additional rent and shall be payable by Tenant to Landlord upon demand; (c)
elect to terminate this Lease and the tenancy created hereby by giving notice of
such election to Tenant, in which event Tenant shall be liable for Base Rent
Additional Rent, and other indebtedness that otherwise would have been payable
by Tenant
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during the remainder of the Term had there been no Event of Default, and on
notice reenter the Premises, by summary proceedings or otherwise, and remove
Tenant and all other persons and property from the Premises, and store such
property in a public warehouse or elsewhere at the cost and for the account of
Tenant, without resort to legal process and without Landlord being deemed guilty
of trespass or becoming liable for any loss or damage occasioned thereby; and
also the right, but not the obligation, to re-let the Premises for any unexpired
balance of the Lease Term, and collect the rent therefor. Landlord shall use
reasonable efforts to relet the Premises based on commercially standard terms
and conditions. In the event of such re-letting by Landlord, the re-letting
shall be on such terms, conditions and rental as Landlord may deem proper, and
the proceeds that may be collected from the same, less the expense of re-letting
(including reasonable leasing fees and commissions and reasonable costs of
renovating the Premises), shall be applied upon the Tenant's rental obligation
as set forth in this Lease for the unexpired portion of the Lease Term. Tenant
shall be liable for any balance that may be due under this Lease, although
Tenant shall have no further right of possession of the Premises; and (d)
exercise any other legal or equitable right or remedy which it may have at law
or in equity. Notwithstanding the provisions of clause (b) above and regardless
of whether an Event of Default shall have occurred, Landlord may exercise the
remedy described in clause (b) without any notice to Tenant if Landlord, in its
good faith judgment, believes it would be materially injured by the failure to
take rapid action, or if the unperformed obligation of Tenant constitutes an
emergency.
To the extent permitted by law, Tenant hereby expressly waives any and
all rights of redemption, granted by or under any present or future laws in the
event of Tenant's being evicted or dispossessed for any cause, or in the event
of Landlord's obtaining possession of the Premises, by reason of the violation
by Tenant of any of the covenants and conditions of this Lease, or otherwise.
Landlord and Tenant hereby expressly waive trial by jury in any action or
proceeding or counterclaim brought by either party hereto against the other
party on any and every matter, directly or indirectly arising out of or with
respect to this Lease, including, without limitation, the relationship of
Landlord and Tenant, the use and occupancy by Tenant of the Premises, any
statutory remedy and/or claim of injury or damage regarding this Lease.
Any costs and expenses incurred by Landlord (including, without
limitation, reasonable attorneys' fees) in enforcing any of its rights or
remedies under this Lease shall be deemed to be additional rent and shall be
repaid to Landlord by Tenant upon demand.
Notwithstanding any of the other provisions of this Lease, in the event
Tenant shall voluntarily or involuntarily come under the jurisdiction of the
Federal Bankruptcy Code and thereafter Tenant or its trustee in bankruptcy,
under the authority of and pursuant to applicable provisions thereof, shall have
the power and so using same determine to assign this Lease, Tenant agrees that
(i) Tenant or its trustee will provide to Landlord sufficient information
enabling it to independently determine whether Landlord will incur actual and
substantial detriment by reason of such assignment and (ii) "adequate assurance
of future performance" under this Lease, as that term is generally defined under
the Federal Bankruptcy Code, will be provided to Landlord by Tenant and its
assignee as a condition of said assignment.
23. Damages. If this Lease is terminated by Landlord pursuant to
Section 22, Tenant shall, nevertheless, remain liable for all rent and damages
which may be due or sustained prior to such termination, and all reasonable
costs, fees and expenses including, but not limited to, reasonable attorneys'
fees, costs and expenses incurred by Landlord in pursuit of its remedies
hereunder, or in renting the Premises to others from time to time and additional
damages (the "Liquidated Damages"), which shall be an amount equal to the total
rent which, but for termination of this Lease, would have become due during the
remainder of the Term, less the amount of rent, if any, which Landlord shall
receive during such period from others to whom the Premises my be rented (other
than any additional rent received by Landlord as a result of any failure of such
other person to perform any of its obligations to Landlord), in which case such
Liquidated Damages shall be computed and payable in monthly installments, in
advance on the first day of each calendar month following termination of the
Lease and continuing until the date
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on which the Lease Term would have expired but for such termination, and any
suit or action brought to collect any such Liquidated Damages for any month
shall not in any manner prejudice the right of Landlord to collect any
Liquidated Damages for any subsequent month by a similar proceeding.
If this Lease is terminated pursuant to Section 22, Landlord shall use
reasonable efforts to relet the Premises or any part thereof, alone or together
with other premises, for such term(s) which may be greater or less than the
period which otherwise would have constituted the balance of the Term and on
such commercially standard terms and conditions (which may include concessions,
free rent and/or alterations of the Premises) as Landlord, in its sole
discretion, may determine, but Landlord shall not be liable for, nor shall
Tenant's obligations hereunder be diminished by reason of, any failure by
Landlord to relet the Premises or any failure by Landlord to collect any rent
due upon such reletting.
24. Services and Utilities. Landlord shall provide the following listed
services and utilities, namely:
(a) automatic passenger elevators providing adequate service leading to
the floor on which the Premises are located;
(b) hot and cold water sufficient for drinking, lavatory toilet and
ordinary cleaning purposes from fixtures either within the Premises (if provided
pursuant to this Lease) or on the floor on which the Premises are located; and
(c) maintenance of Common Areas in a manner comparable to other first
class suburban office buildings in the Baltimore-Washington corridor.
Landlord shall have no responsibility or liability for failure to
supply any service listed above or when prevented from so doing by laws, orders,
or regulations of any Federal, State, County or Municipal authority or by
strikes, accidents or by any other cause whatsoever beyond Landlord's control.
25. Electric Power/HVAC For Premises.
25.1. Electric Service And Meters. Landlord has supplied or will supply
the Premises with the necessary lines to provide electric service to the
Premises for normal office operations, as well as separate meters so that
Tenant's consumption of electric power can be separately measured and charged to
Tenant. Tenant shall pay all charges (including meter installation and
adjustment) for electric and similar utilities or services so supplied directly
to the utility company supplying same when due and before penalties or late
charges on same shall accrue. Tenant shall not at any time overburden or exceed
the capacity of the mains, feeders, ducts, conduits, or other facilities by
which electric and similar utilities are supplied to, distributed in or serve
the Premises. If Tenant desires to install any equipment which shall require
additional electric or similar facilities of a greater capacity than as provided
by Landlord, such installation shall be subject to Landlord's prior written
approval of Tenant's plans and specifications therefor. If such installation is
approved by Landlord, all costs for providing such additional electrical and
similar facilities shall be paid by Tenant.
25.2. Heating, Ventilating and Air-Conditioning. Also as a part of
Landlord's Phase 1 Work and Landlord's Phase 2 Work described in Section 7
hereof, Landlord will install within the Premises facilities and equipment for
heating, ventilating and air-conditioning ("HVAC") of the Premises for normal
office operations, which equipment and facilities shall be and remain the
property of Landlord. All electric power service to operate said HVAC equipment
shall be separately metered and charged to Tenant through those meters referred
to in Subsection 25.1 above. Tenant will not overburden or misuse said HVAC
equipment. All repair, maintenance and/or replacement of such HVAC equipment,
whether general prevention or emergency in
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nature, shall be done and performed by and through Tenant at its cost and
expense pursuant to Section 12.1 hereof. Any supplemental HVAC required by
Tenant for its SCIF facility installed within the Premises by or on behalf of
Tenant shall be maintained and repaired by Tenant at Tenant's sole cost and
expense.
