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Exhibit 10.3
Property Address:
▇▇▇▇▇-▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
INDUSTRIAL BUILDING LEASE
THIS LEASE is made as of this 28th day of July 1998 between ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, INC., a Delaware corporation ("Landlord"), and STERICYCLE, INC., a
Delaware corporation ("Tenant").
ARTICLE I
LEASE TERMS
SECTION 1.1. DEFINITIONS. In addition to the other terms, which are
elsewhere defined in this Lease, the following terms and phrases, whenever used
in this Lease shall have the meanings set forth in this Subsection, and only
such meanings, unless such meanings are expressly contradicted, limited or
expanded elsewhere herein.
A. BASE RENT SCHEDULE:
Period Annual Monthly
(by lease month) Base Rent Base Rent
August 1, 1998 - September 30, 1998 NA $0.00
October 1, 1998 - January 31, 1999 NA $ 4,207.00
February 1, 1999 - December 31, 2001 $188,572.86 $15,714.41
January 1, 2002 - December 31, 2003 $206,830.26 $17,235.86
January 1, 2004 - December 31, 2005 $221,175.36 $18,431.28
B. SECURITY DEPOSIT: None
C. INITIAL DEPOSIT: $2,051.43
(i) Initial Tax Deposit: $1,964.49
(ii) Initial Insurance Deposit: $86.94
D. INITIAL TERM: The initial term of seven (7)-years and five (5)
months, commencing as of the Commencement Date;
provided that the initial two (2) months of the
term shall pertain to the South Section (as
hereinafter defined) in accordance with Section
2.1 hereof.
E. COMMENCEMENT DATE: August 1, 1998
F. TERMINATION DATE: December 31, 2005.
G. TERM: The Initial Term as same may be extended or sooner
terminated pursuant to the provisions of this Lease.
H. USE: General office, corporate headquarters, warehousing and
light manufacturing.
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I. OPTION TO RENEW: See Article XXXIV.
J. LANDLORD'S MAILING ADDRESS:
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
K. TENANT'S MAILING ADDRESS:
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
L. LANDLORD'S BROKER: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Inc.
M. TENANT'S BROKER: Insignia/ESG
SECTION 1.2. SIGNIFICANCE OF DEFINITIONS. Each reference in this Lease to
any of the Definitions contained in Section 1.1 of this Article shall be deemed
and construed to incorporate all of the terms provided under each such
Definition.
SECTION 1.3. ENUMERATION OF EXHIBITS. The exhibits in this Section and
attached to this Lease are incorporated in this Lease by this reference and are
to be construed as a part of this Lease.
EXHIBIT "A" -- Legal Description
EXHIBIT "B" -- Form of Estoppel Certificate
ARTICLE II
PREMISES
SECTION 2.1. LEASE. Landlord, for and in consideration of the rents herein
reserved and of the covenants and agreements herein contained on the part of
Tenant to be kept, observed and performed, does by these presents, lease to
Tenant, and Tenant hereby leases from Landlord, the real estate located at
▇▇▇▇▇-▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, and legally described on
EXHIBIT "A" attached hereto and by this reference incorporated herein ("Land"),
together with all improvements now located or hereafter constructed thereon,
including a one-story industrial warehouse building containing approximately
26,082 rentable square feet consisting of a south (office) section containing
approximately 12,232 rentable square feet ("South Section"), and a north
(warehouse) section containing approximately 13,850 rentable square feet
("North Section") (collectively, the "Improvements") (the Land and the
Improvements are sometimes collectively referred to as the "Premises"), subject
to covenants, conditions, agreements, easements, encumbrances and restrictions
affecting the Land and the Improvements thereon ("Restrictions"); provided,
however, that the Premises shall consist solely of the South Section (as
hereinafter defined) from August 1, 1998 until October 1, 1998.
ARTICLE III
TERM
SECTION 3.1. TERM. The Initial Term of this Lease shall commence on the
Commencement Date and shall end on the Termination Date, unless sooner
terminated as hereinafter set forth. The parties hereto acknowledge and agree
that, in accordance with Section 2.1 hereof, Landlord shall give Tenant
possession of the South Section of the Premises on August 1, 1998, and shall
give Tenant possession of the North Section of the Premises on October 1, 1998.
(i) Late Delivery of the South Section.
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(a) Adjustment of Abatement Period. In the event that Landlord
gives Tenant possession of the South Section after August 1, 1998: i)
no Rent shall be due prior to such possession date; ii) all of
Tenant's obligations which arise or accrue during the Term of the
Lease (including, without limitation, any and all obligations under
Article VIII of the Lease) shall be suspended until such possession is
given; and iii) the Abatement Period for Rent (as defined in Section
5.3 hereof) shall begin on the date that Landlord gives possession of
the South Section to Tenant. For example, if Landlord gives possession
of the South Section to Tenant on August 15, 1998, the Abatement
Period will be adjusted to begin August 15, 1998 and end October 14,
1998, and Tenant will be obligated to pay Rent for the partial month
of October 1998, beginning October 15, 1998, calculated pro rata on a
daily basis.
(b) Tenant Right of Termination. In the event that Landlord gives
Tenant possession of the South Section after October 1, 1998, Tenant
may terminate this Lease upon the giving of written notice by Tenant
to Landlord on or before October 15, 1998; provided, however, that
such notice of termination shall be without force and effect in the
event Landlord gives Tenant such possession of the South Section after
October 1, 1998 and before Landlord's receipt of such notice. Upon
receipt of such notice, this Lease shall terminate on the date of
delivery of such notice to Landlord as though the date of delivery was
the Termination Date set forth herein.
(ii) Late Delivery of the North Section. In the event that
Landlord gives Tenant possession of the North Section after October 1,
1998, Rent allocable to the North Section shall ▇▇▇▇▇ until possession of
the North Section is given to Tenant; provided, further that, in the event
that Landlord gives Tenant possession of the North Section after October
31, 1998, the portion of the Base Rent allocable to the North Section shall
▇▇▇▇▇ at a rate equal to double the daily Base Rent for the North Section
applicable to February 1999 for each day after October 31, 1998 until
possession of the North Section is given to Tenant. For example, if
possession of the North Section is given to Tenant on November 6, 1998,
Tenant shall be entitled to a Base Rent abatement equal to $5,562.90
[($556.29 x 2) x 5]. Any such rent abatement will be credited by Landlord
to Tenant against Base Rent due and payable hereunder.
Except as otherwise provided in this Section 3.1, no failure to give possession
of the Premises as agreed herein shall subject Landlord to any liability, nor
shall same affect the validity of this Lease or the obligations of Tenant
hereunder, nor shall the same be construed to extend the Term. At the option of
Landlord to be exercised within thirty (30) days of the delayed delivery of
possession to Tenant, the Lease shall be amended so that the Term shall be
extended by the period of time possession is delayed.
ARTICLE IV
CONDITION OF DEMISED PREMISES
SECTION 4.1. CONDITION OF PREMISES. Tenant agrees to accept the Premises
in an absolutely "as-is" condition, and Tenant acknowledges that Landlord, its
agents, attorneys, representatives and employees have not and do not make any
representations or warranties, express or implied, to Tenant regarding the
Premises, including, but not limited to: (i) the zoning of the Premises; (ii)
the condition of any underground, above ground or surface improvements; (iii)
the size, area, use or type of the Premises or the fitness of the Premises for
any intended or particular use; (iv) the nature of the soil on and underlying
the Premises or its suitability for development or any other use thereof; (v)
any financial information pertaining to the operation of the Premises; (vi) the
status of any requirements or obligations imposed, implied or to be undertaken
by the owner or developer of the Premises pursuant to any zoning, subdivision,
development laws or agreements with any governmental entities; or (vii) the
presence or absence of any rights of any governmental authority, or of owners
of property in the vicinity of the Premises, to obtain reimbursement, recapture
or special assessments from any owner of the Premises for all or a portion of
the cost of any utilities, roads or other improvements heretofore or hereafter
located on or in the vicinity of the Premises, any and all such representations
and warranties, express or implied, being hereby expressly waived by Tenant and
disclaimed by Landlord. Tenant waives any claim that may exist for patent
defects. No promise of Landlord
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to alter, remodel, decorate, clean or improve the Premises or any portion
thereof and no representation respecting the condition of the Premises or any
portion thereof have been made by Landlord to Tenant. Notwithstanding the
foregoing, Landlord shall (i) cause the HVAC, mechanical, plumbing, fire
protection, and electrical systems to be in working order on the Commencement
Date; (ii) cooperate with Tenant to make claims under all warranties or
guaranties, if any, relating to the construction, renovation, operating systems
or any other portion of the Premises which Tenant is obligated to maintain; and
(iii) deliver the Premises to Tenant on the Commencement Date free of debris
and in compliance with the applicable local building codes; Tenant acknowledges
and agrees that such building codes shall not be deemed to include the federal
Americans with Disabilities Act, and any rules and regulations promulgated
thereunder.
The parties hereto acknowledge and agree that Landlord has repaved the
parking areas at the Premises at a cost of $22,055.00. Upon execution of this
Lease, Tenant shall pay Landlord the sum of $11,027.00 to reimburse Landlord
for one-half (1/2) of the cost of such repaving.
ARTICLE V
RENT
SECTION 5.1. BASE RENT. In consideration of the leasing aforesaid, Tenant
agrees to pay Landlord, without offset or deduction, base rent for the Initial
Term ("Base Rent"), payable monthly in advance in the amount of the Monthly
Base Rent set forth in the Base Rent Schedule commencing on the Commencement
Date and continuing on the first (1st) day of each month thereafter for the
balance of the Term of this Lease, and in addition thereto, shall pay such
charges as are herein described as "Additional Rent". The term "Rent" when
used in this Lease shall include all Base Rent payable under this Section 5.1.,
as well as the charges herein described as Additional Rent. All Rent payable
hereunder shall be payable to Landlord and Landlord's Mailing Address, or as
Landlord may otherwise from time to time designate in writing.
SECTION 5.2. INTEREST AND LATE CHARGES ON LATE PAYMENTS. Tenant
acknowledges that its late payment of any Rent will cause Landlord to incur
certain costs and expenses not contemplated under this Lease, the exact amount
of which is extremely difficult or impracticable to fix. Such costs and
expenses will include, without limitation, loss of use of money, administrative
and collection costs and processing and accounting expenses. Therefore, if any
due and unpaid installment of monthly Base Rent or any other sum due and unpaid
hereunder is not paid within five (5) business days after written notice from
Landlord to Tenant, Tenant shall immediately pay to Landlord a late charge
equal to three percent (3%) of the unpaid amount. Notwithstanding the
foregoing, once Landlord delivers three (3) such notices to Tenant within any
twelve (12) consecutive calendar months, Landlord shall not be obligated to
deliver any further notices to Tenant and the late charge shall be paid by
Tenant to Landlord if any installment of Base Rent or other sum due hereunder
is not paid within five (5) business days of the date when due. Such late
charge is in addition to any interest due as set forth below. Landlord and
Tenant agree that this late charge represents a reasonable estimate of costs
and expenses incurred by Landlord from, and is fair compensation to Landlord
for, its loss suffered, by such non- payment by Tenant. In addition to the
foregoing, Rent not paid within thirty (30) days of the date when due shall
bear interest from the date when the same is payable under the terms of this
Lease until the same shall be paid at an annual rate of interest equal to the
rate of interest announced from time to time by the Bank One ("Bank One") as
its Corporate Base Rate, plus three percent (3%), unless a lesser rate shall
then be the maximum rate permissible by law, in which event said lesser rate
shall be charged ("Lease Interest Rate"). The term "Corporate Base Rate" means
that rate of interest announced by Bank One from time to time as its "Corporate
Base Rate" of interest, changing automatically and simultaneously with each
change in the Corporate Base Rate made by Bank One from time to time. Any
publication issued or published by Bank One from time to time or a certificate
signed by an officer of Bank One stating its Corporate Base Rate as of a date
shall be conclusive evidence of the Corporate Base Rate on that date.
Acceptance of the late charge shall not constitute a waiver of Tenant's default
with respect to such non-payment by Tenant or prevent Landlord from exercising
any other rights and remedies available to Landlord under this Lease. Failure
to pay the late charge shall constitute a default under this Lease.
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SECTION 5.3. RENT ABATEMENT. Notwithstanding anything to the contrary
contained in this Article V, so long as Tenant is not in default under the
terms and conditions of this Lease as of the date any monthly installment of
Base Rent and Rent Adjustments would otherwise be due and owing during the
Abatement Period (as hereinafter defined), Tenant shall be entitled to an
abatement of Base Rent and Additional Rent for the first two (2) months of the
Initial Term (hereinafter referred to as the "Abatement Period").
ARTICLE VI
TAXES AND IMPOSITIONS
SECTION 6.1. TAXES. Subject to Section 6.3 hereof, Tenant further agrees
to pay before any fine, penalty, interest or cost may be added thereto for the
nonpayment thereof, as Additional Rent for the Premises, all Taxes (as
hereinafter defined) due and payable upon the Premises or any part thereof
during the Term of this Lease; provided, however, that such Taxes levied
against the Premises shall be prorated between Landlord and Tenant for the
first year of the Initial Term hereof as of the Commencement Date, and as of
the date of expiration of the Term of this Lease for the last year of said
Term. Tenant shall be responsible for all increases in Taxes based upon
Tenant's occupancy of the Premises. Benefit may be taken by Tenant of the
provisions of any statute or ordinance permitting any special assessment to be
paid over a period of years; provided, however, that Tenant shall pay all
installments of special assessments due during the Term hereof. Tenant shall,
in addition to the foregoing, pay any new Tax of a nature not presently in
effect but which may hereafter be levied, assessed or imposed upon Landlord or
upon the Premises, if such Tax shall be based upon or arise out of the
ownership, use or operation of the Premises; provided, however, that for the
purpose of computing Tenant's liability for such new type of Tax, the Premises
shall be deemed the only property of Landlord. As used herein, the term
"Taxes" shall mean real estate taxes, assessments, sewer rents, rates and
charges, permit and license fees, transit taxes, taxes based upon the receipt
of rent, and any other federal, state or local governmental charge, general,
special, ordinary or extraordinary, which may now or hereafter be assessed
against the Premises or any portion thereof in any year during the Term hereof,
and shall also include any personal property taxes (attributable to the year in
which paid) imposed upon the furniture, fixtures, machinery, equipment,
apparatus, systems and appurtenances used in connection with the operation of
the Premises. It is the intention of the parties hereto that this Section 6.1
shall be interpreted as requiring Tenant to be responsible for the Taxes due
and payable during the Term of the Lease, regardless of the assessment or tax
billing attributable to that period of time.
Nothing contained herein shall be construed to require Tenant to pay any
franchise, inheritance, estate, succession or transfer tax of Landlord or any
income or excess profits tax assessed upon or in respect of all income of
Landlord or chargeable to or required to be paid by Landlord unless such tax
shall be specifically levied against the rental income of Landlord derived
hereunder (as opposed to a general income tax), which tax shall be paid by
Tenant as part of Taxes hereunder provided said rental income shall be
considered as the sole income of Landlord.
