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EXHIBIT 10.8
DEED OF LEASE
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Between
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BOSTON PROPERTIES LIMITED PARTNERSHIP
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and
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LANDMARK SYSTEMS CORPORATION
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TABLE OF CONTENTS
ARTICLE I
THE PREMISES...............................................................3
ARTICLE II
TERM.......................................................................4
ARTICLE III
BASE RENT..................................................................6
ARTICLE IV
ADDITIONAL RENT............................................................7
ARTICLE V
SECURITY DEPOSIT..........................................................12
ARTICLE VI
USE OF PREMISES...........................................................13
ARTICLE VII
ASSIGNMENT AND SUBLETTING.................................................14
ARTICLE VIII
MAINTENANCE AND REPAIRS...................................................16
ARTICLE IX
ALTERATIONS...............................................................17
ARTICLE X
SIGNS AND FURNISHINGS.....................................................18
ARTICLE XI
INSPECTION BY LANDLORD....................................................20
ARTICLE XII
INSURANCE.................................................................20
ARTICLE XIII
SERVICES AND UTILITIES....................................................21
ARTICLE XIV
LIABILITY OF LANDLORD AND TENANT..........................................23
ARTICLE XV
RULES AND REGULATIONS.....................................................25
ARTICLE XVI
DAMAGE OR DESTRUCTION.....................................................25
ARTICLE XVII
CONDEMNATION..............................................................27
ARTICLE XVIII
DEFAULT...................................................................27
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ARTICLE XIX
BANKRUPTCY................................................................30
ARTICLE XX
SUBORDINATION; MORTGAGES..................................................30
ARTICLE XXI
HOLDING OVER..............................................................31
ARTICLE XXII
COVENANTS OF LANDLORD.....................................................32
ARTICLE XXIII
PARKING...................................................................32
ARTICLE XXIV
EXPANSION.................................................................34
ARTICLE XXV
[INTENTIONALLY DELETED]...................................................36
ARTICLE XXVI
RENEWAL...................................................................36
ARTICLE XXVII
COMMUNICATIONS EQUIPMENT..................................................38
ARTICLE XXVIII
[INTENTIONALLY DELETED]...................................................39
ARTICLE XXIX
[INTENTIONALLY DELETED]...................................................39
ARTICLE XXX
GENERAL PROVISIONS........................................................39
ATTACHMENTS:
First Amendment to Lease
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DEED OF LEASE
THIS DEED OF LEASE (the "Lease") is made as of the 30th day of January,
1998, by and between BOSTON PROPERTIES LIMITED PARTNERSHIP, a Delaware limited
partnership (hereinafter referred to as "Landlord"), and LANDMARK SYSTEMS
CORPORATION, a Virginia corporation (hereinafter referred to as "Tenant").
RECITALS:
A. Landlord will acquire a building site known as Block 1 of Section 912
(the "Land"), which is Phase I of a project to be known as The Arboretum, to be
located on Sunrise Valley Drive, in Reston, Fairfax County, Virginia.
B. Tenant desires to cause Landlord to construct a building upon the Land
and to lease a portion of the rentable area of said building, and Landlord is
willing to construct said building and rent a portion of it to Tenant, upon the
terms, conditions, covenants and agreements set forth herein.
NOW, THEREFORE, the parties hereto, intending to be legally bound, hereby
covenant and agree as follows:
ARTICLE I
THE PREMISES
1.1 Landlord hereby leases and demises to Tenant and Tenant hereby leases
and accepts from Landlord, for the term and upon the terms and conditions
hereinafter set forth, the following described premises (the "Premises"):
(a) Approximately 75,000 square feet of rentable area (calculated in
accordance with the Washington, D.C. Association of Realtors standard method of
measurement in effect immediately prior to the Lease Commencement Date), on
either, at Tenant's option, (i) the first (1st), second (2nd) and third (3rd)
floors ("Premises Option 1") or (ii) the second (2nd), third (3rd) and fourth
(4th) floors ("Premises Option 2") of the four-story office building (the
"Building") which is to be built and situated on the Land. Tenant shall inform
Landlord of the Premises Option that Tenant selects on or before March 31, 1998.
The portion of the Building leased by Tenant is hereinafter referred to as the
"Premises."
(b) Upon Tenant's designation of the Premises, a diagram of the
Premises shall be added to this Lease as Exhibit A-1. Landlord shall promptly
notify Tenant in writing of the exact rentable area of the space designated by
Tenant as the Premises. Such rentable area calculation shall be subject to
confirmation prior to the Lease Commencement Date by Tenant's independent
architect. In the event the rentable area figure determined by Tenant's
architect differs by no more than three percent (3%) (higher or lower) from
Landlord's figure, then Landlord's figure shall be controlling. In the event the
rentable area figure determined by Tenant's architect differs by more than three
percent (3%) (higher or lower) from Landlord's figure, then Landlord and Tenant
(in coordination with their respective architects) shall endeavor in good faith
to resolve the discrepancy, and in the event they are not able to resolve such
discrepancy then Landlord and Tenant shall jointly appoint an independent
architect to resolve such discrepancy and the determination of such independent
architect shall be binding on both Landlord and Tenant, subject to the terms of
Section 1.3 below. The fees of such independent architect shall be shared
equally by Landlord and Tenant.
1.2 The lease of the Premises includes the right to use the adjacent
parking areas which are generally described on the site plan referenced on
Exhibit A, as more particularly described in Article XXIII below, and
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the right to use any common areas and facilities (including the Building's
loading docks, if any, doors, platforms, staging areas and freight elevators)
that are located in and adjacent to the Building.
1.3 The rentable area of the Building is expected to be approximately
95,584 rentable square feet, but may be greater or lesser than such figure. The
rentable area of the full floors to be leased by Tenant shall be approximately
24,778 rentable square feet per floor. The number of rentable square feet in the
Premises shall be more exactly determined upon design and construction of the
Building, in accordance with Section 1.1(b), and the rentable area of the
Premises shall be confirmed in the declaration described in Section 2.1(c)
below. Thereafter, no change shall be made in the determination of rentable area
of the Premises.
1.4 The floor plan for each floor in the Building will be rectangular in
shape with 30 x 35 foot column spacing and a "z-corridor". The Building will be
designed and constructed in accordance with the design and construction
standards applicable to comparable first-class suburban four-story office
buildings in the Reston area (other than in Reston Town Center). The Building
will, among other things, include a patio area located adjacent to the back of
the Building, which patio area will be connected to the existing nature reserve
by a pedestrian walkway.
ARTICLE II
TERM
2.1 (a) The term of this Lease (hereinafter referred to as the "Lease
Term") shall commence on the Lease Commencement Date, as determined pursuant to
Section 2.1(b) below, and continue for a period of twelve (12) years thereafter,
unless such Lease Term shall be extended, renewed or terminated earlier in
accordance with the provisions hereof. Notwithstanding the foregoing, if the
Lease Commencement Date shall occur on a day other than the first day of a
month, the Lease Term shall commence on such date and continue for the balance
of such month and for a period of twelve (12) years thereafter. The term "Lease
Term" shall include any and all renewals and extensions of the term of this
Lease.
(b) The Lease Commencement Date shall be the earlier of (i) the date
on which (A) the work and materials to be provided by Landlord pursuant to
Exhibit B are, or are deemed to be, substantially complete as determined
pursuant to Paragraph 10 of Exhibit B, but no earlier than April 1, 1999, and
(B) the lobby is completed, all elevators serving the Premises are in operation,
all the systems and fixtures servicing the Building (such as HVAC, electricity,
plumbing and water) are in good working order and Landlord is able to provide
all services required under the Lease, and the surface parking lot and access
road utilized by Tenant have been top-coated and striped and are operational,
the Building facade, roof and windows have been installed and completed, the
loading facility is operational and accessible to Tenant's equipment and
furniture installers, the entrance to the Building and the access system to
control entry to the Building have been completed, and all common areas of the
Building and the area adjacent to the Building are materially free of
construction materials and debris, as so certified by the Base Building
Architect (as hereinafter defined); or (ii) the date on which Tenant commences
the conduct of its business upon any portion of the Premises (it being agreed
that entry into the Premises for the installation of communications equipment
and wiring, building the Leasehold Work, or moving in Tenant's furniture and
fixtures shall not be considered the conduct of Tenant's business). In all
events, Landlord shall provide Tenant with sixty (60) days prior written notice
of the ten (10)-day period within which the conditions contained in clause (i)
of this Section 2.1(b) will be satisfied, and fifteen (15) days prior written
notice of the date on which such clause (i) conditions have been satisfied.
Notwithstanding the foregoing, in the event Landlord's Work pursuant to Exhibit
B has been substantially completed on one or more full floors within the
Premises prior to the Lease Commencement Date, and if Tenant desires to occupy
all or a portion of such full floor(s) for the conduct of its business prior to
the Lease Commencement Date and Landlord agrees to permit such early occupancy
by Tenant, then such early occupancy shall not cause the Lease Commencement Date
to occur, but all the terms of this Lease (including,
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without limitation, the requirement that Tenant pay annual base rent and
additional rent with respect to such full or partial floors) shall apply with
respect to each space thus occupied by Tenant from the date that Tenant takes
occupancy thereof.
(c) Promptly after the Lease Commencement Date is ascertained,
Landlord and Tenant shall execute a written declaration setting forth the Lease
Commencement Date, the date upon which the Lease Term will expire, and the exact
number of square feet of rentable area in the Premises, subject to Section 1.3
above. The form of such declaration is attached hereto as Exhibit C and made a
part hereof.
(d) It is presently anticipated that the Lease Commencement Date will
occur on or about July 1, 1999 (the "Anticipated Commencement Date"). Landlord
shall incur no liability to Tenant, and this Lease shall not be rendered void or
voidable, in the event the Lease Commencement Date has not occurred by the
Anticipated Commencement Date for any reason, except as otherwise provided in
this Lease. In the event the Lease Commencement Date has not occurred by the
Anticipated Commencement Date, which date shall be extended by one (1) day for
each day of delay caused by Tenant Delay (as defined in Exhibit B attached
hereto), and such delay causes Tenant (i) to hold over beyond the termination
date under its existing lease (the "Existing Lease") for premises at ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ (the "Existing Space") in connection with the
recapture of the Existing Space by the landlord under the Existing Lease or (ii)
to incur any penalties under any sublease for the Existing Space for failure to
deliver the Existing Space within the time periods described in any such
sublease for the Existing Space, then Landlord shall be obligated to make the
following payments to Tenant with respect to the period commencing on the
Anticipated Commencement Date (as thus extended) and ending on the Outside Date
(as hereinafter defined) (collectively, the "Delay Costs"):
An amount, payable on a monthly basis, equal to Three Thousand Two
Hundred Forty-Five Dollars ($3,245.00) per day for each day of delay
in the Lease Commencement Date beyond the Anticipated Commencement
Date.
Prior to the execution of this Lease, Tenant has furnished Landlord with copies
of any existing subleases for the Existing Space, and Tenant represents and
warrants that the penalty provisions thereof have not been modified and are in
full force and effect. Tenant shall advise and consult with Landlord with
respect to all negotiations with the subtenants under any subleases for the
Existing Space regarding penalties for delay in delivery of the Existing Space
and Tenant shall pursue such reasonable strategy and positions as may be
suggested by Landlord in connection with Tenant's negotiations with such
parties; provided that, if Tenant pursues such strategy and positions suggested
by Landlord and consequently incurs legal expenses relating to legal action (or
the threat thereof) between Tenant and such parties, then Landlord shall
compensate Tenant for the out-of-pocket legal costs (including reasonable
attorneys' fees) thus incurred by Tenant.
(e) [Intentionally deleted.]
(f) In the event the Lease Commencement Date has not occurred by
October 1, 1999 (which date shall be extended, however, by one day for each day
of delay attributable to Tenant Delay, and as thus extended is referred to
herein as the "Outside Date"), then Tenant shall have the right to terminate
this Lease by providing ten (10) days written notice to Landlord at any time
following the Outside Date, in which event the term of this Lease shall be
terminated as of the date such notice is given and all rights, obligations, and
liabilities of the parties hereunder shall thereafter be released and discharged
and, within five (5) business days after such termination, Landlord shall return
to Tenant all rent, if any, previously paid to Landlord under this Lease and any
security delivered in connection with this Lease. Notwithstanding the foregoing,
in the event Landlord, within five (5) business days following its receipt of
Tenant's notice of termination, certifies to Tenant in writing that the
conditions to the Lease Commencement Date (as defined in Section 2.1(b) above)
shall occur no later than thirty (30) days following the date of Tenant's
termination notice, then, provided the conditions to the
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Lease Commencement Date do in fact occur within thirty (30) days following the
date of Tenant's termination notice, and in all events prior to the date on
which tenant under any sublease for the Existing Space has exercised any
termination right contained in such sublease, Tenant's termination notice shall
be of no force and this Lease shall remain in force and effect. If Landlord
furnishes the certification described in the immediately preceding sentence but
either the conditions to the Lease Commencement Date do not in fact occur within
thirty (30) days following the date of Tenant's termination notice or the tenant
under any sublease for the Existing Space exercises any termination right
contained in such sublease, then Tenant's termination notice (unless rescinded
by Tenant in writing before the expiration of the aforesaid thirty (30) day
period) shall remain in force and this Lease shall terminate upon expiration of
the thirty (30) day period as described above.
2.2 For purposes of this Lease, the term "Lease Year" shall mean either (a)
each period of twelve (12) consecutive calendar months commencing on the first
day of the month immediately following the month in which the Lease Commencement
Date occurs, and on each anniversary of such date, except that the first Lease
Year shall also include the period from the Lease Commencement Date to the first
day of the following month; or (b) if the Lease Commencement Date shall occur on
the first day of a calendar month, each period of twelve (12) consecutive
calendar months commencing on the Lease Commencement Date and on each
anniversary of such date; whichever is applicable.
ARTICLE III
BASE RENT
3.1 During the first Lease Year, Tenant shall pay to Landlord as annual
base rent, net of all Expenses (which term is defined in Section 4.2 below), for
the Premises, without set off, deduction or demand, an amount equal to the sum
of Sixteen and 00/100 Dollars ($16.00) multiplied by the total number of square
feet of rentable area in the Premises, which amount shall be subject to annual
adjustment as provided in Section 3.2 hereof. The annual base rent payable
hereunder during each Lease Year shall be divided into equal monthly
installments and such monthly installments shall be due and payable in advance
on the first day of each month during such Lease Year.
3.2 Commencing on the first day of the second (2nd) Lease Year and on the
first day of each and every Lease Year thereafter, the annual base rent payable
for such Lease Year shall be increased by two and one-half percent (2.5%) over
the escalated base rent in effect during the preceding Lease Year. Accordingly,
the annual base rent in each Lease Year following the first Lease Year shall be
the amount set forth in the following table:
Annual Base Rent per
Lease Year Rentable Square Foot
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2 $16.40
3 $16.81
4 $17.23
5 $17.66
6 $18.10
7 $18.55
8 $19.02
9 $19.49
10 $19.98
11 $20.48
12 $20.99
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3.3 All rent shall be paid to Landlord in legal tender of the United States
at the address to which notices to Landlord are to be given or to such other
address as Landlord may designate from time to time by written notice to Tenant.
If Landlord shall at any time accept rent after it shall come due and payable,
such acceptance shall not excuse a delay upon subsequent occasions, or
constitute or be construed as a waiver of any of Landlord's rights hereunder.
ARTICLE IV
ADDITIONAL RENT
4.1 An integral part of Landlord's leasing program for the Building
involves the requirement that Tenant bear its pro rata share (based upon the
ratio of the rentable area of the Premises to the rentable office area of the
Building) of the costs and expenses described in Section 4.2 below which are
incurred each year in the operation of the Building. As of the date hereof,
Landlord anticipates that the total number of rentable square feet in the
Building (all of which shall be office space) is 95,584. Such number shall be
confirmed on Exhibit C attached hereto following completion of construction of
the Building. Tenant's proportionate share of Operating Expenses (as hereinafter
defined) shall be a fraction, the numerator of which is the rentable square feet
constituting the Premises and the denominator of which is the total rentable
square feet of office space in the Building), and Tenant's proportionate share
of Real Estate Taxes (as hereinafter defined) shall be a fraction, the numerator
of which is the rentable square feet constituting the Premises and the
denominator of which is the total rentable square feet in the Building. Tenant's
proportionate share of Operating Expenses and Real Estate Taxes shall be
confirmed on Exhibit C hereto following completion of construction of the
Building.
4.2 The costs and expenses (the "Expenses") for which Tenant shall be
responsible are defined as follows:
(a) "Operating Expenses" shall mean and include those direct
reasonable expenses actually incurred and paid in operating and maintaining the
Building in a manner consistent with the operating and maintenance standards
observed at similar first-class buildings located in Fairfax County, Virginia,
including the following: (1) electricity, gas, water, sewer and other utility
charges of every type and nature; (2) premiums and other charges for insurance
(including, but not limited to, property insurance, rent loss insurance and
liability insurance); (3) all management fees incurred in the management of the
Building (subject to the limitations set forth below); (4) all costs incurred in
connection with service and maintenance contracts; (5) maintenance and repair
expenses and supplies; (6) amortization (calculated over the useful life of the
improvement, with interest at Landlord's cost of funds or (if the improvement is
not financed) at the prime rate reported in The Wall Street Journal) for capital
expenditures made by Landlord that are reasonably intended to result in a net
decrease in Operating Expenses; (7) salaries, wages, benefits and other expenses
of Building personnel at or below the level of property manager (except as
excluded below); (8) legal fees (except as excluded below), administrative
expenses, and accounting, architectural and other professional fees and
expenses; (9) costs of any service not provided to the Building on the Lease
Commencement Date but thereafter provided by Landlord in the prudent management
of the Building; (10) charges for concierge, security, janitorial, char and
cleaning services and supplies furnished to the Building (except that costs of
furnishing char and janitorial service to any tenanted space in the Building
shall be excluded to the extent any such tenant is furnishing its own char and
janitorial service to its premises); (11) costs associated with the provision or
operation of any common facilities, including (without limitation) parking
areas, landscaped areas, access roads, and the Building's loading dock, if any;
and (12) any other reasonable expense incurred by Landlord in maintaining,
repairing or operating the Building.