25.3 Interruption to Service. Landlord reserves the right to stop
service of, the heating, air conditioning, elevator, plumbing and electric
systems, when necessary, by reason of accident or emergency, or for repairs,
alterations, replacements or improvements which in the judgment of Landlord are
desirable or necessary to be made, until such repairs, alterations, replacements
or improvements shall have been completed. Landlord shall use best efforts to
notify Tenant in advance prior to Landlord's stopping any such service and shall
use best efforts not to interfere with Tenant's permitted use of the Premises
when stopping such service. Landlord shall have no responsibility or liability
for failure to supply heat, air conditioning, elevator, plumbing, cleaning and
electric service, during such period or when prevented from so doing by laws,
orders, or regulations of any federal, state, county or municipal authority or
by strikes, accidents or by any other cause whatsoever beyond Landlord's control
except where such failure is due to the negligence or willful misconduct of
Landlord.
26. Telephone. Landlord has arranged for the installation of
telephone service within the Building. Tenant shall be responsible for
contacting the utility company supplying said telephone service and arranging to
have such telephone facilities as it may desire to be extended and put into
operation in the Premises. Tenant acknowledges and agrees that all telephone and
telecommunications services desired by Tenant shall be ordered and utilized at
the sole expense of Tenant. All costs related to installation and the provision
of such service shall be borne and paid for directly by Tenant.
In the event Tenant wishes to utilize the services of a telephone or
telecommunications provider whose equipment is not servicing the Building at
such time Tenant wishes to install its telecommunications equipment serving the
Premises ("Provider"), no such Provider shall be permitted to install its lines
or other equipment without first securing the prior written consent of Landlord,
which consent shall not be unreasonably withheld. Prior to the commencement of
any work in or about the Building by the Provider, the Provider shall agree to
abide by such rules and regulations, job site rules, and such other requirements
as reasonably determined by Landlord to be necessary to protect the interest of
the Building and Property, the other tenants and occupants of the Building and
the Landlord, including, without limitation, providing security in such form and
amount as reasonable determined by Landlord. Each Provider must be duly
licensed, insured and reputable. Landlord shall incur no expense whatsoever with
respect to any aspect of Provider's provision of its services, including without
limitation, the costs of installation, materials and service.
27. Several Liability. If the Tenant shall be one or more individuals,
corporations or other entities, whether or not operating as a partnership or
joint venture, then each such individual, corporation, entity, joint venturer or
partner shall be deemed to be both jointly and severally liable for the payment
of the entire rent and other payments specified herein.
28. Acceptance of Premises. Tenant shall have reasonable opportunity,
provided it does not thereby interfere with Landlord's work, to examine the
Premises to determine the condition thereof. Upon taking possession of the
Premises, Tenant shall be deemed to have accepted same as being satisfactory and
in the condition called for hereunder, except for latent defects and punch list
items previously noted to Landlord at a joint walk-thru of the Phase 1 Premises
and the Phase 2 Premises, respectively, to be conducted by Landlord and Tenant
within fifteen (15) days prior to Landlord's anticipated completion of
Landlord's Phase 1 Work and Landlord's Phase 2 Work, respectively.
29. Inability to Perform. This Lease and the obligation of Tenant to
pay rent hereunder and perform all of the other covenants and agreements
hereunder on the part of Tenant to be per-
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formed shall in no way be affected, impaired or excused because Landlord is
unable to fulfill any of its obligations under this Lease or to supply, or is
delayed in supplying, any service to be supplied by it under the terms of this
Lease or is unable to make, or is delayed in making any repairs, additions,
alterations, or decorations or is unable to supply, or is delayed in supplying,
any equipment or fixtures if Landlord is prevented or delayed from so doing by
reason of strikes or labor troubles or any outside cause whatsoever including,
but not limited to, governmental pre-emption in connection with a National
Emergency, or by reason of any rule, order or regulation of any department or
subdivision of any government agency or by reason of the conditions of supply
and demand which have been or are affected by war or other emergency, unless due
to Landlord's gross negligence. Similarly, Landlord shall not be liable for any
interference with any services supplied to Tenant by others if such interference
is caused by any of the reasons listed in this Section 29. Nothing contained in
this Section 29 shall be deemed to impose any obligation on Landlord not
expressly imposed by other sections of this Lease.
30. No Waivers. The failure of Landlord to insist, in any one or more
instances, upon a strict performance of any of the covenants of this Lease, or
to exercise any option herein contained, shall not be construed as a waiver, or
a relinquishment for the future, of such covenant or option, but the same shall
continue and remain in full force and effect. The receipt by Landlord of rent,
with knowledge of the breach of any covenant hereof, shall not be deemed a
waiver of such breach, and no waiver by Landlord of any provision hereof shall
be deemed to have been made unless expressed in writing and signed by Landlord.
31. Access to Premises and Change in Services. Subject to Tenant's
applicable security policies (of which Landlord is made aware), Landlord shall
have the right without abatement of rent, to enter the Premises to examine the
same, or to make such repairs and alterations as Landlord shall deem necessary
for the safety and preservation of the Building, and also to exhibit the
Premises to be let; provided, however, that except in the case of emergency such
entry shall only be after 24 hours advance notice first given to Tenant. Nothing
herein contained, however, shall be deemed or construed to impose upon Landlord
any obligation, responsibility or liability whatsoever, for the care,
supervision or repair, of the Building or any part thereof, other than as herein
elsewhere expressly provided. Landlord shall also have the right at any time,
without the same constituting an actual or constructive eviction and without
incurring any liability to Tenant therefor, to change the arrangement and/or
location of entrances or passageways, doors and doorways, and corridors, stairs,
toilets, elevators, or other public parts of the Building provided that Tenant's
permitted use of the Premises is not materially and adversely affected, and to
change the name by which the Building is commonly known and/or its mailing
address.
32. Estoppel Certificates. Tenant agrees at any time and from time to
time upon not less than ten (10) business days' prior notice by Landlord to
execute, acknowledge and deliver to Landlord a statement in writing certifying
that to the best of Tenant's information, knowledge and belief, this Lease is
unmodified and in full force (or if there have been modifications, that the same
is in full force and effect as modified and stating the modifications) and the
dates to which the rent and other charges have been paid in advance, if any, and
stating whether or not to the best knowledge of the signer of such certificate
Landlord is in default in performance of any covenant, agreement or condition
contained in this Lease and, if so, specifying each such default of which the
signer may have knowledge, it being intended that any such statement delivered
hereunder may be relied upon by third parties not a party to this Lease.
Tenant agrees to execute the Estoppel Certificate in the form attached
hereto as Exhibit "D" upon acceptance of the Premises.
33. Subordination. Tenant accepts this Lease, and the tenancy created
hereunder, subject and subordinate to any mortgages, overleases, leasehold
mortgages or other security interests now or hereafter a lien upon or affecting
the Building or the Property or any part thereof. In connection with such
subordination, the parties acknowledge that as of execution of this Lease, the
Property is unencumbered by any mortgage or other security interest; provided,
however, that
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in the event Landlord shall from and after the execution of this Lease enter
into any mortgage or other security interest with respect to the Building and/or
Property, Landlord agrees to use reasonable efforts to secure from any such
mortgagee or overlandlord a Subordination, Attornment and Non-Disturbance
Agreement in the form attached hereto as Exhibit "F". Tenant shall, at any time
hereafter, on request, execute any instruments or leases or other documents that
may be required by any mortgage or mortgagee or overlandlord (herein a
"Mortgagee") for the purpose of subjecting or subordinating this Lease and the
tenancy created hereunder to the lien of any such mortgage or mortgages or
underlying lease, and the failure of Tenant to execute any such instruments,
releases or documents shall constitute a default hereunder.
34. Attornment. Tenant agrees that upon any termination of Landlord's
interest in the Premises, Tenant will, upon request, attorn to the person or
organization then holding title to the reversion of the Premises (the
"Successor") and to all subsequent Successors, and will pay to the Successor all
of the rents and other monies required to be paid by the Tenant hereunder and
perform all of the other terms, covenants, conditions and obligations in this
Lease contained; provided, however, that if in connection with such attornment
Tenant shall so request from such Successor in writing, such Successor will
execute and deliver to Tenant an instrument wherein such Successor agrees that
as long as Tenant performs all of the terms, covenants and conditions of this
Lease, on Tenant's part to be performed, Tenant's possession under the
provisions of this Lease shall not be disturbed by such Successor.