SECTION 6.2. UTILITIES. Tenant shall pay, directly to the appropriate
supplier, all costs of natural gas, electricity, heat, light, power, sewer
service, telephone, water, refuse disposal and other utilities and services
supplied to the Premises. Landlord shall, at Landlord's sole cost and expense,
separately meter the Premises. Landlord shall not in any way be liable or
responsible to Tenant for any cost or damage or expense which Tenant may
sustain or incur if either the quality or character of such service is changed
or is no longer available or suitable for Tenant's requirements.
SECTION 6.3. DEPOSITS. As security for the obligations contained in
Sections 6.1. and 10.3. hereof, Tenant shall deposit monthly with Landlord, or
such other entity as Landlord may designate, on the first (1st) day of each and
every month of the Term, a sum equal to one twelfth (1/12) of Landlord's
estimate of the current amount of Taxes levied with respect to the Premises and
Insurance Premiums (as hereinafter defined). All monthly deposits need not be
kept separate and apart by Landlord and shall be held by Landlord
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in such account or accounts as may be authorized by the then current state or
federal banking laws, rules or regulations. Provided that no default of Tenant
exists hereunder, Landlord shall use the monthly deposits as a fund to be
applied, to the extent thereof, to the payment of Taxes and Insurance Premiums
(as hereinafter defined) as the same become due and payable. The existence of
said fund shall not limit or alter Tenant's obligation to pay the Taxes and
Insurance Premiums (as hereinafter defined) for which the fund was created.
Tenant shall not be entitled to interest on said fund. Tenant shall pay
Landlord as its monthly deposit, for the period commencing on the Commencement
Date and terminating on the December 31st immediately thereafter, the Initial
Deposit. On or prior to each December 31st occurring within the Term, Landlord
shall advise Tenant as to Landlord's estimate of the monthly deposits that will
be required for the next Lease Year (as hereinafter defined) and, upon receipt
of a notice of increase in assessment, Landlord may require an immediate
adjustment in the amount of the deposits for Taxes. Deposits for Taxes due and
payable by Tenant under this Section 6.3 during 1998 shall be applied to
Tenant's obligation for Taxes due and payable during 1998, as prorated as of
October 1, 1998. Deposits for Taxes due and payable by Tenant during 1999 shall
be applied to Tenant's obligation for Taxes due and payable in 1999, and so on,
with respect to the remaining years of the Lease Term.
SECTION 6.4. ADJUSTMENT STATEMENT. As soon as reasonably feasible after
the expiration of each calendar year contained within the Term ("Lease Year"),
Landlord will furnish Tenant a statement ("Adjustment Statement") showing the
following:
(i) Actual Taxes and Insurance Premiums (as hereinafter defined) for
the Lease Year last ended and the amount of Taxes and Insurance Premiums
(as hereinafter defined) payable by Tenant for such Lease Year;
(ii) The amount of Additional Rent due Landlord for the Lease Year
last ended, less credits for monthly deposits paid, if any; and
(iii) The monthly deposits due in the current Lease Year.
SECTION 6.5. PAYMENTS. Within thirty (30) days after Tenant's receipt of
each Adjustment Statement, Tenant shall pay to Landlord:
(i) The amount of Additional Rent shown on said Adjustment Statement
to be due Landlord for the Lease Year last ended; plus
(ii) The amount, which when added to the monthly deposits theretofore
paid in the current Lease Year would provide that Landlord has then
received such portion of the monthly deposits as would have theretofore
been paid to Landlord had Tenant paid one twelfth (1/12) of the monthly
deposits, for the current Lease Year, to Landlord monthly on the first day
of each month of such Lease Year.
During the last Lease Year, Landlord may include in the monthly deposits its
estimate of the Additional Rent which may not be finally determined until after
the expiration of the Term. Tenant's obligation to pay such Additional Rent
shall survive the Term.
SECTION 6.6. PAYMENT ADJUSTMENTS. Tenant's payment of the monthly deposits
for each Lease Year shall be credited against the Additional Rent for such
Lease Year. If the monthly deposits paid by Tenant for any Lease Year exceed
the Additional Rent due for such Lease Year, then Landlord shall give a credit
to Tenant in an amount equal to such excess against the Additional Rent due for
the next succeeding Lease Year, except that if any such excess relates to the
last Lease Year of the Term, then, provided that no default of Tenant exists
hereunder, Landlord shall refund such excess to Tenant.
SECTION 6.7. RIGHT TO PAY. Landlord shall, at its option, have the right,
without notice to Tenant, at all times during the Term to pay any such Taxes
not timely paid by Tenant, and the amounts so paid,
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including reasonable expenses, shall be so much Additional Rent due at the next
rent day after any such payments, with interest at the Lease Interest Rate from
the date of payment thereof.
SECTION 6.8. LANDLORD'S CONTEST OF TAXES. To the extent Landlord desires,
in Landlord's reasonable business judgment, to contest the imposition of any
Taxes against the Land and Improvements, Landlord shall proceed with such
protest in accordance with applicable law. Tenant agrees Taxes shall include
all of Landlord's reasonable costs and expenses, including reasonable legal
fees and court costs, in pursuing any such contest whether or not Landlord is
successful in such contest. If Landlord elects not to so contest Taxes, Tenant
may do so in Landlord's name and Landlord shall provide reasonable cooperation
in connection with such contest. There shall be deducted from Taxes the amount
of any Taxes refunded in any Lease Year, provided said refund relates to an
assessment year included within the Term of the Lease.
ARTICLE VII
USE
SECTION 7.1. USE. The Premises shall be used for the Use only, and for no
other purpose.
SECTION 7.2. PROHIBITED USES. Tenant shall not permit the Premises, or any
portion thereof, to be used in such manner which impairs Landlord's right,
title or interest in the Premises or any portion thereof, or in such manner
which gives rise to a claim or claims of adverse possession or of a dedication
of the Premises, or any portion thereof, for public use. Tenant shall not use
or occupy the Premises or permit the Premises to be used or occupied contrary
to any statute, rule, order, ordinance, requirement, regulation or restrictive
covenant applicable thereto or in any manner which would violate any
certificate of occupancy affecting the same or which would render the insurance
thereon void or the insurance risk more hazardous, or which would cause
structural injury to the Improvements or cause the value or usefulness of the
Premises or any part thereof to diminish or which would constitute a public or
private nuisance or waste, and Tenant agrees that it will, promptly upon
discovery of any such use, immediately notify Landlord and take all necessary
steps to compel the discontinuance of such use.
ARTICLE VIII
MAINTENANCE, REPAIR AND REPLACEMENTS OF PREMISES
SECTION 8.1. MAINTENANCE OBLIGATIONS.
A. TENANT'S MAINTENANCE. Tenant agrees, at Tenant's sole cost and
expense, to take good care of the Premises, including the Improvements, and
keep same and all parts thereof, together with any and all alterations and
additions thereto, in good order, condition and repair, suffering no waste or
injury. Subject to Subsections 8.1(B) and 8.1(C), Tenant shall, at its sole
cost and expense, promptly make all necessary repairs and replacements,
foreseen as well as unforeseen, in and to any Improvements or equipment now or
hereafter located upon the Land, including, without limitation, the entire
interior and exterior of the Improvements, sidewalks, parking areas, railroad
tracks (if any), water, sewer, gas and electricity connections, pipes, mains
and all other fixtures, machinery, apparatus, equipment and appurtenances now
or hereafter belonging to, connected with or used in conjunction with the
Premises. All such repairs and replacements shall be of first-class quality
and sufficient for the proper maintenance and operation of the Premises.
Tenant shall keep and maintain the Premises, including the Improvements and all
sidewalks, vault space, parking areas and areas adjacent thereto, safe, secure
and clean, specifically including, but not by way of limitation, snow and ice
clearance, landscaping and removal of waste and refuse matter. Tenant shall
not permit anything to be done upon the Premises (and shall perform all
maintenance and repairs thereto so as not) to invalidate, in whole or in part,
or prevent the procurement of any insurance policies which may, at any time, be
required under the provisions of this Lease. Tenant shall not obstruct or
permit the obstruction of any parking area, adjoining street or sidewalk.
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B. STRUCTURAL COMPONENTS. Subject to the provisions of Articles X and
XIII hereof, Landlord shall make, or cause to be made, all repairs and
necessary replacements to the "structural components" (as hereinafter defined)
of the Premises. For purposes of this Lease, the phrase "structural
components" shall mean the exterior roof, exterior face of the exterior walls
(excluding windows, window frames, doors and door frames) and foundation of the
Premises. The cost of such structural repairs and replacements shall be the
sole responsibility of Landlord except to the extent such costs arise as a
result of any act or omission of Tenant or any person, firm or entity claiming
by, through or under any of them, in which event, except as otherwise expressly
provided in this Lease, the cost therefor shall be paid by Tenant as Additional
Rent within five (5) days after Landlord bills Tenant therefor from time to
time.
C. HVAC SYSTEM REPAIRS AND REPLACEMENTS. Notwithstanding anything hereof
to the contrary, Tenant shall, at Tenant's sole cost and expense, maintain and
make, or cause to be made, all necessary repairs to the HVAC system serving the
Premises (the "HVAC System"), and Landlord shall make, or cause to be made, at
Landlord's cost and expense, all necessary replacements (as opposed to
maintenance and repairs) to the HVAC System; provided, however, that (i)
Landlord shall be responsible for all replacements of the HVAC System for the
period beginning with the Commencement Date and ending on the first (1st)
anniversary date of the delivery of the South Section of the Premises to
Tenant, and (ii) with respect to any replacements necessitated thereafter,
Tenant shall reimburse Landlord for the cost of any such replacements to the
HVAC System (the "HVAC Cost") at the time such replacement is made by paying to
Landlord the HVAC Cost multiplied by a fraction, the numerator of which is the
number of years remaining in the Initial Term rounded to the nearest tenth
(10th) of a year (e.g., 2.4 years), and the denominator of which is fifteen
(15), which the parties conclusively presume to be the useful life (in years)
of any such replacements or replacement part; provided that, if Tenant
exercises any option to renew or extend the Lease, or if the Lease is extended
past its Termination Date by other agreement, Tenant shall make an additional
reimbursing payment to Landlord upon the earlier to occur of Tenant's exercise
of such option to renew or the commencement of the renewed or extended Term,
which payment shall be calculated by multiplying the HVAC Cost by a fraction,
the numerator of which is the duration of the extended Lease Term, (i.e., five
(5) years if the extension takes place pursuant to Section 34.1), and the
denominator of which is fifteen (15); it being the intention of the parties
hereto that Tenant shall reimburse Landlord for such replacements only to the
extent of the benefit received by Tenant relative to the replacements' useful
life.
SECTION 8.2. GOVERNMENTAL REQUIREMENTS. Tenant, at its own cost and
expense, shall promptly comply with any and all governmental requirement to or
affecting the Premises or any part thereof, irrespective of the nature of the
work required to be done, extraordinary as well as ordinary, whether or not the
same involve or require any structural changes or additions in or to the
Improvements provided that such changes or additions be required in relation to
Tenant's use, occupancy or alteration of the Premises. Included in the
obligations set forth above, but not in limitation thereof, Tenant, at its own
cost and expense shall promptly comply with OSHA regulations relating to
overhead cranes, CFR 1910-179(j)(2) and 184(d), CFR 1910-179(j)(3), CFR
1910-179(e)(1) through (4) and CFR 1910-179(b)(5).
SECTION 8.3. TENANT'S RESPONSIBILITIES. Landlord shall not be required to
furnish any services or facilities whatsoever to the Premises. Tenant hereby
assumes full and sole responsibility for condition, operation, repair,
alteration, improvement, replacement, maintenance and management of the
Premises. Landlord shall not be responsible for any loss or damage to the
person or property of Tenant, any guests or invitees, any persons using or
working on the Premises, or any persons claiming by, through or under, or any
agents, employees, heirs, legal representatives, successors or assigns of, any
of the foregoing, other than loss or damage caused by Landlord's negligence or
willful misconduct.
SECTION 8.4. MAINTENANCE CONTRACT. At Landlord's option, Tenant shall
enter into a maintenance contract, in form and substance and with a firm
reasonably satisfactory to Landlord, for the maintenance of the Improvements or
portions thereof as designated by Landlord.
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ARTICLE 9
TENANT'S INSURANCE
SECTION 9.1. COVERAGE REQUIRED. Tenant shall procure and maintain, or
cause to be maintained, at all times during the term of this Lease, at Tenant's
sole cost and expense, and until each and every obligation of Tenant contained
in the Lease has been fully performed, the types of insurance specified below,
with insurance companies authorized to do business in the State of Illinois
covering all operations under this Lease, whether performed by Tenant or by
Contractors. For purposes of this Article IX, "Contractors" shall mean Tenant
and contractors and subcontractors and materialmen or any tier providing
services, material, labor, operation or maintenance on, about or adjacent to
the Premises, whether or not in privity with Tenant.
A. IN GENERAL. Upon execution of the Lease, Tenant shall procure and
maintain the following kinds and amounts of insurance:
(i) WORKER'S COMPENSATION AND OCCUPATIONAL DISEASE INSURANCE.
Worker's Compensation and Occupational Disease Insurance, in statutory
amounts, covering all employees who provide a service under this
Lease. Employer's liability coverage with limits of not less than
$100,000 each accident or illness shall be included.
(ii) COMMERCIAL LIABILITY INSURANCE (PRIMARY AND UMBRELLA).
Commercial Liability Insurance or equivalent with limits of not less
than $5,000,000 per occurrence, combined single limit, for bodily
injury, personal injury, and property damage liability.
Products/completed operation, independent contractors, broad form
property damage and contractual liability (with no limitation)
coverages are to be included. Landlord is to be named as additional
insureds, on a primary, non-contributory basis for any liability,
arising directly or indirectly from this Lease.
(iii) CONTENTS INSURANCE. Insurance against fire, sprinkler
leakage, vandalism, and the extended coverage perils for the full
insurable value of all contents of Tenant within the Premises, and of
all office furniture, trade fixtures, office equipment, merchandise
and all other items of Tenant's property on the Premises and business
interruption insurance.
B. CONSTRUCTION. During any construction (other than with respect to
the construction of the Initial Improvements by Landlord, but including
improvements, betterments or repairs), Tenant shall procure and maintain,
or cause to be maintained, the following kinds and amounts of insurance:
(i) WORKER'S COMPENSATION AND OCCUPATIONAL DISEASE INSURANCE.
Worker's Compensation and Occupational Disease Insurance, in statutory
amounts, covering all employees who are to provide a service under
this construction. Employer's liability coverage with limits of not
less than $500,000 for each accident or illness shall be included.
(ii) COMMERCIAL LIABILITY INSURANCE (PRIMARY AND UMBRELLA).
Commercial Liability Insurance or equivalent with limits of not less
than $5,000,000 per occurrence, combined single limit, for bodily
injury, personal injury, and property liability. Products/completed
operations, explosion, collapse, underground, independent contractors,
broad form property damage and contractual liability coverages are to
be included. Landlord is to be named as additional insureds on a
primary non-contributory basis for any liability arising directly or
indirectly from the Lease.
(iii) ALL RISK BUILDERS RISK INSURANCE. Tenant or Contractor shall
provide All Risk Blanket Builder's Risk Insurance to cover the
materials, supplies, equipment, machinery and fixtures that are or
will be part of the Premises. Coverage extensions shall include the
following: right to partial occupancy, material stored off-site and
in-transit, boiler and machinery, earthquake, flood (including surface
water backup), collapse, water damage, debris removal, faulty
workmanship or materials, testing, mechanical-electrical breakdown and
failure, deletion of freezing and temperature exclusions, business
interruption, extra expense, loss of revenue, loss of rents and loss
of use of property, as applicable, Landlord shall be named as loss
payee.