Any provision herein to the contrary notwithstanding, Operating
Expenses shall not include the following:
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(a) the cost of any work performed (such as preparing a tenant's space for
occupancy, including painting and decorating) or services provided
(such as separately metered electricity) for any tenant (including
Tenant) at such tenant's cost, or provided by Landlord without charge
as an inducement to lease (such as free rent or improvement
allowances);
(b) the cost of installing, operating and maintaining any specialty
service, such as an observatory, broadcasting facility, luncheon club,
retail store, sundry shop, newsstand, or concession;
(c) the cost of correcting defects in construction, repair and replacement
resulting from inferior or deficient workmanship, materials, or
equipment in the initial construction or equipping of the Building or
for which Landlord is reimbursed by insurance;
(d) salaries, wages, benefits and other expenses of Landlord's officers
and partners and its headquarters staff;
(e) the cost of any work performed or service provided for any tenant of
the Building (other than Tenant) to a materially greater extent or in
a materially more favorable manner than that furnished generally to
the other tenants and occupants (such as electricity and cleaning
services provided to retail tenants);
(f) the cost of any work performed or service provided (such as
electricity) for any facility other than the Building (such as a
garage) for which fees are charged;
(g) the cost of any items for which Landlord is reimbursed by insurance
proceeds, condemnation awards, or otherwise, or for which Landlord is
actually reimbursed or is entitled to be reimbursed by a tenant of the
Building;
(h) the cost of any additions to the Building, or Operating Expenses
generated by such additions, constructed after the Lease Commencement
Date;
(i) the cost of any additions, changes, or replacements which under
generally accepted accounting principles are properly classified as
capital expenditures, except to the extent provided in clause (6)
above;
(j) the cost of any repair made in response to any fire or casualty damage
(except for the amount of any commercially reasonable "deductible"
under Landlord's property insurance) or any condemnation;
(k) insurance premiums to the extent any tenant causes Landlord's existing
insurance premiums to increase or requires Landlord to purchase
additional insurance;
(l) interest and principal payments on any debt, depreciation, and rental
under any ground lease or other underlying lease;
(m) any real estate brokerage commissions or other costs incurred in
procuring tenants, or any fee in lieu of commission;
(n) any advertising and marketing expenses, and architectural fees for
tenant space;
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(o) any costs representing an amount paid to an entity related to or
affiliated with Landlord to the extent in excess of the amount which
would have been paid in the absence of such a relationship;
(p) payments for rented equipment, the cost of which equipment would
constitute a capital expenditure if the equipment were purchased
(unless such equipment, if purchased, would be comprehended by clause
(6) above);
(q) any expenses for repairs or maintenance which are covered by
warranties, guaranties or service contracts (excluding any mandatory
deductibles);
(r) legal expenses arising out of the construction, sale or financing of
the Building, or the enforcement of the provisions of any tenant's
lease;
(s) insurance premiums to the extent of any refunds thereof;
(t) costs necessitated by or resulting from the gross negligence of
Landlord, its agents, employees or independent contractors;
(u) home office accounting fee allocations;
(v) amortization, except as provided in clause (6) above;
(w) costs with respect to a sale, financing or refinancing;
(x) bad debt loss, rent loss or reserves for bad debt loss or rent loss
(but not the premiums for rent loss insurance);
(y) costs associated with the operation of the business entity of
Landlord, including partnership audit, business entity accounting, and
business entity legal matters;
(z) costs incurred by Landlord in connection with bringing the Building
into compliance with existing requirements of applicable codes and
laws;
(aa) costs arising from the presence or removal of Hazardous Materials from
the Premises, the Building, or the Land;
(bb) fines and penalties associated with Landlord making late payments;
(cc) the cost of maintaining management, engineering and/or maintenance
offices in the Building;
(dd) any personal property tax payable with respect to Landlord's property
located at the Building; and
(ee) wages, salaries and other compensation or benefits paid to any
off-site employees of Landlord or its managing agent (other than
Landlord's reasonable allocation, based on time spent in connection
with the Building, of wages, salaries, compensation and benefits paid
to such off-site employees who are assigned part-time to the
operation, management, maintenance or repair of the Building).
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In addition, Landlord agrees to limit the amount included in Operating Expenses
for the management fee for the Building to 3% of the annual gross income from
the base rent paid for the Building. In the event Landlord fails to ▇▇▇▇ Tenant
for an item of Expenses within six (6) months following the later of (i)
Landlord's delivery of the Reconciliation Statement (as hereinafter defined) for
the calendar year in which such Expense was incurred or (ii) the date on which
Landlord becomes aware that the Expense was incurred and the exact amount
thereof, then Landlord shall forfeit the right to ▇▇▇▇ Tenant for such Expense
item. In the event a single expenditure pays for the provision of a good or
service to both the Building and any other building owned by Landlord, then
Expenses of the Building shall include only the portion of such payment that is
equitably allocable to the Building, as reasonably determined by Landlord.
(b) "Real Estate Taxes" shall mean and include (i) all real property
taxes, including general and special assessments, if any, which are imposed upon
Landlord or assessed against the Building; (ii) any other present or future
taxes or governmental charges which are imposed upon Landlord, or assessed
against the Building and/or the Land, including, but not limited to, any tax
levied on or measured by the rents payable by tenants in the Building which are
in the nature of, or in substitution for, real property taxes; and (iii) all
taxes which are imposed upon Landlord, and which are assessed against the value
of any improvements to the Premises made by Tenant or any machinery, equipment,
fixtures or other personal property of Tenant used therein. In no event shall
"Real Estate Taxes" include (A) income or net profit taxes imposed upon
Landlord, except to the extent such taxes fall within clause (ii) of the above
definition of Real Estate Taxes, (B) the amount of any special taxes or special
assessments actually paid by Landlord in any calendar year in excess of the
minimum installment of special taxes or special assessments required to be paid
by Landlord during such calendar year (it being agreed that Landlord shall elect
the longest period of time allowed by the authority imposing the tax or
assessment in which to pay installments of special taxes or special assessments
that are to be prorated over several years), or (C) franchise, stock,
inheritance, gift, corporation, excise, transfer, recordation or estate taxes.
Upon receiving a notice of assessment or a real estate tax ▇▇▇▇ with respect to
the Building and/or the Land, Landlord will furnish Tenant with a copy thereof.
Landlord shall make a determination whether or not to challenge or appeal such
assessment based on Landlord's reasonable judgment of which course is in the
best interest of the Building. Landlord shall inform Tenant of such
determination, and shall make available appropriate personnel to discuss with
Tenant the reasons underlying such determination. In the event Landlord
determines not to challenge or appeal such assessment (or, having undertaken to
appeal or challenge such an assessment, does not pursue the appeal or challenge
with due diligence and continuity), Landlord agrees that Tenant may appeal or
challenge such assessment in Landlord's place and stead and that Landlord will
join in and cooperate with Tenant in prosecuting such appeal or challenge;
provided, however, that (i) such appeal or challenge shall be undertaken at
Tenant's sole cost and at no expense to Landlord (except that, if Tenant's
appeal or challenge is successful, then Tenant may recover its costs out of the
refund or reduction of Real Estate Taxes achieved by Tenant), and (ii) in the
event the assessment is increased as a result of Tenant's appeal or challenge,
then for the remainder of the Lease Term Tenant shall pay its proportionate
share of the entire incremental tax resulting from such increase.
4.3 Tenant shall pay to Landlord, as additional rent for the Premises, its
proportionate share of the Expenses incurred by Landlord in the operation of the
Building during any calendar year falling entirely or partly within the Lease
Term, but the Expenses for any calendar year during the Lease Term shall be
apportioned so that Tenant shall pay only that portion of such Expenses for such
year as fall within the Lease Term. This provision shall survive the expiration
or earlier termination of this Lease.
4.4 If the average occupancy rate for the Building during any calendar year
is less than ninety-five percent (95%), or if any office tenant is separately
paying for electricity or janitorial services furnished to its premises, then
Expenses for such calendar year shall be deemed to include all additional
expenses with respect to those Expenses that vary in accordance with the
occupancy of the Building, as reasonably estimated by
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Landlord, which would have been incurred during such calendar year if the
occupancy rate for the Building had been ninety-five percent (95%) and if
Landlord paid for electricity and janitorial services furnished to such
premises.
4.5 Commencing on the Lease Commencement Date and on the first day of each
month thereafter, Tenant shall make estimated monthly payments to Landlord on
account of the Expenses that are reasonably expected to be incurred during each
calendar year falling entirely or partly within the Lease Term. The amount of
such monthly payments shall be determined as follows: commencing with the Lease
Commencement Date and at the beginning of each calendar year thereafter,
Landlord shall submit to Tenant a statement setting forth Landlord's reasonable
estimate of the Expenses that are expected to be incurred during such calendar
year and Tenant's proportionate share thereof. Provided that Tenant receives
such statement at least thirty (30) days in advance, Tenant shall pay to
Landlord on the first day of each month following receipt of such statement
during such calendar year an amount equal to (A) the excess of (i) Tenant's
proportionate share of the anticipated Expenses for the full calendar year (or
the portion of such calendar year that falls within the Lease Term) over (ii)
the monthly payments made by Tenant (on the basis of the estimate in effect
during the preceding calendar year) prior to the commencement of payments made
on the basis of Landlord's estimate for the current calendar year, multiplied by
(B) a fraction, the numerator of which is one (1) and the denominator of which
is the number of months during such calendar year which fall within the Lease
Term and follow the date of the foregoing statement. Within approximately ninety
(90) days after the expiration of each calendar year, Landlord shall submit to
Tenant a statement certified by Landlord (the "Reconciliation Statement"),
showing (i) the Expenses actually incurred during the preceding calendar year
and Tenant's proportionate share thereof, and (ii) the aggregate amount of the
estimated payments made by Tenant on account thereof. If the aggregate amount of
such estimated payments exceeds Tenant's actual liability for such Expenses,
then Landlord shall credit the net overpayment against the next monthly
installment of additional rent coming due under this Lease (or if the Lease Term
has ended, shall pay such net overpayment to Tenant within thirty (30) days
after providing such Reconciliation Statement to Tenant). If Tenant's actual
liability for such Expenses exceeds the estimated payments made by Tenant on
account thereof, then Tenant shall pay to Landlord the total amount of such
deficiency within thirty (30) days after its receipt of the Reconciliation
Statement from Landlord. In the event Landlord has failed to deliver a
Reconciliation Statement to Tenant within ninety (90) days after the expiration
of a calendar year, Tenant may deliver to Landlord a written demand that the
Reconciliation Statement be delivered within sixty (60) days following the date
of delivery of Tenant's demand notice, and if Landlord fails to deliver the
Reconciliation Statement to Tenant within sixty (60) days after the date of
delivery of Tenant's demand notice, then Landlord shall forfeit the right to
▇▇▇▇ Tenant for any amount on account of Expenses incurred during such calendar
year in excess of the estimated payments made by Tenant during such calendar
year (but Tenant shall not forfeit the right to be reimbursed for any
overpayment if its estimated payments exceeded the actual Expenses). The
provisions of this paragraph shall survive the expiration or earlier termination
of this Lease.
4.6 Tenant or its designee shall have the right, during business hours and
upon reasonable prior notice, from time to time to inspect and make copies of
Landlord's books and records relating to Expenses, and/or to have such books and
records audited at Tenant's expense by an independent certified public
accountant designated by Tenant, the fees of whom shall not be determined on a
contingent basis, except that any audit that discloses that annual Expenses have
been overstated by more than five percent (5%) shall be at Landlord's expense.
Any discrepancy shall be corrected by a payment of any shortfall to Landlord by
Tenant, or a refund of any overpayment to Tenant by Landlord, within thirty (30)
days after the applicable audit. In the event Tenant does not contest a
statement of Expenses within six (6) months after the date it receives a
Reconciliation Statement (and provided Landlord has cooperated with Tenant
undertaking an audit of Landlord's books and records, if so requested by
Tenant), such Reconciliation Statement shall become binding and conclusive upon
each party, unless any audit performed by Tenant in accordance with this Section
4.6 reflects an overpayment
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by Tenant of five percent (5%) or more with respect to any particular category
of expense, in which event Tenant shall be permitted to audit, in accordance
with all of the other terms of this Section 4.6, Landlord's books and records
for the three (3) years prior to the year for which such overpayment was made
with respect to each particular category of expense for which an overpayment was
made.
4.7 For purposes of determining Tenant's proportionate share of the annual
Expenses, the Controllable Expenses (as defined below) for each Lease Year after
the first (1st) Lease Year shall not exceed an amount that is the product of one
hundred ten percent (110%) multiplied by the Controllable Expenses incurred
during the immediately preceding Lease Year. "Controllable Expenses" shall be
all Operating Expenses other than utility charges, insurance premiums, costs
resulting from an event of Force Majeure (as defined in Section 30.18 below),
and costs of extraordinary repairs to the Building required in Landlord's
commercially reasonable judgment, all of which charges, premiums and costs in
any event shall be commercially reasonable.
ARTICLE V
SECURITY DEPOSIT
5.1 (a) As security for the faithful performance by Tenant of all
covenants, conditions and agreements of this Lease, Tenant shall deliver, on or
before the Lease Commencement Date, to and for the benefit of Landlord, a letter
of credit in the amount of Eight Hundred Thousand and 00/100 Dollars
($800,000.00) (the "Letter of Credit") to be held by Landlord for the first five
(5) Lease Years. The amount of the Letter of Credit automatically shall be
reduced on the first (1st) day of each of the second (2nd), third (3rd), fourth
(4th) and fifth (5th) Lease Years (each, a "Reduction Date") by an amount equal
to 85% of the amount of the Letter of Credit required for the preceding Lease
Year, as shown below:
Lease Year Amount of Letter of Credit
---------- --------------------------
1 $800,000.00
2 $680,000.00
3 $578,000.00
4 $491,300.00
5 $417,605.00
The Letter of Credit shall be unconditional, irrevocable, transferable, payable
to Landlord on sight in partial or full draws, and otherwise in form and content
and issued by a financial institution reasonably acceptable to Landlord.
Landlord hereby approves the form of letter of credit attached hereto as Exhibit
G. The form of the Letter of Credit shall be substantially on the form attached
hereto as Exhibit G or on such approved financial institution's standard form,
with all commercially reasonable modifications thereto requested by Landlord.
The Letter of Credit shall contain an "evergreen" provision which provides that
the Letter of Credit will be automatically renewed on an annual basis unless the
issuer delivers thirty (30) days prior written notice of cancellation to
Landlord and Tenant, such that the Letter of Credit remains in existence through
the last day of the fifth (5th) Lease Year. Landlord may draw upon the Letter of
Credit as necessary to compensate Landlord for any Event of Default under this
Lease on the part of Tenant, or if the issuer notifies Landlord that it does not
intend to renew the Letter of Credit (so that the Letter of Credit will not
remain in existence through the last day of the fifth (5th) Lease Year).
(b) In the Event of a sale or transfer of Landlord's estate or
interest in the Land and Building, Landlord shall transfer the Letter of Credit
to the vendee or transferee as the new landlord under this Lease, and to the
extent the Letter of Credit is so transferred, Landlord shall be considered
released by Tenant from all liability for the return of the Letter of Credit. No
mortgagee or purchaser of any or all of the Building at any
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foreclosure proceeding brought under the provisions of any mortgage shall
(regardless of whether the Lease is at the time in question subordinated to the
lien of any mortgage) be liable to Tenant or any other person for the return of
any Letter of Credit, unless Landlord has actually delivered the Letter of
Credit to such mortgagee or purchaser. If requested by any such mortgagee or
purchaser, Tenant shall obtain an amendment to the Letter of Credit which names
such mortgagee or purchaser as the beneficiary thereof in lieu of Landlord, at
no cost or expense to Tenant.
ARTICLE VI
USE OF PREMISES
6.1 Tenant shall use and occupy the Premises solely for general office
purposes and uses incidental to general office use, including without
limitation, conference and training facilities and a fitness facility for
Tenant's employees, and other uses to the extent not prohibited under applicable
laws and necessary for the conduct of the business in which Tenant is engaged as
of the date of this Lease, and for no other use or purpose. Subject to
Landlord's obligations under Section 6.4 hereof, Tenant shall not use or occupy
the Premises for any unlawful purpose or in any manner that will constitute
waste, nuisance or unreasonable annoyance to Landlord or other occupants of the
Building. Subject to Landlord's obligations under Section 6.4 hereof, Tenant's
use of the Premises shall also comply with all present and future laws,
ordinances (including zoning ordinances and the land use requirements),
regulations, and orders of the County of Fairfax, Commonwealth of Virginia, and
any other public or quasi-public authority having jurisdiction over the
Premises, concerning the use, occupancy and condition of the Premises and all
machinery, equipment and furnishings therein (together referred to herein as the
"Legal Requirements"). Landlord hereby warrants to Tenant that the Building and
all work performed by Landlord in the Premises, when completed, will comply in
all material respects with all applicable Legal Requirements, including without
limitation, the Americans With Disabilities Act of 1990.
