EXHIBIT 10.15
LEASE AGREEMENT
LANDLORD:
ARLINGTON PARK REALTY CORPORATION
and
TENANT:
AMERICAN SCHOOLS OF PROFESSIONAL PSYCHOLOGY, INC.
May 3, 1994
DEED OF LEASE AGREEMENT
between
ARLINGTON PARK REALTY CORPORATION
and
AMERICAN SCHOOLS OF PROFESSIONAL PSYCHOLOGY, INC.
Table of Contents
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SECTION PAGE
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1. DEFINITIONS................................................. 1
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2. LEASE TERM.................................................. 5
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3. BASIC RENTAL................................................ 6
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4. BASIC RENTAL ESCALATION..................................... 7
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5. SECURITY DEPOSIT............................................ 7
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6. LANDLORD'S OBLIGATIONS...................................... 8
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7. IMPROVEMENT OF THE PREMISES................................. 9
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8. OPERATING EXPENSES.......................................... 11
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9. USE......................................................... 13
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10. TENANT'S REPAIRS AND ALTERATIONS............................ 17
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11. ASSIGNMENT AND SUBLETTING................................... 19
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12. INDEMNITY................................................... 22
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13. SUBORDINATION............................................... 23
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14. RULES AND REGULATIONS....................................... 24
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15. INSPECTION.................................................. 25
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16. CONDEMNATION................................................ 25
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17. FIRE OR OTHER CASUALTY...................................... 26
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18. HOLDING OVER................................................ 27
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19. TAXES....................................................... 28
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20. EVENTS OF DEFAULT........................................... 29
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21. REMEDIES.................................................... 30
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22. SURRENDER OF PREMISES....................................... 32
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23. ATTORNEYS' FEES............................................. 33
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24. LANDLORD'S LIEN............................................. 33
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25. MECHANICS' LIENS............................................ 34
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26. WAIVER OF SUBROGATION; INSURANCE............................ 34
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27. INTENTIONALLY DELETED....................................... 36
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28. BROKERAGE................................................... 36
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29. ESTOPPEL CERTIFICATES....................................... 36
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30. NOTICES..................................................... 36
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31. FORCE MAJEURE............................................... 38
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32. SEVERABILITY................................................ 38
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33. AMENDMENTS; WAIVER; BINDING EFFECT.......................... 38
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34. QUIET ENJOYMENT............................................. 38
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35. LIABILITY OF TENANT......................................... 38
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36. LANDLORD LIABILITY.......................................... 39
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37. CERTAIN RIGHTS RESERVED BY LANDLORD......................... 39
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38. FINANCIAL STATEMENTS........................................ 40
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39. REPRESENTATIONS............................................. 40
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40. ADDITIONAL RENT............................................. 41
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41. ENTIRE AGREEMENT............................................ 41
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42. WAIVER OF JURY TRIAL........................................ 41
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43. LAWS AND REGULATIONS........................................ 41
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44. SIGNAGE..................................................... 42
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45. RENEWAL OPTION.............................................. 42
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46. RIGHT OF FIRST OFFER........................................ 44
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47. EXHIBITS.................................................... 46
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(i) Exhibit A - Outline of Premises
(ii) Exhibit ▇-▇ - ▇-▇ ▇▇▇▇▇▇▇▇
(▇▇▇) ▇▇▇▇▇▇▇ ▇-▇ - ▇-▇ Premises
(iv) Exhibit A-3 - Expansion Area
(v) Exhibit B - Legal Description
(vi) Exhibit C - Rules and Regulations
(vii) Exhibit D - Specifications for Construction
(viii) Exhibit E - Tenant Space Plan
(ix) Exhibit F - Tenant Acceptance Letter for the A-1 Premises
(x) Exhibit G - Tenant Acceptance Letter for the A-2 Premises
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DEED OF LEASE AGREEMENT
between
ARLINGTON PARK REALTY CORPORATION
and
AMERICAN SCHOOLS OF PROFESSIONAL PSYCHOLOGY, INC.
DATA SHEET
This Data Sheet is an integral part of this Lease and all of the terms hereof
are incorporated into this Lease in all respects. In addition to the other
provisions which are elsewhere in this Lease, the following, whenever used in
this Lease, shall have the meanings set forth in this Data Sheet.
(a) Premises Suite No. 110 in the Building, generally outlined on the
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floor plan attached hereto as Exhibit A (Section 1(m)).
(b) Area of Premises Approximately 6,620 rentable square feet on the first
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(1st) floor of the Building (Exhibit A and Section 1(m)).
(c) Building An office building located at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇,
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▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (Section 1(e)).
(d) Annual Basic Rental $125,780.00 per year payable in equal monthly
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installments of $10,481.67,
subject to adjustment as herein
provided (Sections 1(b) and 3).
(e) Annual Basic Rental Two and 50/100 percent (2.51k) of the escalated Basic
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Escalation Rental then in effect (Section 4).
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(f) Additional Rent See Section 41.
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(g) Lease Term Approximately five (5) years, commencing on the
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Commencement Date and expiring on August 31, 1999
(Sections 1(k) and 2).
(h) Commencement Date See Section 1(f).
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(i) Building Operation Hours Monday through Friday, 7:00 a.m. to 6:00 p.m.
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(j) Permitted Use Any general business office, college of higher
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education, classroom and administrative office
purpose and for no other purposes
(Sections 1(1) and 9).
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(k) Tenant's Proportionate 6.27% (See Section 1(t)).
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Share of Building Space
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for Operating Costs
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(l) Tenant's Proportionate 6.27% (See Section 1(u)).
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Share of Building Space
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for Real Estate Taxes
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(m) Tenant's Proportionate One (1) per ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ feet (Section 9(i)).
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Share of Parking Spaces
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(n) Brokers Involved ▇▇▇▇▇ ▇▇▇▇▇▇▇ Company and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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(o) Security Deposit See Sections 1(o) and 5.
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(p) Notices If to Landlord:
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NEW 1211 CONNECTICUT, INC.
c/o The ▇▇▇▇▇ ▇▇▇▇▇▇▇ Company
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
If to Tenant prior to Commencement Date:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Controller/CFO
AMERICAN SCHOOLS OF PROFESSIONAL
PSYCHOLOGY, INC.
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
If to Tenant after Commencement Date:
AMERICAN SCHOOLS OF PROFESSIONAL
PSYCHOLOGY, INC.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
DEED OF LEASE AGREEMENT
THIS DEED OF LEASE AGREEMENT is entered into as of the 3rd day of May,
1994, by and between ARLINGTON PARK REALTY CORPORATION, a Delaware corporation
(hereinafter called "Landlord"), and AMERICAN SCHOOLS OF PROFESSIONAL
PSYCHOLOGY, INC., an Illinois corporation (hereinafter called "Tenant").
1. DEFINITIONS.
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(a) "Basic Cost": The actual costs incurred by the Landlord in
operating and maintaining the Building and the Land during each calendar year of
the Lease Term for which Landlord has not been reimbursed by insurance proceeds,
condemnation awards or otherwise.
Such costs shall include, by way of example rather than of limitation,
(i) charges or fees for, and taxes on, the furnishing of electricity, water,
sewer service, gas, fuel, or other utility services to the Building and the
Land; (ii) costs of providing elevator, janitorial and trash removal service,
restripping, resurfacing, maintaining and repairing all walkways, roadways and
parking areas on the Land, security costs, and costs of maintaining grounds,
common areas and mechanical systems of the Building and the Land; (iii) all
other costs of maintaining and repairing any or all of the Building or Land;
(iv) charges or fees for any necessary governmental permits and licenses; (v)
management fees not to exceed the prevailing fees charged by unaffiliated third
party property management firms operating in Washington, D.C. for the management
of comparable office buildings, overhead and expenses reasonably related to
management of the Building (including salaries for personnel directly
responsible for management of the Building); (vi) premiums for hazard,
liability, workers, compensation or similar insurance upon any or all of the
Building and the Land; (vii) costs arising under service contracts with
independent contractors; and (viii) costs of any other items which, under
generally accepted accounting principles consistently applied from year to year
with respect to the Building or the Land, constitute operating or maintenance
costs attributable to any or all of the Building or the Land.
Such costs shall not include (i) the expense of principal and interest
payments made by the Landlord pursuant to the provisions of any mortgage or deed
of trust covering the Building or the Land; (ii) any deduction for depreciation
of the Building taken on the Landlord's income tax returns; or (iii) the cost of
capital improvements made to the Building, other than capital improvements,
modifications or equipment required by federal, state or local ordinance, rule,
regulation or law or determined by Landlord in good faith to result in savings
or reductions in Basic Cost generally, in which case the cost thereof shall be
included in Basic Cost for the calendar year in which the cost shall have been
incurred and in subsequent calendar years, on a straight line basis, such items
will be amortized over an appropriate period and with an appropriate interest
factor selected in good faith by Landlord. If Landlord shall have leased any
such items of capital equipment designed to result in savings or reductions in
Basic Cost, then the rental and other costs paid pursuant to such leasing shall
be included in Basic Cost for each calendar year in which they shall have been
incurred. In addition to the foregoing exclusions,
Basic Cost shall not include any of the following and in the event of any
conflict between any of the other provisions of this Lease and this
subparagraph, the provisions of this subparagraph shall prevail unless otherwise
specified herein: (1) amounts paid to any officer of Landlord, for salary or
other compensation; (2) costs of correcting any violation of Title III of The
Americans with Disabilities Act of 1990, as amended, in the common areas of the
Building, which violation exists prior to the Commencement Date of this Lease;
(3) costs of repairs, restoration or other work (x) paid by insurance required
to be maintained by Landlord under this Lease or which would have been covered
by such insurance had Landlord not elected to self-insure, or (y) paid by the
proceeds of any condemnation award; (4) costs incurred (less costs of recovery)
for any item to the extent reimbursed by a manufacturer's, materialman's,
vendor's or contractor's warranty and paid by such manufacturer, materialman,
vendor or contractor (Landlord shall pursue a breach of warranty claim for items
covered by a warranty unless Landlord determines in its reasonable discretion
that such action would not be in the best interest of the tenants in the
Building); (5) ground rents; (6) payment of principal and interest or other
finance charges made on any debt payments made under any mortgage, except to the
extent that a portion of such payments is expressly for ad valorem/real estate
taxes or insurance premiums on the Building or is otherwise permitted above; (7)
any special levies or assessments applicable to any period prior to the
Commencement Date of this Lease; (8) costs and expenses incurred in completing,
fixturing, furnishing, renovating or otherwise improving, decorating or
redecorating space for tenants (including Tenant), prospective tenants or other
occupants and prospective occupants of the Building, or vacant, leasable space
in the Building; (9) leasing commissions incurred in connection with
negotiations for leases with tenants (including Tenant), other occupants, or
prospective tenants or other occupants of the Building; (10) original
construction costs of the Building and costs of repairing, replacing or
otherwise correcting latent defects of the Building; (11) Landlord's general
corporate overhead and general and administrative expenses; (12) costs which are
not evidenced by reasonably adequate records kept in the ordinary course of
business; (13) interest or penalties arising by reason of Landlord's failure to
timely pay any Basic Cost, unless incurred as a result of Tenant's act or
omission; and (14) all amounts which would otherwise be included in Basic Cost
which are paid to any affiliate or subsidiary of Landlord, or any
representative, employee or agent of an affiliate or subsidiary of Landlord, to
the extent the costs of such services exceed the competitive rates for similar
services of comparable quality rendered by persons or entities of similar skill,
competence and experience.