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(iv) PROFESSIONAL LIABILITY. When any architects, engineers, or
consulting firms perform work in connection with this Lease,
Professional Liability Insurance shall be maintained with limits of
$1,000,000. The policy shall have an extended reporting period of two
(2) years. When policies are renewed or replaced, the policy
retroactive date must coincide with, or precede, start of work.
Tenant shall deliver to Landlord, at least fifteen (15) days prior to the
earlier of (1) the Commencement Date of this Lease or (2) the date Tenant
takes possession of the Premises, duplicate copies of policies (or
certificates evidencing such policies) of the insurance required by this
Section 9.1; provided, however, that certificates shall not be acceptable
with respect to the insurance required under Sections 9.1.A.(iii) and
9.1.B.(vi). Such policies of insurance shall be renewed and duplicate
copies of the new policies (or new certificates) shall be deposited with
Landlord at least forty-five (45) days prior to the expiration of the old
policies.
SECTION 9.2. POLICIES. All insurance policies shall be written with
insurance companies and shall be in form satisfactory to Landlord. All
insurance policies shall name Landlord as an additional insured and loss payee
as their respective interests may appear and shall provide that they may not be
terminated or modified without sixty (60) days' advance written notice to
Landlord. All policies shall also contain an endorsement that Landlord,
although named as additional insured, shall nevertheless be entitled to recover
for damages caused by the negligence of Tenant. The minimum limits of
insurance specified in this Section shall in no way limit or diminish Tenant's
liability under this Lease. Tenant shall furnish to Landlord, prior to the
date such insurance is first required to be carried by Tenant, and thereafter
prior to the expiration of each such policy, true and correct photocopies of
all insurance policies required under this Section, together with any
amendments and endorsements to such policies, certificates of insurance, and
such other evidence of coverages as Landlord may reasonably request, and
evidence of payment of all premiums and other expenses owed in connection
therewith. Upon Tenant's default in obtaining or delivering the policy for any
such insurance or Tenant's failure to pay the charges therefor, Landlord may,
at its option, on or after the tenth (10th) day after written notice thereof is
given to Tenant, procure or pay the charges for any such policy or policies and
the total cost and expense (including attorneys' fees) thereof shall be
immediately paid by Tenant to Landlord as Additional Rent upon receipt of a
▇▇▇▇ therefor. Within thirty (30) days after demand by Landlord that the
minimum amount of any coverage be so increased, Tenant shall furnish Landlord
with evidence of Tenant's compliance with such demand.
SECTION 9.3. SUBROGATION. Landlord and Tenant agree to have all fire and
extended coverage and material damage insurance which may be carried by either
of them endorsed with a clause providing that any release from liability of or
waiver of claim for recovery from the other party or any of the parties named
in Section 9.2 above entered into in writing by the insured thereunder prior to
any loss or damage shall not affect the validity of said policy or the right of
the insured to recover thereunder, and providing further that the insurer
waives all rights of subrogation which such insurer might have against the
other party or any of the parties named in Section 9.2 above. Without limiting
any release or waiver of liability or recovery contained in any other Section
of this Lease but rather in confirmation and furtherance thereof, Landlord and
any beneficiaries of Landlord waive all claims for recovery from Tenant, and
Tenant waives all claims for recovery from Landlord, any beneficiaries of
Landlord and the managing agent for the Premises and their respective agents,
partners and employees, for any loss or damage to any of its property insured
under valid and collectible insurance policies to the extent of any recovery
collectible under such insurance policies. Notwithstanding the foregoing or
anything contained in this Lease to the contrary, any release or any waiver of
claims shall not be operative, nor shall the foregoing endorsements be
required, in any case where the effect of such release or waiver is to
invalidate insurance coverage or invalidate the right of the insured to recover
thereunder or increase the cost thereof (provided that in the case of increased
cost the other party shall have the right, within ten (10) days following
written notice, to pay such increased cost, thereby keeping such release or
waiver in full force and effect).
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SECTION 9.4. MISCELLANEOUS INSURANCE PROVISIONS. Landlord and Tenant
further agree as follows:
A. Tenant and Contractors expressly understand and agree that any
insurance coverages and limits furnished by the Tenant and Contractors
shall in no way limit the Tenant's and Contractor's liabilities and
responsibilities specified under the Lease, or contracts executed relating
to the Premises, or by law.
B. The failure of Landlord to obtain such evidence from Tenant or
Contractors before permitting Tenant or Contractors to commence work shall
not be deemed to be a waiver by Landlord, and Tenant or contractors shall
remain under continuing obligation to maintain the insurance coverage.
C. Any and all deductibles on referenced insurance coverages shall be
borne by Tenant and Contractors.
D. Tenant expressly understands and agrees that any insurance
maintained by Landlord shall apply in excess of and not contribute with
insurance provided by the Tenant or Contractor under the Lease.
E. If Tenant or any Contractors desire additional coverage, higher
limits of liability, or other modifications for their own protection,
Tenant and such Contractors shall be responsible for the acquisition and
cost of such additional protection.
F. Tenant agrees, and shall cause each Contractor in connection with
the Premises to agree, that all insurers shall waive their rights of
subrogation against Landlord.
G. Tenant and Contractors shall not violate or permit to be violated
any of the conditions or provisions of any of the insurance policies, and
Tenant and Contractors shall so perform and satisfy or cause to be
performed and satisfied the requirements of the companies writing such
policies so that at all times companies of good standing, satisfactory to
Landlord shall be willing to write and continue such!insurance.
H. Landlord shall not be limited in the proof of any damages which
Landlord may claim against Tenant and Contractors arising out of or by
reason of Tenant's and Contractor's failure to provide and keep in force
insurance, as aforesaid, to the amount of the insurance premium or premiums
not paid or incurred by Tenant and Contractors and which would have been
payable under such insurance, but Landlord shall also be entitled to
recover as damages for such breach the uninsured amount of any loss, to the
extent of any deficiency in the insurance required by the provisions of
this Lease, and damages, costs and expenses of suit suffered or incurred by
reason of damage to, or destruction of, the Premises occurring during any
period when Tenant or Contractors shall have failed or neglected to provide
insurance as aforesaid.
I. The insurance required by this Lease, at the option of Tenant or
Contractors, may be effected by blanket or umbrella policies issued to
Tenant or Contractors covering the Premises and other properties owned or
leased by Tenant or Contractors, provided that the policies otherwise
comply with the provisions of this Lease and allocate to the Premises the
specified coverage, without possibility of reduction or coinsurance by
reason of, or damage to, any other premises covered therein.
J. All insurance companies shall have a Best rating of not less than
A/VII, or an equivalent rating in the event Best ceases to exist or provide
a rating.
K. Tenant and Contractors shall provide and keep in force such other
insurance in such amounts as may from time to time be reasonably required
by Landlord or a holder of a Mortgage (defined in Section 23.1 hereof)
against such other insurable hazards as at the time are commonly insured
against in the case of prudent owners of properties similar to the
Premises, and in that connection Landlord may require changes in the forms,
types and amounts of insurance required pursuant to this Section or add to,
modify or delete other requirements; and in any event, if under applicable
law, rule, regulation or ordinance of any governmental authority, state or
federal, having jurisdiction in the Premises, liability may be imposed upon
Landlord on account of the use or operation of the Premises or other
improvements,
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insurance within limits reasonably satisfactory to Landlord shall be
maintained by Tenant and Contractors against any such liability.
L. The required insurance to be carried shall not be limited by any
limitations expressed in the indemnification language herein or any
limitation placed on the indemnity therein given as a matter of law.
ARTICLE X
PROPERTY INSURANCE
SECTION 10.1. KINDS AND AMOUNTS. Landlord shall at all times during the
Term of this Lease keep in effect insurance on all Improvements against loss by
fire and lightning, the risks covered by what is commonly known as extended
coverage, malicious mischief and vandalism, and all other risks of direct
physical loss in an amount equal to the full replacement value on the
replacement form basis, of such Improvements. The policy or policies
evidencing such insurance shall be written by a company or companies reasonably
satisfactory to Landlord and to Landlord's mortgagee, if any, and authorized to
do business in the state where the Premises are located, shall name Landlord as
insured thereunder, and shall provide that losses shall be paid to Landlord or
its mortgagee, if applicable. At the request of Landlord, a mortgage clause
may be included in said policies covering Landlord's mortgagee, if any.
Tenant further agrees that if and when obtainable, Landlord will procure and
maintain so-called war risk and war damage insurance, earthquake and flood
insurance on the Improvements for not less than one hundred percent (100%) of
the full insurance value above foundation. Such insurance shall provide for
payment of loss thereunder to Landlord and shall, at Landlord's request,
contain a mortgage clause in favor of Landlord's mortgagee, if any. Landlord
shall also obtain (i) boiler and machinery insurance in an amount equal to the
full replacement value of the Improvements, (ii) insurance against loss of
Rents due to the occurrence of any casualty or hazard in the amount of all Base
Rent payments, taxes, assessments and insurance premiums required hereunder for
a twelve (12)-month period, (iii) liability insurance, (iv) insurance against
breakage of all plate glass in the Improvements and (v) such other insurance
reasonably required by Landlord, all in amounts and under terms customarily
carried by Landlord for similar buildings owned by it. The cost of the
insurance contemplated by this Article X shall be commercially reasonable.
SECTION 10.2. INSURANCE APPRAISALS. From time to time during the Term
hereof upon the request of Landlord, or Landlord's mortgagee, if any, Tenant
shall furnish to Landlord, at Tenant's expense, insurance appraisals,
satisfactory to Landlord, as such are regularly and ordinarily made by or for
the benefit of insurance companies, in order to determine the then replacement
value of the Improvements. Such insurance appraisals shall not be required
more frequently than once in each Lease Year during the Term hereof.
SECTION 10.3. TENANT PAYMENTS. All such insurance described in this
Article X shall be kept in full force through out the Term of this Lease, and
any amounts paid therefor by Landlord (hereinafter referred to as, the
"Insurance Premiums") shall be payable by Tenant as Additional Rent in
accordance with Sections 6.4. and 6.6. hereof.
SECTION 10.4. WAIVER OF RECOVERY. Landlord and Tenant hereby waive all
claims for recovery from the other party for any loss or damage (whether or not
such loss or damage is caused by negligence of the other party and,
notwithstanding any provision or provisions obtained in the Lease to the
contrary) to any person or property insured under valid and collectible
property insurance policies to the extent of any recovery collectible under
such insurance.
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ARTICLE XI
DAMAGE OR DESTRUCTION
SECTION 11.1. DAMAGE OR DESTRUCTION BY FIRE OR CASUALTY. In the event the
Premises are damaged by fire, explosion or other casualty, Landlord shall
diligently proceed with respect to the proposed restoration promptly after
receipt of the insurance proceeds. Landlord shall commence the repair,
restoration or rebuilding thereof and shall complete such restoration, repair
or rebuilding within twelve (12) months after the receipt of such proceeds,
subject to extension due to delay because of changes, deletions, or additions
in construction requested by Tenant, acts of Tenant, strikes, lockouts,
casualties, acts of God, war, fuel or energy shortages, material or labor
shortages, governmental regulation or control, severe weather conditions or
other causes beyond the control of Landlord ("Extension Events"). In the event
of any such casualty all insurance proceeds shall be payable to Landlord. In
no event shall Landlord be required to repair or replace any alterations or
improvements made by Tenant which are not related to the Improvements, Tenant's
Equipment or any other fixtures, furnishing and personal property of Tenant.
Tenant agrees that Tenant shall deposit with Landlord prior to the commencement
of such restoration any sums in the amount of the deductible amounts carried by
Landlord under its insurance policies. Landlord's obligation to repair,
restore or rebuild the Premises shall be limited to restoring the Premises to
substantially the condition in which the same existed prior to the casualty.
Rent and all other charges payable by Tenant hereunder shall ▇▇▇▇▇ during the
period of such repair, restoration or rebuilding to the extent that the
Improvements are not tenantable because of any damage or destruction. In the
event the casualty causes fifty percent (50%) or more of the Premises to be
untenantable during the last twelve (12) months of the Term, either party may
terminate this Lease as of the date of such casualty by providing notice to the
other within thirty (30) days after occurrence of the fire or other casualty
causing the damage, in which event, all insurance proceeds shall be paid to the
Landlord and in addition Tenant shall pay to Landlord the amount of any
deductible carried by Tenant under its insurance policies. Notwithstanding
anything contained herein to the contrary, if Landlord fails to complete such
repair, restoration or rebuilding within such twelve-month time period (subject
to Extension Events), Tenant may, at its option, terminate this Lease upon
written notice to Landlord given within ten (10) days after the expiration of
such twelve-month time period (subject to Extension Events).
ARTICLE XII
LIENS
SECTION 12.1. LIEN CLAIMS. Tenant shall not do any act which shall in any
way encumber the title of Landlord in and to the Premises, nor shall any
interest or estate of Landlord in the Premises be in any way subject to any
claim by way of lien or encumbrance, whether by operation of law or by virtue
of any express or implied contract by Tenant, and any claim to or lien upon the
Premises arising from any act or omission of Tenant shall accrue only against
the leasehold estate of Tenant and shall in all respects be subject and
subordinate to the paramount title and rights of Landlord in and to the
Premises. Tenant will not permit the Premises to become subject to any
mechanics', laborers' or materialmen's lien on account of labor or material
furnished to Tenant or claimed to have been furnished to Tenant in connection
with work of any character performed or claimed to have been performed on the
Premises by or at the direction of sufferance of Tenant; provided, however that
Tenant shall have the right to contest in good faith and with reasonable
diligence the validity of any such lien or claimed lien if Tenant shall provide
to Landlord a bond or other security or assurances reasonably satisfactory to
Landlord against the possibility of sale, foreclosure or forfeiture of the
Premises. On any final determination of the lien or claim for lien, Tenant will
immediately pay any judgment rendered, with all proper costs and charges, and
will, at its own expense, have the lien released and any judgment satisfied.
Should Tenant fail to diligently contest and pursue such lien contest, Landlord
may, at its option, use the sums so deposited to discharge any such lien and
upon the satisfaction of such lien or encumbrance Landlord shall pay all such
sums remaining on deposit to Tenant.
SECTION 12.2. LANDLORD'S RIGHT TO CURE. If Tenant shall fail to contest
the validity of any lien or claimed lien or fail to give security to Landlord
to insure payment thereof, or shall fail to prosecute such contest with
diligence, or shall fail to have the same released and satisfy any judgment
rendered thereon, then Landlord may, at its election (but shall not be so
required) remove or discharge such lien or claim for lien (with the right, in
its discretion, to settle or compromise the same), and any amounts advanced by
Landlord, including reasonable attorneys' fees, for such purposes shall be so
much additional rent due from Tenant to Landlord at the next rent date after
any such payment, with interest thereon at the Lease Interest Rate from the
date so advanced.