6.2 The party performing the Leasehold Work pursuant to Exhibit B hereto
shall obtain the initial non-residential use permit and any other similar
governmental approvals which may be required for Tenant's occupancy of the
Premises. It is expressly understood that if any present or future Legal
Requirements require any other permit(s) for the Premises due to Tenant's
particular use thereof (as distinct from general office use), or Tenant's
improvements or future alterations thereto, that Tenant will obtain such
permit(s) at Tenant's own expense. Further, subject to Landlord's obligations
under Section 6.4 hereof, Tenant will comply with all Legal Requirements which
impose on Landlord or Tenant a duty relating to or arising as a result of
Tenant's use or occupancy of the Premises. Tenant shall promptly pay all fines,
penalties and damages that may arise out of or be imposed on Landlord or Tenant
because of Tenant's failure to comply with the provisions of this Section.
Landlord shall promptly pay all fines, penalties and damages that may arise out
of or be imposed on Landlord or Tenant because of Landlord's failure to comply
with the provisions of this Section, and any such fines, penalties or damages
shall not be Expenses hereunder.
6.3 Tenant shall pay any business, rent or other taxes that are now or
hereafter levied upon Tenant's use or occupancy of the Premises, the conduct of
Tenant's business at the Premises, or Tenant's equipment, fixtures or personal
property. In the event that any such taxes are enacted, changed, or altered so
that any of such taxes are levied against Landlord, or the mode of collection of
such taxes is changed so that Landlord is responsible for collection or payment
of such taxes, Tenant shall pay any and all such taxes to Landlord upon written
demand from Landlord.
6.4 Landlord shall construct the base Building in compliance with all
applicable laws, building codes and governmental and quasi-governmental
regulations and ordinances in effect as of the date hereof, and in a manner that
accommodates all technological capabilities necessary for the Building systems
to operate without interruption as a result of the transition from calendar year
1999 to calendar year 2000. Notwithstanding anything to the contrary contained
in this Lease, it is agreed that Landlord shall be responsible for complying
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with all present and future Legal Requirements with respect to (i) those
elements and components of the base-building structure and systems that are
situated outside the perimeter of the Premises or are within vertical
penetrations running through the Premises (and Tenant shall be responsible for
complying with any present or future Legal Requirements with respect to such
elements and components of the base-building structure and systems that are
situated within the perimeter of the Premises, but not within vertical
penetrations running through the Premises) and (ii) the common areas of the
Building, unless such Legal Requirements are imposed because of Tenant's
particular use of the Premises (as opposed to office use generally) or any
improvements constructed by Tenant in the Premises.
6.5 Tenant covenants not to bring any Hazardous Materials onto the Land,
the Building or the Premises. Notwithstanding the foregoing, Tenant or its
agents may use and store within the Premises reasonable quantities of customary
office and cleaning supplies; provided such items are stored, used and disposed
of in accordance with applicable Legal Requirements. As used in this Lease,
"Hazardous Materials" shall mean (a) "hazardous wastes," as defined by the
Resource Conservation and Recovery Act of 1976, as amended from time to time,
(b) "hazardous substances," as defined by the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended from time to time,
(c) "toxic substances," as defined by the Toxic Substances Control Act, as
amended from time to time, (d) "hazardous materials," as defined by the
Hazardous Materials Transportation Act, as amended from time to time, (e) oil or
other petroleum products, and (f) any substance whose presence in Landlord's
commercially reasonable judgment could be detrimental to the Building or
hazardous to health or the environment. Tenant shall indemnify and hold Landlord
harmless from any and all claims, damages, fines, judgments, penalties, costs,
liabilities or losses arising during or after the Lease Term and arising from
Tenant's breach of this Section 6.5.
ARTICLE VII
ASSIGNMENT AND SUBLETTING
7.1 Tenant shall not have the right to assign, transfer, mortgage or
otherwise encumber this Lease or its interest herein without first complying
with the provisions of subsections (a) and (b) of this Section 7.1.
(a) No assignment, transfer, mortgage or other encumbrance of this
Lease shall be effected unless Tenant obtains the prior written consent of
Landlord, which consent shall not be unreasonably withheld, conditioned or
delayed by Landlord; provided, however, that Landlord may withhold its consent
to any proposed assignment, transfer, mortgage or other encumbrance of this
Lease, among other reasons, if (i) an Event of Default then exists under this
Lease, or (ii) Landlord reasonably determines that the nature of the activities
to be conducted by the proposed assignee would generally be perceived as
inappropriate for a first-class office building, or would physically damage the
Building or the Premises. No assignment or transfer of this Lease or the right
of occupancy hereunder may be effectuated by operation of law or otherwise
without the prior written consent of Landlord, which consent shall not be
unreasonably withheld, conditioned or delayed by Landlord. Any attempted
assignment or transfer by Tenant of this Lease or its interest herein without
Landlord's consent (if Landlord's consent thereto is required) shall, at the
option of Landlord, terminate this Lease; however, in the event of such
termination, Tenant shall remain liable for all rent and other sums due under
this Lease and all damages suffered by Landlord on account of such breach by
Tenant. In the event a proposed partial assignment of this Lease will not cause
more than fifty percent (50%) of the rentable area of the Premises to be subject
to any sublease or assignment, then Tenant may enter into such partial
assignment without Landlord's consent, but upon at least ten (10) business days'
prior written notice to Landlord, if (but only if) Tenant remains liable for the
payment of rent and performance of the other obligations of the tenant under
this Lease.
(b) Landlord, within fifteen (15) business days after receipt of a
written request from Tenant accompanied by a copy of a letter of intent or other
materials reflecting the parties to and proposed use of the
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Premises, shall approve or disapprove each proposed assignment or other transfer
or encumbrance. If Landlord fails to deliver to Tenant, within such fifteen
(15)-business day period, a written notice of such approval or disapproval
(along with a reasonably detailed explanation of the reasons for any
disapproval), then Landlord shall be deemed to have approved the assignment or
transfer or other encumbrance.
7.2 Tenant shall not have the right to sublease (which term, as used
herein, shall include any type of subrental arrangement and any type of license
to occupy) all or any part of the Premises without first complying with the
provisions of subsections (a) and (b) of this Section 7.2.
(a) No sublease of all or any portion of the Premises shall be
effected unless Tenant obtains the prior written consent of Landlord, which
consent shall not be unreasonably withheld, conditioned or delayed by Landlord;
provided, however, that Landlord may withhold its consent to any proposed
sublease, among other reasons, if (i) an Event of Default then exists under this
Lease, or (ii) Landlord reasonably determines that the nature of the activities
to be conducted by the proposed subtenant would generally be perceived as
inappropriate for a first-class office building, or would physically damage the
Building or the Premises.
(b) Landlord, within fifteen (15) business days after receipt of
written request from Tenant accompanied by a copy of a letter of intent or other
materials reflecting the parties to and proposed use of the Premises, shall
approve or disapprove each proposed subletting. If Landlord fails to deliver to
Tenant, within such fifteen (15)-business day period, a written notice of such
approval or disapproval (along with a reasonably detailed explanation of the
reasons for any disapproval), then Landlord shall be deemed to have approved the
proposed subletting.
7.3 The consent by Landlord to any assignment or subletting shall not be
construed as a waiver or release of Tenant from any and all liability for the
performance of all covenants and obligations to be performed by Tenant under
this Lease, nor shall the collection or acceptance of rent from any assignee,
transferee or subtenant constitute a waiver or release of Tenant from any of its
liabilities or obligations under this Lease. Landlord's consent to any
assignment or subletting shall not be construed as relieving Tenant from the
obligation of complying with the provisions of Sections 7.1 or 7.2 hereof, as
applicable, with respect to any subsequent assignment or subletting. For any
period during which an Event of Default exists hereunder with respect to the
payment of base rent or additional rent, Tenant hereby assigns to Landlord the
rent due from any subtenant of Tenant and hereby authorizes each subtenant to
pay said rent directly to Landlord. Tenant further agrees to submit any and all
instruments of assignment and sublease to Landlord for Landlord's prior written
approval as to form and substance, which approval shall not be unreasonably
withheld, but which instruments, as an express condition precedent to Landlord's
prior approval, shall provide that (i) such sublease or assignment is subject
and subordinate to this Lease in all respects, and to any amendments,
modifications, renewals, extensions or expansions hereof, (ii) Tenant shall
remain primarily liable as Tenant hereunder, (iii) such assignee or sublessee
shall conduct a business in the Premises which is a permitted use pursuant to
Article VI of this Lease, (iv) in the case of an assignment, such assignee is
bound by the terms and conditions of this Lease and assumes all of the
obligations and liabilities of Tenant hereunder, (v) in the case of a sublease,
(A) Landlord is not, and will not become, a party to such sublease, and (B)
Landlord's consent to such sublease does not create a contractual relationship
between Landlord and such sublessee, nor does it create any liability of
Landlord to such sublessee, (vi) Landlord's consent to such assignment or
sublease does not affect the obligations of Landlord or Tenant under this Lease,
and (vii) Landlord's consent to such assignment or sublease shall not be
construed to mean that Landlord has approved any plans or specifications for
renovations to the Premises intended by such assignee or sublessee and that any
such work to the Premises must be conducted in accordance with the terms of this
Lease. Any such instrument of assignment or sublease not approved by Landlord as
aforesaid shall be null and void and of no force or effect. Any such instrument
of assignment or sublease submitted to Landlord for approval and not approved or
disapproved in writing by Landlord within ten (10) business days after
submission shall be deemed approved by Landlord for all purposes under this
Lease;
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provided, however, that in the event Tenant delivers to Landlord any
instrument of assignment or sublease concurrently with the delivery to Landlord
of the information required pursuant to Section 7.1(b) or 7.2(b), as applicable,
then Landlord shall approve or disapprove both the proposed subtenant or
assignee and the form and substance of the instrument evidencing the same within
the fifteen (15)-business day period set forth in Section 7.1(b) or 7.2(b), as
applicable.
7.4 If this Lease is or shall be assigned by Landlord to the holder of a
mortgage or deed of trust against the Building as additional security for such
loan, the consent of such holder (if required by the terms of the applicable
loan documents) shall be required in addition to any consents by Landlord under
the terms of this Article VII.
7.5 (a) Notwithstanding the above restrictions on subletting and
assignments, and provided that no Event of Default then exists under this Lease,
Tenant shall have the right, upon not less than five (5) business days prior
written notice to Landlord but without Landlord's prior written consent, to
assign this Lease or to sublet all or any part of the Premises to an Affiliate
of Tenant (as hereinafter described) or a Successor Entity (as hereinafter
defined), provided (i) that the conditions set forth in Section 7.3(i) - (vii)
are fully satisfied, as determined by Landlord in its reasonable judgment, (ii)
that the terms of the sublease or assignment do not conflict with the terms of
this Lease and (iii) if Tenant will cease to exist following the merger,
consolidation or other business reorganization resulting in such assignment,
that such assignee or sublessee has a creditworthiness (reasonably determined on
the basis of assets and capitalization) and net worth (which shall be reasonably
determined using generally accepted accounting principles consistently applied
and using the most recent financial statements) reasonably acceptable to
Landlord.
(b) For purposes of this Section 7.5, an "Affiliate of Tenant" shall
mean any corporation, association, trust, partnership or other business entity
(i) which Controls (as herein defined) Tenant or (ii) which is under the Control
of Tenant through stock ownership or otherwise or (iii) which is under common
Control with Tenant. The terms "Control" or "Controls" as used in this Section
7.5 shall mean the power to directly or indirectly influence the direction,
management or policies of Tenant or such other entity.
(c) For purposes of this Section 7.5, a "Successor Entity" shall mean
a corporation, association, trust, partnership or other business entity into or
with which Tenant shall be merged or consolidated, or to which substantially all
of the assets of Tenant may be transferred or sold.
7.6 Tenant shall use reasonable efforts to notify Landlord in writing of
any intention by Tenant to market the Premises or any portion thereof for
assignment or sublease, and shall furnish to Landlord such information as
Landlord may reasonably request with respect to the economic terms of the
assignment or sublease transaction being sought by Tenant and the actions Tenant
is taking to market the Premises.
7.7 [Intentionally deleted.]
ARTICLE VIII
MAINTENANCE AND REPAIRS
8.1 Landlord shall keep, maintain, repair and replace as appropriate, the
foundation, roof, exterior walls, structural portions (including columns within
the Premises and the vertical sprinkler loop through the Building), and glass
and windows of the Building (specifically excluding the interior walls, doors,
partitions, locks, and door jambs in the Premises), as well as all mechanical,
plumbing, heating, air conditioning, sprinkler and electrical systems and
utility service lines therein, the plumbing system to and from the Premises and
core area restrooms within the Premises, and the driveways, parking areas and
grounds adjacent to the Building in good condition and repair, and the costs
incurred by Landlord in maintaining and repairing such items shall be
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included in the Expenses of the Building (unless the cost or expense of any such
repair or maintenance is excluded from Operating Expenses of the Building under
Section 4.2(a) above).
8.2 Tenant will keep and maintain the Premises and all fixtures and
equipment located in the Premises (specifically including the interior walls,
doors, partitions, locks, door jambs, windows and glass in the Premises, but
excluding those portions of the Premises to be maintained by Landlord pursuant
to Section 8.1 above) in clean, safe and sanitary condition, will take good care
thereof and will maintain and make all required repairs thereto, and will suffer
no waste or injury thereto. At the expiration or other termination of the Lease
Term, Tenant shall surrender the Premises, broom clean, in substantially the
same order and condition which they are in on the Lease Commencement Date,
ordinary wear and tear, damage by the elements, and casualty damage excepted.
8.3 Subject to the provisions of Section 12.4(b) below, all injury,
breakage and damage to the Premises or to any other part of the Building caused
by any negligent act or omission or willful misconduct of Tenant, or of any
agent, employee, subtenant, contractor, customer or invitee of Tenant, shall be
repaired by and at the sole expense of Tenant, except that Landlord shall have
the right, at its option, after Tenant's failure to cure (or commence to cure,
where applicable) within five (5) business days after notice to Tenant of such
injury, breakage or damage, to make such repairs and to charge Tenant for all
reasonable costs and expenses incurred in connection therewith as additional
rent hereunder. The foregoing notwithstanding, should an emergency or similar
situation occur and delay would cause or is likely to cause preventable injury
to persons or property, Landlord may elect to act without notice to Tenant.
ARTICLE IX
ALTERATIONS
9.1 Landlord shall construct the Building and the Leasehold Work in
accordance with the terms of Exhibit B attached hereto. It is understood and
agreed that Landlord will not make, and is under no obligation to make, any
structural or other alterations, decorations, additions or improvements in or to
the Premises other than as set forth in Exhibit B.
9.2 Tenant will not make or permit anyone to make any alterations,
additions or improvements (hereinafter referred to collectively as
"improvements"), structural or otherwise, in or to the Premises without the
prior written consent of Landlord. Notwithstanding the foregoing, Landlord's
consent shall not be required with respect to improvements that are
nonstructural in nature and do not affect any of the base-building systems.
Landlord's consent shall not be unreasonably withheld, conditioned or delayed
with respect to any proposed nonstructural improvement for which Landlord's
consent is required hereunder. In the event Landlord fails to provide written
notice to Tenant approving or disapproving (with a reasonably detailed
explanation of the reasons for any disapproval) a request for its consent to an
improvement within ten (10) business days following submission of such request,
then Landlord's consent shall be deemed granted. When granting its consent,
Landlord may impose any conditions it reasonably deems appropriate, including,
without limitation, the approval by Landlord of plans and specifications, the
approval by Landlord of the contractor or other persons who will perform the
work, Tenant's obtaining all necessary permits and approvals for such work, and
Tenant's obtaining, and providing Landlord with certificates of insurance
evidencing, reasonably appropriate levels and types of insurance coverage. All
improvements permitted by Landlord (or allowed hereunder without Landlord's
approval) must conform to all applicable requirements of the insurers of the
Building ("Insurance Requirements") and to all applicable Legal Requirements.
Landlord's review and approval of any such plans and specifications and consent
to the performance of work described therein shall not be deemed an agreement by
Landlord that such plans, specifications and work conform with all applicable
Legal Requirements and Insurance Requirements nor be deemed a waiver of Tenant's
obligations under this Lease with respect to Legal Requirements and Insurance
Requirements nor impose any liability or obligation upon Landlord with respect
to
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the completeness, design sufficiency or compliance with Legal Requirements or
Insurance Requirements of such plans, specifications and work. Upon completion
of any improvements requiring Landlord's approval, Tenant shall provide Landlord
with final release of lien forms executed by Tenant's general contractor. If,
notwithstanding the foregoing, any mechanic's or materialmen's lien is filed
against the Premises, the Building and/or the Land, for work claimed to have
been done for, or materials claimed to have been furnished to, the Premises on
Tenant's account (other than for Landlord's Work), such lien shall be discharged
by Tenant within twenty (20) days after Tenant has notice thereof, at Tenant's
sole cost and expense, by the payment thereof or by the filing of a surety bond
in form and substance acceptable to Landlord. If Tenant shall fail to discharge
any such mechanic's or materialmen's lien, Landlord may, at its option,
discharge such lien and treat the cost thereof (including reasonable attorneys'
fees incurred in connection therewith) as additional rent payable with the next
monthly installment of base rent falling due. It is understood and agreed that
any improvements to the Premises (other than Landlord's Work) shall be conducted
on behalf of Tenant, and that Tenant shall be fully responsible therefor. It is
further understood and agreed that in the event Landlord shall give its written
consent to the making of any improvements to the Premises, such written consent
shall not be deemed to be an agreement or consent by Landlord to subject its
interest in the Premises, the Building or the Land to any mechanic's or
materialmen's liens which may be filed in connection therewith. Upon completion
of any structural improvements by Tenant, Tenant shall provide Landlord with
accurate "as-built" plans showing the new work in a "CADD" format; in addition,
if Tenant has made any improvements (structural or otherwise) in the Premises
during the course of any calendar year, then Tenant shall provide Landlord with
such "as-built" plans within thirty (30) days following the end of such calendar
year.