In determining Basic Cost, where less than 95% of the Building's
rentable square footage is occupied during all or any part of a year, those
items of the Basic Cost which vary according to occupancy, such as electricity
and janitorial services, shall be increased to that amount which would have been
incurred had the Building been 95% occupied during the entire year.
Notwithstanding anything to the contrary in the foregoing sentence, in the event
the lease between Landlord and GSA for approximately 85,000 rentable square feet
in the Building ("GSA Premises") terminates, then in such event, the electrical,
janitorial and cleaning costs for the common areas located on floors 2 through
8, inclusive, shall not be included in Basic Cost; provided, however, that at
any time after Landlord executes a lease with a tenant for any portion of the
GSA Premises ("Replacement Tenant"), then in such event, the electrical,
janitorial and
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cleaning costs for the common areas located on the floor(s) on which the
Replacement Tenant's premises are located shall once again be included in Basic
Cost.
(b) "Basic Rental": $125,780.00 per year payable in equal monthly
installments of $10,481.67, subject to adjustment as herein provided.
(c) "Base Year Stop": The Basic Cost incurred during the calendar year
1994 divided by the rentable square feet in the Building.
(d) "Base Real Estate Taxes": The Real Estate Taxes for the calendar
year 1994.
(e) "Building": The office building located at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇.
(f) "Commencement Date": The Commencement Date shall be the earlier of
(i) June 1, 1994, or (ii) the date of Substantial Completion of that portion of
the Premises consisting of approximately 2,217 square feet generally outlined on
the floor plan attached hereto as Exhibit A-1 ("A-l Premises") or (iii) the date
the A-1 Premises would have been Substantially Completed but for Tenant Delays.
It is understood and agreed that after the Commencement Date, Landlord may
continue to construct that portion of the Premises consisting of approximately
4,403 square feet generally outlined on the floor plan attached hereto as
Exhibit A-2 ("A-2 Premises").
(g) "Event of Default': As defined in Section 20 of this Lease.
(h) "Excess": As defined in Section 8 of this Lease.
(i) "Land": The entire tract of land on which the Building is located
as further described in Exhibit B attached hereto for all purposes. The term
Land shall also include any property that must be maintained by Landlord due to
the existence of any public or private easement.
(j) "Landlord's Contractor": As defined in Section 7(c) of this Lease.
(k) "Lease Term": The period commencing on the Commencement Date and
expiring on August 31, 1999.
(l) "Permitted Use": Any general business office, college of higher
education, classroom and administrative office purpose and for no other purpose.
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(m) "Premises": Suite No. 110 in the Building, generally outlined on
the floor plan attached hereto as Exhibit A and consisting of approximately
6,620 rentable square feet as determined using the Washington, D.C. Board of
Realtor's Standard Methods of Measurement.
(n) "Rules and Regulations": The Landlord's rules and regulations sent
to Tenant in writing from time to time, as amended or substituted from time to
time, the current form of which is attached hereto as Exhibit C.
(o) "Security Deposit": $26,204.17 as reduced in accordance with
Section 5.
(p) "Special Tenant work": Intentionally Deleted.
(q) "Standard Tenant Work": Intentionally Deleted.
(r) "Substantial Completion": The date when the work to be performed
by Landlord in the Premises in accordance with this Lease shall have been
substantially completed notwithstanding that certain details of construction,
mechanical adjustment or decoration remain to be performed, the noncompletion of
which would not materially interfere with the Tenant's use of the Premises.
For purposes of determining the date of Substantial Completion, there
shall not be considered the duration of any delay which is caused by: (i)
changes in the work to be completed by Landlord in readying the Premises for
Tenant's occupancy, which changes have been requested by Tenant after the
approval by Landlord and Tenant of the Working Drawings; (ii) delays, not caused
by Landlord, in furnishing materials or procuring labor required by Tenant for
installations or work in the Premises which are not encompassed within the
Working Drawings; (iii) any failure by Tenant, to furnish any required plan,
information, approval or consent (including, without limitation, the Working
Drawings) within the required period of time, or any failure to fully and
completely cooperate with Landlord in the preparation of the working Drawings or
(iv) the performance of any work or activity in the Premises by Tenant or any of
its employees, agents or contractors.
(s) "Working Drawings": As defined in Section 7(a) of this Lease and
Exhibit D.
(t) "Tenant's Proportionate Share for Operating Costs": 6.27%. Such
percentage is equal to a fraction, the numerator of which equals the number of
rentable square feet within the Premises and the denominator of which equals the
total number of rentable square feet of office area in the Building.
(u) "Tenant's Proportionate Share For Real Estate Taxes": 6.27%.
Such percentage is equal to a fraction, the numerator of which equals the number
of rentable square
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feet within the Premises and the denominator of which equals the total number of
rentable square feet in the Building.
2. LEASE TERM.
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(a) Landlord, in consideration of the rent to be paid and the other
covenants and agreements to be performed by Tenant and upon the terms
hereinafter stated, does hereby lease, demise and let unto Tenant the Premises,
as defined herein and generally outlined on the floor plan attached hereto as
Exhibit A, commencing on the Commencement Date and ending, without the necessity
of notice from either party to the other, such notice being expressly waived, on
the last day of the Lease Term, unless sooner terminated as herein provided.
Notwithstanding the foregoing, Tenant shall occupy only the A-1 Premises on the
Lease Commencement Date. Landlord shall make available the A-2 Premises for
Tenant's occupancy on or before September 1, 1994; provided, however, that
Tenant may only occupy the A-2 Premises prior to September 1, 1994 with
Landlord's prior written consent and provided the A-2 Premises is Substantially
Completed.
(b) If Landlord shall be unable to tender possession of the Premises
on the Commencement Date, Landlord shall not be liable for any damage caused
thereby, nor shall this Lease be void or voidable by Tenant, but in such event,
unless the delay results (i) from failure of Tenant to approve plans or
otherwise perform in accordance with the requirements of the Lease or (ii) from
any delay in Landlord's ability to tender possession of the Premises caused by
Tenant, no rental shall be payable by Tenant prior to actual tender to Tenant of
possession of the Premises.
(c) By occupying the A-1 Premises, Tenant shall be deemed to have
accepted the same as suitable for the purpose herein intended and to have
acknowledged that the A-1 Premises comply fully with Landlord's obligations
pursuant to the Working Drawings, with the exception of any "punch list" type
items which may not have been completed. Tenant agrees that its failure to
deliver to Landlord such a written "punch list" within thirty (30) days
following occupancy shall be conclusive proof that no such items exist. Within
thirty (30) business days of delivery to Tenant by Landlord, whichever is
sooner, Tenant agrees to execute and return to Landlord a letter prepared by
Landlord confirming the Commencement Date, a copy of which is attached hereto as
Exhibit F, certifying that Tenant has accepted delivery of the A-1 Premises and
that the condition of the A-1 Premises complies with Landlord's obligations
pursuant to the Working Drawings, subject to any "punch list" items which may
not have been completed.
(d) By occupying the A-2 Premises, Tenant shall be deemed to have
accepted the same as suitable for the purpose herein intended and to have
acknowledged that the A-2 Premises comply fully with Landlord's obligations
pursuant to the working Drawings, with the exception of any "punch list" type
items which may not have been completed. Tenant agrees that its failure to
deliver to Landlord such a written "punch list" within thirty (30) days
following occupancy shall he conclusive proof that no such items exist. Within
thirty (30) business days of
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delivery to Tenant by Landlord, whichever is sooner, Tenant agrees to execute
and return to Landlord a letter prepared by Landlord confirming the Commencement
Date, a copy of which is attached hereto as Exhibit G, certifying that Tenant
has accepted delivery of the A-2 Premises and that the condition of the A-2
premises complies with Landlord's obligations pursuant to the Working Drawings,
subject to any "punch list" items which may not have been completed.
3. BASIC RENTAL.
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(a) Tenant promises and agrees to pay Landlord the Basic Rental
(subject to adjustment as hereinafter provided) without demand, notice,
deduction, counterclaim or set-off, for each month of the entire Lease Term.
The first full monthly installment shall be due and payable upon execution of
this Lease. The Basic Rental for each subsequent month shall be paid in advance
beginning on the first day of the calendar month following the expiration of the
first calendar month of the Lease Term and continuing thereafter on or before
the first day of each succeeding calendar month during the term hereof. If the
Lease Term begins on a date other than on the first day of a month, rent for the
first partial month of the Lease Term shall be prorated at the rate of one-
thirtieth (1/30th) of the monthly installment of rent for each day, payable in
advance on the Lease Commencement Date. Tenant will pay all rent to Landlord at
the office of Landlord or to such other party or to such other address as
Landlord may designate from time to time by written notice to Tenant.
Notwithstanding the foregoing, the Basic Rental for the first year of
the Lease shall be divided into two portions consisting of (1) Basic Rental for
the A-1 Premises totalling $42,123.00 annually, payable in equal monthly
installments of $3,510.25 each ("A-1 Basic Rental") and (2) Basic Rental for the
A-2 Premises totalling $83,657.00 annually, payable in equal monthly
installments of $6,971.42 each ("A-2 Basic Rental"), for a total Basic Rental of
$125,780.00 annually during the first year of the Lease prior to adjustment as
set forth in Section 4 hereof. During the first year of the Lease as set forth
in the preceding sentence, Tenant's payment of Basic Rental for the A-1 Premises
shall commence on the Commencement Date ("A-1 Rent Commencement Date"); and
Tenant's payment of Basic Rental for the A-2 Premises shall commence on the
earlier to occur of (1) September 1, 1991; or (2) Tenant's occupancy of the A-2
Premises ("A-2 Rent Commencement Date"). Notwithstanding the foregoing, Landlord
agrees to ▇▇▇▇▇ the A-1 Basic Rental for the first two full calendar months
following the A-1 Rent Commencement Date for a total abatement of A-1 Basic
Rental in the amount of $7,020.50; and Landlord agrees to ▇▇▇▇▇ the A-2 Basic
Rental for the first full two calendar months following the A-2 Rent
Commencement Date for a total abatement of A-2 Basic Rental in the amount of
$13,942.84. Effective on the first anniversary of the Commencement Date, or if
the Commencement Date is not on the first day of a month, then on the first day
of the first full calendar month after the Commencement Date, the Basic Rental
(including both the A-1 Basic Rental and the A-2 Basic Rental) shall be
increased pursuant to Section 4 hereof and payable as set forth in the first
paragraph of this Section 3(a).
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(b) All sums payable by Tenant under this Lease shall be payable
without demand, set-off or deduction and shall be paid to Landlord in legal
tender of the United States by wire transfer or by bank check (subject to
collection). Landlord's acceptance of rent after it shall have become due and
payable shall not excuse a delay upon any subsequent occasion or constitute a
waiver of any of Landlord's rights.