35. Notices. All notices, demands and requests required under this
Lease shall be in writing. All such notices, demands and requests shall be
deemed to have been properly given if either sent by United States registered or
certified mail, or overnight by any nationally recognized overnight delivery
service, postage prepaid, addressed (i) if to the Landlord at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, Vice
President and General Counsel, with a copy sent to Constellation Realty
Management, LLC, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, President or (ii) if to Tenant at the Premises with a copy to
Applied Signal Technology, Inc., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention ▇▇▇▇▇▇▇ ▇▇▇▇.
Any party may designate a change of address by written notice to the
above parties, given at least ten (10) days before such change of address is to
become effective.
36. Relocation. Section Intentionally Deleted.
37. Quiet Enjoyment. Tenant, upon the payment of rent and the
performance of all the terms of this Lease, shall at all times during the Lease
Term and during any extension or renewal term peaceably and quietly enjoy the
Premises without any disturbance from the Landlord or any other person claiming
through the Landlord.
38. Vacation of Premises. Tenant shall vacate the Premises at the end
of the Term of this Lease or any extension or renewal thereof. If Tenant fails
to vacate at such time there shall be payable to Landlord an amount equal to one
hundred and fifty (150%) for the first sixty (60) days of such holdover and
thereafter double the monthly rent last due and payable as stated in Section 6.1
for each month or part of a month that Tenant holds over, plus all other
payments provided for herein, and the payment and acceptance of such payments
shall not constitute an extension or renewal of this Lease. In event of any such
holdover, Landlord shall also be entitled to all remedies provided by law for
the speedy eviction of tenants, and to the payment of all attorneys' fees and
expenses incurred in connection therewith.
39. Partners' Liability. It is understood that the Owner of the
Building is a Maryland Limited Partnership. All obligations of said Owner
hereunder are limited to the net assets of the Owner from time to time. No
General or Limited Partner of Owner, or of any successor partnership, whether
now or hereafter a partner, shall have any personal responsibility or liability
for the obligations of Owner hereunder.
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40. Separability. If any term or provision of this Lease or the
application thereof to any person or circumstances shall, to any extent, be
invalid or unenforceable, the remainder of this Lease or the application of such
term or provision of such term or provision to persons or circumstances other
than those as to which it is held invalid or unenforceable, shall not be
affected thereby, and each term and provision of this Lease shall be valid and
be enforced to the fullest extent permitted by law.
41. Indemnification. Tenant shall indemnify and hold harmless Landlord
and all of its and their respective partners, directors, officers, agents and
employees from any and all liability, loss, cost or expense arising from all
third-party claims resulting from or in connection with:
(i) the conduct or management of the Premises or of any business
therein, or any work or thing whatsoever done, or any condition created in or
about the Premises during the Term of this Lease or during the period of time,
if any, prior to the Phase 1 Commencement Date that Tenant may have been given
access to the Premises;
(ii) any act, omission or negligence of Tenant or any of its subtenants
or licensees or its or their partners, directors, officers, agents, employees,
invitees or contractors;
(iii) any accident, injury or damage whatever occurring in, at or upon
the Premises; and
(iv) any breach or default by Tenant in the full and prompt payment and
performance of Tenant's obligations under this Lease;
together with all costs and expenses reasonably incurred or paid in connection
with each such claim or action or proceeding brought thereon, including, without
limitation, all reasonable attorney's fees and expenses.
In case any action or proceeding is brought against Landlord and/or any
of its and their respective partners, directors, officers, agents or employees
and such claim is a claim from which Tenant is obligated to indemnify Landlord
pursuant to this Section 41, Tenant, upon notice from Landlord shall resist and
defend such action or proceeding (by counsel reasonably satisfactory to
Landlord). The obligations of Tenant under this Section shall survive
termination of this Lease.
42. Cautions. All headings anywhere contained in this Lease are
intended for convenience or reference only and are not to be deemed or taken as
a summary of the provisions to which they pertain or as a construction thereof.
43. Brokers. Tenant represents that Tenant has dealt directly with,
only with, Colliers ▇▇▇▇▇▇▇ as broker in connection with this Lease, and Tenant
warrants that no other broker negotiated this Lease or is entitled to any
commissions in connection with this Lease.
44. Recordation. Tenant covenants that it will not, without Landlord's
prior written consent, record this Lease or any memorandum of this Lease or
offer this Lease or any memorandum of this Lease for recordation. If at any time
Landlord or any mortgagee of Landlord's interest in the Premises shall require
the recordation of this Lease or any memorandum of this Lease, such recordation
shall be at Landlord's expense. If at any time Tenant shall require the
recordation of this Lease or any memorandum of this Lease, such recordation
shall be at Tenant's expense. If the recordation of this Lease or any memorandum
of this Lease shall be required by any valid governmental order, or if any
government authority having jurisdiction in the matter shall assess and be
entitled to collect transfer taxes or documentary stamp taxes, or both transfer
taxes and documentary stamp taxes on this Lease or any memorandum of this Lease,
Tenant will execute such acknowledgments as may be necessary to effect such
recordations and pay, upon request of Landlord, one half of all recording fees,
transfer taxes and
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documentary stamp taxes payable on, or in connection with this Lease or any
memorandum of this Lease or such recordation.
45. Successors and Assigns. The covenants, conditions and agreements
contained in this Lease shall bind and inure to the benefit of Landlord and
Tenant, and their respective heirs, personal representatives, successors and
assigns (subject, however, to the terms of Article 19 hereof).
46. Integration of Agreements. This writing is intended by the Parties
as a final expression of their agreement and is a complete and exclusive
statement of its terms, and all negotiations, considerations and representations
between the Parties are incorporated. No course of prior dealings between the
Parties or their affiliates shall be relevant or admissible to supplement,
explain, or vary any of the terms of this Lease. Acceptance of, or acquiescence
to, a course of performance rendered under this Lease or any prior agreement
between the Parties or their affiliates shall not be relevant or admissible to
determine the meaning of any of the terms or covenants of this Lease. Other than
as specifically set forth in this Lease, no representations, understandings, or
agreements have been made or relied upon in the making of this Lease.
47. Hazardous Material: Indemnity. Tenant shall not cause or permit any
Hazardous Material (as hereinafter defined) to be brought upon, kept, or used in
or about the Premises by Tenant, its agents, employees, contractors or invitees,
without the prior written consent of Landlord (which Landlord shall not
unreasonably withhold as long as Tenant demonstrates to Landlord's reasonable
satisfaction that such Hazardous Material is necessary or useful to Tenant's
business and will be used, kept and stored in a manner that complies with all
laws regulating any such Hazardous Material so brought upon or used or kept in
or about the Premises). If Tenant breaches the obligations stated in the
preceding sentence, or if the presence of Hazardous Material on the Premises
caused or permitted by Tenant results in contamination of the Premises, the
Building and/or the Property, or if contamination of the Premises, the Building
and/or the Property by Hazardous Material otherwise occurs, for which Tenant is
legally liable to Landlord for damage resulting therefrom, then Tenant shall
indemnify, defend and hold Landlord and its Mortgagee(s) harmless from any and
all claims, judgments, damages, penalties, fines, costs, liabilities or losses
(including, without limitation, diminution in value of the Premises, the
Building and/or the Property, damages for the loss or restriction on use of
rentable or usable space or of any amenity of the Premises, the Building and/or
the Property, damages arising from any adverse impact on marketing of space, and
sums paid in settlement of claims, attorneys' fees, consultant fees and expert
fees) which arise during or after the Term as a result of such contamination.