9.3 Tenant shall indemnify and hold Landlord harmless from and against any
and all expenses, liens, claims, liabilities and damages based on or arising,
directly or indirectly, by reason of the making of any improvements to the
Premises by Tenant or its employees, agents or contractors. If any improvements
are made without the prior written consent of Landlord (if such consent is
required hereunder), Landlord shall have the right to remove and correct such
improvements and restore the Premises to their condition immediately prior
thereto, and Tenant shall be liable for all reasonable expenses incurred by
Landlord in connection therewith. All improvements affixed to the Premises or
the Building made by either party shall remain upon and be surrendered with the
Premises as a part thereof at the end of the Lease Term, except that (i) Tenant
shall have the right to remove, prior to the expiration of the Lease Term, all
furniture, furnishings, fixtures, trade fixtures and equipment installed in the
Premises solely at the expense of Tenant, and (ii) Tenant shall be required to
remove all improvements to the Premises which Landlord designates in writing for
removal at the time Landlord approves installation of such improvement (provided
that Landlord shall have the right to designate for removal any improvements
installed pursuant to Exhibit B hereto only if they are of a nature that is
materially different from that typically included in an office build-out, and
provided further that SCIF space, if any, installed pursuant to Exhibit B
comprising not more than 10,000 rentable square feet in the aggregate shall not
be subject to Landlord's right to require removal). All damage and injury to the
Premises or the Building caused by such removal shall be repaired by Tenant, at
Tenant's sole expense. If any property of Tenant is not removed by Tenant prior
to the expiration or termination of this Lease, the same shall become the
property of Landlord and shall be surrendered with the Premises as a part
thereof.
ARTICLE X
SIGNS AND FURNISHINGS
10.1 Throughout the Lease Term and so long as Tenant is leasing and
occupying at least one (1) full floor of rentable area in the Building, and
subject to any applicable Legal Requirements and requirements of the Reston
Architectural Board of Review (collectively, "Signage Requirements"), Tenant
shall have the right (a) to install and maintain, at Tenant's sole expense,
exclusive building signage identifying Tenant on the upper portion of the
Building facade, which signage shall be sufficiently large and prominently
placed so as to make it
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reasonably visible from the Dulles Airport access road and to pedestrian and
vehicular traffic in the immediate vicinity of the Building, it being understood
and agreed that Landlord shall not permit any other signage to be located
anywhere on the Building facade, except as otherwise expressly provided pursuant
to Section 10.3 below, and (b) to have installed and maintained, at Landlord's
expense (and passed through to the tenants as an Operating Expense to the extent
permitted pursuant to Section 4.2(a) above, such that Tenant will pay its
proportionate share of the costs thereof for any period during the Lease Term in
which Tenant is not the sole tenant of the Building and the entire costs thereof
for any period during the Lease Term in which Tenant is the sole tenant of the
Building (and the monument sign so reflects the same)), one (1) non-exclusive
monument sign, in the maximum size permitted pursuant to applicable Signage
Requirements, to be located beside the vehicle accessway leading to the front
entrance of the Building. The size, position, materials, color, style and manner
of installation of such signage shall be subject to Landlord's prior written
approval, which shall not be unreasonably withheld, conditioned or delayed. In
the event Landlord fails to provide written notice to Tenant approving or
disapproving (with a reasonably detailed explanation of the reasons for any
disapproval) a written request for its consent to Tenant's proposed signage
within ten (10) business days following submission of such request, then
Landlord's consent shall be deemed granted. Landlord shall use good faith
efforts to cooperate with and assist Tenant in obtaining the necessary
governmental, quasi-governmental and Reston Architectural Board of Review
approvals for the signage permitted pursuant to this Section 10.1. No other
sign, advertisement or notice referring to Tenant shall be inscribed, painted,
affixed or otherwise displayed on any part of the exterior or the interior of
the Building (other than directional signage in the lobby and signage on the
doors leading into the Premises and in the interior of the Premises). All of
Tenant's signage that is approved by Landlord, other than the non-exclusive
monument sign permitted pursuant to clause (b) above, shall be installed, and
removed at the expiration or earlier termination of the Lease Term, and Tenant
shall repair any damage to the Building resulting therefrom, at Tenant's cost
and expense. If any sign, advertisement or notice required to be approved by
Landlord hereunder is exhibited or installed by Tenant prior to receiving such
approval, Landlord shall have the right to remove the same at Tenant's expense.
10.2 Throughout the Lease Term, in the event Tenant assigns this Lease or
subleases to a single subtenant a portion of the Premises consisting of more
than twenty-four thousand seven hundred fifty (24,750) rentable square feet,
then such assignee or subtenant may install and maintain signage identifying
such assignee or subtenant in place of one of Tenant's signs upon the upper
portion of the Building facade if (i) Tenant requests that a sign identifying
such assignee or subtenant be permitted in place of Tenant's sign (which shall
be removed by Tenant at Tenant's sole expense), (ii) Tenant or such assignee or
subtenant obtains all necessary approvals or permits from all applicable
governmental and quasi-governmental authorities and complies with all applicable
Legal Requirements relating thereto, (iii) such assignee or subtenant is, in
Landlord's reasonable judgment, an entity of first-class and non-controversial
character and reputation, and (iv) the size, position, materials, color, style
and manner of installation of such substitute signage are approved in advance by
Landlord (such approval not to be unreasonably withheld, conditioned or
delayed).
10.3 Provided such signage does not adversely affect Tenant's rights under
Section 10.1 and 10.2 hereof, Landlord shall be entitled to grant exterior
signage rights to any retail tenant leasing space in the Building, provided that
such signage shall be situated at or near the ground floor of the Building.
10.4 Landlord agrees to furnish, at Landlord's expense, a directory board
for installation in the lobby of the Building. Such directory board shall have
room for at least one listing per one thousand square feet of rentable area
initially leased by Tenant. Tenant may designate all individuals and groups to
be listed under its name on such directory board. Landlord shall not charge for
the initial listings on such directory board or any changes to such listings.
10.5 Tenant shall not place or install in the Premises any safes, fixtures
or other equipment which will exceed a load factor of one-hundred pounds (100
lbs.) per square foot (80 pounds live load, and 20 pounds for
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partitions). Any and all damage or injury to the Premises or the Building caused
by moving the property of Tenant into or out of the Premises, or due to the same
being in or upon the Premises, shall be repaired at the sole cost of Tenant.
Tenant agrees to remove promptly from the parking areas or sidewalks adjacent to
the Building any of Tenant's furniture, equipment or other material there
delivered or deposited.
ARTICLE XI
INSPECTION BY LANDLORD
11.1 Subject to the provisions of Section 13.2 hereof, Tenant will permit
Landlord, or its agents or representatives, to enter the Premises, without
charge therefor to Landlord and without diminution of the rent payable by
Tenant, (i) to examine, inspect and protect the Premises and the Building, (ii)
to make such alterations and/or repairs as in Landlord's reasonable judgment may
be required by law or be necessary to maintain the Building in good condition
and repair, (iii) to comply with and carry out Landlord's obligations under this
Lease, and (iv) to exhibit the same to prospective tenants (provided that
Tenant's consent, which shall not be unreasonably withheld, shall be required if
the Premises are to be exhibited to a prospective tenant more than twelve (12)
months prior to the expiration of the term of this Lease). In connection with
any such entry, Landlord shall reasonably endeavor to minimize the disruption to
Tenant's use of the Premises, shall reasonably endeavor to give Tenant at least
twenty-four (24) hours advance notice of such entry (except in the event of an
emergency) and shall reasonably endeavor to conduct such entry only during
normal working hours (except in the event of an emergency). Notwithstanding
anything to the contrary set forth in this Lease, except in the event of an
emergency, Landlord shall not be permitted access to areas previously designated
in writing by Tenant as security areas ("Secured Access Areas"), unless Landlord
or its representatives are accompanied by an agent of Tenant designated and made
available by Tenant for such purpose.
ARTICLE XII
INSURANCE
12.1 Tenant shall not conduct or permit to be conducted any activity, or
place any equipment, inventory or other materials, in or about the Premises or
the Building that will in any way increase the rate of fire insurance or other
insurance on the Building. If any increase in the rate of fire insurance or
other insurance is stated by any insurance company or by the applicable
Insurance Rating Bureau to be due solely to any activity of Tenant or the
placing of any equipment, inventory or other materials by Tenant in or about the
Premises or the Building, such statement shall be conclusive evidence that the
increase in such rate is due to such activity or equipment. In such event,
Landlord shall notify Tenant thereof and Tenant shall be liable for the amount
of such increase. Notwithstanding the foregoing, if such activity or materials
are not prohibited under this Lease, Tenant shall be permitted to continue such
activity or maintain such materials, provided that Tenant shall reimburse
Landlord for such amount upon written demand from Landlord and such sum shall be
considered additional rent payable hereunder.
12.2 Throughout the Lease Term, Landlord shall insure the Building against
loss due to fire and other casualties included in standard extended coverage
insurance policies, in an amount equal to the full replacement cost thereof;
provided, however, that if, in Landlord's reasonable judgment, full replacement
cost insurance is not available at commercially reasonable rates, then the
amount of such insurance that Landlord shall carry shall be equal to at least
ninety percent (90%) of the full replacement cost of the Building (in all events
exclusive of architectural and engineering fees, excavation, footings and
foundations). Throughout the Lease Term, Landlord shall obtain and maintain
comprehensive public liability insurance in a company or companies licensed to
do business in the Commonwealth of Virginia. Such insurance shall be in minimum
amounts of One Million Dollars ($1,000,000) per occurrence plus a general
aggregate of Two Million Dollars ($2,000,000) for injury to persons and damage
to property and shall be for a minimum term of one (1) year. Throughout the
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Lease Term, Landlord shall obtain and maintain a policy of insurance protecting
Landlord from loss of rents and other charges during the period while the
Premises are untenantable due to fire or other casualty.
12.3 Throughout the Lease Term, Tenant shall insure the contents of the
Premises, including all furnishings, trade fixtures, and equipment used or
installed in the Premises by Tenant, and any other personal property of Tenant
therein, against loss due to fire and other casualties included in standard
extended coverage insurance policies in minimum amounts not less than the full
replacement cost of Tenant's furnishings, trade fixtures, equipment and other
personal property. Throughout the Lease Term, Tenant shall obtain and maintain
comprehensive public liability insurance in a company or companies licensed to
do business in the Commonwealth of Virginia and approved by Landlord. Such
insurance shall be in minimum amounts of One Million Dollars ($1,000,000) per
occurrence plus a general aggregate of Two Million Dollars ($2,000,000) for
injury to persons and damage to property and shall be for a minimum term of one
(1) year. In addition, Tenant's public liability insurance policy shall name
Landlord and Boston Properties, Inc. (or an entity affiliated with Boston
Properties, Inc.), as managing agent of the Building, as additional insureds. If
requested by the holder of any mortgage or deed of trust against the Building,
the public liability policy referred to above shall also name such holder as an
additional insured thereunder. Receipts or certificates evidencing payment of
the premiums for such insurance shall be delivered by Tenant if requested by
Landlord. Each such policy shall contain an endorsement prohibiting cancellation
or reduction of coverage without first giving Landlord and the holder of any
mortgage or deed of trust on the Building at least thirty (30) days' prior
written notice of such proposed action.
12.4 (a) Tenant hereby waives its right of recovery against Landlord and
releases Landlord from any claim arising out of losses, claims, casualties or
other damages for which Landlord may otherwise be liable to the extent either
(i) such loss, claim, casualty or other damage would have been covered under
insurance coverage Tenant is required to maintain pursuant to this Article XII
(without regard to any deductible) or (ii) Tenant receives insurance proceeds on
account of any such losses, claims, casualties or other damages. Each policy of
property insurance obtained by Tenant pursuant to the provisions of this Article
XII shall include a waiver of the insurer's right of subrogation against
Landlord, and shall contain an endorsement to the effect that any loss payable
under such policy shall be payable notwithstanding any act or negligence of
Landlord, or any agent, contractor or employee of Landlord, which might, absent
such agreement, result in the forfeiture of payment for such loss.
(b) Landlord hereby waives its right of recovery against Tenant and
releases Tenant from any claim for which Tenant may otherwise be liable arising
out of losses, claims, casualties or other damages to the extent either (i) such
loss, claim, casualty or other damage would have been covered under insurance
coverage Landlord is required to maintain pursuant to this Article XII (without
regard to any deductible) or (ii) Landlord receives insurance proceeds on
account of any such losses, claims, casualties or other damages. Each policy of
property insurance obtained by Landlord with respect to the Building shall
include a waiver of the insurer's right of subrogation against Tenant, and shall
contain an endorsement to the effect that any loss payable under such policy
shall be payable notwithstanding any act or negligence of Tenant, or any agent,
contractor or employee of Tenant, which might, absent such agreement, result in
the forfeiture of payment for such loss.
ARTICLE XIII
SERVICES AND UTILITIES
13.1 Landlord will furnish to the Premises during the normal hours of
operation of the Building (as set forth hereinbelow) air-conditioning and
heating during the seasons and within the temperature ranges required in
accordance with the specifications attached hereto as Exhibit D. Landlord will
provide: electricity; water; elevator service; an access-control system for the
Building (excluding the Premises); and exterior window-cleaning service. The
normal hours of operation of the Building will be 7:30 a.m. to 7:00 p.m. on
Monday
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through Friday (except the holidays listed on Exhibit E attached hereto) and
8:00 a.m. to 12:00 p.m. on Saturday (except the holidays listed on Exhibit E).
If Tenant requires air-conditioning or heat beyond the normal hours of
operation, then Landlord will furnish the same. Tenant shall pay for such extra
service in accordance with Landlord's then-current schedule of costs and
assessments for such extra service (including additional depreciation of the
base building systems in proportion to the actual number of hours beyond the
normal hours of operation for which Tenant is furnished such HVAC services),
which shall compensate Landlord for Landlord's actual costs of furnishing such
extra service, without markup. Landlord agrees to provide an access control
system for the Building that will afford Tenant access to the Premises
twenty-four (24) hours per day every day of the year. At Tenant's option and
expense, Landlord's system may be expanded to provide electronic suite access to
the Premises, and Landlord will reasonably coordinate any interaction between
Tenant's suite access system and the base-building access system. Landlord shall
not be permitted to require persons entering the Building to show identification
to a lobby attendant without Tenant's prior written consent. At least one (1)
elevator serving the Premises shall be in service at all times. Except as
otherwise specified herein, Landlord shall not be required to furnish services
and utilities during hours other than the normal hours of operation of the
Building unless Tenant agrees to compensate Landlord for the actual costs,
without markup, of such services and utilities.
13.2 It is understood and agreed that Landlord shall not have any liability
to Tenant whatsoever as a result of Landlord's inability to furnish any of the
utilities or services required to be furnished by Landlord under the terms of
this Lease, whether resulting from breakdown, removal from service for
maintenance or repairs, strikes, scarcity of labor or materials, acts of God,
governmental requirements or from any other cause whatsoever. It is further
agreed that, except as provided in this Section 13.2, any such inability to
furnish the utilities or services required hereunder shall not be considered an
eviction, actual or constructive, of Tenant from the Premises, and shall not
entitle Tenant to terminate this Lease or to an abatement of any rent payable
hereunder. Notwithstanding the foregoing or anything else in this Lease, in the
event that Tenant is prevented from using, and does not use, the Premises or any
portion thereof for five (5) consecutive business days or for ten (10) business
days in any twelve (12) month period (the "Eligibility Period") as a result of
(i) any interruption of utilities or services or access (including elevator
access) or any repair, maintenance or alteration performed by Landlord after the
Lease Commencement Date (other than repairs undertaken pursuant to Article XVI
hereof) which renders the Premises inaccessible or untenantable, or (ii) the
presence of Hazardous Materials in, on or around the Building which could, in
Tenant's reasonable business judgment and taking into account any Legal
Requirements with respect to Hazardous Materials, pose a health risk to
occupants of the Premises (the foregoing circumstances being referred to herein
as "Suspension Events"), then all base rent and additional rent payable
hereunder shall be reduced after expiration of the Eligibility Period for such
time that Tenant continues to be so prevented from using, and does not use, the
Premises or a portion thereof, in the proportion that the rentable area of the
portion of the Premises that Tenant is prevented from using, and does not use,
bears to the total rentable area of the Premises. However, in the event that
Tenant is prevented from so conducting, and does not conduct, its business in
any portion of the Premises for a period of time in excess of the Eligibility
Period, and the remaining portion of the Premises is not sufficient to allow
Tenant to effectively conduct its business therein, and if Tenant does not
conduct its business in such remaining portion, then for such time after
expiration of the Eligibility Period during which Tenant is so prevented from
effectively conducting its business therein, all base rent and additional rent
payable hereunder for the entire Premises shall be abated. In the event Tenant
is prevented from using, and does not use, substantially the entire Premises for
a period in excess of seventy-five (75) days after an Eligibility Period because
of the occurrence of a Suspension Event, then Tenant shall have the right to
terminate this Lease by notice delivered to Landlord while such Suspension Event
is continuing. For purposes of this Section 13.2, Tenant shall be deemed not to
be using or conducting its business in the Premises (or a portion thereof) if at
least ninety percent (90%) of Tenant's personnel that would otherwise be in
occupancy of the Premises (or such portion thereof) are actually not present in
the Premises (or such portion thereof) by reason of the Suspension Event.
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13.3 Tenant shall have the right, at its option, to either (a) employ its
own contractor or personnel to furnish char and janitorial service to the
Premises, in which event Tenant (i) shall pay for such services directly to the
contractor employed by Tenant for such purpose and (ii) Tenant's janitorial
contractor, and the cleaning specifications incorporated into Tenant's contract
with its janitorial contractor, shall be subject to Landlord's prior written
approval, which shall not be unreasonably withheld, conditioned or delayed; or
(b) Tenant may at any time during the Lease Term, request that Landlord arrange
for janitorial service to be furnished to the Premises by Landlord's janitorial
contractor.