(c) In the event any installment of the Basic Rental, or any other
sums which become owing by Tenant to Landlord under the provisions hereof, are
not received within five (5) days of the due date thereof, without regard to any
grace periods specified in Section 20 hereof, Tenant shall pay, in addition to
such installment of the Basic Rental or such other sums owed, and not as a
penalty, additional rent in the form of a late payment charge equal to five
percent (5%) of such monthly installment of the Basic Rental or such other sums
owed for each month or part thereof such payment is overdue. In addition, such
payment and such late charge shall bear interest at the Default Rate as set
forth in Section 21(d) from the date such payment was due to the date of payment
hereof. Such late charge and interest shall constitute agreed liquidated
damages and not penalties, and shall be in addition to, and not in lieu of, all
other rights and remedies provided to Landlord in this Lease, at law, or in
equity.
(d) All costs and expenses which Tenant assumes or agrees to pay to
Landlord pursuant to this Lease, including, without limitation, operating
Expenses and Real Estate Taxes, shall be deemed to be additional rent and, in
the event of nonpayment thereof, Landlord shall have all the rights and remedies
provided for in case of nonpayment of rent, including assessment of interest and
late payment charges. Basic Rental and additional rent are sometimes referred
to collectively herein as "rent".
(e) Notwithstanding any expiration or termination of this Lease prior
to the end of the Lease Term, Tenant's obligations to pay any and all additional
rent pursuant to this Lease shall continue and shall cover all periods up to the
expiration or termination date of this Lease. Tenant's obligation to pay any
and all additional rent or other sums owing by Tenant to Landlord under this
Lease shall survive any expiration or termination of this Lease.
4. BASIC RENTAL ESCALATION.
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The Basic Rental shall be increased annually, effective on each
anniversary of the Commencement Date, or if the Commencement Date is not on the
first day of a month, then on the first day of the first full calendar month
after the Commencement Date during the term hereof, by an amount equal to two
and 50/100 percent (2.5%) of the escalated Basic Rental then in effect.
5. SECURITY DEPOSIT.
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The Security Deposit, which shall be paid upon execution of this
Lease, shall be held by Landlord without liability for interest and not in trust
or in a separate account, as security
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for the performance by Tenant of Tenant's covenants and obligations under this
Lease. The Security Deposit shall not be considered an advance payment of rental
or a measure of Landlord's damages in case of default by Tenant. Upon the
occurrence of any Event of Default by Tenant, Landlord may, from time to time in
its sole discretion, without prejudice to any other remedy, use and apply the
Security Deposit to the extent necessary to make good any arrearages of rent and
any other damage, injury, expense or liability suffered by Landlord by such
Event of Default. Following any such application of the Security Deposit, Tenant
shall pay to Landlord on demand as additional rent the amount so applied in
order to restore the Security Deposit to its original amount. If Tenant is not
then in default hereunder, any remaining balance of the Security Deposit shall
be returned by Landlord to Tenant within a reasonable period of time after the
termination of this Lease and (i) Tenant shall have surrendered the entire
Premises to Landlord, (ii) Landlord shall have inspected the Premises after such
vacation, and (iii) Tenant shall have complied with all of the terms, conditions
and covenants in the Lease. If Landlord transfers the Security Deposit to any
transferee of the Building or Landlord's interest therein, then said transferee
shall be liable to Tenant for the return of the Security Deposit, and Landlord
shall be released from all liability for the return of the Security Deposit. The
holder of any mortgage shall not be liable for the return of the Security
Deposit unless such holder actually receives the Security Deposit.
Notwithstanding the foregoing paragraph, provided an Event of Default does
not exist under the terms and conditions of this Lease and Landlord has not
previously used and applied all or any portion of the Security Deposit (unless
Tenant has restored such amount used and applied): (1) Landlord shall return to
Tenant $10,481.67 of the Security Deposit within thirty (30) days of the first
anniversary of the Commencement Date and (2) Landlord shall return to Tenant
$5,240.83 of the Security Deposit within thirty (30) days of the second
anniversary of the Commencement Date.
6. LANDLORD'S OBLIGATIONS.
----------------------
(a) Subject to the limitations hereinafter set forth, Landlord agrees,
while Tenant is occupying the Premises and is not in breach of or in default
under this Lease, to furnish to Tenant; (i) facilities to provide water at those
points of supply both within the Premises and those provided for general use of
tenants of the Building; (ii) facilities to provide a supply of electrical
current reasonably necessary for general business office use and occupancy of
the Premises and electric lighting and a supply of electrical current to the
common areas of the Building; (iii) heating and refrigerated air conditioning in
season; and (iv) elevator and janitorial service to the Premises, all such
services to be provided in scope, quality and frequency to those services being
customarily provided by landlords in comparable office buildings in the
surrounding area. Landlord shall provide Tenant supplementary HVAC equipment in
a configuration in accordance with Option A or option B as set forth in Exhibit
D. Tenant shall choose either Option A or option B. Option A can operate
independently from the Building HVAC system and therefore, Option A can be
operated without turning on the Building HVAC system. Option B requires that
the Building system be turned on. Heating, ventilation and air
8
conditioning requirements and standards under this Lease shall be subject,
however, to such regulations as the Department of Energy or any other local,
state or federal governmental agency, Board or commission shall adopt from time
to time. In addition, Landlord agrees to maintain the public and common areas of
the Building, such as lobbies, stairs, corridors and restrooms, in reasonably
good order and condition; provided, however, that Tenant shall reimburse
Landlord, upon demand, for all repairs and additional maintenance resulting from
damages to such public or common areas caused by Tenant, or its employees,
agents or invitees. Landlord reserves the right, exercisable without notice and
without liability to Tenant for damage or injury to property, persons or
business and without effecting an eviction, constructive or actual, or
disturbance of Tenant's use or possession of the Premises, or giving rise to any
claim by Tenant for setoff or abatement of rent, to decorate and to make
repairs, alterations, additional modifications, changes or improvements, whether
structural or otherwise, in and about the Building, or any part thereof, and for
such purposes to enter upon the Premises and, during the continuance of any such
work, to temporarily close doors, entryways, public space and corridors in the
Building and to interrupt or temporarily suspend Building services and
facilities.
(b) If Landlord, to any extent, fails to make available any of the
services to be provided by Landlord expressly set forth above or if any
slowdown, stoppage or interruption of, or any change in the quantity, character
or availability of, the services to be provided by Landlord expressly set forth
above occurs, such failure or occurrence shall not render Landlord liable in any
respect for damages to either person, property or business, nor be construed as
an eviction of Tenant or work an abatement of rent, nor relieve Tenant from
fulfillment of any covenant or agreement hereof. Should any equipment or
machinery furnished by Landlord break down or for any cause beyond Landlord's
reasonable control cease to function properly, Landlord shall use reasonable
diligence to repair same promptly, but Tenant shall have no claim for abatement
of rent or damages on account of any interruptions in service occasioned thereby
or resulting therefrom.
7. IMPROVEMENT OF THE PREMISES.
---------------------------
(a) Landlord and Tenant agree to comply with the following schedule in
buildout of the Premises:
(i) A Space Plan has been prepared and approved by Landlord and
Tenant and is attached hereto as Exhibit E and incorporated herein for all
purposes. Any modifications to the Space Plan made after the date of this Lease
shall be made at Tenant's expense and, if delay in Substantial Completion of the
A-1 Premises or the A-2 Premises occurs as a result of such modifications,
Tenant shall commence paying A-1 Basic Rental on the date that the A-1 Premises
would have been Substantially Completed but for the days of delay caused by the
changes in the Space Plan and commence paying A-2 Basic Rental on the date that
the A-2 Premises would have been Substantially Completed but for the days of
delay caused by the changes in the Space Plan.
9
(ii) Upon the execution of this Lease by Landlord and Tenant,
Landlord shall prepare and deliver to Tenant detailed floor plan layouts,
together with working drawings and written instructions sufficiently detailed to
enable Landlord to bid firm contracts (herein called "Working Drawings") with
respect to and reflecting the partitions and improvements in the Premises. The
Working Drawings shall include all of the work described in the Specifications
for Construction attached hereto as Exhibit D and incorporated herein for all
purposes and the Space Plan. Tenant shall fully and completely cooperate with
Landlord in the preparation of the Working Drawings, shall promptly respond to
Landlord's requests for information and approvals within three (3) business days
after inquiry, and shall use its best efforts to assist Landlord to complete the
Working Drawings as soon as possible. Tenant agrees to deliver to Landlord, not
later than three (3) business days after delivery of the Working Drawings to
Tenant, an original executed copy of the Working Drawings approved by Tenant;
provided, however, if Tenant, in good faith, reasonably objects to any aspect of
the Working Drawings submitted by Landlord, Tenant shall specify in detail any
objection to such Working Drawings as submitted to Tenant in a written notice to
Landlord within such 3-day period. Landlord shall, if applicable, modify such
Working Drawings to address Tenant's written objections, and submit new Working
Drawings to Tenant for approvals. Notwithstanding the foregoing, the Working
Drawings shall remain subject to Landlord's review and approval, which approval
shall not be unreasonably withheld, and shall be deemed modified to take account
of any changes reasonably required by Landlord. If Tenant fails to timely
deliver the Working Drawings as required herein, makes modifications to the
Working Drawings after the deadlines provided in this subsection or requests any
changes to the Specifications for Construction, Tenant shall (1) pay to Landlord
all reasonable expenses incurred by Landlord due to Tenant's modifications
and/or delay in delivering the working Drawings or the Specifications for
Construction; and (2) commence paying to Landlord the A-1 Basic Rental on the
date the A-1 Premises would have been substantially Completed but for the days
of delay caused by Tenant's failure to timely comply with the requirements in
this Section and commence paying to Landlord the A-2 Basic Rental on the date
the A-2 Premises would have been Substantially Completed but for the days of
delay caused by Tenant's failure to timely comply with the requirements of this
Section.
(iii) Time is of the essence as to all dates provided in this
subsection.
(b) Any changes ("Changes") to any approved Working Drawings or the
Specifications for Construction desired by Tenant shall be submitted in writing
and in detail to Landlord and shall be subject to Landlord's consent, which
consent shall not be unreasonably withheld. If Tenant requests any Changes to
the Working Drawings or the Specifications for Construction, Tenant shall be
responsible for all costs and expenses, including architectural, engineering and
related design costs, resulting from such Changes. Landlord shall not be
responsible for any delay in performing the construction of the tenant
improvements caused by any Changes to the Working Drawings or the Specifications
for Construction. If Tenant requests any Changes to the Working Drawings the
Specifications for Construction, Landlord shall notify Tenant in writing of the
cost which will be chargeable to Tenant by reason of such Changes and
10
Tenant shall, within three (3) days, notify Landlord in writing whether it
desires to proceed with such Changes. If Tenant does not notify Landlord whether
it desires such Changes within the aforesaid three (3) day period, Landlord
shall not be obligated to continue work on Tenant's Premises and may suspend all
work until such notice is given by Tenant, and Tenant shall be responsible for
any and all delays in completing the tenant improvements resulting from Tenant's
failure to so notify Landlord. If Tenant authorizes any Changes pursuant to this
Section 7, Tenant shall pay the entire cost of same to Landlord prior to
Landlord's making such Changes.