This indemnification of Landlord and its Mortgagee(s) by Tenant includes,
without limitation, costs incurred in connection with any investigation of site
conditions or any cleanup, remedial, removal, or restoration work required by
any federal, state or local governmental agency or political subdivision because
of Hazardous Material present in the soil or ground water on or under the
Building. Without limiting the foregoing, if the presence of any Hazardous
Material on the Premises, the Building and/or the Property caused or permitted
by Tenant results in any contamination of the Premises, the Building and/or the
Property, Tenant shall promptly take all actions as its sole expense as are
necessary to return the Premises, the Building and/or the Property to the
condition existing prior to the introduction of any such Hazardous Material to
the Premises, the Building and/or the Property; provided that Landlord's
approval of such actions shall first be obtained, which approval shall not be
unreasonably withheld so long as such actions would not potentially have any
material adverse long-term or short-term effect on the Premises or the Building.
As used herein, the term "Hazardous Material" means any hazardous or
toxic substance, material or waste which is or becomes regulated by any local
governmental authority, the State of Maryland or the United States Government.
The term "Hazardous Material" includes, without limitation, any material or
substance that is (i) defined as a "hazardous substance" under the laws of the
State of Maryland, (ii) petroleum, (iii) asbestos, (iv) designated as a
"hazardous substance" pursuant to Section 311 of the Federal Water Pollution
Control Act (33 U.S.C. Section 1321),
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(v) defined as a "hazardous waste" pursuant to Section 1004 of the Federal
Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq. (42
U.S.C. Section 6903), (vi) defined as a "hazardous substance" pursuant to
Section 101 of the Comprehensive Environmental Response, Compensation and
Liability Act, 42 U.S.C. Section 9601 et seq. (42 U.S.C. Section 9601), or (vii)
defined as a "regulated substance" pursuant to Subchapter IX, Solid Waste
Disposal Act (Regulation of Underground Storage Tanks), 42 U.S.C. Section 6991
et seq.
48. Americans With Disabilities Act. Notwithstanding any other
provisions contained in this Lease and with the purpose of superseding any such
provisions herein that might be construed to the contrary, it is the intent of
the Landlord and Tenant that at all times while this Lease shall be in effect
that the following provisions shall be deemed their specific agreement as to
how the responsibility for compliance (and cost) with the Americans With
Disabilities Act and amendments to same "ADA", both as to the Premises and
the Property, shall be allocated between them, namely:
1 . Landlord and Tenant agree to cooperate together in the initial
design, planning and preparation of specifications for construction of the
Premises so that same shall be in compliance with the ADA. Any costs associated
with assuring that the plans and specifications for the construction of the
Premises are in compliance with the ADA shall be borne by the party whose
responsibility it is hereunder to bear the cost of preparation of the plans and
specifications. Similarly those costs incurred in the initial construction of
the Premises so that same are built in compliance with the ADA shall be included
within Tenants Improvements and handled in the manner as provided for in other
Sections of this Lease.
2. Modifications, alterations and/or other changes required to and
within the Common Areas which are not capital in nature shall be the
responsibility of Landlord to perform and the cost of same shall be considered a
part of the Building Expenses and treated as such.
3. Modifications, alterations and/or other changes required to and
within the Common Areas which are capital in nature shall be the responsibility
of Landlord and at its cost and expense.
4. Modifications, alterations and/or other changes required to and
within the Premises (after the initial construction of same), whether capital in
nature or non-capital in nature, shall be the responsibility of Tenant and at
its cost and expense; unless said changes are structural in nature and result
from the original design of the Building, in which instance they shall be the
responsibility of Landlord and at its cost and expense.
Each party hereto shall indemnify and hold harmless the other party
from any and all liability, loss, cost or expense arising as a result of a party
not fulfilling its obligations as to compliance with the ADA as set forth in
this Section 48.
49. Building Signage. So long as Tenant continues to lease the
aggregate rentable square footage on the first floor of the Building as
contemplated by this Lease, then Tenant shall have the non-exclusive right to,
at Tenant's sole cost and expense, install an exterior Building sign reflecting
Tenant's trade name, provided, however, that the trade name used on such
signage, the location, design, color, size and method and manner of installation
of such signage shall be subject to Landlord's prior approval and shall be based
upon detailed plans and specifications (which shall include color selections)
prepared by Tenant at its cost and expense which shall be subject to Landlord's
prior approval. All governmental or quasi-governmental permits or approvals
required for such exterior Building sign shall be obtained by Tenant at its sole
cost and expense. Upon the earlier to occur of (a) the expiration or earlier
termination of this Lease, or (b) upon a monetary Event of Default by Tenant
under this Lease, or (c) expiration or earlier termination of the Term, and/or
(d) if Tenant shall no longer continue to lease the aggregate square footage
located on the first floor of the Building, then upon the occurrence of any of
such events, Tenant shall cause such signage to be removed from the Building at
its sole cost and
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expense and shall promptly repair all damage caused by the installation and
removal of such exterior Building signage.
Further, to identify tenants of the Building, Landlord at Landlord's
expense shall maintain a directory sign in the Building Lobby (the "Building
Directory") and at the main Tenant suite entrance door. Landlord shall list
Tenant's trade name within the Building Directory and at the main Tenant suite
entrance door at Landlord's cost and expense using Building standard materials
and design.
50. Roof Penetrations. Tenant shall have the non-exclusive right to
install a roof-top telecommunications equipment serving the Premises on the roof
of the Building, provided that: (i) plans and specifications including details
as to visibility and method of roof penetration are prepared at Tenant's expense
and submitted to Landlord for prior approval; (ii) all costs and expense of any
such installations are borne by Tenant; (iii) Tenant releases Landlord from any
and all liability or loss incurred by Tenant, its officers, employees, agents
and contractors, and other tenants within the Building as a result of any leaks
in the roof or loss or damages to the facilities so installed; (iv) Tenant shall
use only those licensed, reputable and insured contractors for the installation
of such telecommunications equipment; (v) Landlord reserves the right to
relocate the Tenant's roof-top equipment, at Landlord's expense, in the event
such relocation is necessary or desirable in connection with alterations,
expansions or renovations of the Building or Property; (vi) the installation and
use of such roof-top equipment shall not unreasonably interfere with the use and
quiet enjoyment of the Building by any other person or entity occupying any
portion of the Building, and if requested by Landlord, Tenant shall install at
its expense sound barriers for its roof-top equipment; (vii) all roof-top
equipment installed by or on behalf of Tenant shall be maintained by Tenant at
its cost and expense in good operating condition; (viii) Tenant's roof-top
equipment shall not be visible above any parapet of the Building; (ix) all roof
penetrations shall be appropriately flashed in a manner satisfactory to Landlord
at Tenant's cost and expense; (x) Tenant's installation of such equipment
shall be subject to all applicable governmental laws, rules and regulations and
Tenant shall obtain and keep in force any required permits or other governmental
authorizations required in connection with such equipment; and (v) Tenant shall,
at its expense, promptly remove such roof-top equipment at its sole cost and
expense at the expiration or earlier termination of the Term and shall promptly
repair and restore all damage to the Building caused by the installation and
removal of such roof-top telecommunications equipment.
51. Tenant's Right of First Option. Landlord agrees that during the
initial seven-year Term of this Lease, Tenant shall have a continuing right of
first offering to lease from Landlord all or any portion of the rentable area
comprised of approximately 30,000 square feet on the second floor of the
Building as shown on Exhibit "E" attached hereto and made a part hereof (the
"Expansion Space") for a term running conterminously with the Term of this
Lease. At such time as Landlord shall enter into meaningful negotiations with a
third party to lease all or any portion of the Expansion Space, Landlord shall
so notify Tenant in writing (herein "Landlords Offer Notice"). Tenant's rental
of the Expansion Space or any portion thereof shall be at a base rent equal to
the "Prevailing Market Rate" hereinafter defined as established by Landlord for
the Expansion Space. Landlord shall notify Tenant of the "Prevailing Market
Rate" in Landlord's Offer Notice.
For purposes of this Section 51, the term "Prevailing Market Rate"
shall mean the then prevailing market rate being charged for comparable space in
comparable office buildings within a five (5) mile radius of the Building as
reasonably determined by Landlord (taking into account annual adjustments and
rent abatements, cash allowances, premiums, commissions, improvement allowances,
age of building, and other concessions commonly in use at the time of the
Landlord's Offer Notice).