13.4 In the event Tenant determines that the services being furnished by
any contractor (excluding the property management company) employed by Landlord
are unsatisfactory, in Tenant's reasonable judgment, Tenant shall deliver
written notice to Landlord specifying in detail the manner in which the services
are deemed deficient. If the deficiencies are not, in Tenant's reasonable
judgment, substantially corrected during the next succeeding sixty (60) days,
then Tenant may deliver a further notice to Landlord advising Landlord of such
fact, and, provided Landlord will not incur any liability to the contractor as a
result thereof, Landlord shall terminate the contract of such deficient
contractor and select a qualified replacement contractor.
13.5 Landlord agrees (a) to bid all contracts (excluding the service
contract for the property management company) for the operation of the major
services provided to the Building to at least three (3) service providers
reasonably acceptable to Tenant and (b) to keep Tenant reasonably apprised of
the bidding process by, among other things, notifying Tenant of the various bid
proposals received and Landlord's final selection of a particular service
provider. Landlord shall have the right to select such service provider from
among the three (3) who provided bids for each particular service, in the
exercise of its commercially reasonable judgment.
ARTICLE XIV
LIABILITY OF LANDLORD AND TENANT
14.1 Landlord shall not be liable to Tenant, its employees, agents,
business invitees, licensees, customers, clients, family members or guests for
any damage, injury, loss, compensation or claim, including, but not limited to,
claims for the interruption of or loss to Tenant's business, based on, arising
out of or resulting from any cause whatsoever (except as hereinbelow set forth),
including but not limited to the following: (i) repairs to any portion of the
Premises or the Building; (ii) interruption in the use of the Premises; (iii)
any accident or damage resulting from the use or operation (by Landlord, Tenant
or any other person or persons) of elevators, or of the heating, cooling,
electrical or plumbing equipment or apparatus; (iv) the termination of this
Lease by reason of the destruction of the Premises or the Building; (v) any
fire, robbery, theft, mysterious disappearance and/or any other casualty; (vi)
the actions of other tenants in the Building, if any, or of any other person or
persons; and (vii) any leakage in any part or portion of the Premises or the
Building, or from water, rain or snow that may leak into, or flow from, any part
of the Premises or the Building, or from drains, pipes or plumbing fixtures in
the Building; provided, however, that Landlord shall not be released pursuant to
this Section 14.1 from any liability (i) resulting directly from Landlord's
breach of, or default as to, any of its covenants, warranties or other
obligations under this Lease, or (ii) subject to Section 12.4(a) above, property
damage, personal injury or death caused directly by Landlord's or its agents' or
employees' negligence or willful misconduct. In no event (notwithstanding
anything in the immediately-preceding sentence to the contrary) shall Landlord
have any liability to Tenant for any claims based on the interruption of or loss
to Tenant's business.
14.2 Tenant hereby agrees to indemnify, defend on request, and hold
Landlord harmless from and against all costs, damages, claims, liabilities and
expenses (including reasonable attorneys' fees and any costs of litigation)
suffered by or claimed against Landlord, directly or indirectly, and not to be
covered by the property insurance required to be maintained by Landlord
hereunder, based on, arising out of or resulting from (i)
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Tenant's use and occupancy of the Premises or the business conducted by Tenant
therein, (ii) any accident, injury or damage whatsoever caused to any person, or
to the property of any person, occurring on or about the Premises during the
Lease Term, (iii) any act or omission to act by Tenant or its employees,
contractors, agents, licensees, or invitees, or (iv) any breach or default by
Tenant in the performance or observance of its covenants or obligations under
this Lease; provided that Tenant's obligations to indemnify and hold harmless
Landlord pursuant to this Section 14.2 shall not include any costs, damages,
claims, liabilities, or expenses suffered by or claimed against Landlord
directly based on, arising out of or resulting from any negligence or willful
misconduct of Landlord or its agents or employees.
14.3 In the event that at any time Landlord shall sell or transfer the
Building, provided the purchaser or transferee assumes the obligations of
Landlord hereunder, the Landlord named herein shall not be liable to Tenant for
any obligations or liabilities based on or arising out of events or conditions
occurring on or after the date of such sale or transfer. Furthermore, upon such
assumption, Tenant agrees to attorn to any such purchaser or transferee upon all
the terms and conditions of this Lease.
14.4 In the event that at any time during the Lease Term Tenant shall have
a claim against Landlord, Tenant shall not have the right to deduct the amount
allegedly owed to Tenant from any rent or other sums payable to Landlord
hereunder (except to the extent expressly provided in Section 14.6 below), it
being understood that Tenant's sole remedy for recovering upon such claim shall
be to institute an independent action against Landlord.
14.5 Tenant agrees that in the event Tenant is awarded a money judgment
against Landlord, Tenant's sole recourse for satisfaction of such judgment shall
be limited to execution against Landlord's equity interest in the Building and
the Land at the time of such execution and any insurance proceeds received by
Landlord in connection therewith. In no event shall Landlord or any partner or
member of Landlord or any other person be held to have any personal liability
for satisfaction of any claims or judgments that Tenant may have against
Landlord. Notwithstanding anything in this Lease to the contrary, the foregoing
limitation on Tenant's right to execute against Landlord's assets other than
Landlord's equity in the Building and the Land shall not be applicable to any
obligation of Landlord with respect to any work to be performed and/or any funds
to be disbursed by Landlord pursuant to the terms of the Work Agreement attached
hereto as Exhibit B.
14.6 In the event Landlord shall be in default with respect to any service
or action that Landlord is obligated to furnish or perform under this Lease,
then Tenant shall have the right to obtain such service or perform such act on
Landlord's account; provided, however, that Tenant shall have the rights set
forth in this Section 14.6 with respect to services and actions that affect the
structure of the Building, any common area or any base-building system only if
Tenant gives Landlord written notice of Landlord's alleged default and Landlord
does not in good faith dispute such alleged default in writing within ten (10)
business days following the delivery of Tenant's notice. Prior to Tenant
undertaking any action to cure or remedy such condition, Tenant shall first give
written notice of such condition to Landlord and Landlord's lender(s) of whose
identity and notice address Tenant has been informed and allow Landlord and such
lender(s) ten (10) business days following receipt by Landlord and such
lender(s) of such written notice to cure or remedy the condition specified in
Tenant's notice; provided, however, that if such condition cannot be cured
within the ten (10) business day period, such period shall be extended for a
reasonable additional time, so long as Landlord or such lender(s) commence to
cure such condition within the ten (10) business day period and proceed
diligently thereafter to effect such cure. If Landlord or such lender(s) fail to
cure or remedy such condition within such time period, then Tenant may cure or
remedy such condition and deliver an invoice to Landlord for such costs and
expenses, and Landlord shall pay to Tenant the amount of such invoice within
thirty (30) days after delivery by Tenant. The amount of such expenses, when
paid by Landlord, shall be included within Operating Expenses, to the extent
such costs and expenses are not excluded from the definition of Operating
Expenses. In the event Landlord fails to pay to Tenant when due any sum which
Tenant is entitled to recover from Landlord
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pursuant to this Section 14.6, then Tenant shall have the right to a credit
against annual base rent in the amount of any such unpaid sum if Tenant has
obtained a final, nonappealable court judgment that such sum was due and payable
to Tenant under the terms of this Section 14.6 but was wrongfully withheld by
Landlord. In the event Tenant seeks to cure or remedy any condition which gives
rise to Tenant's remedies set forth in this Section 14.6, Tenant shall (i)
proceed in accordance with the applicable provisions of this Lease and all
applicable Legal Requirements; (ii) use only such contractors, suppliers, etc.
as are duly licensed in the Commonwealth of Virginia and insured to effect such
repairs and who perform such repairs on first-class buildings in the normal
course of their business; (iii) promptly effect such repairs in a good
workmanlike quality and in a first-class manner; and (iv) use new or other
first-quality materials. Landlord agrees to cooperate with Tenant in the
performance of repairs by Tenant's contractors, including granting access to
portions of the Building outside the Premises and making available for
inspection and copying any plans that might be required by such contractors.
14.7 Landlord hereby agrees to indemnify, defend on request, and hold
Tenant harmless from and against all costs, damages, claims, liabilities and
expenses (including reasonable attorneys' fees and any costs of litigation)
suffered by or claimed against Tenant, directly or indirectly, and not to be
covered by the property insurance required to be maintained by Tenant hereunder,
based on, arising out of or resulting from (i) Landlord's ownership, use and
operation of the Building or any portion thereof other than the Premises, (ii)
any accident, injury or damage whatsoever caused to any person, or to the
property of any person, occurring on or about the Building other than within the
Premises, (iii) any act or omission to act by Landlord or its employees,
contractors, agents, licensees, or invitees, or (iv) any breach or default by
Landlord in the performance or observance of its covenants or obligations under
this Lease; provided that Landlord's obligations to indemnify and hold harmless
Tenant pursuant to this Section 14.7 shall not include any costs, damages,
claims, liabilities, or expenses suffered by or claimed against Tenant directly
based on, arising out of or resulting from any negligence or willful misconduct
of Tenant or its agents or employees.
ARTICLE XV
RULES AND REGULATIONS
15.1 Tenant agrees to comply with and observe the rules and regulations
pertaining to the use and occupancy of the Premises or the Building set forth in
Exhibit F attached hereto, together with all reasonable amendments thereto as
may be promulgated hereafter by Landlord (collectively, the "Rules and
Regulations"); provided that (i) any such amendment shall not increase Tenant's
monetary obligations hereunder or cause Tenant to incur significant additional
costs or adversely affect the rights expressly granted to Tenant hereunder or
Tenant's use and enjoyment of the Premises, (ii) Tenant shall be given written
notice of such amendment at least thirty (30) days before it takes effect, and
(iii) if there is any inconsistency between this Lease and the Rules and
Regulations, this Lease shall govern. Tenant's failure to keep and observe said
Rules and Regulations after applicable notice and opportunity to cure shall
constitute an Event of Default under this Lease. Landlord shall not enforce the
Rules and Regulations in a manner that discriminates against Tenant.
ARTICLE XVI
DAMAGE OR DESTRUCTION
16.1 If, during the Lease Term, the Premises or the Building are totally or
partially damaged or destroyed from any cause, thereby rendering the Premises
totally or partially inaccessible or unusable by Tenant for its business,
Landlord shall diligently (taking into account the time necessary to effectuate
a satisfactory settlement with any insurance company involved) restore, replace
and repair the Premises and the Building to substantially the same condition
they were in prior to such damage within one hundred eighty (180) days after the
occurrence of such damage; provided, however, if (i) in the reasonable judgment
of an independent architect selected by Landlord the repairs, replacement and
restoration cannot be completed within one hundred eighty
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(180) days after the occurrence of such damage, including the time needed for
removal of debris, preparation of plans and issuance of all required
governmental permits, or (ii) more than fifty percent (50%) of the Building is
rendered inaccessible or unusable for at least one hundred eighty (180) days as
a result of such damage, then Landlord shall have the right, at its sole option,
to terminate this Lease by giving written notice of termination to Tenant within
sixty (60) days after the occurrence of such damage. If this Lease is terminated
pursuant to the preceding sentence, all rent payable hereunder shall be
equitably apportioned and paid to the date of the occurrence of such damage or
destruction, and neither Landlord nor Tenant shall have any further rights or
remedies as against each other pursuant to this Lease accruing after the date of
termination.
16.2 If the independent architect selected by Landlord determines in its
reasonable discretion that the repairs and restoration cannot be completed
within one hundred eighty (180) days after the date of such damage or
destruction but that Landlord does not elect to terminate this Lease pursuant to
Section 16.1, then Landlord shall promptly notify Tenant of such determination.
For a period continuing through the tenth (10th) day after receipt of such
notice, Tenant shall have the right to terminate this Lease by providing written
notice thereof to Landlord, in which event the Lease Term shall end on the date
of the giving of such notice as if such date were the date originally provided
herein as the end of the Lease Term. If Tenant does not elect to terminate this
Lease within such period, and provided Landlord does not elect to terminate this
Lease, then Landlord shall proceed to repair and restore the Premises and the
Building. Notwithstanding any provision herein to the contrary, if Landlord does
not restore, replace and repair the Premises and the Building to substantially
the same condition they were in prior to such damage by the later of (i) one
hundred eighty (180) days after the occurrence of such damage or (ii) the date
by which it had been projected that Landlord's work would be completed, then
Tenant shall have the right, at any time thereafter before the restoration has
been completed, to terminate this Lease by delivering thirty (30) days' written
notice of termination to Landlord. If Landlord completes such restoration within
thirty (30) days following the delivery of Tenant's termination notice, then the
termination notice shall be rendered void, and this Lease shall continue in
force and effect. If Landlord has not completed such restoration within thirty
(30) days following the delivery of Tenant's termination notice, then the Lease
Term shall end on the thirtieth (30th) day after the delivery of Tenant's
termination notice as if such date were the date originally provided herein as
the end of the Lease Term.
16.3 Notwithstanding anything to the contrary contained herein, in the
event the Premises is damaged during the last two (2) years within the Lease
Term, and if the period of time reasonably projected by Landlord for restoration
of the damage (taking into account the time necessary to effectuate a
satisfactory settlement with any insurance company involved) exceeds one-fourth
( 1/4th) of the time remaining in the Lease Term as of the date of the damage,
then Landlord and Tenant shall each have the right to terminate this Lease by
written notice delivered to the other party within fifteen (15) days after
Landlord notifies Tenant in writing of the projected restoration period;
provided, however, that if (i) Landlord exercises its right of termination under
this Section 16.3, and (ii) at such time, Tenant has a right to renew the Lease
Term pursuant to Article XXVI hereof, and (iii) Tenant notifies Landlord in
writing, within fifteen (15) days following the delivery of Landlord's
termination notice, that Tenant is exercising its right to renew the Lease Term,
and (iv) pursuant to Article XXVI, Landlord and Tenant either reach agreement
concerning the Market Rent applicable to the Renewal Term or cause such
determination to be made by the means described in Section 26.3(b), then
Landlord's termination notice shall be deemed nullified and this Lease shall
continue in force and effect through the remainder of the Lease Term (as thus
renewed).
16.4 If this Lease is not terminated in accordance with the provisions of
Sections 16.1, 16.2 or 16.3, until the repair and restoration of the Premises is
completed Tenant shall be required to pay base rent and additional rent only for
that part of the Premises that Landlord and Tenant mutually agree, in their
reasonable judgment, that Tenant is able to use (as such use is contemplated by
this Lease) while repairs are being made, based on the ratio that the amount of
usable rentable area bears to the total rentable area in the Premises.
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Landlord shall bear the costs and expenses of repairing and restoring the
Premises. In addition to any abatement granted pursuant to the previous
sentence, Tenant's abatement period shall continue until Tenant has been given
sufficient time, and sufficient access to the Premises, to (i) rebuild any
portion of the Premises it is required to rebuild, (ii) install its property,
furniture, fixtures, and equipment, and (iii) move in over one (1) weekend.
16.5 If Landlord repairs and restores the Premises as provided in this
Article XVI, Landlord shall not be required to repair or restore any
decorations, alterations or improvements to the Premises previously made by or
at the expense of Tenant (other than the Leasehold Work installed pursuant to
Exhibit B hereto) or any trade fixtures, furnishings, equipment or personal
property belonging to Tenant. It shall be Tenant's sole responsibility to repair
and restore all such items.
ARTICLE XVII
CONDEMNATION
17.1 If (i) more than twenty percent (20%) of the rentable area of the
Premises, or (ii) the use or occupancy of more than twenty percent (20%) of the
rentable area of the Premises, shall be taken or condemned by any governmental
or other authority having the power of eminent domain for any public or
quasi-public use or purpose (including a sale thereof under threat of such a
taking) (each such event being referred to herein as a "Taking"), then this
Lease shall terminate on the date title thereto (or the right to use or occupy,
as appropriate) vests in such governmental or quasi-governmental authority, and
all base rent and additional rent payable hereunder shall be equitably
apportioned as of such date. If less than twenty percent (20%) of the rentable
area of the Premises or the use or occupancy thereof is condemned, then this
Lease shall continue in full force and effect as to the part of the Premises not
condemned, except that (i) as of the date title (or the right to use or occupy,
as appropriate) vests in such authority base rent and Expenses with respect to
the part of the Premises condemned shall be equitably reduced for the balance of
the Lease Term, and (ii) Landlord shall, at its cost, restore the Premises to
create, to the extent reasonably possible, a single unit of space, including
(but not limited to) building or moving demising walls, suite entries, heating
and air conditioning equipment, and utility lines.
17.2 All awards, damages and other compensation paid by the condemning
authority on account of such Taking shall belong to Landlord, and Tenant hereby
assigns to Landlord all rights to such awards, damages and compensation. Tenant
agrees not to make any claim against Landlord or the condemning authority for
any portion of such award or compensation attributable to damages to the
Premises, the value of the unexpired term of this Lease, the loss of profits or
goodwill, leasehold improvements or severance damages. Nothing contained herein,
however, shall prevent Tenant from pursuing a separate claim against the
condemning authority for the value of furnishings, equipment and trade fixtures
installed in the Premises at Tenant's expense and for relocation expenses,
provided that such claim does not in any way diminish the award or compensation
payable to or recoverable by Landlord in connection with such taking or
condemnation.
ARTICLE XVIII
DEFAULT
18.1 The occurrence of any of the following shall constitute an Event of
Default by Tenant under this Lease:
(a) If Tenant shall fail to pay any installment of base rent or
additional rent when due and such failure shall continue uncured for a period of
ten (10) days after Landlord notifies Tenant of such failure in writing;
provided, however, that after Landlord has given Tenant two (2) such written
notices with respect to the payment of base rent in any twelve (12)-month
period, Tenant shall be in default if any payment of base rent
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accruing during such twelve (12)-month period (and after the second of such
notices) is not made within ten (10) days after such payment is due (without the
necessity of any notice being sent by Landlord).