(c) Landlord shall, in a good and workmanlike manner, cause the
Premises to be improved and completed in accordance with the Working Drawing by
a general contractor or construction manager ("Landlord's Contractor") selected
by Landlord (which may be an affiliate of Landlord or a partner in Landlord or
an affiliate of a partner in Landlord). Landlord reserves the right however,
(i) to make substitutions of material of equivalent grade and quality when and
if any specified material shall not be readily and reasonably available, and
(ii) to make changes necessitated by conditions met in the course of
construction, provided that Tenant's approval of any substantial change shall
first be obtained (which approval shall not be unreasonably withheld,
conditioned or delayed so long as there shall be general conformity with the
Working Drawings).
(d) Any costs or expenses to be paid by Tenant pursuant to this
Section 7 shall be deemed additional rent. Any failure by Tenant to pay such
costs and expenses shall constitute a failure to pay rent when due and an Event
of Default by Tenant hereunder, giving rise to all remedies available to
Landlord under this Lease and at law or equity for non-payment of rent.
(e) Upon Substantial Completion of the A-1 Premises, Tenant and
Landlord's representatives shall make a final inspection of the A-1 Premises to
ascertain that the construction of the Tenant Improvements has been accomplished
in accordance with the Working Drawings. A punch-list of items to be completed
or connected shall be prepared in accordance with Section 2(c).
(f) Upon Substantial Completion of the A-2 Premises, Tenant and
Landlord's representatives shall make a final inspection of the A-2 Premises to
ascertain that the construction of the Tenant Improvements has been accomplished
in accordance with the Working Drawings. A punch-list of items to be completed
or connected shall be prepared in accordance with Section 2(d).
8. OPERATING EXPENSES.
------------------
(a) During the term of this Lease, Tenant shall pay as additional rent
an amount (per each square foot within the Premises) equal to the excess
("Excess") from time to time of the per square foot Basic Cost (which shall be
calculated by dividing the Basic Cost by the total rentable square feet of
office area in the Building) over the Base Year Stop. Landlord, at its option,
may collect such additional rent for each calendar year in a lump sum, to be due
and
11
payable within thirty (30) days after Landlord furnishes to Tenant a statement
of actual Basic Cost for the previous year, or, beginning with the first
anniversary of the Commencement Date, or if the Commencement Date is not on the
first day of a month, then on the first day of the first full calendar month
after the Commencement Date, and on each anniversary of such date thereafter,
Landlord shall also have the option to make a good faith estimate of the Excess
for each upcoming calendar year and may require the monthly payment of such
additional rent equal to one-twelfth (1/12) of such estimate, except that
commencing in calendar year 1996 and each calendar year thereafter, Tenant's
first payment shall include the one-twelfth (1/12th) monthly payments for the
months from January 1st through the month in which Landlord submitted the
estimate of the Excess for the then-current calendar year.
(b) By April 1st of each calendar year during Tenant's occupancy and
the calendar year following termination of this Lease, or as soon thereafter as
practical, Landlord shall furnish to Tenant a statement of Landlord's actual
Basic Cost for the previous year. If for any calendar year additional rent
collected for the prior year as a result of Landlord's estimate of Basic Cost is
(i) in excess of the additional rent actually due during such prior year, then
Landlord shall either credit such overpayment towards Tenant's next installment
of Basic Rental becoming due or refund to Tenant any overpayment, or (ii) less
than the additional rent actually due during such prior year, then Tenant shall
pay to Landlord, within fifteen (15) days of demand, any underpayment with
respect to the prior year. If the Lease Expiration Date is a day other than the
first day or last day of a calendar year, respectively, then Tenant's liability
for its proportionate share of the Basic Cost incurred during such calendar year
shall be apportioned by multiplying the amount of Tenant's liability therefor
for the full calendar year by a fraction, the numerator of which is the number
of days during such calendar year falling within the Lease Term, and the
denominator of which is 365. Once the Basic Cost for the last calendar year of
the Lease Term has been determined, Landlord shall provide Tenant with a
statement of the actual Basic Cost for which Tenant is liable. If Tenant owes
an additional amount, such amount is due on or before thirty (30) days after
receipt of the statement. If Tenant is entitled to a refund, Landlord shall
have thirty (30) days from the date of the statement within which to remit
payment to Tenant. Tenant's obligation for this increase shall survive any
termination of the Lease by lapse of time or otherwise.
(c) Each statement furnished by Landlord to Tenant shall be conclusive
and binding upon Tenant unless, within thirty (30) days after receipt of such
statement, Tenant delivers to Landlord a written notice specifying the
particular details for which such statement is claimed to be incorrect. Pending
the determination of such dispute, Tenant shall pay without delay the full
amount of the additional rent payable by Tenant in accordance with each such
statement that Tenant is disputing, less the amount that Tenant is disputing.
Without limiting the preceding sentence, Tenant, or its authorized agent, shall
have the right, during Landlord's normal business hours and after reasonable
notice, to inspect the books and records of Landlord applicable to the
determination of any statement of any additional rent payable by Tenant for the
purpose of verifying in good faith the information contained in such statement
for a period of up to one year after the receipt of such statement by Tenant.
12
(d) Should Tenant require any additional work or service, including
but not limited to heating, ventilation and air conditioning ("HVAC") furnished
outside Landlord's normal operating hours of 7:00 a.m. to 6:00 p.m., Monday
through Friday, excluding holidays, Landlord may, upon reasonable advance notice
by Tenant, furnish such additional services at a charge not less than Landlord's
actual cost, plus overhead for the additional services provided, it being agreed
that the cost to the Landlord of such additional services shall not be
considered or treated as Basic Cost.
(e) Landlord may, at any time in its sole discretion, require separate
metering for gas, electric power or for any other utility service required by
Tenant if such service is deemed by Landlord to be in excess of Building
standard usage or for any other reason, in which case the cost of such metering
shall be at Tenant's sole cost and expense, due and payable upon demand by
Landlord, and in which event Tenant shall pay for all such utility service in
excess of its normal and customary usage, as metered. For any utility services
that are separately metered as prescribed herein, the amount of said services
which had been included in the calculation of the Base Year Stop or the
calculation of Basic Cost shall be excluded therefrom.
(f) Notwithstanding any expiration or termination of this Lease prior
to the end of the Lease Term, Tenant's obligations to pay any and all additional
rent pursuant to this Lease shall continue and shall cover all periods up to the
expiration or termination date of this Lease. Tenant's obligation to pay any
and all additional rent or other sums owing by Tenant to Landlord under this
Lease shall survive any expiration or termination of this Lease.
9. USE.
---
(a) Tenant shall use the Premises only for the Permitted Use. Tenant
will not occupy or use the Premises, or permit any portion of the Premises to be
occupied or used, for any business or purpose other than the Permitted Use or
for any use or purpose which is unlawful, in part or in whole, disreputable in
any manner, or extra hazardous, nor will Tenant permit anything to be done which
shall in any way cause substantial noise (except for routine graduate school
activities), vibrations or fumes, or increase the rate of insurance on the
Building or contents or cause any cancellation of any insurance policy covering
the Building or any portion of its contents. Tenant will comply, at Tenant's
cost and expense, with all present and future laws, ordinances, regulations and
orders of the United States of America, the Commonwealth of Virginia, and any
other public or quasi-public authority having jurisdiction over the Premises.
In the event that, by reason of acts or omissions of Tenant, there shall be any
increase in the rate of insurance on the Building or contents created by
Tenant's acts, omissions or conduct of business, Tenant hereby agrees to pay to
Landlord the amount of such increase on demand; provided, however, that Landlord
provides to Tenant a letter from Landlord's insurer stating that Tenant's acts
or omissions have caused the increase in Landlord's insurance premiums. Tenant
will conduct its business and control its agents, employees and invitees in such
a manner as not to create any nuisance, nor interfere with or disturb the
possession of other tenants or Landlord in
13
the management of the Building. In addition to, and not in limitation of, the
foregoing, Tenant agrees that neither Tenant nor its employees, students,
clients, customers, agents, guests and/or business invitees shall loiter,
linger, congregate or wait in or around the restrooms, parking areas, sidewalks,
walks, lobby entries, lobbies, corridors, staircases, elevators, or any and all
other common areas of the Building. The parking areas, sidewalks, walks, lobby
entries, lobbies, corridors, staircases, elevators, and any and all other common
areas of the Building shall not be obstructed or used for any purpose other than
ingress and egress to and from the Premises or the Building. Tenant shall cause
its employees, students, clients, customers, agents, guests and/or business
invitees to comply with this Section 9(a).
(b) Notwithstanding the generality of subsection (a) above, Tenant
represents, warrants and covenants that (1) the Premises will not be used for
any dangerous, noxious or offensive trade or business and that it will not cause
or maintain a nuisance therein, (2) it shall at all times comply with all
Environmental Laws (as hereinafter defined) and shall cause the Premises to
comply, and (3) Tenant will keep the Premises, the Building or the Land free of
any lien imposed pursuant to any Environmental Laws. Tenant shall also cause
its subtenants and assignees (if subtenants and assignees are permitted by this
Lease or are hereafter approved by Landlord), licensees, invitees, agents,
contractors, subcontractors and employees to comply with all Environmental Laws.
Tenant and its permitted subtenants, licensees, invitees, agents, contractors,
subcontractors and employees shall obtain, maintain, and comply with all
necessary environmental permits, approvals, registrations and licenses.
In addition to and not in limitation of the foregoing, Tenant, its
permitted subtenants and assignees, licensees, invitees, agents, contractors,
subcontractors and employees shall not generate, refine, produce, transfer,
treat, store, use, process or transport Hazardous Materials on, above, beneath
or near the Premises, the Building or the Land. As used herein, the term
"Hazardous Materials" shall include, without limitation, all of the following:
(1) hazardous substances, as such term is defined in the Comprehensive
Environmental Response, Compensation and Liability Act ("CERCLA"), 42 U.S.C.
Section 9601 (14), as amended by the Superfund Amendments and Reauthorization
Act of 1986, Pub. L. ▇▇. ▇▇-▇▇▇, ▇▇▇ ▇▇▇▇. ▇▇▇▇ (▇▇▇. 17, 1986) ("▇▇▇▇"); (2)
regulated substances, within the meaning of Title I of the Resource Conservation
and Recovery Act, 42 U.S.C. Sections 6991-6991(i), as amended by ▇▇▇▇; (3)
hazardous materials as defined in Va. Code ▇▇▇. (S) ▇▇-▇▇▇-▇▇ (1950), as
amended from time to time and regulations promulgated thereunder; (4) any
element, compound or material which can pose a threat to the public health or
the environment when released into the environment; (5) asbestos and any
asbestos containing material and any substance that is then defined or listed
in, or otherwise classified pursuant to, any Environmental Laws or any
applicable laws or regulations as a "hazardous substance", "hazardous material",
"hazardous waste", "infectious waste", "toxic substance", "toxic pollutant" or
any other formulation intended to define, list, or classify substances by reason
of deleterious properties such as ignitability, corrosivity, reactivity,
carcinogenicity, toxicity, reproductive toxicity, or Toxicity Characteristic
Leaching Procedure (TCLP) toxicity; (6) any petroleum and drilling fluids,
produced waters, and other wastes associated with the exploration, development
or production of crude oil, natural gas,
14
or geothermal resources; (7) petroleum, petroleum byproducts, petroleum
products, polychlorinated biphenyls, urea formaldehyde, radon gas, radioactive
material (including any source, special nuclear, or by-product material), and
medical waste; (8) an object or material which is contaminated with any of the
foregoing; (9) any other substance designated by any of the Environmental Laws
or a federal, state or local agency as detrimental to public health, safety and
the environment.