Tenant shall exercise the foregoing right of first offering by
delivering written notice thereof to Landlord within ten (10) days of Tenant's
receipt of Landlord's Offer Notice. Tenant's
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election notice shall specify all or which portion of the Expansion Space for
which Tenant is exercising such right of first offering. In the event Tenant
shall exercise its right of first offering granted herein, Landlord and Tenant
shall enter into an amendment to this Lease within forty-five (45) days of
Landlord's Offer Notice, which amendment shall set for the base rent payable by
Tenant for the Expansion Space, and such other agreements, if any, with respect
to the Expansion Space. In the event (i) Tenant is then in default under the
terms of this Lease at the time of exercising such right, or (ii) Tenant fails
to deliver the requisite notice to Landlord exercising such right within the ten
(10) day period specified above, or (iii) Tenant fails to execute an amendment
to this Lease for the Expansion Space within thee aforesaid forty-five (45) day
period, or (iv) Tenant declines to exercise its right as above-provided as to
all or any portion of the Expansion Space, then Landlord shall be free to
proceed to lease that portion of the Expansion Space specified in Landlord's
Offer Notice to such third party, provided that this right of first offering
shall continue in effect pursuant to the terms set forth herein during the
initial Term of this Lease for such space referenced in Landlord's Offer Notice
and any other space within the Expansion Space becoming available for lease as
defined above. The right of first offering herein given shall not be severed
from this Lease, or separately sold, assigned or transferred, but may only be
assigned or transferred as a part of this Lease.
IN WITNESS WHEREOF, Landlord and Tenant have respectively affixed their
hands and seals to this Lease as of the day and year first above written.
WITNESS OR ATTEST: LANDLORD:
CONSTELLATION REAL ESTATE, INC.,
Agent for Owner
/s/ By: /s/ J. ▇▇▇▇▇▇▇ ▇▇▇▇▇, (SEAL)
------------------------------ -----------------------------
J. ▇▇▇▇▇▇▇ ▇▇▇▇▇,
Senior Vice President
WITNESS OR ATTEST: TENANT:
APPLIED SIGNAL TECHNOLOGY, INC.,
a California corporation
------------------------------- By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇ (SEAL)
----------------------------
Title: President
--------------------------
STATE OF MARYLAND, Baltimore County , TO WIT:
-------------------------------
I HEREBY CERTIFY, that on this 31 day of May, 1996, before me, the
undersigned Notary Public of said State, personally appeared J. ▇▇▇▇▇▇▇ ▇▇▇▇▇,
who acknowledged himself to be the Senior Vice President of CONSTELLATION REAL
ESTATE, INC., a Maryland corporation, known to me (or satisfactorily proven) to
be the person whose name is subscribed to the within instrument, and
acknowledged that he executed the same on behalf of said corporation for the
purposes therein contained as the duly authorized Senior Vice President of said
corporation by signing the name of the corporation by himself as such Senior
Vice President.
WITNESS my hand and Notarial Seal.
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------- [NOTARY SEAL]
Notary Public
My Commission Expires: 05/01/98
28
▇▇
▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇▇
I HEREBY CERTIFY, that on this 29th day of May, 1996, before me, the
undersigned Notary Public of said State, personally appeared ▇▇▇▇ ▇. ▇▇▇▇▇▇,
known to me to be the person whose name is subscribed to the within
instrument, and acknowledged himself to be the President of APPLIED
SIGNAL TECHNOLOGY, INC., a California, and that he, as such President,
being authorized so to do, executed the foregoing instrument on behalf of said
Corporation by himself as such President.
WITNESS my hand and Notarial Seal.
/s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Notary Public
My Commission Expires: 3-20-2000
[NOTARY SEAL]
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EXHIBIT "A-2"
DESCRIPTION OF PHASE 1 PREMISES AND PHASE 2 PREMISES
[DIAGRAM]
PHASE 1 PREMISES
SUITE #100
20,783 RSF
PHASE 2 PREMISES
SUITE #110
8,338 RSF
EXHIBIT "A-2" - Page 1
31
EXHIBIT "B"
RULES AND REGULATIONS
TO THE EXTENT THAT ANY OF THE FOLLOWING RULES AND REGULATIONS, OR ANY
RULES AND REGULATIONS SUBSEQUENTLY ENACTED CONFLICT WITH THE PROVISIONS OF THE
LEASE, THE PROVISIONS OF THE LEASE SHALL CONTROL.
1. Tenant shall not obstruct or permit its agents, clerks or servants
to obstruct, in any way, the sidewalks, entry passages, corridors, halls,
stairways or elevators of the Building, or use the same in any other way than as
a means of passage to and from the offices of Tenant; bring in, store, test or
use any materials in the Building which could cause a fire or an explosion or
produce any fumes or vapor; make or permit any improper noises in the Building;
smoke in the elevators; throw substances of any kind out of the windows or
doors, or down the passages of the Building, in the halls or passageways; sit on
or place anything upon the window ▇▇▇▇▇; or clean the windows.
2. Waterclosets and urinals shall not be used for any purpose other
than those for which they were constructed; and no sweepings, rubbish, ashes,
newspaper or any other substances of any kind shall be thrown into them. Waste
and excessive or unusual use of electricity or water is prohibited.
3. Tenant shall not (i) obstruct the windows, doors, partitions and
lights that reflect or admit light into the halls or other places in the
Building, or (ii) inscribe, paint, affix, or otherwise display signs,
advertisements or notices in, on, upon or behind any windows or on any door,
partition or other part of the interior or exterior of the Building without the
prior written consent of Landlord which shall not be unreasonably withheld. If
such consent be given by Landlord, any such sign, advertisement, or notice shall
be inscribed, painted or affixed by Landlord, or a company approved by Landlord,
but the cost of the same shall be charged to and be paid by Tenant, and Tenant
agrees to pay the same promptly, on demand.
4. Section Intentionally Deleted.
5. When electric wiring of any kind is introduced, it must be connected
as directed by Landlord, and no stringing or cutting of wires will be allowed,
except with the prior written consent of Landlord which shall not be
unreasonably withheld, and shall be done only by contractors approved by
Landlord. The number and location of telephones, telegraph instruments, electric
appliances, call boxes, etc., shall be subject to Landlord's approval. No
tenants shall lay linoleum or other similar floor covering so that the same
shall be in direct contact with the floor of the Premises; and if linoleum or
other similar floor covering is desired to be used, an interlining of builder's
deadening felt shall be first affixed to the floor by a paste or other material,
the use of cement or other similar adhesive material being expressly prohibited.
6. No additional lock or locks shall be placed by Tenant on any door in
the Building, without prior written consent of Landlord. A reasonable amount
(not to exceed twenty) of keys will be furnished Tenant by Landlord with charge;
any additional keys requested by Tenant shall be paid for by Tenant. Tenant,
its agents and employees, shall not have any duplicate keys made and shall not
change any locks. All keys to doors and washrooms shall be returned to Landlord
at the termination of the tenancy, and in the event of any loss of any keys
furnished, Tenant shall pay Landlord the cost thereof. Tenant shall be permitted
at its sole cost and expense to install on the entrance doors to the Premises a
card key access system provided that Tenant shall first secure Landlord's
approval to the contractor installing the same and method of installation, and
provided further that Tenant shall provide Landlord a card key for Landlord's
access to the Premises.
EXHIBIT "B" - Page 1
32
7. Tenant shall not employ any person or persons other than Landlord's
janitors for the purpose of cleaning the Premises, without prior written consent
of Landlord which shall not be unreasonably withheld. Landlord shall not be
responsible to Tenant for any loss of property from the Premises however
occurring, or for any damage done to the effects of Tenant by such janitors or
any of its employees, or by any other person or any other cause.
8. No bicycles, vehicles or animals (except for guide dogs) of any kind
shall be brought into or kept in or about the Premises.