(b) If Tenant shall fail to pay when due any other payment required by
this Lease (other than base rent or additional rent), and such failure shall
continue for a period of ten (10) days after Landlord notifies Tenant, in
writing, of such failure.
(c) If Tenant shall violate or fail to perform any other term,
condition, covenant or agreement to be performed or observed by Tenant under
this Lease and such violation or failure shall continue uncured for a period of
thirty (30) days after Landlord notifies Tenant in writing of such failure. If
such violation or failure is not capable of being cured within such thirty
(30)-day period, Tenant shall not be deemed to be in default hereunder if Tenant
commences curative action within such thirty (30)-day period and proceeds
diligently and in good faith thereafter to cure such violation or failure until
completion.
(d) An Event of Bankruptcy as defined in Article XIX hereof.
18.2 If there shall occur an Event of Default under this Lease, including
without limitation an Event of Default prior to the Lease Commencement Date,
Landlord shall have the right, at its sole option, to terminate this Lease. In
addition, with or without terminating this Lease, Landlord may re-enter,
terminate Tenant's right of possession, and take possession of the Premises. In
the event of an Event of Default resulting from Tenant's failure to pay any base
rent or additional rent, the provisions of this Article XVIII shall operate as a
notice to quit, and Tenant waives any other notice to quit or notice of
Landlord's intention to re-enter the Premises or terminate this Lease. If
necessary, Landlord may proceed to recover possession of the Premises under and
by virtue of the laws of the Commonwealth of Virginia, or (in the event of an
Event of Default resulting from Tenant's failure to pay any base rent or
additional rent only) by such other proceedings, including re-entry and
possession, as may be applicable. If Landlord terminates this Lease and/or
terminates Tenant's right of possession, then everything contained in this Lease
on the part of Landlord to be done and performed shall cease without prejudice,
however, to the right of Landlord to recover from Tenant all rent and other sums
due under this Lease. Whether or not this Lease and/or Tenant's right of
possession is terminated by reason of Tenant's default, Landlord shall have the
right, after any Event of Default occurs and so long as such Event of Default
continues, to grant or withhold any consent or approval pursuant to this Lease
in its sole and absolute discretion. Landlord agrees to use reasonable efforts
to relet the Premises for such rent and upon such terms as are not unreasonable
under the circumstances, and if the full rental provided herein plus the
reasonable costs, expenses and damages hereafter described shall not be realized
by Landlord, Tenant shall be liable for all damages sustained by Landlord,
including, without limitation, deficiency in base rent and additional rent,
reasonable attorneys' fees, brokerage fees, and the expenses of placing the
Premises in the condition that would have been required if the date of
termination had been the date of expiration of the Lease Term. Tenant expressly
acknowledges that Landlord's agreement to use reasonable efforts to relet the
Premises shall in no event limit, restrict or prejudice in any way Landlord's
and Landlord's affiliates' and agents' rights to lease other space in the
Building prior to reletting the Premises. Landlord shall in no way be
responsible or liable for any failure to relet the Premises or any part thereof,
or any failure to collect any rent due or accrued upon such reletting, to the
end and intent that Tenant may be liable for the base rent, additional rent, and
any and all other items of cost and expense which Tenant shall have been
obligated to pay throughout the remainder of the Lease Term. Any damages or loss
of rent sustained by Landlord may be recovered by Landlord, at Landlord's
option, at the time of the reletting, or in separate actions, from time to time,
as said damage shall have been made more easily ascertainable by successive
relettings, or, at Landlord's option, may be deferred until the expiration of
the Lease Term, in which event Tenant hereby agrees that the cause of action
shall not be deemed to have accrued until the date of expiration of the Lease
Term. The provisions contained in this Section 18.2 shall not prevent the
enforcement of any claim Landlord may have against Tenant for anticipatory
breach of this Lease.
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18.3 As an alternative to recovering damages on account of rental
deficiencies on a periodic basis as set forth in Section 18.2 above, Landlord
may recover as liquidated damages an amount equal to the present value (as of
the date of the termination of this Lease) of the difference between (i) the
base rent and additional rent which would have become due during the remainder
of the Lease Term, and (ii) the fair market rental value of the Premises for the
same period, which damages shall be payable to Landlord in one lump sum on
demand. For purpose of this Section, present value shall be computed by
discounting at a rate equal to the "Prime Rate" as published in the Money Rates
section of The Wall Street Journal.
18.4 All rights and remedies of Landlord set forth herein are in addition
to all other rights and remedies available to Landlord at law or in equity. All
rights and remedies available to Landlord hereunder or at law or in equity are
expressly declared to be cumulative. The exercise by Landlord of any such right
or remedy shall not prevent the concurrent or subsequent exercise of any other
right or remedy. No delay in the enforcement or exercise of any such right or
remedy shall constitute a waiver of any default by Tenant hereunder or of any of
Landlord's rights or remedies in connection therewith. Landlord shall not be
deemed to have waived any default by Tenant hereunder unless such waiver is set
forth in a written instrument signed by Landlord. If Landlord waives in writing
any default by Tenant, such waiver shall not be construed as a waiver of any
covenant, condition or agreement set forth in this Lease except as to specific
circumstances described in such written waiver.
18.5 If Landlord shall institute proceedings against Tenant and a
compromise or settlement thereof shall be made, the same shall not constitute a
waiver of default or of any other covenant, condition or agreement set forth
herein, nor of any of Landlord's rights hereunder, except to the extent agreed
by Landlord in writing in connection with such compromise or settlement. Neither
the payment by Tenant of a lesser amount than the installments of base rent,
additional rent or of any sums due hereunder nor any endorsement or statement on
any check or letter accompanying a check for payment of rent or other sums
payable hereunder shall be deemed an accord and satisfaction, and Landlord may
accept such check or payment without prejudice to Landlord's right to recover
the balance of such rent or other sums or to pursue any other remedy available
to Landlord. Notwithstanding any request or designation by Tenant, Landlord may
apply any payment received from Tenant to any payment then due. No re-entry by
Landlord, and no acceptance by Landlord of keys from Tenant, shall be considered
an acceptance of a surrender of this Lease.
18.6 If Tenant defaults in the making of any payment or in the doing of any
act herein required to be made or done by Tenant, then Landlord may (after
giving Tenant the appropriate notice and opportunity to cure specified in
Section 18.1 hereof), but shall not be required to, make such payment or do such
act. If Landlord elects to make such payment or do such act, all reasonable
costs and expenses incurred by Landlord, plus interest thereon at the rate per
annum which is two percent (2%) higher than the publicly announced "prime rate"
then being charged by The ▇▇▇▇▇ National Bank of Washington, D.C., from the date
paid by Landlord to the date of payment thereof by Tenant, shall constitute
additional rent hereunder and shall be immediately paid by Tenant to Landlord;
provided, however, that nothing contained herein shall be construed as
permitting Landlord to charge or receive interest in excess of the maximum rate
then allowed by law. The taking of such action by Landlord shall not prevent
Landlord from pursuing any remedy it is otherwise entitled to in connection with
such default.
18.7 If Tenant fails to make any payment of base rent or of additional rent
on or before the date such payment is due and payable, Tenant shall pay to
Landlord a late charge of five percent (5%) of the amount of such payment. In
addition, such payment shall bear interest at the rate per annum which is two
percent (2%) higher than the publicly announced "prime rate" then being charged
by The ▇▇▇▇▇ National Bank of Washington, D.C., from the date such payment
became due to the date of payment thereof by Tenant; provided, however, that
nothing contained herein shall be construed as permitting Landlord to charge or
receive interest in
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excess of the maximum rate then allowed by law. Such late charge and interest
shall constitute additional rent due and payable hereunder with the next
installment of base rent due hereunder.
18.8 Notwithstanding anything in this Lease to the contrary, in the event
(i) an Event of Default shall occur under this Lease and (ii) Tenant shall
thereafter tender performance of the obligation that gave rise to such Event of
Default and (iii) Landlord, in its discretion, shall agree to accept such
performance as curing the Event of Default, then, for all purposes of this
Lease, no Event of Default shall thereafter be deemed to exist.
ARTICLE XIX
BANKRUPTCY
19.1 The following shall be an Event of Bankruptcy under this Lease:
(a) Tenant's becoming insolvent, as that term is defined in Title 11
of the United States Code (the "Bankruptcy Code"), or under the insolvency laws
of the Commonwealth of Virginia (the "Insolvency Laws");
(b) The filing of a voluntary petition under the provisions of the
Bankruptcy Code or Insolvency Laws;
(c) The filing of an involuntary petition against Tenant as the
subject debtor under the Bankruptcy Code or Insolvency Laws, which either (i) is
not dismissed within ninety (90) days of filing or (ii) results in the issuance
of an order or relief against the debtor; or
(d) Tenant's making or consenting to an assignment for the benefit of
creditors or a common law composition of creditors.
19.2 (a) Upon occurrence of an Event of Bankruptcy, Landlord shall have all
rights and remedies available to Landlord pursuant to Article XVIII, provided
that while a case in which Tenant is the subject debtor under the Bankruptcy
Code is pending and only for so long as Tenant or its Trustee in Bankruptcy
(hereinafter referred to as "Trustee") is in compliance with the provisions of
Section 19.2(b), (c) and (d) below, Landlord shall not exercise its rights and
remedies pursuant to Article XVIII.
(b) In the event Tenant becomes the subject debtor in a case pending
under the Bankruptcy Code, Landlord's right to terminate this Lease pursuant to
Section 19.2(a) shall be subject to the rights of Trustee to assume or assign
this Lease. Trustee shall not have the right to assume or assign this Lease
unless Trustee promptly (i) cures all defaults under this Lease, (ii)
compensates Landlord for monetary damages incurred as a result of such defaults,
and (iii) provides adequate assurance of future performance on the part of
Tenant as debtor in possession or on the part of the assignee tenant.
(c) Landlord and Tenant hereby agree in advance that adequate
assurance of future performance, as used in Section 19.2(b) above, shall mean
that all of the following minimum criteria must be met: (i) Tenant's gross
receipts in the ordinary course of business during the thirty (30) day period
immediately preceding the initiation of the case under the Bankruptcy Code must
be at least two (2) times greater than the next monthly installment of annual
base rent and additional rent due under this Lease; (ii) both the monthly
average and median of Tenant's gross receipts in the ordinary course of business
during the six month period immediately preceding the initiation of the case
under the Bankruptcy Code must be at least two (2) times greater than the next
monthly installment of annual base rent and additional rent due under this
Lease; (iii) Tenant must pay its estimated pro rata share of the cost of all
services provided by Landlord (whether or not previously included as a part of
the annual base rent) in advance of the performance or provision of such
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services; (iv) Trustee must agree that Tenant's business shall be conducted in a
first-class manner and that no liquidating sales, auctions or other
non-first-class business operations shall be conducted on the Premises; (v)
Trustee must agree that the use of the Premises as stated in this Lease will
remain unchanged and that no prohibited use shall be permitted; and (vi) Tenant
or Trustee must agree to pay to Landlord at any time Landlord is authorized to
and does draw on the escrow account the amount necessary to restore such escrow
account to the original level required by Section 19.2(c)(iii).
(d) In the event Tenant is unable to (i) cure its defaults, (ii) pay
the rent due under this Lease and all other payments required of Tenant under
this Lease on time (or within five (5) days of the due date), or (iii) meet the
criteria and obligations imposed by Section 19.2(c) above, Tenant agrees in
advance that it has not met its burden to provide adequate assurance of future
performance and this Lease may be terminated by Landlord in accordance with
Section 19.2(a) above.
ARTICLE XX
SUBORDINATION; MORTGAGES
20.1 This Lease is subject and subordinate to the lien of any and all
mortgages (which term "mortgages" shall include both construction and permanent
financing and shall include deeds of trust and similar security instruments)
which may now or hereafter encumber the Land or the Building, and to all and any
renewals, extensions, modifications, recastings or refinancings thereof;
provided, however, that the effectiveness of such subordination is subject to
the condition that Landlord obtain from any holder of any such mortgage or deed
of trust on the Land or the Building a non-disturbance agreement, to the end and
intent that as long as Tenant pays all rent when due and punctually observes all
other covenants and obligations on its part to be observed under this Lease
(subject to applicable notice and cure provisions), the terms and conditions of
this Lease (specifically including, but not limited to, the expansion rights
granted under Article XXIV and the renewal right granted under Article XXVI)
shall continue in full force and effect and Tenant's rights under this Lease and
its possession, use and occupancy of the Premises shall not be disturbed during
the term of this Lease by the holder of such mortgage or deed of trust or by any
purchaser upon foreclosure of such mortgage or deed of trust. At any time after
the execution of this Lease, the holder of any mortgage to which this Lease is
subordinate shall have the right to declare this Lease to be superior to the
lien of such mortgage, and Tenant agrees to execute all documents required by
such holder in confirmation thereof.
20.2 In confirmation of the foregoing subordination, Tenant shall, at
Landlord's request, promptly execute and deliver any requisite or appropriate
certificate or other document evidencing such subordination. Provided the holder
has granted the required nondisturbance agreement, Tenant agrees that neither
the institution of any suit, action or other proceeding by the holder of any
mortgage on the Land or the Building to realize upon such mortgage holder's
interest in the Land or the Building, nor any sale of the Land or the Building
pursuant to the provisions of the mortgage in favor of such mortgage holder,
shall, by operation of law or otherwise, result in the cancellation or
termination of this Lease or of the obligations of Tenant hereunder, and that
Tenant shall attorn to the purchaser at such foreclosure sale and shall
recognize such purchaser as the landlord under this Lease. Tenant further agrees
that for the purposes of this Section 20.2, the term "purchaser" or "purchaser
at a foreclosure sale" shall mean, without limitation, a purchaser at a
foreclosure sale affecting the Land or the Building or the holder of any
mortgage on the Land or the Building. Tenant agrees that upon such attornment,
such purchaser shall not (a) be bound by any rent credits or payments of annual
base rent or additional rent for more than one (1) month in advance, (b) be
bound by any amendment of this Lease made without the consent of any lender
providing financing for the Building, (c) be liable for damages for any act or
omission of any prior landlord; or (d) be subject to any offsets or defenses
which Tenant might have against any prior landlord; provided, however, that
after succeeding to Landlord's interest under this Lease, such purchaser shall
perform in accordance with the terms of this Lease all obligations of Landlord
arising after the date such
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purchaser acquires title to the Building. Upon request by such purchaser, Tenant
shall execute and deliver an instrument or instruments confirming its
attornment.
20.3 (a) After Tenant receives notice in writing from any person, firm or
other entity that it holds a mortgage or deed of trust on the Building or the
Land requesting that copies of notices from Tenant to Landlord be sent to it, no
notice from Tenant to Landlord alleging any default by Landlord shall be
effective unless and until a copy of the same is given to such holder or
Trustee; provided, however, that Tenant shall have been furnished with the name
and address of such holder or Trustee. The curing of any of Landlord's defaults
by such holder or Trustee shall be treated as performance by Landlord.
(b) In addition to the time afforded Landlord for the curing of any
default, any such holder or Trustee shall have an additional thirty (30) days
after the expiration of the period allowed to Landlord for the cure of any such
default within which to commence a cure; provided that this Section 20.3(b)
shall not extend any period that Tenant must forebear from exercising its rights
and remedies pursuant to Section 13.2 above.
20.4 Landlord shall endeavor to obtain the agreement of any lender
providing financing secured by a mortgage or deed of trust on the Land or the
Building to furnish Tenant with a copy of any notice furnished to Landlord
declaring the existence of a default by Landlord under such mortgage or deed of
trust; provided, however, that (i) Landlord shall not be required to refuse
financing offered by a lender who will not agree to give such notice to Tenant,
and (ii) Landlord shall not be responsible for ensuring that a lender who has
agreed to give such notice to Tenant fulfills such agreement.
ARTICLE XXI
HOLDING OVER
21.1 In the event that Tenant shall not immediately surrender the Premises
on the date of the expiration of the Lease Term, Tenant shall become a tenant by
the month. During the first sixty (60) days of such holdover period, Tenant
shall pay a rent equal to one hundred twenty-five percent (125%) of the base
rent and all additional rent in effect during the last month of the Lease Term.
In the event such holdover period extends beyond sixty (60) days, then the rent
shall be adjusted, retroactively to the first day of the holdover period, to
equal the greater of (i) one hundred ten percent (110%) of fair market rental
value for the Premises in its then-existing condition or (ii) one hundred
twenty-five percent (125%) of the base rent and all additional rent in effect
during the last month of the Lease Term. Said monthly tenancy shall commence on
the first day following the expiration of the Lease Term. As a monthly tenant,
Tenant shall be subject to all the terms, conditions, covenants and agreements
of this Lease. Tenant shall give to Landlord at least thirty (30) days' written
notice of any intention to vacate the Premises, and Tenant shall be entitled to
thirty (30) days' written notice to quit the Premises, unless Tenant is in
default hereunder, in which event Tenant shall not be entitled to any notice to
quit, the usual thirty (30) days' notice to quit being hereby expressly waived.
Notwithstanding the foregoing provisions of this Section 21.1, in the event that
Tenant shall hold over after the expiration of the Lease Term, and if Landlord
shall desire to regain possession of the Premises promptly at the expiration of
the Lease Term, then at any time prior to Landlord's acceptance of rent from
Tenant as a monthly tenant hereunder, Landlord, at its option, may forthwith
re-enter and take possession of the Premises by any legal process in force in
the Commonwealth of Virginia.