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ARTICLE XIII
ALTERATIONS AND IMPROVEMENTS
SECTION 13.1. ALTERATIONS. Tenant shall not at any time during the Term
of this Lease make any openings in the roof or exterior walls of the Building
or make any Tenant alteration, addition or improvement to the Premises or any
portion thereof (collectively, "Alterations") without in each instance, the
prior written consent of Landlord; provided, however, upon notice to, but
without the consent of Landlord, Tenant shall have the right to make any
Alterations where same are non-structural, do not require openings on the roof
or exterior walls of the Improvements, do not affect any Building system, and
do not exceed FIFTY THOUSAND AND NO/100 DOLLARS ($50,000.00) in the aggregate
in any twelve (12)-month period. No Alteration to the Premises for which
Landlord's consent is required shall be commenced by Tenant until Tenant has
furnished Landlord with a satisfactory certificate or certificates from an
insurance company acceptable to Landlord, evidencing workmen's compensation
coverage, and insurance coverage in amounts satisfactory to Landlord and
protecting Landlord against public liability and property damage to any person
or property, on or off the Premises, arising out of and during the making of
such alterations, additions or improvements. Any Alteration by Tenant
hereunder shall be done in a good and workmanlike manner in compliance with any
applicable governmental law, statute, ordinance or regulation. Upon completion
of any Alteration by Tenant hereunder, Tenant shall furnish Landlord with a
copy of the "as built" plans covering such construction. Tenant, at its sole
cost and expense, will make all Alterations on the Premises which may be
necessary by the act or neglect of any other person or corporation (public or
private), except Landlord, its agents, employees or contractors. Before
commencing any Alterations, involving an estimated cost of more than FIFTY
THOUSAND AND NO/100 DOLLARS ($50,000.00): (a) plans and specifications
therefor, prepared by a licensed architect, shall be submitted to and approved
by Landlord (such approval shall not be unreasonably withheld or delayed); (b)
Tenant shall furnish to Landlord an estimate of the cost of the proposed work,
certified by the architect who prepared such plans and specifications; (c) all
contracts for any proposed work shall be submitted to and approved by Landlord;
and (d) Tenant shall either furnish to Landlord a bond in form and substance
satisfactory to Landlord, or such other security reasonably satisfactory to
Landlord to insure payment for the completion of all work free and clear of
liens. Tenant further agrees that all contractors engaging in any construction
activity by and for the benefit of Tenant for which Landlord's consent shall be
required shall obtain comprehensive/commercial general liability, worker's
compensation and such other liability insurance in such amounts as may be
reasonably required by Landlord naming the Landlord as an additional insured
and providing liability coverage during all phases of construction including,
without limitation: (a) contractor's and owners protection; (b) blanket
contractual liability coverage; (c) broad form property damage insurance; (d)
statutory worker's compensation coverage and employer's liability coverage; (e)
coverage under the structural work act of the State of Illinois; and (f)
environmental liability, if applicable. Before commencing any Alteration,
Tenant shall provide Landlord with a written certification that the Alteration
does not have any environmental impact on the Premises. Prior to the
commencement of any construction activity for which Landlord's consent shall be
required, certificates of such insurance coverages (and original policies with
respect to environmental liability insurance) shall be provided to Landlord.
SECTION 13.2. OWNERSHIP OF ALTERATIONS. All Alterations (except Tenant's
Equipment, as defined in Section 21.2 hereof), put in at the expense of Tenant
shall become the property of Landlord and shall, unless the Landlord requests
their removal, remain upon and be surrendered with the Premises as a part
thereof at the termination of this Lease, without compensation or allowance to
Tenant. Landlord may, at its sole option, request that Tenant, at Tenant's
sole cost, remove any such Alterations and if Tenant shall fail to do so,
Landlord may remove the same and Tenant shall pay the cost of such removal to
Landlord upon demand. Notwithstanding the foregoing, upon Tenant's request
prior to such time as Tenant intends to make any Alteration, Landlord shall
indicate to Tenant at the time of such request whether or not such Alterations
must be removed upon surrender of the Premises.
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SECTION 13.3. SIGNS. Tenant shall not place any signs on any part of the
Premises without the prior written consent of Landlord. Notwithstanding any of
the immediately foregoing provisions of this Section 13.3, upon notice and with
the consent of Landlord, which consent shall not be unreasonably withheld,
Tenant may place a monument sign adjacent to the Premises, provided that: (i)
the installation and dimensions of said sign is in strict accordance with
applicable law, ordinances and restrictions; (ii) Tenant continually maintains
said sign in a first-class manner; and (iii) Tenant, at Tenant's sole cost and
expense, removes said sign at the expiration of the Term and restores the area
in which said sign is placed to its condition prior to the installation of said
sign.
SECTION 13.4. TENANT INDEMNITY. Tenant hereby agrees to indemnify, defend
and hold the Landlord, its beneficiaries, shareholders, partners or members and
their respective agents and employees harmless from any and all liabilities of
every kind and description which may arise out of or be connected in any way
with said Alterations. Any mechanic's lien filed against the Premises for work
claimed to have been furnished to Tenant shall be discharged of record by
Tenant within ten (10) days thereafter, at Tenant's expense. Upon completing
any Alterations, Tenant shall furnish Landlord with contractors' affidavits and
full and final waivers of lien and receipted bills covering all labor and
materials expended and used. All Alterations shall comply with all insurance
requirements and with all ordinances and regulations of any pertinent
governmental authority. All alterations and additions shall be constructed in
a good and workmanlike manner and only good grades of materials shall be used.
SECTION 13.5. ENVIRONMENTAL IMPACT. Notwithstanding any other term,
covenant or condition contained in this Lease, in the event that any Alteration
has any environmental impact on the Premises, Landlord may deny the Tenant the
right to proceed in Landlord's sole and absolute discretion.
SECTION 13.6. TENANT'S SPACE PLANNING CREDIT. Provided that: (i) the term
of this Lease has commenced; (ii) Tenant has begun paying Rent due hereunder;
(iii) Tenant is not in default hereunder: and (iv) the Tenant has taken
possession of the Premises, Landlord will pay to Tenant the sum of THIRTEEN
THOUSAND FORTY-ONE AND NO/100 DOLLARS ($13,041.00) (the "Space Planning
Credit") for fees and expenses incurred by Tenant in relation to space
improvement plans, construction documents and related services provided!to
Tenant by Tenant's architect. The Space Planning Credit will be paid upon
execution of this Lease.
ARTICLE XIV
CONDEMNATION
SECTION 14.1. TAKING: LEASE TO TERMINATE. In the event the whole of the
Premises shall be taken as a result of the exercise of the power of eminent
domain or condemned for a public or quasi-public use or purpose by any
competent authority or sold to the condemning authority under threat of
condemnation, or in the event a portion of the Premises shall be taken or sold
as a result of such event, and as a result thereof the balance of the Premises
cannot be used for the same purpose as before such taking, sale or
condemnation, then and in either of such events, the Term of this Lease shall
terminate as of the date of vesting of title pursuant to such proceeding or
sale. The total award, compensation or damages received from such proceeding
or sale (collectively, the "Award"), shall be paid to and be the property of
Landlord, whether the Award shall be made as compensation for diminution of the
value of the leasehold or the fee of the Premises or otherwise, and Tenant
hereby assigns to Landlord, all of Tenant's right, title and interest in and to
the Award. Tenant shall execute, immediately upon demand of Landlord, such
documents as may be necessary to facilitate collection by Landlord of any such
Award.
SECTION 14.2. TAKING: LEASE TO CONTINUE. In the event only a part of the
Premises shall be taken as a result of the exercise of the power of eminent
domain or condemned for a public or quasi-public use or purpose by any
competent authority or sold to the condemning authority under threat of
condemnation, and as a result thereof the balance of the Premises can be used
for the same purpose as before such taking, sale or condemnation, this Lease
shall not terminate and Landlord, at its sole cost and expense, shall, to the
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extent practical, promptly repair and restore the Premises, subject to any
Extension Events. To the extent of the taking of any Improvements the Base
Rent shall be equitably adjusted. Any Award paid as a consequence of such
taking, sale, or condemnation, shall be paid to Landlord. Any sums not so
disbursed shall be retained by Landlord. In the event of a taking of land
only, this Lease shall not terminate and Landlord shall not be obligated to
repair or restore the Premises.
SECTION 14.3 TENANT'S CLAIM. To the extent permitted by law and subject
to the rights of any lender with respect to the Premises, Tenant shall be
allowed to pursue a claim against the condemning authority (hereinafter
referred to as the "Tenant's Claim") that shall be independent of and wholly
separate from any action, suit or proceeding relating to the Award (hereinafter
referred to as the "Landlord's Proceeding") for reimbursement of relocation
expenses or for the loss of any Tenant's Equipment; provided, however: (i)
Tenant's Claim shall in no event limit, affect, alter or diminish in any kind
or way whatsoever the Award to Landlord as a result of such taking, sale or
condemnation; (ii) Tenant's Claim shall in no event include any claim for any
interest in real property, it being expressly understood and agreed that the
entire Award and other sums paid with respect to the real property interests
taken, sold or condemned shall be the sole property of Landlord pursuant to
this Article XIII; and (iii) Tenant's Claim shall in no event be joined with
Landlord's Proceeding or argued or heard concurrently therewith and if the
tribunal hearing Tenant's Claim orders such joinder, Tenant agrees to
voluntarily dismiss Tenant's Claim without prejudice until such time as
Landlord has received the Award for such taking, sale or condemnation.
ARTICLE XV
RENT ABSOLUTE
SECTION 15.1. RENT ABSOLUTE. This Lease shall be deemed and construed to
be a "net lease" and, subject to Section 8.1 hereof, Tenant agrees to pay all
costs and expenses of every kind and nature whatsoever, ordinary and
extraordinary, arising out of or in connection with the ownership, maintenance,
repair, replacement, use and occupancy of the Premises during the Term of this
Lease, which, except for the execution and delivery hereof, would otherwise
have been payable by Landlord.
ARTICLE XVI
ASSIGNMENT -- SUBLETTING BY TENANT
SECTION 16.1. NO ASSIGNMENT, SUBLETTING OR OTHER TRANSFER. Tenant shall
not assign this Lease or any interest hereunder, nor shall Tenant sublet or
permit the use or occupancy of the Premises or any part thereof by anyone other
than Tenant, without the express prior written consent of Landlord. No
assignment or subletting shall relieve Tenant of its obligations hereunder, and
Tenant shall continue to be liable as a principal and not as a guarantor or
surety, to the same extent as though no assignment or sublease had been made,
unless specifically provided to the contrary in Landlord's consent. Consent by
Landlord pursuant to this Article shall not be deemed, construed or held to be
consent to any additional assignment or subletting, but each successive act
shall require similar consent of Landlord. Landlord shall be reimbursed by
Tenant for any costs or expenses incurred pursuant to any request by Tenant for
consent to any such assignment or subletting. In the consideration of the
granting or denying of consent, Landlord may, at its option, take into
consideration: (i) the business reputation and credit worthiness of the
proposed subtenant or assignee; (ii) any required alteration of the Premises;
(iii) the intended use of the Premises by the proposed subtenant or assignee;
and (iv) any other factors which Landlord shall deem relevant. Notwithstanding
the foregoing, Tenant may assign this Lease or sublet the Premises to any
subsidiary or affiliated corporation, provided that Tenant gives Landlord at
least thirty (30) days' prior written notice of such assignment or subletting,
and further provided that Tenant shall continue to be liable as a principal
under the Lease and not as a guarantor or surety, to the same extent as though
no assignment or sublease had been made. Further, notwithstanding the
foregoing, Landlord hereby approves a sublease of a portion of the Premises to
PTS Labs, L.L.C., an Illinois limited liability company ("PTS"), provided that
Tenant shall continue to be liable as principal under the Lease and not as a
guarantor or surety, to the same extent as if such Sublease had not been made
and Tenant provides Landlord with a copy of the sublease agreement promptly
after execution.
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SECTION 16.2. OPERATION OF LAW. Tenant shall not allow or permit any
transfer of this Lease, or any interest hereunder, by operation of law, or
convey, mortgage, pledge or encumber this Lease or any interest hereunder.
SECTION 16.3. EXCESS RENTAL. If Tenant shall, with Landlord's prior
consent as herein required, sublet the Premises, an amount equal to fifty
percent (50%) of the rental in excess of the base rent and any additional rent
herein provided to be paid shall be for benefit of Landlord and shall be paid
to Landlord promptly when due under any such subletting as additional rent due
hereunder.
SECTION 16.4. MERGER OR CONSOLIDATION. If Tenant is a corporation whose
stock is not publicly traded, any trans action or series of transactions
(including, without limitation, any dissolution, merger, consolidation or other
reorganization of Tenant, or any issuance, sale, gift, transfer or redemption
of any capital stock of Tenant, whether voluntary, involuntary or by operation
of law, or any combination of any of the foregoing transactions) resulting in
the transfer of control of Tenant, other than by reason of death, shall be
deemed to be a voluntary assignment of this Lease by Tenant subject to the
provisions of this Section 16. If Tenant is a partnership, any transaction or
series of transactions (including without limitation any withdrawal or
admittance of a partner or a change in any partner's interest in Tenant,
whether voluntary, involuntary or by operation of law, or any combination of
any of the foregoing transactions) resulting in the transfer of control of
Tenant, other than by reason of death, shall be deemed to be a voluntary
assignment of this Lease by Tenant subject to the provisions of this assignment
of this Lease by Tenant subject to the provisions of this Section 16. If
Tenant is a corporation whose stock is publicly traded, a change or series of
changes in ownership of stock which would result in direct or indirect change
in ownership by the stockholders or an affiliated group of stockholders of less
than fifty percent (50%) of the outstanding stock as of the date of the
execution and delivery of this Lease shall not be considered a change of
control. Tenant may, upon notice to, but without Landlord's consent, assign
this Lease to any corporation resulting from a merger or consolidation of
Tenant, provided that: (i) the total assets of such assignee after such
consolidation or merger shall be in excess of the total assets of Tenant
immediately prior to such consolidation or merger, and (ii) the total net worth
of such assignee after such consolidation or merger shall be at least
$22,500,000.00, determined by generally accepted accounting principles, and
provided that Tenant is not at such time in default hereunder, and provided
further that such successor shall execute an instrument in writing, acceptable
to Landlord in its reasonable discretion, fully assuming all of the obligations
and liabilities imposed upon Tenant hereunder and deliver the same to Landlord.
Tenant shall provide in its notice to Landlord such information as may be
reasonably required by Landlord to determine that the requirements of this
Section 16.4 have been satisfied. As used in this Section 16.4, the term
"control" means possession of the power to vote not less than a majority
interest of any class of voting securities and partnership or limited liability
company interests or to direct or cause the direction (directly or indirectly)
of the management or policies of a corporation, or partnership or limited
liability company through the ownership of voting securities, partnership
interests or limited liability company interests, respectively.
SECTION 16.5. UNPERMITTED TRANSACTION. Any assignment, subletting, use,
occupancy, transfer or encumbrance of this Lease or the Premises without
Landlord's prior written consent shall be of no effect and shall, at the option
of Landlord, constitute a default under this Lease, subject to the exceptions
set forth in this Article XVI.
ARTICLE XVII
ANNUAL STATEMENTS
SECTION 17.1. ANNUAL STATEMENTS. Tenant agrees to furnish Landlord
annually, within ninety (90) days of the end of such fiscal year, or as soon
thereafter as they are reasonably available, a copy of its annual audited
statements, together with applicable footnotes and any other financial
information reasonably requested by Landlord (hereinafter collectively referred
to as, the "Financial Information") and agrees
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that Landlord may deliver such Financial Information to any mortgagee,
prospective mortgagee or prospective purchaser of the Premises.