(c) "Environmental Laws" collectively means and includes all present
and future laws and any amendments (whether common law, statute, rule, code,
regulation or otherwise), permits, and other requirements or guidelines of
governmental authorities applicable to the Premises and relating to the
environment and environmental conditions or to any Hazardous Material(s)
(including, without limitation, CERCLA, 42 U.S.C. (S)9601, et. seq.; the
Resource Conservation and Recovery Act of 1976, 42 U.S.C., (S)6901, et. seq.;
the Hazardous Materials Transportation Act, 49 U.S.C. (S)1801, et. seq.; the
Federal Water Pollution Control Act, 33 U.S.C. (S)1251, et. seq.; the Clean Air
Act, 33 U.S.C. (S)7401, et. seq., the Clean Air Act, 42 U.S.C. (S)741, et. seq.;
the Toxic Substances Control Act, 15 U.S.C. (S)2601-2629; the Safe Drinking
Water Act, 42 U.S.C. (S)300f-300j; the Emergency Planning and Community Right-
▇▇-▇▇▇▇ ▇▇▇, ▇▇ ▇.▇.▇. (▇)▇▇▇▇, et. seq., and any so-called "Super Fund" or
"Super Lien" law, any law requiring the filing of reports or notices relating to
Hazardous Materials, environmental laws administered by the Environmental
Protection Agency and any similar state and local laws and regulations, all
amendments thereto and all regulations, orders, decisions, and decrees now or
hereafter promulgated thereunder concerning the environment, industrial hygiene
or public health or safety.)
(d) Tenant shall protect, indemnify, defend (with counsel approved by
Landlord) and save Landlord and Landlord's affiliates, shareholders, directors,
officers, employees and agents harmless from and against any and all
liabilities, losses, damages (including consequential damages), claims,
judgments, penalties, fines, suits, administrative proceedings, costs or
expenses (including reasonable attorneys' fees) of any kind or nature, known or
unknown, contingent or otherwise, that Landlord may suffer or incur as a result
of any claims, demands, damages, losses, liabilities, costs, expenses, fines,
charges, suits, orders, judgments or adjudications asserted, assessed, filed, or
entered against Landlord or the Premises or any of the Building or the Land, by
any third party, including, without limitation, any governmental authority,
arising from Tenant's breach of the Environmental Laws or otherwise arising from
or related to the alleged generation, refining, production, storage, handling,
use, transfer, processing, transportation, release, spillage, pumping, pouring,
emission, emptying, dumping, discharge or escape of Hazardous Materials on, from
or affecting the Premises, the Building or the Land, including, without
limitation, liability for costs and expenses of abatement, correction, clean-up
or other remedies, fines, damages, responses (including death), property damage
and loss or restriction on use of rentable or usable space of the Building.
(e) Tenant, its permitted subtenants and assignees, licensees,
invitees, agents, contractors, subcontractors and employees shall not release,
spill, pump, pour, emit, empty, dump
15
or otherwise discharge or allow to escape Hazardous Materials onto the Land,
Building or the Premises, and Tenant shall take all action necessary to remedy
the results of any such release, spillage, pumping, pouring, emission, emptying,
dumping, discharge, or escape. Tenant shall give to Landlord immediate verbal
and follow-up written notice of any actual or threatened spills, releases or
discharges of Hazardous Materials on the Premises, caused by the acts or
omissions of Tenant or its agents, employees, representatives, invitees,
licensees, subtenants, customers or contractors. Tenant covenants to promptly
investigate, clean up and otherwise remediate any spill, release or discharge of
Hazardous Materials caused by the acts or omissions of Tenant or its agents,
employees, representatives, invitees, licensees, subtenants, customers or
contractors at Tenant's sole cost and expense; such investigation, clean up and
remediation to be performed in accordance with all Environmental Laws and to the
satisfaction of Landlord and after Tenant has obtained Landlord's written
consent, which shall not be unreasonably withheld. Tenant shall return the
Premises to the condition existing prior to the introduction of any such
Hazardous Materials.
In the event of (1) a violation of any Environmental Laws, (2) a
release, spill or discharge of any Hazardous Materials on or from the Premises,
or (3) the discovery of an environmental condition requiring response which
violation, release, or condition is attributable to the acts or omissions of
Tenant, its agents, employees, representatives, invitees, licensees, subtenants,
customers, or contractors, or (4) an emergency environmental condition (together
"Environmental Defaults"), Landlord shall have the right, but not the
obligation, to immediately enter the Premises, to supervise and approve any
actions taken by Tenant to address the Environmental Default(s); and in the
event Tenant fails to immediately address such Environmental Default(s), or if
the Landlord deems it necessary, then Landlord may perform, at Tenant's expense,
any lawful actions necessary to address the Environmental Default(s).
Landlord has the right but not the obligation to cure any
Environmental Default(s), has the right to suspend some or all of the operations
of the Tenant until it has determined to its sole satisfaction that appropriate
measures have been taken, and has the right to terminate the Lease upon the
occurrence of any Environmental Default(s).
(f) Tenant shall within 48 hours deliver to the Landlord (1) copies of
any documents received from the United States Environmental Protection Agency
and/or any state, county or municipal environmental or health agency concerning
the Tenant's operations upon the Premises; (2) copies of any documents submitted
by the Tenant to the United States Environmental Protection Agency and/or any
state, county or municipal environmental or health agency concerning its
operations on the Premises, including but not limited to copies of permits,
licenses, annual filings, registration forms and; (3) upon the request of
Landlord, Tenant shall provide Landlord with evidence of compliance of
Environmental Laws.
(g) Landlord shall have the right, but not the obligation, at all
times during the term of this Lease to (1) inspect the Premises, (2) conduct
tests and investigations and take samples to determine whether Tenant is in
compliance with the provisions of this Section 9, and
16
(3) request lists of all Hazardous Materials used, stored or located on the
Premises; the cost of all such inspections, tests and investigations to be borne
by Tenant.
Tenant will cooperate with Landlord and allow Landlord and Landlord's
representatives access to any and all parts of the Premises and to the records
of Tenant with respect to the Premises for environmental inspection purposes at
any time. In connection therewith, Tenant hereby agrees that Landlord or
Landlord's representatives may perform any testing upon or in the Premises that
Landlord deems reasonably necessary for the valuation of environmental risks,
costs, or procedures, including soils or other sampling or coring.
(h) The provisions of this Section 9 shall survive the expiration or
earlier termination of this Lease.
(i) Tenant, its permitted subtenants and assignees, licensees,
invitees, agents, contractors, subcontractors and employees shall have the right
to contract for that number of parking spaces set out on the attached Data Sheet
which has been reasonably determined by Landlord to be Tenant's proportionate
share of the total parking spaces available on the Building and Land ("Parking
Spaces") within one hundred eighty (180) days of the Commencement Date.
Notwithstanding anything contained herein, if any governmental regulation or
ordinance is enacted or amended after the effective date of this Lease so as to
allow or require a modification in Tenant's number of Parking Spaces, Landlord
reserves the right to make such modification without modifying in any way the
rent due hereunder or any other obligations of Tenant. Tenant's right to
contract for the Parking Spaces as set forth above shall expire if Tenant does
not exercise said right within one hundred eighty (180) days after the
Commencement Date. Notwithstanding the foregoing, if there are parking spaces
available up to the amount of the Parking Spaces after the one hundred eighty
(180) days period has expired ("Additional Spaces"), Tenant and its employees
shall have the right to contract for the Additional Spaces on an "as available"
basis throughout the remaining term of the Lease at the then competitive rates
charged for such parking spaces. Landlord shall have no obligation to maintain
or keep Additional Spaces available and Landlord shall have the right to lease
such Additional Spaces to other tenants or occupants of the Building. Tenant
shall comply with all reasonable rules and regulations which Landlord or the
parking garage manager may make from time to time with respect to the use of the
parking areas. Landlord's remedies under such rules and regulations may include,
but shall not be limited to, the right to tow away at the owner's expense .any
vehicles not parked in compliance with such rules and regulations. Landlord
shall not be responsible to Tenant for the noncompliance or breach of such rules
and regulations by the parking garage manager or by any other tenant, its
agents, employees and invitees or members of the public who may park in the
parking area.
10. TENANT'S REPAIRS AND ALTERATIONS.
--------------------------------
(a) Tenant shall not in any manner deface or injure or make unapproved
modifications of the Premises or the Building and will pay the cost of repairing
any damage or
17
injury done to the Premises or the Building or any part thereof by Tenant or
Tenant's agents, employees or invitees. Tenant shall throughout the Lease Term
take good care of the Premises and keep them free from waste and nuisance of any
kind. Tenant agrees, at Tenant's sole cost and expense, to keep the Premises,
including, without limitation, all fixtures installed by Tenant and any plate
glass and special store fronts, in good condition, normal wear and tear
excepted, and make all necessary non-structural repairs and replacements except
those caused by fire, casualty or acts of God covered by Landlord's fire
insurance policy covering the Building. Such repairs and replacements shall be
in quality equal to the original work and installation. If Tenant fails to make
such repairs within fifteen (15) days after the occurrence of the damage or
injury, Landlord may, at its sole option, make such repair, and Tenant shall,
upon demand therefor, pay Landlord for Landlord's cost thereof plus fifteen
percent (15%) for overhead costs.
(b) The original improvements of the Premises shall be accomplished by
Landlord in accordance with the Working Drawings and Title III of the Americans
with Disabilities Act of 1990, as amended. Landlord is under no obligation to
make any structural or other alterations, decorations, additions, improvements
or other changes including computer or telephone cabling (collectively
"Alterations") in or to the Premises except as set forth in the Working Drawings
or otherwise expressly provided in this Lease. Any additional Alterations,
which are necessary in order for the Premises to comply with the requirements of
Title III of the Americans with Disabilities Act of 1990, as amended, or such
other laws or amendments thereto which may be hereinafter enacted during the
term of this Lease or any extensions or renewals hereof shall be the
responsibility of Tenant, and Tenant hereby agrees to indemnify Landlord for any
loss, claim or damages incurred by Landlord as a result of Tenant's failure to
make such additional Alterations.