ARTICLE XXII
COVENANTS OF LANDLORD
22.1 Landlord covenants that it has the right to make this Lease for the
term aforesaid, and Landlord covenants that Tenant shall, during the term hereby
created, freely, peaceably and quietly occupy and enjoy the full possession of
the Premises without disturbance, molestation or hindrance by any person
whatever claiming
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an interest in the Premises prior or superior to Tenant's. Nothing in this
Section 22.1, however, shall prevent Landlord from exercising any remedy
available to it on account of an Event of Default by Tenant under this Lease.
Tenant acknowledges and agrees that its leasehold estate in and to the Premises
vests on the date this Lease is executed, notwithstanding that the Lease Term
will not commence until a future date.
22.2 Landlord hereby reserves to itself and its successors and assigns the
following rights (all of which are hereby consented to by Tenant): (i) if
required by applicable law in Landlord's reasonable judgment, to change the
street address and/or the arrangement and/or location of entrances, passageways,
doors, doorways, corridors, elevators (other than those designated for the
exclusive use of Tenant), stairs, toilets, or other public parts of the Building
(provided that if Landlord changes the street address of the Building for any
reason other than to comply with a Legal Requirement, then Landlord shall pay
Tenant's reasonable costs of replacing its stationery); and (ii) subject to the
provisions of Section 13.2 hereof, to erect, use and maintain pipes and conduits
in and through the Premises. Provided Landlord acts reasonably and in a manner
not likely to interfere materially with Tenant's business, Landlord may exercise
any or all of the foregoing rights without being deemed to be guilty of an
eviction, actual or constructive, or a disturbance or interruption of the
business of Tenant or of Tenant's use or occupancy of the Premises.
22.3 Landlord represents and warrants that, to the best of its knowledge
and belief, there are no Hazardous Materials on, in or under the Land or the
Building. Landlord covenants not to bring any Hazardous Materials onto the Land
or the Building. Notwithstanding the foregoing, Landlord or its agents may use
and store within the Building reasonable quantities of customary office and
cleaning supplies; provided such items are stored, used and disposed of in
accordance with applicable Legal Requirements. If any Legal Requirements require
an investigation into the presence of any Hazardous Materials, or if any
Hazardous Materials are actually discovered and Legal Requirements require
abatement, remediation or removal, Landlord shall, at its sole cost and expense,
▇▇▇▇▇, remediate and remove all such Hazardous Materials as required by the
applicable Legal Requirements. Landlord shall indemnify and hold Tenant harmless
from any and all claims, damages, fines, judgments, penalties, costs,
liabilities or losses arising during or after the Lease Term and arising from
Landlord's breach of this Section 22.3.
ARTICLE XXIII
PARKING
23.1 At all times during the Lease Term, Tenant shall be granted, at no
charge to Tenant, 3.6 parking permits per 1,000 square feet of rentable area in
the initial Premises, for parking in the surface parking area (or in any parking
deck substituted for the surface parking area) located immediately adjacent to
the Building. In the event Tenant leases any expansion space in the Building,
Tenant shall be granted 3.6 additional parking permits per 1,000 square feet of
rentable area in such expansion space. At Tenant's request, Landlord agrees to
designate a reasonable number of spaces convenient to the entrance to the lobby
of the Building as being reserved for Tenant's visitors, and such spaces shall
be counted against the parking permits allocated to Tenant pursuant to this
Section 23.1, at no additional charge to Tenant. In addition to the foregoing,
Tenant shall be provided reserved or dedicated visitor spaces at the same ratio
of rentable square feet leased to parking spaces as any other tenant of the
Building who is granted such parking spaces and at the same cost per space as
such tenant.
23.2 It is understood and agreed that Landlord does not assume any
responsibility for, and shall not be held liable for, any damage or loss to any
automobiles parked in the parking area or to any personal property located
therein, or for any injury sustained by any person in or about the parking area,
unless proximately caused by the action or omission of Landlord or any of its
employees or agents.
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ARTICLE XXIV
EXPANSION
24.1 Landlord agrees that until March 31, 1998, it will not lease or market
for lease any of the office space in the Building that is not initially leased
by Tenant pursuant to this Lease. Any space that is thus being held off the
market shall, during the period that it is thus being held off the market, be
referred to herein as the "Withheld Space." Tenant shall have the right to lease
all or any portion of the Withheld Space (the "Expansion Option") upon the same
terms and conditions as the initial Premises, including a tenant improvement
allowance of $25.00 per rentable square foot, by written notice delivered to
Landlord during the period that the Withheld Space is being held off the market;
provided, however, that if Tenant elects to lease any portion of the Withheld
Space that is not a full floor, then the configuration of the space that Tenant
leases hereunder must be reasonably acceptable to Landlord.
24.2 [Intentionally deleted.]
24.3 From and after April 1, 1998, Tenant shall have a right of first offer
to lease any office space ("Option Space") that is available in the Building
prior to the initial leasing of such space to another tenant. Tenant's right to
lease any such space (each of which spaces is referred to herein as an "Option
Space") shall be subject to the following terms and conditions:
(a) Except as provided below, Landlord shall not enter into a lease
for any Option Space without first giving Tenant written notice (an "Option
Notice") that such Option Space is available for leasing and granting Tenant the
opportunity to enter into a lease of the Option Space in accordance with this
Section 24.3. The Option Notice shall identify the relevant Option Space and the
annual base rent and other economic terms and conditions for the lease of such
space.
(b) Tenant shall have a period of five (5) business days following
receipt of the Option Notice to notify Landlord in writing whether Tenant
desires to lease the entirety of the Option Space described in the Option
Notice, time being of the essence. The leasing of the Option Space shall be on
the annual base rent and other economic terms and conditions set forth in the
Option Notice (it being agreed that the "legal" (i.e., non-economic and
non-transaction specific) terms of such lease shall be the same as in this
Lease). In the event that Tenant does not timely notify Landlord that Tenant
desires to lease the Option Space that is the subject of the Option Notice, then
Landlord shall be free to lease such Option Space to any other party on such
terms and conditions as Landlord in its sole discretion may determine; provided,
however, that in the event Landlord proposes to lease such Option Space to a
third party at a net effective rental rate that is less than ninety-five percent
(95%) of the net effective rental rate offered to Tenant in the Option Notice,
then Landlord shall re-offer such Option Space to Tenant by delivering to Tenant
another Option Notice setting forth the terms and conditions offered to such
third party and following the procedures set forth above with respect to the
first such offer of such Option Space to Tenant.
(c) If Tenant leases any Option Space hereunder, Landlord shall
deliver possession of the Option Space to Tenant promptly following Tenant's
election to lease such Option Space, and the term of Tenant's leasing of such
Option Space shall commence on such delivery date and shall be coterminous with
the term for the initial Premises. To afford Tenant an opportunity to construct
any initial improvements desired by Tenant in the Option Space, Tenant's
obligation to pay rent with respect to the Option Space shall not commence until
the earlier of (i) sixty (60) days after the date on which possession of the
Option Space is delivered to Tenant, or (ii) the date on which Tenant commences
to conduct business within the Option Space.
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(d) Notwithstanding anything in this Section 24.3 to the contrary, at
Landlord's election, Tenant shall have no right to lease any Option Space at any
time during the existence of an Event of Default under this Lease.
24.4 From and after April 1, 1998, Tenant also shall have a right of first
offer to lease any Option Space in the Building that becomes available for
leasing following the initial leasing of such space to another tenant. Tenant's
right to lease any Option Space shall be subject to the following terms and
conditions:
(a) Except as provided below, Landlord shall not enter into a new
lease for any Option Space that will commence after the expiration or
termination of the initial lease of such space without first giving Tenant an
Option Notice that such Option Space is or will be becoming available for
leasing and granting Tenant the opportunity to enter into a lease of the Option
Space in accordance with this Section 24.4. The Option Notice shall identify the
relevant Option Space and the date on which such Option Space is expected to be
available for delivery to Tenant.
(b) Tenant shall have a period of five (5) business days following
receipt of the Option Notice to notify Landlord in writing whether Tenant
desires to lease the Option Space, time being of the essence. The leasing of the
Option Space shall be for an annual base rent equal to the Market Rent (as
defined in, and determined in accordance with the provisions of, Sections 26.3
and 26.4 below, except that the parties shall have a period of five (5) business
days to reach agreement upon the Market Rent, whereupon, if the parties have not
reached agreement upon the Market Rent, either Tenant shall have rescinded its
exercise of its right to lease the Option Space or the Market Rent for the
Option Space shall be determined by the three-broker mechanism set forth in
Section 26.3) and additional rent on account of all Expenses incurred during the
term of Tenant's leasing of the Option Space, it being agreed that the "legal"
(i.e., non-economic and non-transaction specific) terms of such lease shall be
the same as in this Lease. In the event Tenant does not timely notify Landlord
that Tenant desires to lease the Option Space, then Landlord shall be free to
lease such Option Space to any other party on such terms and conditions as
Landlord in its sole discretion may determine.
(c) Tenant shall have the right to lease either (i) the entirety of
any Option Space offered to Tenant hereunder, or (ii) any full floor(s)
contained within the Option Space, and/or (iii) any partial floor contained
within the Option Space (but not a portion of any full floor contained within
the Option Space). Tenant's notice exercising its right to lease the Option
Space shall specify whether Tenant will lease the entirety of the Option Space
or a portion thereof permitted pursuant to clause (ii) and/or (iii) above.
(d) If Tenant leases any Option Space hereunder, Landlord shall
deliver possession of the Option Space to Tenant on the day following the date
on which the Option Area is vacated by the prior tenant thereof, and the term of
Tenant's leasing of such Option Space shall commence on such delivery date and
shall be coterminous with the term for the initial Premises. Landlord shall
incur no liability, and the expiration date of the term for which the Option
Space is leased shall not be extended, if Landlord is unable to deliver
possession of the Option Space to Tenant due to any holdover tenant's refusal to
vacate, or for any other reason not within Landlord's control. Landlord agrees
to use reasonable efforts to evict any such holdover tenant and to obtain
possession of the Option Space as soon as reasonably possible. Any Option Space
which is leased to Tenant shall be delivered by Landlord in its "as is"
condition. To afford Tenant an opportunity to construct any initial improvements
desired by Tenant in the Option Space, Tenant's obligation to pay rent with
respect to the Option Space shall not commence until the earlier of (i) sixty
(60) days after the date on which possession of the Option Space is delivered to
Tenant, or (ii) the date on which Tenant commences to conduct business within
the Option Space.
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(e) Notwithstanding anything in this Section 24.4 to the contrary, at
Landlord's election, Tenant shall have no right to lease any Option Space at any
time during the existence of an Event of Default under this Lease.
(f) Notwithstanding anything in this Section 24.4 to the contrary,
Tenant's rights under this Section 24.4 are subject and subordinate to all
renewal and expansion rights that may hereafter be granted to any party leasing
space in the Building, provided that such rights are granted in the leases of
such parties and, with respect to expansion rights, are for specifically defined
areas of space, and no space in the Building shall be deemed to be an Option
Space hereunder unless and until Landlord is preparing to market it for lease to
the general public.
24.5 [Intentionally deleted]
ARTICLE XXV
[INTENTIONALLY DELETED]
ARTICLE XXVI
RENEWAL
26.1 Landlord hereby grants to Tenant the conditional right, exercisable at
Tenant's option, to renew the term of this Lease for two (2) terms (each, a
"Renewal Term") of sixty (60) months each. If exercised, and if the conditions
applicable thereto have been satisfied, the first Renewal Term shall commence
immediately following the end of the Lease Term provided in this Lease and the
second Renewal Term shall commence immediately following the end of the first
Renewal Term. The right of renewal herein granted to Tenant with respect to each
Renewal Term shall be subject to, and shall be exercised in accordance with, the
following terms and conditions:
(a) Tenant shall exercise its right of renewal with respect to each
Renewal Term by giving Landlord written notice thereof not earlier than
twenty-four (24) months and not later than twelve (12) months prior to the
expiration date of the then-current Lease Term. Tenant's exercise of its right
of renewal shall be irrevocable (except as provided in Section 26.3(a) below)
and shall be binding upon both Landlord and Tenant.
(b) In the event a renewal option notice is not given timely, Tenant's
right of renewal with respect to such Renewal Term shall lapse and be of no
further force or effect.
(c) A renewal option may be exercised either with respect to the
entire Premises (including all expansion space theretofore leased by Tenant) or
with respect to a "Divisible Portion of the Premises" (as hereinbelow defined).
Tenant's renewal option notice shall specify whether Tenant is exercising its
right of renewal with respect to the entire Premises or with respect to a
Divisible Portion of the Premises, and (if applicable) shall identify the
Divisible Portion of the Premises with specificity. As used herein, the term
"Divisible Portion of the Premises" shall mean a portion of the Premises
consisting of at least seventy-five percent (75%) of the rentable area contained
in the Premises at the time of Tenant's exercise of its renewal option, all of
which space shall be contiguous. In the event Tenant desires to extend the term
of this Lease with respect to a portion of the Premises consisting of less than
seventy-five percent (75%) of the rentable area contained in the Premises but at
least 25,000 rentable square feet, Section 26.2 below shall not apply and
Landlord and Tenant may enter into negotiations with respect to the terms and
conditions that would govern such an extension of the Lease Term (which terms
and conditions may differ from both the economic and the non-economic terms set
forth herein). In the event Tenant desires to extend the term of this Lease with
respect to a portion of the Premises consisting of less than 25,000 rentable
square feet, Landlord shall have no obligation to agree to an extension of the
Lease Term with respect to such a reduced portion of the Premises.
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(d) In the event an Event of Default under this Lease has occurred and
has continued for ten (10) business days on the date a renewal option notice is
sent or any time thereafter up to and including the date such Renewal Term is to
commence, then, at Landlord's option, such Renewal Term shall not commence and
the Lease Term shall expire at the date the Lease Term would have expired
without such renewal.
(e) In the event this Lease is not renewed for the first Renewal Term,
Tenant's right to renew this Lease for the second Renewal Term shall also lapse.
In the event this Lease is renewed for the first Renewal Term with respect to
only a Divisible Portion of the Premises, then Tenant's right to renew this
Lease for the second Renewal Term shall apply only to such Divisible Portion of
the Premises.
26.2 During any Renewal Term, all the terms, conditions, covenants and
agreements set forth in this Lease shall continue to apply and be binding upon
Landlord and Tenant, except that: (1) the annual base rent shall be calculated
at the beginning of the Renewal Term so that the annual base rent payable during
each Lease Year of such Renewal Term shall be equal to ninety-five percent (95%)
of Market Rent for the Renewal Term, including a market-based formula for
adjusting Market Rent for each year of such Renewal Term; and (2) in no event
shall Tenant have the right to renew the Lease Term beyond the expiration of the
second Renewal Term provided for in Section 26.1 or in the event this Lease is
terminated as provided in the other provisions of this Lease.
26.3 "Market Rent" shall be the fair market amount of "net" annual base
rent (including escalations) determined as follows:
(a) Following the giving of the renewal option notice, Landlord and
Tenant shall commence negotiations concerning the amount of base rent that shall
constitute Market Rent. The parties shall have thirty (30) days after the date
Tenant delivers its renewal option notice in which to agree on such Market Rent.
If, during such negotiation period, the parties are unable to agree on such
Market Rent, then Tenant shall have the right to rescind its exercise of the
renewal option by notice of rescission delivered to Landlord no later than the
expiration of such thirty (30) day period.
(b) In the event Landlord and Tenant do not reach agreement concerning
the Market Rent, but Tenant does not timely exercise the right of rescission
described in subsection (a) above, then Landlord and Tenant shall each designate
an independent, licensed real estate broker within seven (7) days from the
expiration of the thirty (30) day period described in subsection (a) above, who
shall have more than eight (8) years' experience as a real estate broker
specializing in commercial office leasing and who shall be familiar with the
commercial real estate market in which the Building is located. Said brokers
shall each determine the Market Rent within fifteen (15) days. If the lower of
the two determinations is not less than ninety-five percent (95%) of the higher
of the two determinations, then the Market Rent shall be the average of the two
determinations. If the lower of the two determinations is less than ninety-five
percent (95%) of the higher of the two determinations, then the two brokers
shall render separate written reports of their determinations and within fifteen
(15) days thereafter the two brokers shall appoint a third broker with like
qualifications. Such third broker shall be furnished the written reports of the
first two brokers. Within fifteen (15) days after the appointment of the third
(3rd) broker, the third broker shall determine the Market Rent. If three brokers
are used to determine Market Rent, then, for purposes of this Section 26.3,
Market Rent shall equal the average of the two closest determinations; provided,
however, that (i) if any one determination is agreed upon by any two of the
brokers, then the Market Rent shall be such determination, and (ii) if any one
determination is equidistant from the other two determinations, then the Market
Rent shall be such middle determination. Landlord and Tenant shall each bear the
cost of its broker and shall share equally the cost of the third broker.
(c) Among the factors to be considered in determining Market Rent
shall be the rental rates then being obtained for leases of similar space, size
and terms in the Building and in other comparable office
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buildings of a similar class in Reston, Virginia. All determinations shall
reflect market conditions expected to exist as of the date that base rent based
on Market Rent is to commence (including base rents and escalations, rental
abatements, construction allowances, parking and other tenant concessions,
operating expense and tax pass-through provisions, and other terms expected to
be agreed to in market leases entered into at such time).