ARTICLE XVIII
INDEMNITY FOR LITIGATION
SECTION 18.1. INDEMNITY FOR LITIGATION. Tenant agrees to pay, and to
indemnify and defend Landlord against, all costs and expenses (including
reasonable attorneys' fees) incurred by or imposed upon Landlord by or in
connection with any litigation to which Landlord becomes or is made a party
without fault on its part, whether commenced by or against Tenant, or any other
person or entity or that may be incurred by Landlord in enforcing any of the
covenants and agreements of this Lease with or without the institution of any
action or proceeding relating to the Premises or this Lease, or in obtaining
possession of the Premises after an Event of Default hereunder or upon
expiration or earlier termination of this Lease. The foregoing
notwithstanding, Tenant's responsibility under this Section 18.1 to pay
Landlord's costs and expenses (including reasonable attorneys' fees) shall not
extend to such costs and expenses incurred in defending an action brought by
Tenant to enforce the terms of this Lease in which there is a court
determination that Landlord failed to perform its obligations under this Lease.
The provisions of this Section 18.1 shall survive the expiration or earlier
termination of this Lease.
ARTICLE XIX
ESTOPPEL CERTIFICATES
SECTION 19.1. ESTOPPEL CERTIFICATE. Tenant agrees that on the
Commencement Date and at any time and from time to time thereafter, upon not
less than ten (10) days' prior written request by Landlord, it will execute,
acknowledge and deliver to Landlord, or Landlord's mortgagee to the extent
factually accurate, a statement in writing in the form of EXHIBIT "B" attached
hereto and by this reference incorporated herein; provided, however, Tenant
agrees to certify to any prospective purchaser or mortgagee any other
reasonable information specifically requested by such prospective purchaser or
mortgagee.
ARTICLE XX
INSPECTION OF PREMISES
SECTION 20.1. INSPECTIONS. Tenant agrees to permit Landlord and any
authorized representatives of Landlord, to enter the Premises at all reasonable
times on reasonable advance notice, except in the case of emergency, for the
purpose of inspecting the same. Any such inspections shall be solely for
Landlord's purposes and may not be relied upon by Tenant or any other person.
SECTION 20.2. SIGNS. Tenant agrees to permit Landlord and!any authorized
representative of Landlord to enter the Premises at all reasonable times during
business hours on reasonable advance notice to exhibit the same for the purpose
of sale, mortgage or lease, and during the final year of the Term hereof or any
extension thereof, Landlord may display on the Premises customary "For Sale" or
"For Rent" signs.
ARTICLE XXI
FIXTURES
SECTION 21.1. BUILDING FIXTURES. All improvements and all plumbing,
heating, lighting, electrical and air-conditioning fixtures and equipment, and
other articles of personal property used in the operation of the Premises (as
distinguished from operations incident to the business of Tenant), whether or
not attached or affixed to the Premises ("Building Fixtures"), shall be and
remain a part of the Premises and shall constitute the property of Landlord.
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SECTION 21.2. TENANT'S EQUIPMENT. All of Tenant's trade fixtures and all
personal property, fixtures, apparatus, machinery and equipment now or
hereafter located upon the Premises, other than Building Fixtures, as shall be
and remain the personal property of Tenant, and the same are herein referred to
as "Tenant's Equipment."
SECTION 21.3. REMOVAL OF TENANT'S EQUIPMENT. Tenant's Equipment may be
removed from time to time by Tenant; provided, however, that if such removal
shall injure or damage the Premises, Tenant shall repair the damage and place
the Premises in the same condition as it would have been if such Tenant's
Equipment had not been installed.
ARTICLE XXII
DEFAULT
SECTION 22.1. EVENTS OF DEFAULT. Tenant agrees that any one or more of
the following events shall be considered "Events of Default" as said term is
used herein:
(a) If an order, judgment or decree shall be entered by any court
adjudicating Tenant a bankrupt or insolvent, or approving a petition
seeking reorganization of Tenant or appointing a receiver, trustee or
liquidator of Tenant, or of all or a substantial part!of its assets, and
such order, judgment or decree shall continue unstayed and in effect for
any period of sixty (60) days; or
(b) Tenant shall file an answer admitting the material allegations of
a petition filed against Tenant in any bankruptcy, reorganization or
insolvency proceeding or under any laws relating to the relief of debtors,
readjustment or indebtedness, reorganization, arrangements, composition or
extension; or
(c) Tenant shall make any assignment for the benefit of creditors or
shall apply for or consent to the appointment of a receiver, trustee or
liquidator of Tenant, or any of the assets of Tenant; or
(d) Tenant shall file a voluntary petition in bankruptcy, or shall
admit in writing its inability to pay its debts as they come due, or shall
file a petition or an answer seeking reorganization or arrangement with
creditors or take advantage of any insolvency law; or
(e) A decree or order appointing a receiver of the property of Tenant
shall be made and such decree or order shall not have been vacated within
sixty (60) days from the date of entry or granting thereof; or
(f) Tenant shall abandon the Premises during the Term hereof; or
(g) Tenant shall default in making any payment of Rent or other
payment required to be made by Tenant hereunder and such default shall
continue for a period of ten (10) days after written notice from Landlord
to Tenant;
(h) Tenant shall repeatedly default in the timely payment of Rent in
accordance with Section 5.1 hereof or any other charges required to be paid
hereunder. For purposes of the foregoing, the occurrence of similar
defaults three (3) times within any twelve (12) consecutive calendar months
shall constitute a repeated default; or
(i) Tenant shall be in default in the performance of or compliance
with any of the agreements, terms, covenants or conditions in this Lease
other than those referred to in the foregoing subparagraphs (a) through (h)
of this Section for a period of twenty (20) days after notice from Landlord
to Tenant specifying the items in default, or in the case of a default
which cannot, with due diligence, be cured within said twenty (20)-day
period, Tenant fails to proceed within said twenty (20)-day period to cure
the same and thereafter to prosecute the curing of such default with due
diligence (it being
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intended in connection with a default not susceptible of being cured with
due diligence within said twenty (20)-day period that the time of Tenant
within which to cure the same shall be extended for such period as may be
necessary to complete the same with all due diligence).
Upon the occurrence of any one or more of such Events of Default, Landlord
may at its election terminate this Lease or terminate Tenant's right to
possession only, without terminating this Lease. Upon termination of this
Lease or of Tenant's right to possession, Tenant shall immediately surrender
possession and vacate the Premises, and deliver possession thereof to Landlord,
and Landlord or Landlord's agents may immediately or any time thereafter
without notice, re-enter the Premises and remove all persons and all or any
property therefrom, either by any suitable action or proceeding at law or
equity or by force or otherwise, without being liable in indictment,
prosecution or damages, therefor, and repossess and enjoy the Premises,
together with the right to receive all income of, and from, the Premises.
Upon termination of this Lease, Landlord shall be entitled to recover as
liquidated damages, because the parties hereto recognize that as of the date
hereof actual damages are not ascertainable and are of imprecise calculation
and not as a penalty, all Rent and other sums due and payable by Tenant through
the date of termination plus (i) an amount equal to the present value of the
Rent and other sums provided herein to be paid by Tenant for the residue of the
Term using a discount rate equal to five percent (5%) per annum, (ii) the costs
of repairing or restoring the Premises as Landlord deems necessary or
desirable, and (iii) the costs of performing any other covenants to be
performed by Tenant.
If Landlord elects to terminate Tenant's right to possession only, without
terminating this Lease, Landlord may, at Landlord's option, enter into the
Premises, remove Tenant's signs and other evidences of tenancy, and take and
hold possession thereof as hereinabove provided, without such entry and
possession terminating this Lease or releasing Tenant, in whole or in part,
from Tenant's obligations to pay the Rent hereunder for the full Term or from
any other obligations of Tenant under this Lease. Landlord shall use
commercially reasonably efforts to relet all or any part of!the Premises for
such rent and upon terms as are commercially reasonable (including the right to
relet the Premises for a term greater or lesser than that remaining of the Term
of premises and the right to relet the Premises as a part of a larger area, the
right to change the character or use made of the Premises and the right to
grant concessions of free rent). For the purpose of such reletting, Landlord
may decorate or make any repairs, changes, alterations, or additions in or to
the Premises that may be necessary or desirable. If Landlord is unable to
relet the Premises after using such commercially reasonably efforts to do so,
Landlord shall have the right to terminate this Lease, in which event, Tenant
shall pay to Landlord liquidated damages (because the parties hereto recognize
that as of the date hereof actual damages are not ascertainable and are of
imprecise calculation and not as a penalty) equal to the present value of the
Rent and other sums provided herein to be paid by Tenant for the remainder of
the Term. If the Premises are relet and sufficient sums shall not be realized
from such reletting after payment of all expenses of such decorations, repairs,
changes, alterations, additions and the expenses of repossession and such
reletting, and the collection of the Rent herein provided and other payments
required to be made by Tenant under the provisions of this Lease for the
remainder of the Term of this Lease then, in such event, Tenant shall pay to
Landlord on demand any such deficiency and Tenant agrees that Landlord may file
suit to recover any sums falling due under the terms of this Section from time
to time, and all costs and expenses of Landlord, including attorneys' fees,
incurred in connection with any such suit shall be paid by Tenant.
SECTION 22.2. WAIVERS. Tenant, for and on behalf of itself and all
persons claiming through or under Tenant, waives any and all rights of
redemption or re-entry or repossession in case Tenant shall be dispossessed by
a judgment or by warrant of any court or judge or in case of re-entry or
repossession by Landlord or in case of any expiration or termination of this
Lease. The terms "enter," "re-enter," "entry" or "re-entry" as used in this
Lease are not restricted to their technical legal meanings.
SECTION 22.3. BANKRUPTCY. If Landlord shall not be permitted to terminate
this Lease, as provided in this Article XXII because of the provisions of the
United States Code relating to Bankruptcy, as amended (the "Bankruptcy Code"),
then Tenant as a debtor-in-possession or any trustee for Tenant agrees
promptly,
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within no more than sixty (60) days after the filing of the bankruptcy
petition, to assume or reject this Lease. In such event, Tenant or any trustee
for Tenant may only assume this Lease if: (a) it cures or provides adequate
assurances that the trustee will!promptly cure any default hereunder; (b)
compensates or provides adequate assurance that Tenant will promptly compensate
Landlord of any actual pecuniary loss to Landlord resulting from Tenant's
default; and (c) provides adequate assurance of performance during the fully
stated term hereof of all of the terms, covenants, and provisions of this Lease
to be performed by Tenant. In no event after the assumption of this Lease
shall any then-existing default remain uncured for a period in excess of the
earlier of ten (10) days or the time period set forth herein. Adequate
assurance of performance of this Lease, as set forth hereinabove, shall
include, without limitation, adequate assurance: (i) of the source of rent
reserved hereunder; and (ii) that the assumption of this Lease will not breach
any provision hereunder.
If Tenant assumes this Lease and proposes to assign the same pursuant to
the provisions of the Bankruptcy Code to any person or entity who shall have
made a bona fide offer to accept an assignment of this Lease on terms
acceptable to Tenant, then notice of such proposed assignment, setting forth:
(i) the name and address of such person; (ii) all of the terms and conditions
of such offer, and (iii) the adequate assurance to be provided Landlord to
assure such person's future performance under the Lease, including, without
limitation, the assurance referred to in Section 365(b)(3) of the Bankruptcy
Code, shall be given to Landlord by the Tenant no later than twenty (20) days
after receipt by the Tenant but in any event no later than ten (10) days prior
to the date that the Tenant shall make application to a court of competent
jurisdiction for authority and approval to enter into such assignment and
assumption, and Landlord shall thereupon have the prior right and option, to be
exercised by notice to the Tenant given at any time prior to the effective date
of such proposed assignment, to accept an assignment of this Lease upon the
same terms and conditions and for the same consideration, if any, as the bona
fide offer made by such person, less any brokerage commissions which may be
payable out of the consideration to be paid by such person for the assignment
of this Lease.
If this Lease is assigned to any person or entity pursuant to the
provisions of the Bankruptcy Code any and all monies or other considerations
payable or otherwise to be delivered to Landlord, shall be and remain the
exclusive property of Landlord and shall not constitute property of Tenant or
of the estate of the Tenant within the meaning of the Bankruptcy Code. Any and
all monies or other considerations constituting the Landlord's property under
the preceding sentence not paid or delivered to the Landlord shall be held in
trust for the benefit of Landlord and shall be promptly paid to the Landlord.
Any person or entity to which this Lease is assigned pursuant to the
provisions of the Bankruptcy Code shall be conclusively deemed without further
act or deed to have!assumed all of the obligations arising under this Lease on
and after the date of such assignment. Any such assignee shall upon demand
execute and deliver to Landlord an instrument confirming such assumption. Any
such assignee shall be permitted to use the Leased Premises only for the Use.
Nothing contained in this Section shall, in any way, constitute a waiver of
the provisions of Article XVI of this Lease relating to alienation. Tenant
shall not, by virtue of this section, have any further rights relating to
assignment other than those granted in the Bankruptcy Code. Notwithstanding
anything in this Lease to the contrary, all amounts payable by Tenant to or on
behalf of Landlord under this Lease, whether or not expressly denominated as
rent, shall constitute rent for the purpose of Section 501(b)(6) or any
successive section of the Bankruptcy Code.
SECTION 22.4. LANDLORD'S DEFAULT. If Landlord shall be in default in the
performance of or compliance with any of the agreements, terms, covenants or
conditions in this Lease for a period of thirty (30) days after notice from
Tenant to Landlord specifying the items in default, or in the case of a default
which cannot, with due diligence, be cured within said thirty (30)-day period,
Landlord fails to proceed within said thirty (30)-day period to cure the same
and thereafter to prosecute the curing of such default with due diligence (it
being intended in connection with a default not susceptible of being cured with
due diligence within said thirty (30)-day period that the time of Landlord
within which to cure the same shall be
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extended for such period as may be necessary to complete the same with all due
diligence), then Tenant may, at its option )but shall not be required to) do
the same or cause the same to be done, the amounts paid and expenses incurred
by tenant in connection therewith shall be due and payable by Landlord to
Tenant within thirty (30) days after demand therefor from Tenant.
ARTICLE XXIII
LANDLORD'S PERFORMANCE OF TENANT'S COVENANTS
SECTION 23.1. LANDLORD'S RIGHT TO PERFORM TENANT'S OBLIGATIONS. In the
event Tenant shall fail to maintain any insurance required to be paid by it
under the terms hereof, or in an Emergency Situation or upon occurrence of an
Event of Default, Landlord may (but shall not be obligated so to do), and
without waiving or releasing Tenant from any obligation of Tenant hereunder,
make any payment or perform any other act which Tenant is obligated to make or
perform under this Lease in such manner and to such extent as Landlord may deem
desirable; and in so doing Landlord shall also have the right to enter upon the
Premises for any purpose reasonably necessary in connection therewith and to
pay or incur any other necessary and incidental costs and expenses, including
reasonable attorneys' fees. !All sums so paid and all liabilities so incurred
by Landlord, together with interest thereon at the rate per annum which is the
lesser of (i) the Lease Interest Rate or (ii) the highest rate permitted by law
shall be deemed Additional Rent hereunder and shall be payable to Landlord upon
demand as Additional Rent. Landlord shall use reasonable efforts to give prior
notice (which may be oral) of its performance, if reasonably feasible under the
circumstances. The performance!of any such obligation by Landlord shall not
constitute a waiver of Tenant's default in failing to perform the same.