9. Tenant shall not conduct, or permit any other person to conduct, any
auction upon the Premises; manufacture or store goods, wares or merchandise upon
the Premises, without the prior written approval of Landlord, except the storage
of usual supplies and inventory to be used by Tenant in the conduct of its
business; permit the Premises to be used for gambling; make any unusual noises
in the Building; permit to be played any musical instrument in the Premises;
permit to be played any radio, television, recorded or wired music in such a
loud manner as to disturb or annoy other tenants; or permit any unusual odors to
be produced upon the Premises.
Tenant shall not permit any portion of the Premises to be used for the
manufacture or sale of intoxicating beverages or the storage, manufacture, or
sale of narcotics, tobacco in any form, or as a ▇▇▇▇▇▇ or manicure shop.
10. No awnings or other projections shall be attached to the outside
walls of the Building. No 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 written consent of Landlord which consent shall not be
unreasonably withheld. Such curtains, blinds and shades must be of a quality,
type, design, and color, and attached in a manner reasonably approved by
Landlord.
11. Canvassing, soliciting and peddling in the Building are
prohibited, and Tenant shall cooperate to prevent the same.
12. There shall not be used in the Premises or in the Building, either
by Tenant or by others in the delivery or receipt of merchandise, any hand
trucks except those equipped with rubber tires and side guards, and no hand
trucks will be allowed in passenger elevators.
13. Tenant, before closing and leaving its Premises, shall ensure that
all entrance doors to same are locked.
14. Landlord shall have the right to prohibit any advertising by Tenant
from the Premises which in Landlord's opinion tends to impair the reputation of
the Building or its desirability as a building for offices, and upon written
notice from Landlord, Tenant shall refrain from or discontinue such
advertising.
15. Landlord hereby reserves to itself any and all rights not granted
to Tenant hereunder, including, but not limited to, the following rights which
are reserved to Landlord for its purposes in operating the Building:
(a) the exclusive right to the use of the name of the Building
for all purposes, except that Tenant may use the name as its
business address and for no other purpose;
(b) the right to change the name or address of the Building,
without incurring any liability to Tenant for so doing;
(c) the right to install and maintain a sign or signs on the
exterior of the Building;
(d) the exclusive right to use or dispose of the use of the
roof of the Building;
EXHIBIT "B" - Page 2
33
(e) the right to limit the space on the directory of the
Building to be allotted to Tenant;
(f) the right to grant to anyone the right to conduct any
particular business or undertaking in the Building.
16. As used herein the term "Premises" shall mean and refer to the
"Leased Premises" as defined in Section 1 of the Lease.
17. Tenant shall not operate space heaters or other heating or
ventilating equipment without the express prior written consent of Landlord in
each instance first obtained. Tenant shall not install or operate any electrical
equipment, appliances or lighting fixtures in the Premises which are not listed
and labeled by Underwriter's Laboratories or other testing organization
acceptable to Landlord.
EXHIBIT "B" - Page 3
34
EXHIBIT "C"
PRELIMINARY PLANS - PHASE 1 PREMISES
[DIAGRAM]
PHASE 1 PREMISES
20,783 RSF
PHASE 2 PREMISES
8,338 RSF
EXHIBIT "C" Page 1
35
EXHIBIT "D"
ESTOPPEL CERTIFICATE
Premises: ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
National Business Park
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Lease dated: ________________ 199_, between CONSTELLATION REAL
ESTATE, INC., Agent for Owner, Landlord, and APPLIED SIGNAL TECHNOLOGY, INC.,
a California corporation, Tenant.
The undersigned, the Tenant under the above Lease, hereby certifies to
____________________, to induce ____________________ to loan certain funds to
Landlord/____________________ to invest certain funds in the Landlord pursuant
to Landlord's Limited Partnership Agreement, that said Lease is presently in
full force and effect and unmodified; that the term thereof commenced on
____________________ and full rental is now accruing thereunder; in addition
to the minimum rent payable under the Lease, Tenant is paying the additional
rents as required thereby; that the undersigned accepted possession of said
premises on ____________________, and that any improvements required by the
terms of said Lease to be made by the Landlord have been completed to the
satisfaction of the undersigned; that no rent under said Lease has been paid
beyond ____________________, and that the undersigned, as of this date, has no
charge, lien or claim of offset under said Lease or otherwise, against rents
or other charges due or to become due thereunder, except as to the security
deposits, if any, listed below and to the knowledge of the undersigned, there
is no default by the Landlord under the Lease.
Tenant Deposit held by Landlord: $________________.
WITNESS OR ATTEST: APPLIED SIGNAL TECHNOLOGY, INC.,
a California corporation
__________________________________ By______________________________________
EXHIBIT "D" - Page 1
36
EXHIBIT "E"
DESCRIPTION OF EXPANSION SPACE
THE EXPANSION SPACE
Second Floor, 135 National
Business Parkway
[DIAGRAM]
EXHIBIT "E" - Page 1
37
EXHIBIT "F"
SUBORDINATION, ATTORNMENT AND NON-DISTURBANCE AGREEMENT
THIS AGREEMENT, made this _____ day of __________, 1996, by and among
CONSTELLATION REAL ESTATE, INC., a Maryland corporation, Agent for Owner
(hereinafter called "Lessor"), ________________________________________
(hereinafter called "Lessee"), and __________________________________________
a national banking association (hereinafter called "Mortgagee").
WHEREAS, by Lease dated ________________, 1996, (hereinafter called
the "Lease") between Lessor and Lessee, Lessee leased certain improvements
constructed or to be constructed on the real property described in
Schedule 1 attached hereto (hereinafter called the "Property"); and
WHEREAS, Mortgagee is, or will be, the holder of a note secured by a
deed of trust recorded or intended to be recorded among the Land Records of the
jurisdiction in which the Property is located, which constitutes a lien against
the Property (which deed of trust, as the same may be modified, supplemented,
extended, or renewed from time to time, is hereinafter called the "Deed of
Trust"); and
WHEREAS, Mortgagee desires that Lessee agree to attorn to the purchaser
at foreclosure of the Deed of Trust in the event of such foreclosure, or to
Mortgagee in the event of collection of the rent by Mortgagee; and Lessee is
willing to agree to attorn if Mortgagee and such purchaser will recognize
Lessee's rights under the Lease as hereinafter indicated.
NOW THEREFORE, for and in consideration of the sum of One Dollar
($1.00) paid in hand by each of the parties hereto to the other, receipt whereof
is acknowledged, and for and in consideration of their respective covenants
herein made, the parties agree as follows:
1. So long as no default has occurred and continued for such period of
time (after notice, if any, required by the Lease) as would entitle the Lessor
to terminate the Lease or would cause, without any further action of the Lessor,
the termination of the Lease, the Lease shall not be terminated, nor shall the
Lessee's use, possession or enjoyment of the leased premises be interfered with,
nor shall the leasehold estate granted by the Lease be affected in any other
manner, in any foreclosure or any action or proceeding instituted under or in
connection with the Deed of Trust or in case the Mortgagee takes possession of
the Property pursuant to the provisions of the Deed of Trust.
2. Subject to the provisions of this Agreement, the estate created by
the Lease shall be subject and subordinate to the lien and terms and conditions
of the Deed of Trust. If the interest of Lessor in the Property shall be
transferred to and owned by Mortgagee by reason of foreclosure or other
proceedings brought by it, or by deed in lieu of foreclosure or any other
manner, Lessee shall be bound to Mortgagee under all of the terms, covenants and
conditions of the Lease for the balance of the term thereof and any extensions
or renewals thereof which may be effected in accordance with any option in the
Lease, with the same force and effect as if Mortgagee were the Lessor under the
Lease. Lessee does hereby attorn to Mortgagee as its landlord, such attornment
to be effective and self-operative without the execution of any further
instruments on the part of any of the parties hereto immediately upon Mortgagee
succeeding to the interest of the Lessor in the Property. Upon request, Lessee
will execute a written attornment agreement in favor of Mortgagee at such time
as Mortgagee succeeds to the Lessor's interest in the Property.