ARTICLE XXVII
COMMUNICATIONS EQUIPMENT
27.1 (a) Tenant may install, free of charge, at its sole cost, risk and
expense, satellite dishes and communications equipment (the "Communications
Equipment") on the roof of the Building, in an amount and of a type mutually
agreed to by Landlord and Tenant, subject in all events to the availability of
suitable space on the roof of the Building (to be determined in Landlord's
reasonable discretion) and subject further to Landlord's prior written approval
of plans and specifications for the Communications Equipment and the type and
placement of all cabling and wiring ancillary thereto, which approval shall not
be unreasonably withheld with respect to matters that do not affect the
structure of the Building. Landlord makes no representation concerning the
suitability of the rooftop as a location for Tenant's Communications Equipment,
and Landlord's approval of Tenant's plans and specifications shall in no event
be construed as constituting such a representation. Tenant shall be responsible
for obtaining and maintaining all approvals, permits and licenses required by
any federal, state or local government for installation and operation of the
Communications Equipment and for paying all fees attendant thereto and for
complying with all other Legal Requirements relating to the Communications
Equipment. If the Communications Equipment is installed, Tenant shall have sole
responsibility for the maintenance, repair and replacement thereof and of all
cabling and wiring ancillary thereto. Tenant shall coordinate with Landlord's
property manager concerning any penetration of the roof or the exterior facade
of the Building, and shall in no event take any action that will void any
then-existing roof warranty. All repairs to the Building made necessary by
reason of the furnishing, installation, maintenance, operation or removal of the
Communications Equipment or any replacements thereof shall be at Tenant's sole
cost. Upon expiration or termination of this Lease, Tenant agrees that it will
remove, forthwith, the Communications Equipment and any wiring or accessories
associated with the Communications Equipment and shall repair any damage to the
Building caused by the installation or removal of the Communications Equipment
and related equipment. In the event Tenant fails to remove the Communications
Equipment and associated equipment, Landlord may remove and dispose of such
Communications Equipment and associated equipment and charge Tenant the entire
reasonable cost thereof. Tenant's Communications Equipment shall not interfere
with the structure of the Building, any of the building systems, or the
equipment (including airwaves reception and other equipment) of any other tenant
in the Building. Tenant's rights pursuant to this Section 27.1 shall be
non-exclusive. Landlord shall have no liability on account of any damage to or
interference with the operation of the Communications Equipment by any third
party. Notwithstanding the foregoing, Landlord agrees that it will manage the
available space on the rooftop so as to accommodate Tenant's needs with respect
to the Communications Equipment to the greatest extent reasonably possible,
including requesting that other tenants or rooftop users relocate their
equipment if such relocation is necessary to enable Tenant to operate its
Communications Equipment. Landlord shall have the right to require Tenant to
relocate the Communications Equipment at Landlord's cost to another suitable
location on the rooftop, provided such relocation can be done at a time and in a
manner that only minimally and temporarily interferes with Tenant's use of the
Communications Equipment.
(b) Tenant also shall be permitted to install, free of charge, at its
sole cost and expense, a back-up power generator and a supplemental HVAC system,
each in a location to be mutually agreed upon by Landlord and Tenant, and all
necessary feeders and conduits extending from such generator and/or supplemental
HVAC system to the Premises. Tenant shall be responsible for complying with all
Legal Requirements relating to such generator and supplemental HVAC system.
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ARTICLE XXVIII
[INTENTIONALLY DELETED]
ARTICLE XXIX
[INTENTIONALLY DELETED]
ARTICLE XXX
GENERAL PROVISIONS
30.1 Tenant acknowledges that neither Landlord nor any broker, agent or
employee of Landlord has made any representations or promises with respect to
the Premises or the Building except as herein expressly set forth, and no
rights, privileges, easements or licenses are being acquired by Tenant except as
herein expressly set forth.
30.2 Nothing contained in this Lease shall be construed as creating a
partnership or joint venture of or between Landlord and Tenant, or to create any
other relationship between the parties hereto other than that of landlord and
tenant.
30.3 Landlord and Tenant each represents and warrants to the other that
neither of them has employed or dealt with any broker, agent or finder in
carrying on the negotiations relating to this Lease other than Barnes, Morris,
▇▇▇▇▇▇ & ▇▇▇▇▇▇, Inc., who shall be paid a commission by Landlord pursuant to
the terms of a separate agreement. Each party shall indemnify and hold the other
harmless from and against any claim or claims for brokerage or other commissions
asserted by any other broker, agent or finder engaged by the indemnifying party
or with whom the indemnifying party has dealt in connection with this Lease.
30.4 Tenant agrees, at any time and from time to time, upon not less than
fifteen (15) days' prior written notice by Landlord, to execute, acknowledge and
deliver to Landlord a statement in writing (i) certifying that this Lease is
unmodified and in full force and effect (or if there have been any
modifications, that the Lease is in full force and effect as modified and
stating the modifications); (ii) stating the dates to which the rent and any
other charges hereunder have been paid by Tenant; (iii) stating whether or not,
to the best knowledge of Tenant, Landlord is in default in the performance of
any covenant, agreement or condition contained in this Lease, and if so,
specifying the nature of such default; (iv) stating the address to which notices
to Tenant are to be sent; and (v) stating such other information as Landlord or
any mortgagee or prospective mortgagee of the Building may reasonably request.
Any such statement delivered by Tenant may be relied upon by any landlord of the
Building or the land upon which it is situated, any prospective purchaser of the
Building or such land, any mortgagee or prospective mortgagee of the Building or
such land or of Landlord's interest therein, or any prospective assignee of any
such mortgagee. Landlord agrees, at any time and from time to time, upon not
less than fifteen (15) days' prior written notice by Tenant, to execute,
acknowledge and deliver to Tenant a statement in writing (i) certifying that
this Lease is unmodified and in full force and effect (or if there have been any
modifications, that the Lease is in full force and effect as modified and
stating the modifications); (ii) stating the dates to which the rent and any
other charges hereunder have been paid by Tenant; (iii) stating whether or not,
to the best knowledge of Landlord, Tenant is in default in the performance of
any covenant, agreement or condition contained in this Lease, and if so,
specifying the nature of such default; (iv) stating the address to which notices
to Landlord are to be sent; and (v) stating such other information as Tenant may
reasonably request.
30.5 Landlord and Tenant each hereby waive trial by jury in any action,
proceeding or counterclaim brought by either of them against the other in
connection with any matter arising out of or in any way connected with this
Lease, the relationship of landlord and tenant hereunder, Tenant's use or
occupancy of the Premises,
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and/or any claim of injury or damage. Landlord hereby waives any statutory or
other landlord's lien available under the laws of the Commonwealth of Virginia
or otherwise.
30.6 All notices, waivers, demands, requests or other communications
required or permitted hereunder shall, unless otherwise expressly provided, be
in writing and be deemed to have been properly given, served and received (a) if
delivered by messenger, when delivered (with receipt therefor), (b) if mailed,
on the third (3rd) business day after deposit in the United States Mail,
certified or registered, postage prepaid, return receipt requested, or (c) if
delivered by reputable overnight express courier, freight prepaid, the next
business day after delivery to such courier; in every case addressed to the
party to be notified as follows. Either party may change its address for the
giving of notices by notice given in accordance with this Section.
If to Landlord:
Boston Properties Limited Partnership
c/o Boston Properties, Inc.
▇▇▇ ▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
and a copy to:
Boston Properties, Inc.
▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: General Counsel
If to Tenant before occupancy:
Landmark Systems Corporation
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Corporate Services Manager
and a copy to:
Shaw, Pittman, ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
If to Tenant after occupancy:
Landmark Systems Corporation
at the Premises
Attn: Corporate Services Manager
and a copy to:
Shaw, Pittman, ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇
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▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
30.7 If any 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 provision to persons or
circumstances other than those as to which it is invalid or unenforceable, shall
not be affected thereby, and each provision of this Lease shall be valid and
enforced to the fullest extent permitted by law.
30.8 Feminine or neuter pronouns shall be substituted for those of the
masculine form, and the plural shall be substituted for the singular number, in
any place or places herein in which the context may require such substitution.
30.9 The provisions of this Lease shall be binding upon, and shall inure to
the benefit of, the parties hereto and each of their respective representatives,
successors and assigns, subject to the provisions hereof restricting assignment
or subletting by Tenant.
30.10 This Lease contains and embodies the entire agreement of the parties
hereto and supersedes all prior agreements, negotiations and discussions between
the parties hereto. Any representation, inducement or agreement that is not
contained in this Lease shall not be of any force or effect. This Lease may not
be modified or changed in whole or in part in any manner other than by an
instrument in writing duly signed by both parties hereto.
30.11 This Lease shall be governed by and construed in accordance with the
laws of the Commonwealth of Virginia.
30.12 Article and section headings are used herein for the convenience of
reference and shall not be considered when construing or interpreting this
Lease.
30.13 The submission of an unsigned copy of this document to Tenant for
Tenant's consideration does not constitute an offer to lease the Premises or an
option to or for the Premises. This document shall become effective and binding
only upon the execution and delivery of this Lease by both Landlord and Tenant.
30.14 Time is of the essence of each provision of this Lease.
30.15 This Lease shall not be recorded, except that upon the request of
either party, the parties agree to execute, in recordable form, a short-form
memorandum of this Lease, provided that such memorandum shall not contain any of
the specific rental terms set forth herein and shall otherwise be mutually
acceptable to Landlord and Tenant. Such memorandum may be recorded in the land
records of Fairfax County in the Commonwealth of Virginia, and the party
desiring such recordation shall pay all recordation costs.
30.16 Except as otherwise provided in Section 4.5 of this Lease, any
additional rent owed by Tenant to Landlord, and any cost, expense, damage or
liability shall be paid by Tenant to Landlord no later than thirty (30) days
after the date Landlord notifies Tenant in writing of the amount of such
additional rent or such cost, expense, damage or liability. If any payment
hereunder is due after the end of the Lease Term, such additional rent or such
cost, expense, damage or liability shall be paid by Tenant to Landlord not later
than thirty (30) days after Landlord notifies Tenant of the amount of such
additional rent or such cost, expense, damage or liability.
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30.17 All of Tenant's duties and obligations hereunder, including but not
limited to Tenant's duties and obligations to pay base rent, additional rent and
the costs, expenses, damages and liabilities incurred by Landlord for which
Tenant is liable, shall survive the termination of this Lease for any reason
whatsoever.
30.18 In the event either Tenant or Landlord is in any way delayed,
interrupted or prevented from performing any of its respective obligations under
this Lease (other than Tenant's obligation to pay any rent due hereunder), and
such delay, interruption or prevention is due to fire, act of God, governmental
or quasi-governmental act (including, without limitation, any delay in the
issuance of required permits or in the scheduling or performance of required
inspections), strike, labor dispute, inability to procure materials or
utilities, or any other cause beyond Tenant's or Landlord's reasonable control
(whether similar or dissimilar) (all of which are collectively referred to
herein as "Force Majeure"), then Tenant or Landlord (as applicable) shall be
excused from performing the affected obligations for the period of such delay,
interruption or prevention.
30.19 Tenant and Landlord hereby each represent and warrant to the other
that all necessary corporate and/or partnership action has been taken to enter
into this Lease and that the person signing this Lease on behalf of Tenant and
Landlord, respectively, has been duly authorized to do so.
30.20 Any amounts required to be paid by Tenant under this Lease shall be
considered additional rent. Except as expressly provided herein, all payments of
additional rent shall be paid to Landlord without diminution, set-off or
deduction in the same manner as annual base rent pursuant to Section 3.3 hereof
or as may otherwise be provided in this Lease.
30.21 This Lease includes and incorporates Exhibits ▇, ▇-▇, ▇, ▇, ▇, ▇, ▇
▇▇▇ ▇ attached hereto.
30.22 Notwithstanding anything to the contrary contained in this Lease, in
no event shall Landlord or Tenant have any liability to the other for the
interruption of or loss to such other party's business or for any other indirect
damages or consequential losses.
- 42 -
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IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease under seal
on or as of the day and year first above written.
LANDLORD:
BOSTON PROPERTIES LIMITED PARTNERSHIP,
a Delaware limited partnership
WITNESS: By: Boston Properties, Inc., its general partner
By: /s/
-------------------- --------------------------------------------
Title: Senior Vice President
--------------------------------------------
TENANT:
WITNESS: LANDMARK SYSTEMS CORPORATION, a Virginia corporation
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------- ---------------------------------------------
Title: President / COO
---------------------------------------------
- 43 -
45
FIRST AMENDMENT TO LEASE
THIS FIRST AMENDMENT TO LEASE (this "First Amendment") is made as of March 30,
1998, by and between BOSTON PROPERTIES LIMITED PARTNERSHIP, a Delaware limited
partnership ("Landlord"), and LANDMARK SYSTEMS CORPORATION, a Virginia
corporation ("Tenant").
WITNESSETH:
WHEREAS, pursuant to that certain Deed of Lease dated as of January 30,
1998 (the "Lease"), Landlord leased to Tenant certain space consisting of
approximately seventy-five thousand (75,000) rentable square feet of office
space (the "Premises") in the office building to be known as The Arboretum and
to be constructed on Sunrise Valley Drive in Reston, Virginia (the "Building"),
as more particularly described in the Lease;
WHEREAS, Tenant desires to exercise the Expansion Option contained in
Section 24.1 of the Lease to lease all of the Withheld Space, constituting
approximately twenty-five thousand (25,000) square feet of rentable area, as
more particularly described herein (the "First Amendment Space");
WHEREAS, Landlord and Tenant desire to amend the Lease in order to add the
First Amendment Space to the Premises, to more accurately set forth the
approximate number of rentable square feet constituting the Premises (as
expanded by the First Amendment Space) and to modify certain provisions in
connection with the addition to the Premises of the First Amendment Space,
subject to the terms and conditions set forth herein; and
WHEREAS, unless otherwise provided herein, all terms used in this First
Amendment that are defined in the Lease shall have the meanings provided for in
the Lease.
NOW, THEREFORE, in consideration of the foregoing, the mutual covenants
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Landlord and Tenant, intending to
be legally bound, do hereby agree as follows'
1. The foregoing recitals are intended to be a material part of this
First Amendment and are incorporated herein by this reference.
2. Article I - The Premises.
a. Landlord does hereby lease and demise unto Tenant, and Tenant
does hereby hire, lease and accept from Landlord, the First
Amendment Space. Effective as of the date of this First
Amendment, (i) the First Amendment Space shall become a part of
the Premises, such that the Premises shall consist of
approximately ninety-five thousand five hundred eighty-four
(95,584) square feet of rentable area (which rentable area
calculation shall be confirmed in accordance with Sections 1. 1
(b) and 1.3 of the Lease), constituting the entire rentable area
of the Building, and (ii) the First Amendment Space shall be
subject to all of the terms and conditions of the Lease for the
remainder of the Lease Term.
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b. Pursuant to Section 1. 1 (b) of the Lease, a diagram of the
Premises in the form attached hereto as Attachment A shall be
added to the Lease as Exhibit A-1.
c. Notwithstanding anything to the contrary contained in Section 1.
1 (a) of the Lease, in connection with the addition to the
Premises of the First Amendment Space, no Premises Option
selection shall be required of Tenant pursuant to Section 1. 1
(a) of the Lease.
3. Article II - Term. The term of the Lease with respect to the First
Amendment Space shall be coterminous with the Lease Term for the initial
Premises. Notwithstanding anything to the contrary contained in the Lease, the
First Amendment Space and the initial Premises shall be considered together as
part of a single delivery of space for purposes of determining the Lease
Commencement Date, and accordingly, there shall be one and the same Lease
Commencement Date for the Premises, as increased by the First Amendment Space.
The Declaration to be executed by Landlord and Tenant pursuant to Section 2. 1
(c) of the Lease shall confirm the matters included thereon with respect to the
Premises, as increased by the First Amendment Space.
4. Article III - Base Rent. The annual base rent payable with respect to
the First Amendment Space shall be the product of the annual base rent per
rentable square foot payable with respect to the initial Premises for the
applicable Lease Years, as set forth in Article III Of the Lease, multiplied by
the number of square feet of rentable area constituting the First Amendment
Space and shall be paid in accordance with the terms and conditions contained in
Article III.
5. Article IV - Additional Rent. Tenant's proportionate share of
Operating Expenses and Tenant's proportionate share of Real Estate Taxes each
shall be calculated with respect to the Premises, as increased by the First
Amendment Space, and otherwise in accordance with Section 4.1 of the Lease.
6. Article XXIII - Parking. Pursuant to the terms of Section 23.1 of the
Lease, from and after the date hereof, Tenant shall be entitled to 3.6 parking
permits in the parking area for the Building for every 1,000 square feet of
rentable area constituting the First Amendment Space.
7. Article XXX - Section 30.3 - Brokers. Landlord and Tenant each
represent to the other that they had no dealings with any real estate broker,
finder or other person with respect to the First Amendment Space, except Bames,
Morris, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, Inc. (the "Broker"). Landlord shall pay any commissions
or fees that are payable to the Broker with respect to this Amendment, in
accordance with the terms of a separate commission contract.
8. Exhibit B - Work Agreement. All of the terms and conditions of the
Work Agreement attached to the Lease as Exhibit B shall be applicable to the
First, Amendment Space, including without limitation, the Improvements Allowance
provided pursuant to Paragraph 8(a) of Exhibit B in the amount of Twenty-Five
Dollars ($25) per square foot of rentable area of the Premises, as increased by
the First Amendment Space, and the Excess Allowance pursuant to Paragaph 8(c) of
Exhibit B in the amount of Five Dollars ($5) per square foot of rentable area of
the Premises, as increased by the First Amendment Space.
9. Except as otherwise expressly set forth herein, all other terms and
conditions of the Lease shall remain unmodified and in full force and effect.
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IN WITNESS WHEREOF, the parties hereto have caused this First
Amendment to be duly executed as of the date first above written.
LANDLORD:
BOSTON PROPERTIES LIMITED PARTNERSHIP, a
Delaware limited partnership
WITNESS: By: Boston Properties, Inc., its general partner
By: /s/
--------------------- --------------------------------------------
Title: Senior Vice President
--------------------------------------------
TENANT:
WITNESS: LANDMARK SYSTEMS CORPORATION, a Virginia corporation
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
--------------------- --------------------------------------------
Title: President / COO
--------------------------------------------