Inaction of Landlord shall never be considered as a waiver of any right
accruing to it pursuant to this Lease. Landlord, in making any payment hereby
authorized: (a) relating to Taxes, may do so according to any ▇▇▇▇, statement
or estimate, without inquiry into the validity of any tax, assessment, sale,
forfeiture, tax lien or title or claim thereof; (b) for the discharge,
compromise or settlement of any lien, may do so without inquiry as to the
validity or amount of any claim for lien which may be asserted; or (c) in
connection with the completion of construction of improvements to the Premises
or the repair, maintenance or the payment of operating costs thereof, may do so
in such amounts and to such persons as Landlord reasonably may deem
appropriate. Nothing contained herein shall be construed to require Landlord
to advance monies for any purpose. Landlord shall not in any event be liable
for inconvenience, annoyance, disturbance, loss of business or other damage of
Tenant or any other occupant of the Premises or any part thereof, by reason of
making repairs or the performance of any work on the Premises or on account of
bringing materials, supplies and equipment into or through the Premises during
the course thereof and the obligations of Tenant under this Lease shall not
thereby be affected in any manner. In doing so, however, Landlord shall use
reasonable efforts not to interfere with the normal operation of the Premises.
The term "EMERGENCY SITUATION" shall mean a situation which has caused or is
likely to cause bodily injury to persons, contamination of or physical damage
to the Premises or adjoining property or economic liability or criminal
jeopardy to Landlord.
ARTICLE XXIV
EXERCISE OF REMEDIES
SECTION 24.1. CUMULATIVE REMEDIES. No remedy contained herein or
otherwise conferred upon or reserved to Landlord, shall be considered exclusive
of any other remedy, but the same shall be cumulative and shall be in addition
to every other remedy given herein, now or hereafter existing at law or in
equity or by statute, and every power and remedy given by this Lease to
Landlord may be exercised from time to time and as often as occasion may arise
or as may be deemed expedient. No delay or omission of Landlord to exercise
any right or power arising from any default shall impair any such right or
power or shall be construed to be a waiver of any such default or an
acquiescence therein.
SECTION 24.2. NO WAIVER. No waiver of any breach of any of the covenants
of this Lease shall be construed, taken or held to be a waiver of any other
breach, or a waiver, acquiescence in or consent to any further
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or succeeding breach of the same covenant. The acceptance by Landlord of any
payment of Rent or other sums payable hereunder after the termination by
Landlord of this Lease or of Tenant's right to possession hereunder shall not,
in the absence of agreement in writing to the contrary by Landlord, be deemed
to restore this Lease or Tenant's right to possession hereunder, as the case
may be, but shall be construed as a payment on account and not in satisfaction
of damages due from Tenant to Landlord. Receipt of Rent by Landlord, with
knowledge of any breach of this Lease by Tenant or of any default by Tenant in
the observance or performance of any of the conditions or covenants of this
Lease, shall not be deemed to be a waiver of any provision of this Lease.
SECTION 24.3. EQUITABLE RELIEF. In the event of any breach or threatened
breach by Tenant of any of the agreements, terms, covenants or conditions
contained in this Lease, Landlord shall be entitled to enjoin such breach or
threatened breach and shall have the right to invoke any right and remedy
allowed at law or in equity or by statute or otherwise as though re-entry,
summary proceedings, and other remedies were not provided for in this Lease.
ARTICLE XXV
SUBORDINATION TO MORTGAGES
SECTION 25.1. SUBORDINATION. Landlord may execute and deliver a mortgage
or trust deed in the nature of a mortgage (both sometimes hereinafter referred
to as "Mortgage") against the Premises or any portion thereof. This Lease and
the rights of Tenant hereunder, shall automatically, and without the
requirement of the execution of any further documents, be and are hereby made
expressly subject and subordinate at all times to the lien of any Mortgage now
or hereafter encumbering any portion of the Improvements, and to all advances
made or hereafter to be made upon the security thereof; provided, however, the
holder of said Mortgage agrees in writing not to disturb the rights of Tenant
under this Lease so long as Tenant is not in default hereunder.
Notwithstanding the foregoing, Tenant agrees to execute and deliver such
instruments subordinating this Lease to the lien of any such Mortgage as may be
requested in writing by Landlord from time to time. Notwithstanding anything
to the contrary contained herein, any mortgagee under a Mortgage may, by notice
in writing to the Tenant, subordinate its Mortgage to this Lease.
SECTION 25.2. MORTGAGE PROTECTION. Tenant agrees to give the holder of
any Mortgage, by registered or certified mail, a copy of any notice of default
served upon the Landlord by Tenant, provided that prior to such notice Tenant
has received notice (by way of service on Tenant of a copy of an assignment of
rents and leases, or otherwise) of the address of such mortgagee and containing
a request therefor. Tenant further agrees that if Landlord shall have failed
to cure such default within the time provided for in this Lease, then said
mortgagee shall have an additional thirty (30) days after receipt of notice
thereof within which to cure such default or, if such default cannot be cured
within that time, then such additional time as may be necessary, if, within
such thirty (30) days, any mortgagee has commenced and is diligently pursuing
the remedies necessary to cure such default (including but not limited to
commencement of foreclosure proceedings, if necessary to effect such cure).
Such period of time shall be extended by any period within which such mortgagee
is prevented from commencing or pursuing such foreclosure proceedings by reason
of Landlord's bankruptcy. Until the time allowed as aforesaid for said
mortgagee to cure such defaults has expired without cure, Tenant shall have no
right to, and shall not, terminate this Lease on account of default. This
Lease may not be modified or amended so as to reduce the Rent or shorten the
Term, or so as to adversely affect in any other respect to any material extent
the rights of the Landlord, nor shall this Lease be cancelled or surrendered,
without the prior written consent, in each instance, of the mortgagee.
ARTICLE XXVI
INDEMNITY AND WAIVER
SECTION 26.1. INDEMNITY. Tenant shall not do or permit any act or thing
to be done or omit to do any act or thing upon the Premises which may subject
Landlord to any liability or responsibility for injury, damage
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to persons or property, or to any liability by reason of any violation of
applicable laws and shall exercise such control over the Premises so as to
fully protect Landlord against any such liability. Tenant shall defend,
indemnify and save Landlord, and any official, agent, beneficiary, contractor,
director, employee, lessor, mortgagee, officer, parent, partner, shareholder
and trustee of Landlord (each an "INDEMNIFIED PARTY") representatives,
successors and assigns harmless from and against any and all liabilities,
suits, judgments, settlements, obligations, fines, damages, penalties, claims,
costs, charges and expenses, including, without limitation, engineers',
architects' and attorneys' fees, court costs and disbursements, which may be
imposed upon or incurred by or asserted against any Indemnified Party by reason
of any of the following occurring during or after (but attributable to a period
of time falling within) the Term:
A. any demolition or razing or construction of any improvements or
any other work or thing done in, on or about the Premises or any part
thereof by Tenant or any member of the Tenant Group (defined below),
including any claim that such work constitutes "public works";
B. any use, nonuse, possession, occupation, alteration, repair,
condition, operation, maintenance or management of the Premises or any part
thereof or of any tunnel, creek, ditch, detention area, sidewalk, curb or
vault adjacent thereto by Tenant or any member of the Tenant Group;
C. any act or failure to act on the part of Tenant or any member of
the Tenant Group;
D. any accident, injury (including death) or damage to any person or
property occurring in, on or about the Premises or any part thereof or in,
on or about any tunnel, creek, ditch, detention area, sidewalk, curb or
vault adjacent thereto as a result of the act or neglect of Tenant or any
member of the Tenant Group;
E. any failure to perform or comply with any of the covenants,
agreements, terms or conditions in this Lease on Tenant's part to be
performed or complied with (other than the payment of money);
F. any lien or claim which may be alleged to have arisen against or
on the Premises, or any lien or claim which may be alleged to have arisen
out of this Lease and created or permitted to be created by Tenant or any
member of the Tenant Group against any assets of Landlord, or any liability
which may be asserted against Landlord with respect thereto;
G. any failure on the part of Tenant to keep, observe and perform any
of the terms, covenants, agreements, provisions, conditions or limitations
contained in the contracts and agreements affecting the Premises on
Tenant's part to be kept, observed or performed; and
H. any contest permitted pursuant to the provisions of this Lease.
No agreement or covenant of Tenant in this Section 26.1 shall be deemed to
exempt Landlord from, and Tenant's obligations under this Section 26.1 shall
not include liability or damages for injury to persons or damage to property
caused by or resulting from the negligence of Landlord, its agents or
employees, in the operation or maintenance of the Premises.
The obligations of Tenant under this Section 26.1 shall not be affected in
any way by the absence in any case of covering insurance or by the failure or
refusal of any insurance carrier to perform any obligation on its part
underinsurance policies affecting the Premises or any part thereof.
SECTION 26.2. WAIVER OF CLAIMS. Tenant waives all claims it may have
against Landlord and Landlord's agents for damage or injury to person or
property sustained by Tenant or any persons claiming through Tenant or by any
occupant of the Premises, or by any other person, resulting from any part of
the Premises becoming out of repair, or resulting from any accident on or about
the Premises or resulting directly or indirectly from any act or neglect of any
person. This Section 26.2. shall include, but not by way of limitation, damage
caused by water, snow, frost, steam, excessive heat or cold, sewage, gas,
odors, or noise, or caused
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by bursting or leaking pipes or plumbing fixtures, and shall apply equally
whether any such damage results from the act or neglect of Tenant or of any
other person, and whether such damage be caused or result from anything or
circumstance above mentioned or referred to, or to any other thing or
circumstance whether of a like nature or of a wholly different nature. All
Tenant's Equipment and other personal property belonging to Tenant or any
occupant of the Premises that is in or on any part of the Premises shall be
there at the risk of Tenant or of such other person only, and Landlord shall
not be liable for any damage thereto or for the theft or misappropriation
thereof. Notwithstanding the foregoing, nothing in this Section shall be
construed as a waiver by Tenant of any claims arising out of Landlord's
negligence.
SECTION 26.3. LANDLORD'S INDEMNITY. Landlord will protect, indemnify and
save Tenant, its partners, shareholders, employees, officers, directors, agents
and their respective successors and assigns harmless from and against all
liabilities, obligations, claims, damages, penalties, causes of action, costs
and expenses (including without limitation, reasonable attorneys' fees and
expenses) imposed upon, incurred by or asserted against Tenant by reason of any
accident, injury to or death of persons or loss of or damage to property
occurring on or about the Premises or any part thereof or the adjoining
properties, sidewalks, curbs, streets or ways resulting from the negligent act
or omission of Landlord or anyone claiming by, through or under Landlord.
ARTICLE XXVII
SURRENDER
SECTION 27.1. CONDITION. Upon the termination of this Lease whether by
forfeiture, lapse of time or otherwise, or upon the termination of Tenant's
right to possession of the Premises, Tenant will at once surrender and deliver
up the Premises to Landlord, broom clean, in good order, condition and repair,
reasonable wear and tear excepted. "Broom clean" means free from all debris,
dirt, rubbish, personal property of Tenant, oil, grease, tire tracks or other
substances, inside and outside of the Improvements and on the grounds
comprising the Premises. Any damage caused by removal of Tenant from the
Premises, including any damages caused by removal of Tenant's Equipment
as!defined above, shall be repaired and paid for by Tenant prior to the
expiration of the Term.
SECTION 27.2. REMOVAL OF TENANT'S EQUIPMENT. Upon the termination of this
Lease by lapse of time, or otherwise, Tenant may remove Tenant's Equipment
provided, however, that Tenant shall repair any injury or damage to the
Premises which may result from such removal. If Tenant does not remove
Tenant's Equipment from the Premises prior to the end of the Term, however
ended, Landlord may, at its option, remove the same and deliver the same to any
other place of business of Tenant or warehouse the same, and Tenant shall pay
the cost of such removal (including the repair of any injury or damage to the
Premises resulting from such removal), delivery and warehousing to Landlord on
demand, or Landlord may treat tenant's equipment as having been conveyed to
Landlord with this Lease as a ▇▇▇▇ of Sale, without further payment or credit
by Landlord to Tenant.
SECTION 27.3. HOLDOVER. If Tenant retains possession of the Premises or
any part thereof after the termination of the Term, by lapse of time and
otherwise, then Tenant shall pay to Landlord monthly rent, at one hundred fifty
percent (150%) of the rate payable for the month immediately preceding said
holding over (including increases for additional rent which Landlord may
reasonably estimate), computed on a per-month basis, for each month or part
thereof (without reduction for any such partial month) that Tenant thus remains
in possession, and in addition thereto, Tenant shall pay Landlord all damages,
consequential as well as direct, sustained by reason of Tenant's retention of
possession. The provisions of this paragraph do not exclude the Landlord's
rights of re-entry or any other right hereunder. Any such extension or renewal
shall be subject to all other terms and conditions herein contained.
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ARTICLE XXVIII
COVENANT OF QUIET ENJOYMENT
SECTION 28.1. COVENANT OF QUIET ENJOYMENT. Landlord covenants that
Tenant, on paying the Rent and all other charges payable by Tenant hereunder,
and on keeping, observing and performing all the other terms,covenants,
conditions, provisions and agreements herein contained on the part of Tenant to
be kept, observed and performed, all of which obligations of Tenant are
independent of Landlord's obligations hereunder, shall, during the Term,
peaceably and quietly have, hold and enjoy the Premises subject to the terms,
covenants, conditions, provisions and agreement hereof free from hindrance by
Landlord or any person claiming by, through or under Landlord.
ARTICLE XXIX
NO RECORDING
SECTION 29.1. SHORT FORM OF LEASE. This Lease shall not be recorded.
ARTICLE XXX
NOTICES
SECTION 30.1. NOTICES. All notices, consents, approvals to or demands
upon or by Landlord or Tenant desired or required to be given under the
provisions hereof, shall be in writing. Any notices or demands from Landlord
to Tenant shall be deemed to have been duly and sufficiently given if a copy
thereof has been personally served, forwarded by expedited messenger or
recognized overnight courier service with evidence of delivery or mailed by
United States registered or certified mail in an envelope properly stamped and
addressed to Tenant at Tenant's Mailing Address, with a copy to ▇▇▇▇▇ ▇.
▇▇▇▇▇▇, Esq., ▇▇▇▇▇▇▇ & Colmar, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or at such other address as Tenant may theretofore have
furnished by written notice to Landlord. Any notices or demands from Tenant to
Landlord shall be deemed to have been duly and sufficiently given if forwarded
by expedited messenger or recognized overnight courier service with evidence of
delivery or mailed by United States registered or certified mail in an envelope
properly stamped and addressed to Landlord at Landlord's Mailing Address, with
a copy to ▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq., Cohon, Raizes & Regal, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, or at such other address as
Landlord may theretofore have furnished by written notice to Tenant. The
effective date of such notice shall be the date of actual delivery, except that
if delivery is refused, the effective date of notice shall be the date delivery
is refused.