(c) Notwithstanding anything in the Lease to the contrary, Tenant
shall not make or allow to be made any Alterations without the prior written
consent of Landlord, which shall not be unreasonably withheld. All maintenance,
repairs or Alterations shall be conducted only by contractors or subcontractors
approved in advance in writing by Landlord, it being understood that Tenant
shall procure and maintain, and shall cause such contractors and subcontractors
engaged by or on behalf of Tenant to procure and maintain, insurance coverage
against such risks, in such amounts and with such companies as Landlord may
require in connection with any such maintenance, repair or Alterations. Any
Alterations made by Tenant shall be made: (a) in a good, workmanlike, first-
class and prompt manner; (b) using new materials only; (c) by a contractor and
in accordance with plans and specifications approved in writing by Landlord; (d)
in accordance with all applicable legal requirements and requirements of any
insurance company insuring the Building or portion thereof, including, but not
limited to, compliance with Title III of the Americans with Disabilities Act of
1990, as amended; and (e) after Tenant has obtained and delivered to Landlord
written, unconditional waivers of mechanics' and materialmen's liens against the
Premises and the Building from all proposed contractors, subcontractors,
laborers and material suppliers for all work and materials in connection with
such Alterations. Landlord shall require a guarantee by each of Tenant's prime
contractors and materialmen for the benefit of Landlord, Tenant and such other
parties as Landlord shall
18
designate that all work performed and materials and equipment furnished by such
contractors will conform to the requirements of the plans and specifications as
to the kind, quality, function of the equipment and characteristics of material
and workmanship and will remain so for a period of at least one year from the
date that the work has been completed, said guarantees to be effective whether
or not any part of the aforesaid work has been subcontracted by the contractor.
In the event any deficiencies, defects, faults or imperfections of materials,
equipment or workmanship shall appear prior to the expiration of such one year
period, the contractor, upon receiving written notice thereof from Landlord or
Tenant, will immediately correct and repair the same at the expense of such
contractor.
(d) At the expiration or other termination of this Lease, Tenant shall
surrender the Premises with all Alterations located therein in good repair and
condition, reasonable wear and tear excepted, and shall deliver to Landlord all
keys to the Premises. All Alterations (whether temporary or permanent in
character) made in or upon the Premises by Landlord or Tenant shall be
Landlord's property upon termination of this Lease and shall remain on the
Premises without compensation to Tenant; provided, however, that if Landlord
elects to have Tenant remove the Alterations as provided below, Tenant shall
remove the specified Alterations and shall restore the Premises to its original
condition by the date of termination of this Lease or upon earlier vacating of
the Premises. Upon receiving Tenant's written request to make any Alterations,
and if Landlord consents to the Alterations requested, Landlord shall specify
whether and to what extent Landlord will require Tenant to remove the
Alterations in question at or prior to the termination or earlier vacation of
the Premises. If Landlord fails to so specify, Tenant shall have no further
obligation to remove the Alterations which were the subject of Tenant's request.
If Tenant fails to restore the Premises upon Landlord's request, Landlord shall
have the right to perform such restoration and Tenant shall be liable for all
costs and expenses incurred by Landlord therefor.
11. ASSIGNMENT AND SUBLETTING.
-------------------------
(a) Neither Tenant nor Tenant's representatives, successors and
assigns nor any subtenant or assignee will assign, transfer, mortgage or
otherwise encumber this Lease or sublet or rent (or permit the occupancy or use
of) the Premises, or any part thereof, without obtaining the prior written
consent of Landlord, which consent will not be unreasonably withheld or delayed
as provided in subsection (b) below, nor shall any assignment or transfer of
this Lease or the right of occupancy hereunder be effectuated by operation of
law or otherwise without the prior written consent of Landlord. The transfers,
whether a single transfer or multiple transfers, of fifty percent (50%) or more
of the ownership interests of Tenant shall be deemed equivalent to an assignment
or subletting requiring consent of Landlord. Any reasonable expenses incurred
by Landlord with respect to the review and consent or denial of consent of the
foregoing, including reasonable attorneys' fees, shall be paid by Tenant to
Landlord as additional rent, and shall be due and payable with the next monthly
Installment of rent when billed.
19
(b) Subject to the provisions of Section 11(c) hereof, Landlord shall
not unreasonably withhold or delay its consent hereunder to any sublease by
Tenant, provided that all of the following conditions are met:
(i) Tenant must first notify Landlord, in writing, of any
proposed sublease, at least thirty (30) days prior to the effective date of such
proposed sublease. The notice to Landlord must include a copy of the proposed
sublease and a copy of the proposed subtenant's financial statement for its most
recent fiscal year, prepared in accordance with generally accepted accounting
principles and certified by a public accountant or an executive officer of the
proposed subtenant.
(ii) The subtenant must have a credit rating satisfactory to
Landlord (in Landlord's reasonable judgment).
(iii) The sublease must be expressly subject and subordinate to
this Lease, must require that any subtenant must comply with and abide by all of
the terms of the Lease, and must provide that any termination of this Lease
shall extinguish the sublease as well.
(iv) The subtenant may not propose to change, without the
Landlord's prior written consent, the use of the Premises to a purpose other
than as stated in Section 9 hereof, nor conduct its business in a manner which,
in Landlord's reasonable judgment, is not appropriate for a first-class office
building in the metropolitan Washington, D.C. area.
(v) The Tenant may not be in default under this Lease, or have
committed two Events of Default hereunder during the precious twelve (12)
months, whether cured or not.
(vi) Any sublease, assignment or other transfer shall be
affected on a form approved by Landlord.
(vii) The sublease shall contain the following clause:
"Underlying Lease Agreement. This Sublease and Subtenant's
--------------------------
rights under this Sublease shall at all times be subject and subordinate to
the underlying Lease identified in Paragraph _ hereof and Subtenant shall
perform all obligations of Tenant under said Lease, with respect to the
Sublease Premises. Subtenant acknowledges that any termination of the
underlying Lease shall extinguish this Sublease. Landlord's consent to
this Sublease shall not make Landlord a party to this Sublease, shall not
create any privity of contract between Landlord and Subtenant or other
contractual liability or duty on the part of the Landlord to the Subtenant,
shall not constitute its consent or waiver of consent to any subsequent
sublease or sub-sublease, and shall not in any manner increase, decrease or
otherwise affect the rights and obligations of Landlord and Tenant under
the underlying Lease, in respect of the Sublease Premises. Subtenant shall
20
have no right to assign this Sublease or further sublet the Premises
without the prior written consent of Landlord. Any term of this Sublease
that in any way conflicts with or alters the provisions of the underlying
Lease shall be of no effect as to Landlord and Landlord shall not assume
any obligations as landlord under the Sublease and Tenant shall not acquire
any rights under the Sublease directly assertable against Landlord under
the underlying Lease. Tenant hereby collaterally assigns to Landlord this
Sublease and any and all payments due to Tenant from Subtenant as
additional security for Tenant's performance of all of its covenants and
obligations under the underlying Lease, and authorizes Landlord to collect
the same directly from Subtenant and otherwise administer the provisions of
this Sublease, at the option of Landlord. Subtenant hereby consents to such
collateral assignment of this Sublease to Landlord and agrees to observe
its obligations created hereby."
(c) Landlord shall have the right, within thirty (30) days after
receipt of the notice from Tenant required under Section 11(b)(i) above, that
Tenant proposes to sublease all or a portion of the Premises, to elect (i) to
sublet the Premises from Tenant at the rent then being paid by Tenant for the
Premises under Section 3 hereof (or that portion thereof which Tenant proposes
to sublease) by a proportionate reduction in the rent as hereinafter set forth;
(ii) to terminate this Lease in its entirety if Tenant intends to sublet all or
substantially all of the Premises or, if Tenant proposes to sublet a portion of
the Premises, to terminate this Lease only with respect to such portion of the
Premises; or (iii) to require Tenant to pay Landlord, within ten (10) days of
receipt, fifty percent (50%) of the amount of rent payable by such sublease in
excess of the amount of rent payable by Tenant hereunder with respect to the
portion of the Premises sublet, offset by any direct reasonable expenses
incurred by Tenant in subleasing such portion of the Premises (amortized in
equal monthly payments over the initial term of such sublease). Upon exercise
by Landlord of either of the options set forth in (i) or (ii) above, Tenant
shall surrender the Premises or such portion of the Premises, as the case may
be, to Landlord, and thereafter the rent to be paid by Tenant pursuant to
Section 3 above shall be that portion of the total rent which the amount of
square foot area remaining in the possession of Tenant bears to the total square
foot area of the Premises. In the event that Landlord does not exercise its
right to sublet the Premises, or such portion of the Premises, as the case may
be, or to terminate this Lease, within said thirty (30) day period, Tenant shall
have the right, subject to the provisions of (iii) above, to sublet the Premises
or a portion thereof after first obtaining the written consent of Landlord as
provided in Section 11(a) above. Upon exercise by Landlord of the option set
forth in (iii) above, Tenant covenants and agrees to provide Landlord with semi-
annual statements, prepared and verified by a certified public accountant or
executive officer of Tenant, stating the amount of rent received by Tenant from
its subtenant(s) during such semi-annual period. If such statement shows Tenant
failed to make the full payment required by (iii) above, a late charge equal to
ten percent (10%) of the amount due shall be paid by Tenant to Landlord as
additional rent, and shall be due and payable with the monthly installment of
rent next becoming due. For purposes of calculating any amounts due from Tenant
pursuant to (iii) above, the "amount of rent payable by Tenant" exclusive of
such amounts due pursuant to (iii) shall be that portion of the total rent
21
which the amount of square foot area sublet by Tenant bears to the total square
foot area of the Premises.
(d) The consent by Landlord to any assignment or subletting shall not
be construed as a waiver or release of Tenant from the terms of any covenant or
obligation under this Lease, nor shall the collection or acceptance of rent from
any such assignee, subtenant or occupant constitute a waiver or release of
Tenant of any covenant or obligation contained in this Lease, nor shall any such
assignment or subletting be construed to relieve Tenant from obtaining the
consent in writing of Landlord to any further assignment or subletting. Tenant
hereby assigns to Landlord the rent due from any subtenant of Tenant and hereby
authorizes each such subtenant to pay said rent directly to Landlord, at
Landlord's option, in the event of any default by Tenant under the terms of this
Lease. In the event of default by any assignee of Tenant or any successor of
Tenant in the performance of any of the terms hereof, Landlord may proceed
directly against Tenant without the necessity of exhausting remedies against
such assignee or successor. Landlord may consent to subsequent assignments or
sublettings of this Lease or amendments or modifications to this Lease with
assignees of Tenant, without notifying Tenant, or any successor of Tenant, and
without obtaining its or their consent thereto and such action shall not relieve
Tenant of liability under this Lease. All restrictions and obligations imposed
pursuant to this Lease on Tenant shall be deemed to extend to any subtenant,
assignee or occupant of Tenant, and Tenant shall cause such persons to comply
with all such restrictions and obligations.
(e) Notwithstanding the foregoing provisions of this Section 11, if
consent of any assignment is required by the holder of any mortgage on the
Building, no assignment shall be permitted without the prior written consent of
such holder.