Exhibit "F" - Page 1 of 5
38
3. If Mortgagee shall succeed to the interest of Lessor under the
Lease, Mortgagee shall not be (a) liable for any act or omission of Lessor, or
(b) subject to any offsets or defenses which Lessee might have against Lessor,
or (c) bound by any rent or additional rent which Lessee might have paid for
more than one month in advance or any security deposit, unless the rent,
additional rent or security deposit is actually in the Mortgagee's possession,
or (d) bound by any amendment or modification of the Lease made without
Mortgagee's consent.
4. At any time after an event of default has occurred under the Deed of
Trust, Lessee shall make payments under the Lease directly to Mortgagee. Receipt
of Mortgagee's written certification that such an event of default has occurred
shall be the only condition to Lessee's making payments directly to Mortgagee,
and Lessee shall not be required to investigate or verify the nature or extent
of any default. Lessor by its execution of this Agreement irrevocably consents
to such direct payment by Lessee and agrees to hold Lessee harmless for the
application of any payments so made.
5. Lessee agrees (a) to give the Mortgagee written notice and a period
of 30 days within which the Mortgagee may, at its option, cure any default by
Lessor under the Lease, (b) to certify to the Mortgagee from time to time as to
whether the Lease is in effect and whether there are any defaults thereunder,
(c) not to surrender, cancel or terminate the Lease, except due to an uncured
default by Lessor, without the Mortgagee's prior written consent, (d) that if
Mortgagee elects to perform Lessor's obligations under the Lease, the Lease
shall not be terminated due to any defaults of Lessor which are not capable of
being cured by Mortgagee, such as, for example, the bankruptcy of Lessor, and
(e) that notwithstanding anything contained in the Lease to the contrary, the
application of hazard insurance and condemnation proceeds shall be determined in
accordance with the Deed of Trust.
6. Lessee certifies to Mortgagee that: (a) the Lease is in full force
and effect, (b) the Lease has not been modified or amended, (c) neither the
Lessor nor the Lessee is in default under the Lease, (d) Lessee has no defense
or offset to the payment of rent, (e) no rent has been paid for more than 30
days in advance, (f) all improvements which the Lessor is required to provide or
construct under the Lease have been furnished and/or completed in an acceptable
manner, (g) the Lessee is not the subject of any bankruptcy or insolvency
proceeding, nor, to the best of Lessee's knowledge is any such proceeding
contemplated by or threatened against Lessee, and (h) the Lessee has no right of
first refusal, option, or other right to purchase the Property or any portion
thereof.
7. All notices under this Agreement shall be given by first class
registered or certified mail, postage prepaid, addressed as follows:
if to the Lessor: Constellation Real Estate, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
Vice President and General Counsel
if to the Lessee:
-----------------------------------
-----------------------------------
-----------------------------------
if to the Mortgagee:
-----------------------------------
-----------------------------------
-----------------------------------
or at such other address as any of the parties have notified the others of in
the manner provided in this paragraph.
Exhibit "F" - Page 2 of 5
39
8. The word "Lease" as used herein shall mean the Lease executed by
Lessor and Lessee, as amended or modified by written agreements hereafter made,
from time to time, between Lessor and Lessee and consented to by Mortgagee. The
words "foreclosure" and "foreclosure sale" as used herein shall be deemed to
include the acquisition of Lessor's estate in the Property by voluntary deed (or
assignment) in lieu of foreclosure. The word "Mortgagee" shall include the
Mortgagee herein specifically named and any of its nominees, successors, and
assigns, including anyone who shall have succeeded to Lessor's interest in the
Property by, through or under foreclosure of the Deed of Trust, or by voluntary
deed.
9. All of the terms, covenants and conditions hereof shall run with the
land and shall be binding upon and inure to the benefit of the parties hereto
and their respective [heirs, personal representatives] successors and assigns.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
properly executed and sealed the day and year first above written.
WITNESS OR ATTEST: CONSTELLATION REAL ESTATE, INC.,
a Maryland corporation,
Agent for Owner
__________________________________ By:____________________________ (SEAL)
LESSOR
WITNESS OR ATTEST:
__________________________________ By:____________________________ (SEAL)
LESSEE
WITNESS OR ATTEST:
__________________________________ By:____________________________ (SEAL)
MORTGAGEE
STATE OF MARYLAND, COUNTY OF ____________________ TO WIT:
I HEREBY CERTIFY, that on this _____ day of ____________ 1996, before
me, the undersigned Notary Public of said State, personally appeared J. ▇▇▇▇▇▇▇
▇▇▇▇▇, who acknowledged himself to be Senior Vice President of CONSTELLATION
REAL ESTATE, INC., Agent for Owner, a Maryland corporation, known to me (or
satisfactorily proven) to be the person whose name is subscribed to the within
instrument, and acknowledged that he executed
Exhibit "F" - Page 3 of 5
40
the same for the purposes therein contained as the duly authorized Agent by
signing the name of the corporation by himself as Agent.
WITNESS my hand and Notarial Seal.
___________________________________
Notary Public
My Commission Expires:____________________
STATE OF _______________, CITY/COUNTY OF _______________,TO WIT:
I HEREBY CERTIFY, that on this _____ day of _______________, 1996,
before me, the undersigned Notary Public of said State, personally appeared
____________________ who acknowledged himself/herself to be a ________________
of _________________________________, known to me (or satisfactorily proven)
to be the person whose name is subscribed to the within instrument, and
acknowledged that he/she executed the same for the purposes therein contained
as the duly authorized _____________________________ of said corporation by
signing the name of the corporation by himself/herself as ___________________.
WITNESS my hand and Notarial Seal.
___________________________________
Notary Public
My Commission Expires:__________________
STATE OF MARYLAND,__________________________ TO WIT:
I HEREBY CERTIFY that on this _____ day of __________, 1996, before
me, the undersigned Notary Public of said State, personally appeared
_________________________________, who acknowledged himself to be the
_________________________________ of _____________________________________
a national banking association, known to me (or satisfactorily proven) to be
the person whose name is subscribed to the within instrument, and acknowledged
that he/she executed the same for the purposes therein contained as the duly
authorized ______________________________ of said national banking association
by signing the name of the association by himself/herself as _________________
_______________________.
WITNESS my hand and Notarial Seal.
___________________________________
Notary Public
My Commission Expires: __________________
Exhibit "F" - Page 4 of 5
41
Schedule 1
BEING KNOWN AND DESIGNATED as Lot 6BR, as shown on that certain
resubdivision plat entitled, "The National Business Park, Lots 6-AR, 6-BR, and
7AR," which Plat is recorded among the Land Records of ▇▇▇▇ Arundel County,
Maryland in Plat Book ___________ Page No. ___________, as Plat No. __________.
Exhibit "F" - Page 5 of 5
42
FIRST AMENDMENT TO LEASE AGREEMENT
This First Amendment to Lease Agreement (the "First Amendment") is made and
entered into to be effective as of February 1, 1995, by and between SUNNYVALE
BUSINESS PARK, A CALIFORNIA LIMITED PARTNERSHIP ("Landlord") and Applied Signal
Technology, Inc., a California corporation ("Tenant"), with reference to the
following facts.
RECITALS
A. Landlord and Tenant have entered into that certain Lease
Agreement dated November 23, 1994 (the "Lease"), wherein Tenant leased from
Landlord those certain premises in the Buildings located at 115, 160, 175 and
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ and consisting of approximately 202,587
rentable square feet of office and warehouse space (the "Premises"), as more
particularly described in the Lease.
B. Landlord and Tenant desire to modify the terms and provisions
of the Lease to accurately reflect the parties' intentions with respect to
casualty damage to any portion of the Premises.
C. Landlord and Tenant desire to modify the Lease on the terms and
conditions set forth in this First Amendment.