ARTICLE XXXI
COVENANTS RUN WITH LAND
SECTION 31.1. COVENANTS. All of the covenants, agreements, conditions and
undertakings in this Lease contained shall extend and inure to and be binding
upon the heirs, executors, administrators, successors and assigns of the
respective parties hereto, the same as if they were in every case specifically
named, and shall be construed as covenants running with the Land, and wherever
in this Lease reference is made to either of the parties hereto, it shall be
held to include and apply to, wherever applicable, the heirs, executors,
administrators, successors and assigns of such party. Nothing herein contained
shall be construed to grant or confer upon any person or persons, firm,
corporation or governmental authority, other than the parties hereto, their
heirs, executors, administrators, successors and assigns, any right, claim or
privilege by virtue of any covenant, agreement, condition or undertaking in
this Lease contained.
SECTION 31.2. RELEASE OF LANDLORD. The term "Landlord" as used in this
Lease, so far as covenants or obligations on the part of Landlord are
concerned, shall be limited to mean and include only the owner or owners at the
time in question of title to the Premises, and in the event of any transfer or
transfers of the title, Landlord herein named (and in the case of any
subsequent transfers or conveyances, the then grantor) shall be automatically
freed and relieved, from and after the date of such transfer or conveyance, of
all personal liability as respects the performance of any covenants or
obligations on the part of Landlord
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contained in this Lease thereafter to be performed; provided that any funds in
the hands of such Landlord or the then grantor at the time of such transfer, in
which Tenant has an interest, shall be turned over to the grantee.
ARTICLE XXXII
ENVIRONMENTAL MATTERS
SECTION 32.1. DEFINED TERMS.
A. The term "HAZARDOUS MATERIALS", when used herein, shall include, but
shall not be limited to, any substances, materials or wastes that are regulated
by any local governmental authority, the state where the Premises is located,
or the United States of America because of toxic, flammable, explosive,
corrosive, reactive, radioactive or other properties that may be hazardous to
human health or the environment, including without limitation, above or
underground storage tanks, flammables, explosives, radioactive materials,
radon, petroleum and petroleum products, petroleum products (other than
petroleum products that are normally contained in motor vehicles to the extent
such products are not released), urea formaldehyde foam insulation, methane,
lead-based paint, polychlorinated biphenyl compounds, hydrocarbons or like
substances and their additives or constituents, pesticides and any other
special, toxic or hazardous materials, wastes, substances or materials of any
kind, including without limitation, those now or hereafter defined, determined
or identified as "hazardous substances," "hazardous materials," "toxic
substances" or "hazardous wastes" in any Environmental Law.
B. "ENVIRONMENTAL LAW" shall mean any Federal, state or local law,
statute, ordinance, code, rule, regulation, policy, common law, license,
authorization, decision, order, injunction, which pertains to health, safety,
any Hazardous Material, or the environment (including but not limited to ground
or air or water or noise pollution or contamination, and underground or
above-ground tanks) and shall include, without limitation, the Resource
Conservation and Recovery Act ("RCRA"), 42 U.S.C. Section 6901 et seq., as
amended by the Hazardous and Solid Waste Amendments of 1984; the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C.
Section 9601 et seq. ("CERCLA"), as amended by the Superfund Amendments and
Reauthorization Act of 1986 ("▇▇▇▇"); the Hazardous Materials Transportation
Act, 49 U.S.C. Section 1801 et seq.; the Federal Water Pollution Control Act,
33 U.S.C. Section 1251 et seq.; the Clean Air Act, 42 U.S.C. Section 7401 et
seq.; the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the
Safe Drinking Water Act, 42 U.S.C. Section 300f et seq.; the Illinois
Environmental Protective Act, 415 ILCS 4/1 et seq.; the Municipal Code of the
City of Chicago; the Clean Air Act (42 U.S.C. Section 7401 et seq., "CAA"); the
Rivers and Harbors Act, (33 U.S.C. Section 401 et seq., "RHA"); the Emergency
Planning and Community Right-to-Know Act of 1986 (41 U.S.C. 11001 et seq.,
"EPCRA"), the Federal Insecticide, Fungicide and Rodenticide Act (7 U.S.C. 136
to 136y); the Oil Pollution Act of 1990 (33 U.S.C. 2701 et seq., "OPA"); and
the Occupational Safety and Health Act (29 U.S.C. 651 et seq., "OSHA"); and any
other local, state or federal environmental statutes, and all rules,
regulations, orders and decrees now or hereafter promulgated under any of the
foregoing, as any of the foregoing now exist or may be changed or amended or
come into effect in the future.
C. "ENVIRONMENTAL CLAIM" shall mean and include any demand, notice of
violation, inquiry, cause of action, proceeding or suit for damages (including
reasonable attorneys' and experts' fees), losses, injuries to person or
property, damages to natural resources, fines, penalties, interest, cost
recovery, compensation, or contribution resulting from or in any way arising in
connection with any Hazardous Material or any Environmental Law.
D. "PRE-EXISTING CONDITION" shall mean the presence of any Hazardous
Material on the Premises, to the extent such Hazardous Material was not
introduced onto the Premises after the Commencement Date.
E. "ENVIRONMENTAL CONDITION" shall mean the existence of any Hazardous
Material on the Premises other than a Pre- Existing Condition, (i) in violation
of, or requiring cleanup under, any Environmental Law
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or the provisions of this Article XXX; or (ii) which subjects Landlord to
liability for any Environmental Claim or which must be remediated to prevent
Landlord from incurring liability as a result of such Environmental Claim.
F. "ENVIRONMENTAL REMEDIATION" shall mean any investigative, cleanup,
removal, containment, remedial or other action relating to an Environmental
Condition (i) required pursuant to any Environmental Law, or (ii) necessary to
prevent Landlord from incurring, or relieve Landlord from, liability as a
result of an Environmental Claim.
G. "REMEDIATING PARTY" shall mean that party which has elected (or is
deemed to have elected) to perform any Environmental Remediation.
H. "TENANT GROUP" shall mean any of all of Tenant's agents, employees,
representatives, contractors, workmen, mechanics, suppliers, customers, guests,
licensees, invitees, sublessees, assignees and all of their respective
successors and assigns or any party claiming by, through or under any of them.
SECTION 32.2. TENANT'S COVENANTS WITH RESPECT TO ENVIRONMENTAL MATTERS.
During the Term, Tenant, at its sole cost and expense, shall:
A. comply with all Environmental Laws relating to the use and
operation of the Premises;
B. keep the Premises free of Hazardous Materials;
C. not exacerbate a Pre-Existing Condition;
D. in the case of an Environmental Condition:
(1) promptly, but not later than three (3) business days after
the discovery of an Environmental Condition, notify Landlord of the
Environmental Condition;
(2) furnish a letter of credit, personal guaranty, escrow of
funds or other security reasonably acceptable to Landlord to secure
performance of Environmental Remediation and to assure Landlord that
all necessary funds are readily available to Landlord to pay the costs
and expenses of Environmental Remediation;
(3) submit to Landlord for review and approval prior to
commencement of any Environmental Remediation, a proposed scope of
work and timetable therefor, and provide Landlord with a cost estimate
for same;
(4) diligently perform Environmental Remediation, as approved by
Landlord;
(5) submit to Landlord in a timely manner for review and comment
the documentation and information required by Sections 30.5 and 30.6
relating to each phase of the Environmental Remediation; and
(6) comply with applicable release reporting requirements and
provide Landlord with any information necessary to comply;
E. not install or operate any above or below ground tank, sump, pit,
pond, lagoon or other storage or treatment vessel or device on the Premises
without first obtaining Landlord's prior written consent;
F. not handle, use, generate, treat, dispose of or permit the use,
handling, generation, treatment, storage or disposal of any Hazardous
Materials in, on, under, around or above the Premises at any time during
the Term.
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SECTION 32.3. CONDUCT OF TENANT. If Tenant, with the prior written
authorization of Landlord, which authorization may be granted or denied by
Landlord in its sole and absolute discretion generates, uses, transports,
stores, treats or disposes of any Hazardous Materials:
A. Tenant shall, at its own cost and expense, comply with all
Environmental Laws relating to Hazardous Materials;
B. Tenant shall (i) not dispose of any Hazardous Materials in
dumpsters or trash containers or at any other location at the Premises;
(ii) not discharge any Hazardous Materials into drains or sewers; (iii) not
cause or allow the release, discharge, emission or run-off of any Hazardous
Materials to air, to surface waters, to the land, to ground water, whether
directly or indirectly; (iv) at Tenant's own cost and expense, arrange for
the lawful transportation and off-site disposal of all Hazardous Materials
generated by Tenant; (v) provide secondary containment around all Hazardous
Materials storage containers, storage facilities and above ground storage
tanks; (vi) conduct all necessary environmental inspections, such as, but
not limited to, asbestos inspections prior to any renovation or demolition,
as required by 40 CFR Part 61 and provide copies of all such reports to the
Landlord; (vii) comply with all reporting requirements under any local,
state or federal ordinance, statute or regulation, such as, but not limited
to, toxics inventory reporting under the Emergency Planning and Community
Right-to-Know Act, the provisions under 40 CFR Part 61, or various
regulations controlling the emissions into the atmosphere of volatile
organic compounds and provide copies of all such reports and notifications
to Landlord; and (viii) use only highly skilled people to address all
environmental issues associated with the leasehold, that such people and
all employees of the Tenant shall receive all required training or
certification under any local, state or federal law specifically mentioned
or alluded to in Section 32.1 of this Lease;
C. Tenant shall promptly provide Landlord with copies of all
communications, permits or agreements with any governmental authority or
agency (federal, state or local) or any private entity relating in any way
to the violation or alleged violation of any Environmental Laws or to any
violation of Tenant's obligations under subparagraph (B) above;
D. Landlord and Landlord's agents and employees shall have the right
to enter the Premises and/or conduct appropriate tests for the purpose of
ascertaining that Tenant complies with all applicable laws, rules or
permits relating in any way to the presence of Hazardous Materials on the
Premises; and
E. Upon the written request of Landlord no more frequently than once
every year, or on any other occasion in the event that Landlord has reason
to believe an environmental problem exists at the Premises, Tenant shall
provide Landlord the results of appropriate tests of air, water and soil to
demonstrate (i) that Tenant is in compliance with all applicable laws,
rules or permits relating in any way to the presence of any Hazardous
Materials on the Premises and (ii) the lack of any releases, discharges or
emissions.
If the presence, release, threat of release, placement on or in the
Premises occurs or is caused in whole or in part during the Term of this Lease,
or the generation, transportation, storage, treatment, or disposal at the
Premises or is caused in whole or in part during the Term of this Lease of any
Hazardous Materials gives rise to liability (including, but not limited to, a
response action, remedial action, or removal action) under any Environmental
Laws or common law theory, including, but not limited to nuisance, strict
liability, negligence and trespass, Tenant shall promptly take any and all
remedial and removal action necessary to clean up the Premises containing such
Hazardous Materials and mitigate exposure to liability arising from the
Hazardous Materials, whether or not required by law.
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SECTION 32.4. EXACERBATION. If Tenant exacerbates a Pre-Existing
Condition (including as a result of Tenant's investigative or remediation
activities) during the Lease term, that the provisions of this Article XXXII
shall apply to such exacerbation of the Pre-Existing Condition, and Tenant
shall perform Environmental Remediation as to such exacerbation. Tenant shall
be responsible for all fines and penalties caused by Tenant or to the extent
exacerbated by Tenant (including Tenant's environmental investigation or
remediation activities) at any time during the Lease Term.
SECTION 32.5. RIGHTS OF INSPECTION. Landlord and their respective agents
and representatives shall have a right of entry and access to the Premises at
any time in Landlord's discretion for the purposes of (i) inspection of the
documentation relating to Hazardous Materials or environmental matters
maintained by Tenant or occupant of the Premises; (ii) ascertaining the nature
of the activities being conducted on the Premises and investigating whether
Tenant is in compliance with its obligations under Article XXXII of this Lease;
and (iii) determining the type, kind and quantity of all products, materials
and substances brought onto the Premises, or made or produced thereon.
Landlord and its agents and representatives shall have the right to take
samples in quantities sufficient for analysis of all products, materials and
substances present on the Premises including, but not limited to, samples,
products, materials or substances brought onto or made or produced on the
Premises by Tenant or occupant of the Premises or their respective agents,
employees, contractors or invitees and shall also have the right to conduct
other tests and studies as may be reasonably determined by Landlord to be
appropriate in order to investigate whether Tenant is in compliance with its
obligations under Article XXXII.
SECTION 32.6. COPIES OF NOTICES. During the term of this Lease, Tenant
and Landlord shall each provide the other promptly with copies of all summons,
citations, directives, information inquiries or requests, notices of potential
responsibility, notices of violation or deficiency, orders or decrees,
Environmental Claims, complaints, investigations, judgments, letters, notices
of environmental liens or response actions in progress, and other
communications, written or oral, actual or threatened, received in the case of
Tenant, by Tenant or occupant of the Premises, or in the case of Landlord, by
Landlord, from the United States Environmental Protection Agency, Occupational
Safety and Health Administration, Illinois Environmental Protection Agency, or
other federal, state or local agency or authority, or any other entity or
individual (including both governmental and non-governmental entities and
individuals), concerning (a) any actual or alleged release of a Hazardous
Material on, to or from the Premises; (b) the imposition of any lien on the
Premises relating to any Hazardous Material; (c) any actual or alleged
violation of or responsibility under Environmental Laws; or (d) any actual or
alleged liability under any theory of common law tort or toxic tort, including
without limitation, negligence, trespass, nuisance, strict liability or
ultrahazardous activity.
SECTION 32.7. TESTS AND REPORTS.
A. Upon written request by Landlord, Tenant shall provide Landlord, at
Tenant's expense, with (i) copies of all environmental reports and tests
prepared or obtained by or for Tenant or occupant of the Premises; (ii) copies
of transportation and disposal contracts (and related manifests, schedules,
reports and other information) entered into or obtained by Tenant with respect
to any Hazardous Materials; (iii) copies of any permits issued to Tenant under
Environmental Laws with respect to the Premises; (iv) prior to filing, copies
of any and all reports, notifications and other filings to be made by Tenant or
occupant of the Premises to any federal, state or local environmental
authorities or agencies and after filing, copies of such filings; and (v) any
other applicable documents and information with respect to environmental
matters relating to the Premises. Tenant shall be obligated to provide such
documentation only to the extent within Tenant's possession or control.
B. In addition, if Landlord shall ever reasonably believe that there
exists any breach by Tenant of the terms of this Article XXXII, or if any
Environmental Claim is made or threatened, or if a default shall have occurred
under the Lease, or at Landlord's discretion, one (1) time per calendar year,
Landlord shall have the right, but not the duty, to enter upon the Premises and
conduct an environmental assessment of the
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Premises, including but not limited to a visual site inspection, review of
records pertaining to the site and interviews of Tenant's representatives or
others concerning the site use and history and other matters. The
investigation may also include reasonable subsurface or other invasive
investigation of the Premises including but not limited to soil borings and
sampling of site soil and ground or surface water for laboratory analysis, as
may be recommended by the consultant as part of its inspection of the Premises
or based upon such other reasonable evidence of Environmental Conditions
warranting such subsurface or other invasive investigation. Landlord shall
have the right, but not the duty, to retain any independent professional
consultant to conduct any such environmental assessment; provided, however,
that Landlord agrees to limit, in the absence of an Environmental Claim or
default under this Article XXXII, the number of such environmental assessments
to one (1) per calendar year for the Lease Term. Tenant will cooperate with
the Landlord's consultant and will supply to the consultant, promptly upon
request, any information reasonably requested by Landlord to facilitate the
completion of the environmental assessment. Landlord and its designees are
hereby granted access to the Premises at any time or times, upon reasonable
notice (which may be written or oral) to perform such environmental assessment.