12. INDEMNITY.
---------
Landlord shall not be liable for, and Tenant shall indemnify and save
harmless Landlord, ground lessor, if any, and Landlord's managing agent, and
Landlord's subsidiaries, directors, officers, agents and employees, if any, from
and against all fines, damages, suits, claims, demands, costs, expenses, losses
and actions (including court costs and reasonable attorneys' fees) for any
injury to person (including death) or damage to or loss of property on or about
the Premises, Building or Land caused by Tenant, its employees, contractors,
subtenants, agents, invitees or by any other person entering the Premises or the
Building or the Land under the express or implied invitation of Tenant, or
arising out of Tenant's use of the Premises, Building or Land or the acts or
omissions of Tenant, its employees, contractors, subtenants, agents or invitees.
Landlord shall not be liable or responsible for any loss or damage to any
property or death or injury to any person occasioned by theft, fire, act of God,
public enemy, criminal conduct of third parties, injunction, riot, strike,
insurrection, war, court order, requisition or other governmental body or
authority, by other tenants of the Building or any other matter beyond the
reasonable control of Landlord, or for any injury or damage or inconvenience
which may arise through repair or alteration of any part of the Building, or
failure to make repairs, or from any cause whatsoever except Landlord's gross
negligence or willful misconduct.
22
13. SUBORDINATION.
-------------
(a) This Lease and all rights of Tenant hereunder shall be and are
subject and subordinate at all times to any deeds of trust, mortgages,
installment sale agreements and other instruments or encumbrances, as well as to
any ground leases or primary leases, that now or hereafter cover all or any part
of the Building, the Land or an interest of Landlord therein, and to any and all
advances made on the security thereof, and to any and all increases, renewals,
modifications, consolidations, replacements and extensions of any of such deeds
of trust, mortgages, installment sale agreements, instruments, encumbrances or
leases, as well as any substitutions therefor, all automatically and without the
necessity of any further action on the part of Tenant to effectuate such
subordination. Provided, however, that notwithstanding the foregoing, the party
secured by any such deed of trust shall have the right to recognize this Lease,
and in the event of any foreclosure sale under such deed of trust, this Lease
shall continue in full force and effect at the option of the party secured by
such deed of trust or the purchaser under any such foreclosure sale, in which
event Tenant shall attorn to such party secured by such deed of trust or
purchaser and shall recognize such party secured by such deed of trust or
purchaser as the Landlord under this Lease. Tenant shall upon demand at any
time execute, acknowledge and deliver to Landlord's mortgagee (including the
beneficiary under any deed of trust) or other holder any and all instruments and
certificates that in the judgment of Landlord's mortgagee may be necessary or
proper to confirm or evidence such attornment. Tenant hereby appoints Landlord
the Tenant's attorney-in-fact to execute any such certificate or certificates
for and on behalf of the Tenant. Upon such attornment such party secured by
such deed of trust or purchaser shall not be (i) bound by any payment of rent or
additional rent more than one (1) month in advance, (ii) bound by any amendment
of this Lease made without the consent of the holder of the deed of trust
existing as of the date of such amendment, (iii) liable for damages for any
breach, act or omission of any prior landlord, or (iv) subject to any offsets or
defenses which Tenant might have against any prior landlord; provided, however,
that after succeeding to Landlord's interest, such party secured by such deed of
trust or purchaser shall perform, in accordance with the terms of this Lease,
all obligations of Landlord arising after the date of acquisition of title to
the Building. within fifteen (15) days after the request of Landlord's
successor, Tenant shall execute, acknowledge, and deliver any requisite or
appropriate document submitted to Tenant confirming such attornment. Landlord
agrees to use its best efforts to obtain from any holder of any mortgage or deed
of trust securing the Land or the Building ("Mortgagee") a subordination, non-
disturbance and attornment agreement for the benefit of Tenant and which is
acceptable to Mortgagee. For purposes of this Section 13, Landlord shall be
deemed to have used its best efforts if (1) Landlord has diligently inquired in
writing to such Mortgagee requesting the Mortgagee to provide a subordination,
non-disturbance and attornment agreement for the benefit of Tenant and (2)
Landlord has sent Tenant a copy of such written request. Tenant agrees to pay
any fees, costs or expenses required to be paid by the Mortgagee for reviewing
such request, whether or not granted. Landlord shall have no liability if such
Mortgagee refuses to give Tenant a subordination, non-disturbance and attornment
agreement.
23
(b) Tenant covenants and agrees that it will, at the written request
of the party secured by any such deed of trust, execute, acknowledge and deliver
any instrument that has for its purpose and effect the subordination of said
deed of trust to the lien of this Lease. At the option of any landlord under any
ground or underlying lease to which this lease is now or may hereafter become
subject or subordinate, Tenant agrees that neither the cancellation nor
termination of such ground or underlying lease shall, by operation of law or
otherwise, result in cancellation or termination of this Lease or the
obligations of Tenant hereunder and Tenant covenants and agrees to attorn to
such landlord or to any successor to Landlord's interest in such ground or
underlying lease, and in that event, this Lease shall continue as a direct lease
between Tenant herein and such landlord or its successor.
(i) After receiving notice from any person, firm or other
entity that it holds a mortgage or deed of trust on the Building or the Land, no
notice from Tenant to Landlord alleging any default by Landlord shall be
effective unless and until a copy of the same is given to such holder, provided
that Tenant shall have been furnished with the name and address of such holder.
Any such holder shall have thirty (30) days, or such additional time as may
reasonably be necessary, after receipt of notice from Tenant of a default by
Landlord under this Lease to cure such default before Tenant may exercise any
remedy hereunder. The curing of any of Landlord's default by such holder shall
be treated as performance by Landlord.
(ii) In the event that any lender providing construction or
permanent financing or any refinancing for the Building requires, as a condition
of such financing, that modifications to this Lease be obtained, and provided
that such modifications (a) are reasonable; (b) do not adversely affect in a
material manner Tenant's use of the Premises as herein permitted; and (c) do not
increase the rent or other sums to be paid by Tenant hereunder, Landlord may
submit to Tenant a written amendment to this Lease incorporating such required
changes, and Tenant hereby covenants and agrees to execute, acknowledge, and
deliver such amendment to Landlord within fifteen (15) days of Tenant's receipt
thereof.
14. RULES AND REGULATIONS.
---------------------
Tenant will comply and Tenant shall cause Tenant's agents,
contractors, employees and invitees to comply fully with all requirements of the
Rules and Regulations of the Building, as specified in the Rules and Regulations
attached hereto as Exhibit C. Landlord shall at all times have the right to
change such Rules and Regulations and to promulgate other Rules and Regulations
in such manner as Landlord may deem advisable, in its reasonable discretion, for
the operation, maintenance, safety, care or cleanliness of the Building or the
Premises, and for preservation of good order therein, all of which Rules and
Regulations, changes and amendments will be forwarded to Tenant in writing and
shall be carried out and observed by Tenant; provided, however, that no changes
and amendments to the Rules and Regulations shall prevent Tenant from using the
Premises as a college of higher education. Tenant shall be responsible for
compliance therewith by the agents, contractors, employees and invitees of
Tenant. Nothing contained in this Lease shall be construed to impose upon
Landlord any duty or obligation to
24
enforce such rules and regulations, or the terms, conditions or covenants
contained in any other lease, as against any other tenant, and Landlord shall
not be liable to Tenant for violation of the same by any other tenant, its
employees, agents, or invitees. If there is any inconsistency between this Lease
and the rules and regulations as set forth in Exhibit C, this Lease shall
govern. Landlord shall enforce all Rules and Regulations in a non-discriminatory
manner.
15. INSPECTION.
----------
Landlord or its officers, agents and representatives, and any ground
lessor or mortgagee thereof, shall have the right to enter into and upon any and
all parts of the Premises at all reasonable hours upon reasonable advance
notice, which may be oral, (or, in any emergency or for the purpose of
performing routine maintenance, at any hour and without advance notice) to (a)
inspect the Premises at any time, (b) clean or make repairs or alterations or
additions as Landlord may deem necessary (but without any obligation to do so,
except as expressly provided for herein), or (c) show the Premises to
prospective tenants (in the last twelve (12) months of the term or at any time
if an Event of Default exists under the terms and provisions of this Lease),
purchasers or lenders; and Tenant shall not be entitled to any abatement or
reduction of rent by reason thereof, nor shall such be deemed to be an actual or
constructive eviction.
16. CONDEMNATION.
------------
(a) If the whole or, as determined by Landlord in its sole discretion,
any substantial part of the Land or the Building or if any portion of the
Premises should be taken for any public or quasi-public use under governmental
law, ordinance or regulation, or by right of eminent domain, or by private
purchase in lieu thereof and the taking would prevent or materially interfere
with the use of the Premises for the purpose for which they are being used, as
determined by Landlord, this Lease shall terminate, effective on the date of
possession thereof by the authority and the rent shall be apportioned as of such
date. If part of the Land or Building, which does not include the Premises,
shall be taken for any public or quasi-public use under any governmental law,
ordinance or regulation, or by right of eminent domain, or by private purchase
in lieu thereof, and this Lease is not terminated as provided in the sentence
above, this Lease shall not terminate but the rent payable hereunder during the
unexpired portion of this Lease shall be reduced to such extent as Landlord
shall determine may be fair and reasonable under all of the circumstances;
provided, however, that if such taking prevents access to the Premises or the
use of the Premises as a college of higher education, then Tenant shall have the
right to terminate this Lease, effective on the date of possession by the
authority and the rent shall be apportioned as of such date.
(b) All awards, damages and other compensation paid by such authority
on account of such condemnation shall belong to Landlord, and Tenant assigns to
Landlord all rights to such awards, damages and compensation. Tenant shall not
make any claim against Landlord or the authority for any portion of such award,
damages or compensation attributable to damage to the Premises, value of the
unexpired portion of the Lease Term, loss of profits or goodwill,
25
leasehold improvements or severance damages. Tenant may, if allowed by statute,
seek such awards or damages for moving expenses, loss of profits and fixtures
and other equipment installed by it which do not, under the terms of this Lease,
become the property of Landlord at the termination hereof. Such awards or
damages must be made by a condemnation court or other authority and must be
separate and distinct from any award to Landlord for the Land and Building and
shall not diminish any award of Landlord.
17. FIRE OR OTHER CASUALTY.
----------------------
(a) In the event of damage to or destruction of the Premises or the
Building, or the entrances and other common facilities necessary to provide
normal access to the Premises, caused by fire or other casualty, Tenant shall
provide immediate notice thereof to Landlord, and Landlord shall make repairs
and restorations as hereafter expressly provided, unless this Lease shall be
terminated by Landlord or unless any mortgagee which is entitled to receive
casualty insurance proceeds fails to make available to Landlord a sufficient
amount of such proceeds to cover the cost of such repairs and restoration.