NOW THEREFORE, in consideration of the mutual promises and covenants
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. Section 28 of the Lease entitled "Casualty Damage" is hereby
deleted in its entirety and the following shall be substituted therefor in its
entirety:
28. Casualty Damage.
28.1 CASUALTY. If the Premises or any part thereof
(including the Tenant Improvements but excluding any other alterations or
improvements installed by or for the benefit of Tenant) shall be damaged or
destroyed by fire or other casualty, Tenant shall give immediate written notice
thereof to Landlord. Within thirty (30) days after receipt by Landlord of such
notice, Landlord shall notify Tenant, in writing, whether the necessary repairs
can reasonably be made: (a) within two hundred forty (240) days; or (b) in more
than two hundred forty (240) days, from the date of such notice.
28.1.1 MINOR INSURED DAMAGE. If any of the
individual premises comprising the Premises are damaged only to such extent
that repairs, rebuilding and/or restoration can be reasonably completed within
two hundred forty (240) days, this Lease shall not terminate and, provided that
insurance proceeds are available to fully repair the damage and Landlord is
able to do so under then applicable governmental codes, ordinances, regulations
and/or laws, Landlord shall repair the damaged portions of the Premises to
substantially the same condition that existed prior to the occurrence of such
casualty, except Landlord shall not be required to rebuild, repair, or replace
any alterations or improvements installed by or for the benefit of Tenant
(other than the Tenant Improvements) or any part of Tenant's furniture,
furnishings or fixtures and equipment removable by Tenant. The Rent payable
hereunder shall be abated proportionately from the date and to the extent such
damage or destruction materially interferes with Tenant's use or occupancy of
the portion of the Premises which are damaged, but only to the extent business
interruption insurance proceeds are not received by Tenant.
28.1.2 MAJOR INSURED DAMAGE. If any of the individual
premises comprising the Premises are damaged to such extent that repairs,
rebuilding and/or restoration cannot be reasonably completed within two hundred
forty (240) days, and if (i) there are not adequate insurance proceeds to enable
Landlord to repair, rebuild and/or restore the damaged portions of the Premises
(and Tenant does not deliver, or agree to deliver, to Landlord sufficient funds
to cover any shortfall in insurance proceeds; or Landlord does not elect to
cover any shortfall in insurance proceeds), or (ii) reparation, rebuilding or
restoration would not be permitted under then applicable governmental codes,
ordinances, regulations and/or laws, then either Landlord or Tenant may
terminate this Lease as it relates to the damaged Building(s) by giving written
notice within twenty (20) days after notice from Landlord regarding the time
period of repair. If either party notifies the other of its intention to so
terminate this Lease as it relates to the damaged Building(s) then this Lease
shall terminate with respect to the portion(s) of the Premises so terminated and
the Rent shall be abated from the date Tenant vacates the damaged individual
premises comprising the Premises of the damaged Building(s). If neither party
elects to
1
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terminate this Lease as it relates to the damaged Building(s), Landlord shall
promptly commence and diligently prosecute to completion the repairs to the
damaged portion(s) of the Premises, provided insurance proceeds are available
to fully repair the damage (except that Landlord shall not be required to
rebuild, repair, or replace any alterations or improvements installed by or for
the benefit of Tenant, other than the Tenant Improvements, or any part of
Tenant's furniture, furnishings or fixtures and equipment removable by Tenant).
During the time when Landlord is prosecuting such repairs to completion, the
Rent payable hereunder shall be abated proportionately from the date and to the
extent such damage or destruction materially interferes with Tenant's use or
occupancy of the damaged Portion(s) of the Premises but only to the extent
business interruption insurance proceeds, as related to this Lease, are not
received by Tenant.
28.1.3 DAMAGE NEAR END OF TERM. Notwithstanding anything to the
contrary contained in this Lease except for the provisions of Section 28.2
below, if any of the individual premises comprising the Premises are damaged or
destroyed during the last year of the then applicable term of this Lease,
Landlord may, at its option, cancel and terminate this Lease as it relates to
the damaged Building(s) by giving written notice to Tenant of its election to
do so within thirty (30) days after receipt by Landlord of notice from Tenant of
the occurrence of such casualty. If Landlord so elects to terminate this Lease
as it relates to the damaged Building(s), all rights of Tenant hereunder with
respect to such portion of the Premises shall cease and terminate ten (10) days
after Tenant's receipt of such notice.
28.2 TENANT'S OR TENANT'S REPRESENTATIVE'S FAULT. If any portion of
the Premises is damaged or destroyed due to the fault, negligence (active or
passive) or breach of this Lease by Tenant or any of Tenant's Representatives,
Rent shall not be diminished during the repair of such damage and Tenant shall
be liable to Landlord for the cost of the repair caused thereby to the extent
such cost is not covered by any insurance proceeds. In addition,
notwithstanding any to the contrary contained herein, Tenant shall not have any
rights to terminate this Lease pursuant to the provisions of this Section 28.
28.3 UNINSURED CASUALTY. Tenant shall be responsible for and shall pay
to Landlord, as Additional Rent, any deductible amounts under the property
insurance for the Premises and/or the Buildings; provided, however, with
respect to the deductible for any earthquake, Tenant shall pay such earthquake
deductible amortized over a period equal to the lesser of five (5) years of the
then remaining balance of the term of this Lease. If any portion of the Premises
is damaged and is not fully covered by insurance proceeds received by Landlord
(and Tenant elects not to pay any such difference) or if the holder of any
indebtedness secured by any portion of the Premises requires that the insurance
proceeds by applied to such indebtedness, then Landlord shall have the right to
terminate this Lease as this Lease relates to the damaged Building(s) by
delivering written notice of termination to Tenant within thirty (30) days
after the date of notice to Tenant of any such event, whereupon all rights and
obligations shall cease and terminate hereunder with respect to the portion(s)
of the Premises for which this Lease is so terminated, except for those
obligations expressly provided for in this Lease to survive such termination of
this Lease related to the damaged Building(s).
28.4 TENANT'S WAIVER. Landlord shall not be liable for any
inconvenience or annoyance to Tenant, injury to the business of Tenant, loss of
use of any part of the Premises by Tenant or loss of Tenant's personal
property, resulting in any way from such damage, destruction or the repair
thereof, except that, Landlord shall allow Tenant a fair diminution of Rent
during the time and to the extent the damaged portion(s) of the Premises are
unfit for occupancy as specifically provided above in this Section 28. With
respect to any damage or destruction which Landlord is obligated to repair or
may elect to repair, Tenant hereby waives all rights to terminate this Lease,
except as otherwise expressly permitted hereunder, or offset any amounts
against Rent pursuant to rights accorded Tenant by any law currently existing
or hereafter enacted, including but not limited to, all rights pursuant to the
provisions of Sections 1932(2.), 1933(4.), 1941 and 1942 of the California
Civil Code, as the same may be amended or supplemented from time to time.
Notwithstanding anything in the Lease to the contrary, if the Lease is
terminated as it relates to the damaged portion of the Individual premises
comprising the Premises, the Lease as it relates to the balance of the
individual premises comprising the Premises which are not damaged shall remain
in full force and effect.
2. All capitalized terms used herein and not otherwise defined herein
shall have the same meaning ascribed to such terms as set forth in the Lease.
3. Landlord and Tenant hereby further agree that the Lease is in full
force and effect, and that the terms and provisions of the Lease shall remain
unchanged except as modified by this First Amendment. The terms and provisions
of the Lease are hereby incorporated herein in their entirety.
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44
4. In the event of any conflict or inconsistency between the terms and
provisions of the Lease and the terms and provisions of this First Amendment,
the terms and provisions of this First Amendment shall prevail.
IN WITNESS WHEREOF, the parties have executed this First Amendment as of
the date and year first written above in this First Amendment.
TENANT:
Applied Signal Technology, Inc.,
A California Corporation
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
President
LANDLORD:
SUNNYVALE BUSINESS PARK,
A CALIFORNIA LIMITED PARTNERSHIP
By: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ASSOCIATES LIMITED PARTNERSHIP,
A CALIFORNIA LIMITED PARTNERSHIP
By: Lincoln Property Company Management Services, Inc.,
As Manager and Agent for Owner
By: /s/ illegible
---------------------------------
Vice President
By: PATRICIAN ASSOCIATES, INC.,
a California corporation
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Vice President
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President & Secretary