In exercising its right, Landlord shall use its reasonable efforts to minimize
disruption of operations at the Premises. Any costs associated with
performance of the environmental assessment, including but not limited to the
consultant fees and restoration of any property damaged by such environmental
assessment, shall be paid by Landlord, unless such investigation discloses an
Environmental Condition, in which case Tenant shall pay such costs.
C. Tenant shall pay Tenant's Proportion of all costs incurred by Landlord
for consultant fees to review and comment on all reports, and other
documentation and information required by Sections 32.5 and 32.6 concerning the
work, and to monitor the performance of any Environmental Remediation performed
by Tenant.
SECTION 32.8. INDEMNIFICATION. Tenant shall reimburse, defend, indemnify
and hold Landlord and any other Indemnified Party free and harmless from and
against any and all Environmental Claims, response costs, losses, liabilities,
damages, costs and expenses, including, without limitation, loss of rental
income, loss due to business interruption, and reasonable attorneys' fees and
costs, arising out of or in any way connected with any or all of the following:
A. any Hazardous Materials (other than a Pre-Existing Condition)
which, at any time during the Term, are or were actually or allegedly
generated, stored, treated, released, disposed of or otherwise located on
or at the Premises as a result of the act or omission of Tenant or any
other member of the Tenant Group (regardless of the location at which such
Hazardous Materials are now or may in the future be located or disposed
of), including, but not limited to any and all (i) liabilities under any
common law theory of tort, nuisance, strict liability, ultrahazardous
activity, negligence or otherwise based upon, resulting from or in
connection with any Hazardous Material; (ii) obligations to take response,
cleanup or corrective action pursuant to any Environmental Laws; and (iii)
the costs and expenses of investigation or remediation in connection with
the decontamination, removal, transportation, incineration or disposal of
any of the foregoing; and
B. any actual or alleged illness, disability, injury or death of any
person, in any manner arising out of or allegedly arising out of exposure
to Hazardous Materials or other substances or conditions present at the
Premises as a result of the act or omission of any member of the Tenant
Group (including, but not limited to, ownership, operation and disposal of
any equipment which generates, creates or uses electromagnetic files,
x-rays, other forms of radiation and radioactive materials), regardless of
when any such illness, disability, injury or death shall have occurred or
been incurred or manifested itself; and
C. any actual or alleged failure of Tenant or any member of the
Tenant Group at any time and from time to time to comply with all
applicable Environmental Laws;
D. any failure by Tenant to comply with its obligations under this
Article XXXIII relating to an Environmental Condition for which Tenant is
Remediating Party;
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E. Tenant's failure to provide all information, make all submissions,
and take all steps required by all applicable governmental authorities;
F. the imposition of any lien for damages caused by, or the recovery
of any costs for, the remediation cleanup of Hazardous Material as a result
of events that took place during the Term of this Lease as a result of the
act or omission of Tenant or any member of the Tenant Group;
G. costs of removal of any and all Hazardous Material from all or any
portion of the Premises, which Hazardous Material were placed on the
Premises during the Term of this Lease as a result of the act or omission
of Tenant or any member of the Tenant Group;
H. costs incurred to comply, in connection with all or any portion of
the Premises, with all governmental regulations with respect to Hazardous
Materials on, in, under or affecting the Premises, which Hazardous
Materials were placed on the Premises during the Term of this Lease as a
result of the act or omission of Tenant or any member of the Tenant Group;
I. any spills, discharges, leaks, escapes, releases, dumping,
transportation, storage, treatment or disposal of any Hazardous Materials
which occur during the Term of this Lease, but only to the extent that such
Hazardous Materials originated from or were or are located on the Premises.
In the event Environmental Claims or other assertion of liability shall be
made against any Indemnified Party for which the Indemnified Party is entitled
to indemnity hereunder, the procedure set forth in Section 26.1 shall apply.
The obligations of Tenant under this Section 32.8 shall survive any termination
or expiration of this Lease.
SECTION 32.9. TENANT REPRESENTATIONS WITH RESPECT TO ENVIRONMENTAL
MATTERS. Tenant acknowledges that the Premises are being leased in their
present "as is" condition. Tenant further acknowledges that Landlord has made
no representation whatsoever regarding Hazardous Materials on or about the
Premises.
SECTION 32.10. LIABILITY OF LANDLORD. Landlord shall reimburse, defend,
indemnify and hold Tenant harmless from and against any and all Environmental
Claims, response costs, losses, liabilities, damages, costs and expenses,
including, without limitation, reasonable attorneys' fees and costs, arising
out of or in any way connected with any Hazardous Materials which, at any time
during the Term, are or were actually or allegedly generated, stored, treated,
released, disposed of or otherwise located on or at the Premises as a result of
the act or omission of Landlord. Subject to Tenant's obligations under this
Article XXXII, Landlord agrees that it shall be liable to remediate any
Pre-Existing Condition, to the extent required by Environmental Laws.
ARTICLE XXXIII
MISCELLANEOUS
SECTION 33.1. CAPTIONS. The captions of this Lease are for convenience
only and are not to be construed as part of this Lease and shall not be
construed as defining or limiting in any way the scope or intent of the
provisions hereof.
SECTION 33.2. SEVERABILITY. If any covenant, agreement or condition of
this Lease or the application thereof to any person, firm or corporation or to
any circumstances, shall to any extent be invalid or unenforceable, the
remainder of this Lease, or the application of such covenant, agreement or
condition to persons, firms or corporations or to circumstances other than
those as to which it is invalid or unenforceable,
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shall not be affected thereby. Each covenant, agreement or condition of this
Lease shall be valid and enforceable to the fullest extent permitted by law.
SECTION 33.3. APPLICABLE LAW. This Lease shall be construed and enforced
in accordance with the laws of the state where the Premises are located.
SECTION 33.4. AMENDMENTS IN WRITING. None of the covenants, terms or
conditions of this Lease, to be kept and performed by either party, shall in
any manner be altered, waived, modified, changed or abandoned, except by a
written instrument, duly signed, acknowledged and delivered by the other party.
SECTION 33.5. RELATIONSHIP OF PARTIES. Nothing contained herein shall be
deemed or construed by the parties hereto, nor by any third party, as creating
the relationship of principal and agent or of partnership, or of joint venture
by the parties hereto, it being understood and agreed that no provision
contained in this Lease nor any acts of the parties hereto shall be deemed to
create any relationship other than the relationship of Landlord and Tenant.
SECTION 33.6. BROKERAGE. Tenant warrants that it has no dealings with any
real estate broker or agent in connection with this lease other than Landlord's
Broker and Tenant's Broker, and Tenant covenants to pay, hold harmless and
indemnify Landlord from and against any and all cost, expense or liability for
any compensation, commissions and charges claimed by any other broker or other
agent with respect to this Lease or the negotiation thereof arising out of any
acts of Tenant.
SECTION 33.7. NO ACCORD AND SATISFACTION. No payment by Tenant or receipt
by Landlord of a lesser amount than the monthly rent herein stipulated and
additional rent shall be deemed to be other than on account of the earliest
stipulated rent, nor shall any endorsement or statement on any check or any
letter accompanying any check or payment as rent be deemed an accord and
satisfaction, and Landlord may accept such check or payment without prejudice
to Landlord's right to recover the balance of such rent or pursue any other
remedy in this Lease provided.
SECTION 33.8. JOINT EFFORT. The preparation of this Lease has been a
joint effort of the parties hereto and the resulting documents shall not,
solely as a matter of judicial construction, be construed more severely against
one of the parties than the other.
SECTION 33.9. TIME. Time is of the essence of this Lease, and all
provisions herein relating thereto shall be strictly construed.
SECTION 33.10. LANDLORD'S CONSENT. Landlord's granting of any consent
under this Lease, or Landlord's failure to object to any action taken by Tenant
without Landlord's consent required under this Lease, shall not be deemed a
waiver by Landlord of its rights to require such consent for any further
similar act by Tenant. No waiver by Landlord of any other breach of the
covenants of this Lease shall be construed, taken or held to be a waiver of any
other breach or to be a waiver, acquiescence in or consent to any further or
succeeding breach of the same covenant. None of the Tenant's covenants under
this Lease, and no breach thereof, shall be waived, altered or modified except
by a written instrument executed by Landlord.
SECTION 33.11. NO PARTNERSHIP. Landlord is not, and shall not be deemed to
be, in any way or for any purpose, the partner, employer, principal, master or
agent of or with Tenant.
SECTION 33.12. LANDLORD'S LIABILITY. Notwithstanding anything to the
contrary herein contained, there shall be absolutely no personal liability
asserted or enforceable against Landlord or on any persons, firms or entities
who constitute Landlord with respect to any of the terms, covenants, conditions
and provisions of this Lease, and Tenant shall, subject to the rights of any
mortgagee, look solely to the interest of Landlord, its successors and assigns
in the Premises for the satisfaction of each and every remedy of Tenant in the
event of default by Landlord hereunder; such exculpation of personal liability
is absolute and
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without any exception whatsoever. If the entity constituting Landlord is a
partnership, Tenant agrees that the deficit capital account of any such partner
shall not be deemed an asset or property of said partnership. Notwithstanding
anything in this Lease to the contrary, with respect to any provision of this
Lease which requires Landlord's consent or approval, Tenant shall not be
entitled to make, nor shall Tenant make, any claim for (and Tenant hereby
waives any claim for) money damages as a result of any claim by Tenant that
Landlord has unreasonably withheld or unreasonably delayed any consent or
approval, but Tenant's sole remedy shall be an action or proceeding to enforce
such provision, or for specific performance, injunction or declaratory
judgment.
SECTION 33.13. LANDLORD RIGHTS. This Lease does not grant any rights to
light or air over or about the Premises. Landlord specifically excepts and
reserves to itself the use of any roofs, the exterior and structural components
of the Building, all rights to the land and improvements below the improved
floor level of the Building, to the improvements and air rights above the
Building and to the improvements and air rights located outside the demising
walls of the building and to such areas within the Building required for
installation of utility lines and other installations and to such portions of
the Premises necessary to access, maintain and repair same, and no rights with
respect thereto are conferred upon Tenant.
SECTION 33.14. ENTIRE AGREEMENT. It is understood and agreed that all
understandings and agreements heretofore had between the parties hereto are
merged in this Lease, the exhibits annexed hereto and the instruments and
documents referred to herein, which alone fully and completely express their
agreements, and that no party hereto is relying upon any statement or
representation, not embodied in this Agreement, made by the other. Each party
expressly acknowledges that, except as expressly provided in this Agreement,
the other party and the agents and representatives of the other party have not
made, and the other party is not liable for or bound in any manner by, any
express or implied warranties, guaranties, promises, statements, inducements,
representations or information pertaining to the transactions contemplated
hereby.
ARTICLE XXXIV
RENEWAL OPTIONS
SECTION 34.1. RENEWAL OPTION. Tenant shall have the option ("Renewal
Option") to renew the Initial Term for all of the Premises as of the expiration
date of the Initial Term, for one (1) additional period of five (5) years
("Renewal Term") upon the following terms and conditions:
A. Tenant gives Landlord written notice of its exercise of the
Renewal Option prior to April 30, 2005.
B. Tenant is not in default under this Lease either on the date
Tenant delivers the notice required under subparagraph 34.1A. above or at
any time thereafter prior to the commencement of the Renewal Term so
exercised.
C. Landlord shall be provided with evidence satisfactory to it of
Tenant's compliance with the terms and conditions of Article XXXII hereof.
D. All of the terms and provisions of this Lease (except this Article
XXXIV) shall be applicable to the Renewal Term, except that Base Rent for
the Renewal Term shall be determined as follows. Upon receipt of a notice
from Tenant exercising the Renewal Option Landlord shall promptly advise
Tenant of Landlord's determination of the Fair Value (as hereinafter
defined). Landlord and Tenant shall thereafter attempt in good faith to
agree upon the amount of Base Rent to be paid by Tenant for each year
during the Renewal Term. In the event that Landlord and Tenant are unable
to agree upon the amount of Base Rent to be paid by Tenant for each year
during the Renewal Term, either Landlord or Tenant may, upon notice to the
other at any time after June 30, 2005, discontinue discussions with the
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other party in which event the exercise of the Renewal Option shall be
deemed revoked and the term of the Lease shall expire on December 31, 2005.
For purposes of this Lease, "Fair Value" shall mean Landlord determination,
utilizing its reasonable judgment, of an annual amount per rentable square
foot for a term equivalent to the period for which Fair Value is being
determined beginning with the first (1st) day of the subject period that a
willing, creditworthy, new non-equity tenant leasing comparable space to
Tenant's would pay and a willing, comparable landlord of an industrial
building comparable to the Building in the Chicago metropolitan area
("Market") would accept at arm's length, giving appropriate consideration
to annual rental rate per rentable square foot, rental escalations, length
of lease term, size and location of the premises being leased, and other
generally applicable terms and conditions prevailing for comparable space
in comparable buildings located in the Market. Upon Tenant's written
request, Landlord shall provide Tenant with the information Landlord relied
upon to determine Fair Value.
SECTION 34.2. "AS IS" CONDITION. Tenant agrees to accept the Premises to
be covered by this Lease during the Renewal Term in an "as is" physical
condition and Tenant shall not be entitled to receive any allowance, credit,
concession or payment from Landlord for the improvement thereof.
SECTION 34.3. AMENDMENT. In the event that Tenant exercises the Renewal
Option, then Landlord and Tenant shall mutually execute and deliver an
amendment to this Lease reflecting the renewal of the Term on the terms herein
provided, which amendment shall be executed and delivered promptly after the
determination of Rent to be applicable to the Renewal Term as hereinabove
provided.
SECTION 34.4. TERMINATION. The Renewal Options herein granted shall
automatically terminate upon the earliest to occur of (i) the expiration or
termination of this Lease, (ii) the termination of Tenant's right to possession
of the Premises, (iii) any assignment or subletting by Tenant, except as to
assignments or subleases to which Landlord has consented pursuant to Section
16.1 hereof, or (iv) the failure of Tenant to timely or properly exercise the
Renewal Option.
SECTION 34.5. NO COMMISSIONS. Landlord and Tenant acknowledge and agree
that no real estate brokerage commission or finder's fee shall be payable by
Landlord in connection with any exercise by Tenant of the Renewal Option herein
contained.
IN WITNESS WHEREOF, the parties have executed this Lease as of the date set
forth above.
LANDLORD: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, INC.,
a Delaware corporation
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------------------
Its: President
TENANT: STERICYCLE, INC.,
a Delaware corporation
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------------
Its: President and Chief Executive Officer
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EXHIBIT "A"
LEGAL DESCRIPTION
[Omitted]
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EXHIBIT "B"
TENANT ESTOPPEL CERTIFICATE
[Omitted]
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