(b) If (i) the damage is of such nature or extent, in the judgment of
Landlord's architect, that more than two hundred ten (210) consecutive days,
after the casualty date, would be required (with normal work crews and hours and
taking into account the time needed for effecting a satisfactory settlement with
any insurance company involved, removal of debris, preparation of plans and
issuance of all required governmental permits) to repair and restore the part of
the Premises or Building which has been damaged, or (ii) a substantial portion
of the Premises or the Building is so damaged that, in Landlord's sole judgment,
it is uneconomic to restore or repair the Premises or the Building, as the case
may be, Landlord shall so advise Tenant promptly; and Landlord or Tenant, for a
period of thirty (30) days thereafter, shall have the right to terminate this
Lease by written notice to the other, as of the date specified in such notice,
which termination date shall be no later than thirty (30) days after the date of
such notice. If this Lease is terminated, then all rent shall be apportioned
(based on the portion of the Premises which is useable after such damage or
destruction). If this Lease is not terminated pursuant to the terms of this
Section 17, and if (i) sufficient casualty insurance proceeds are available for
use for such restoration or repair, and (ii) this Lease is then in full force
and effect, Landlord shall proceed promptly and diligently to restore the
Premises to its substantially similar condition prior to the occurrence of the
damage, provided that Landlord shall not be obligated to repair or restore any
alterations, additions, improvements or fixtures which Tenant or any other
tenant may have installed. The validity and effect of this Lease shall not be
impaired in any way by, and Landlord shall have no liability as a result of, the
failure of Landlord to complete repairs and restoration of the Premises or of
the Building within two hundred ten (210) consecutive days after commencement of
work (taking into account the time needed for effecting a satisfactory
settlement with any insurance company involved, removal of debris, preparation
of plans and issuance of all required governmental permits), even if Landlord
had in good faith notified Tenant that it estimated that the repair and
restoration would be completed within such period, provided that Landlord
proceeds diligently with such repair and restoration.
26
(c) In the case of damage to the Premises not caused by the negligence
or willful misconduct of the Tenant or any of its agents, employees or invitees,
and which is of a nature or extent that Tenant's continued occupancy is
substantially impaired, the rent otherwise payable by Tenant hereunder shall be
equitably abated or adjusted for the duration of such impairment as determined
by Landlord. In no event, however, shall any damages be payable by Landlord to
Tenant in respect of business interruption resulting from any fire or other
casualty on the Premises or Building or for any inconvenience or annoyance
occasioned by any such damage, repair or restoration. Tenant shall be
responsible to insure and/or repair all of Tenant's leasehold improvements and
all equipment, fixtures and personal property located in the Premises.
(d) Notwithstanding anything herein to the contrary, Landlord shall
not be obligated to restore the Premises or the Building and shall have the
right to terminate this Lease if (a) the holder of any mortgage fails or refuses
to make insurance proceeds available for such repair and restoration, (b) zoning
or other applicable laws or regulations do not permit such repair and
restoration, or (c) the cost of repairing and restoring the Building would
exceed fifty percent (50%) of the replacement value of the Building, whether or
not the Premises are damaged or destroyed, provided the leases of all other
tenants in the Building are similarly terminated.
18. HOLDING OVER.
------------
Tenant shall, at the termination of this Lease by lapse of time or
otherwise, yield up immediate possession to Landlord. If Tenant or any party
claiming under Tenant remains in possession of the Premises, or any portion
thereof at the termination of this Lease, no tenancy or interest in the Premises
shall result therefrom, unless Landlord elects as hereinafter provided, but such
holding over shall be an unlawful detainer and all such parties shall be subject
to immediate eviction and removal. If, without the written consent of Landlord,
Tenant or any party claiming under Tenant remains in possession of the Premises,
or any part thereof, after the termination of this Lease, Landlord may, in
addition to its other rights, including without limitation, rights of ejectment
and damages, elect, in its sole discretion, to treat such holding over by Tenant
as a creation of a month-to-month tenancy subject to all of the terms, covenants
and conditions in this Lease insofar as the same are applicable to a month-to-
month tenancy, except that Tenant shall pay a monthly Basic Rental in an amount
equal to one hundred fifty percent (150%) of the monthly Basic Rental in effect
during the last month of the term of this Lease. In the event Tenant holds over
pursuant to this Section 18, then Tenant shall give Landlord at least thirty
(30) days prior written notice of any intention to quit the Premises and Tenant
shall be entitled to thirty (30) days prior written notice to quit the Premises,
except in the event of nonpayment of rent in advance or the breach of any other
covenant by Tenant, in which event, Tenant shall not be entitled to any notice
to quit, the usual thirty (30) days notice to quit being hereby expressly
waived. If Landlord agrees in writing that Tenant may hold over after the
expiration or termination of this Lease, unless the parties hereto otherwise
agree in writing on the terms of such holding over, the holdover tenancy shall
be subject to termination by either Landlord or Tenant at any time upon not less
than thirty (30) days advance written notice (except in the event
27
of nonpayment of rent in advance or the breach of any other covenant by Tenant,
in which event, Tenant shall not be entitled to any notice to quit, the usual
thirty (30) days notice to quit being hereby expressly waived), and all of the
other terms and provisions of this Lease shall be applicable during that period,
except Tenant shall pay Landlord in advance, as the monthly Basic Rental for the
period of any holdover, an amount equal to one hundred fifty percent (150%) of
the monthly Basic Rental in effect on the termination date, computed on a daily
basis for each day of the holdover period. No holding over by Tenant, whether
with or without consent of Landlord, shall operate to extend this Lease except
as otherwise expressly provided in this Lease.
19. TAXES.
-----
(a) During each calendar year or portion thereof included in the Lease
Term, and any renewal thereof, Tenant shall pay to Landlord as additional rent,
Tenant's Proportionate Share of any increase in Real Estate Taxes over the Base
Real Estate Taxes. Real Estate Taxes shall mean (i) all real estate taxes,
including general and special assessments, if any, which are imposed upon
Landlord or assessed against the Building and/or the Land during any calendar
year, and (ii) any other present or future taxes or governmental charges that
are imposed upon Landlord with respect to the Building and/or the Land or
assessed against the Building and/or the Land during any calendar year which are
in the nature of, in addition to or in substitution for real estate taxes,
including, without limitation, any license fees, tax measured by or imposed upon
rents, or other tax or charge upon Landlord's business of leasing the Building,
but shall not include any federal, state or local income tax. Real Estate Taxes
shall also include all expenses incurred by Landlord in obtaining or attempting
to obtain a reduction of Real Estate Taxes, including but not limited to, legal
fees.
(b) Commencing on the first anniversary of the Commencement Date, or
if the Commencement Date is not the first day of a month, then on the first day
of the first full calendar month after the Commencement Date, and each
anniversary of such date thereafter, Landlord may deliver to Tenant a statement
of Landlord's estimate of any increase in the annual Real Estate Taxes for the
then current calendar year over the Base Real Estate Taxes and Tenant's
percentage thereof. Within thirty (30) days after delivery of such statement,
(including any statement delivered after the expiration or termination of this
Lease), Tenant shall pay to Landlord, as additional rent, Tenant's aforesaid
percentage share of such estimated increase in the annual Real Estate Taxes,
except that commencing in calendar year 1996 and each calendar year thereafter,
Tenant's first payment shall include the one-twelfth (1/12th) monthly shares for
the months from January 1st through the month in which Landlord submitted the
estimate of the increase in the annual Real Estate Taxes for the then current
calendar year.
(c) Commencing January 1, 1996, Landlord shall deliver to Tenant a
statement showing the determination of the increase in the annual Real Estate
Taxes for the preceding calendar year and Tenant's total percentage thereof,
such statement to be delivered on or before April 1st of the then current
calendar year and on or before April 1st of each subsequent calendar year, or as
soon thereafter as possible. If such statement shows that Tenant's payments,
28
if any, of the estimated monthly increase in the annual Real Estate Taxes for
said preceding calendar year exceeded Tenant's actual increases for said year,
then Tenant may deduct such overpayment from its next payment or payments of
monthly rent. If such statement shows that Tenant's percentage share of
Landlord's actual increases in the annual Real Estate Taxes exceeded Tenant's
payments, if any, of the estimated monthly increase in the annual Real Estate
Taxes for said preceding calendar year, then Tenant shall pay the total amount
due to Landlord, which amount shall constitute additional rent hereunder due and
payable with the first monthly installment of rent due after delivery of said
statement.
(d) In the event that the Lease date or other termination is not
December 31st, the increase to be paid by Tenant for the calendar year in which
the Lease date or other termination occurs shall be determined by multiplying
the amount of Tenant's share thereof for the full calendar year by a fraction
with the number of days during such calendar year prior to the Lease date as the
numerator, and with 365 as the denominator. The expiration or other termination
of this Lease shall not affect the obligations of Landlord and Tenant pursuant
to this Section 19 to be performed after such expiration or other termination.
(e) Tenant shall be liable for all taxes levied or assessed against
personal property, furniture or fixtures placed by Tenant in the Premises, and
if any such taxes for which Tenant is liable are in any way levied or assessed
against Landlord, Tenant shall pay the Landlord upon demand that part of such
taxes for which Tenant is primarily liable hereunder.
20. EVENTS OF DEFAULT.
-----------------
The occurrence of any of the following events shall be deemed to be an
event of default ("Event of Default") by Tenant under this Lease:
(a) Tenant shall fail to pay when due any rental or other sums payable
by Tenant hereunder; provided that, on up to one (1) occasion in any twelve (12)
month period, there shall exist no Event of Default unless Landlord gives to
Tenant written notice of such failure and Tenant shall have failed to make such
payment within five (5) days following the giving of such notice.
(b) Tenant shall fail to comply with or observe Section 9 of this
Lease (or a comparable section of any other lease now or hereafter executed by
Tenant in connection with space in the Building).
(c) Tenant shall fail to comply with or observe any other provision of
this Lease (or any other lease now or hereafter executed by Tenant in connection
with space in the Building), and same is not cured within fifteen (15) days
after Landlord's written notice thereof to Tenant.
(d) Intentionally deleted.
29
(e) Tenant or any partner or guarantor of Tenant, as the case may be,
shall apply for or consent to the appointment of a receiver, trustee or
liquidator of itself or himself or any of its or his property, admit in writing
its or his inability to pay its or his debts as they mature, make a general
assignment for the benefit of creditors, be adjudicated a bankrupt, insolvent or
file a voluntary petition in bankruptcy or a petition or an answer seeking
reorganization or an arrangement with creditors or to take advantage of any
bankruptcy, reorganization, insolvency, readjustment of debt, dissolution or
liquidation law or statute, or an answer admitting the material allegations of a
petition filed against it or him in any proceeding under any such law, or if
action shall be taken by Tenant or any partner or guarantor of Tenant for the
purposes of effecting any of the foregoing or the filing of an involuntary
petition against Tenant, or any partner or guarantor of Tenant is the subject
debtor under any bankruptcy law or insolvency law.
(f) Any court of competent jurisdiction shall enter an order, judgment
or decree approving a petition seeking reorganization of Tenant or all or a
substantial part of the assets of Tenant or any partner or guarantor of Tenant,
or appointing a receiver, sequestrator, trustee or liquidator of Tenant or any
partner or guarantor of Tenant or any of its or his property, and such order,
judgment or decree shall continue unstayed and in effect for any period greater
than thirty (30) days.
(g) Tenant's failure to take possession of the Premises after notice
to Tenant that the same are substantially completed.
21. REMEDIES.
--------
(a) If there shall be an Event of Default, including an Event of
Default prior to the Commencement Date, then Landlord shall have the right, at
its sole option, to terminate this Lease. In addition, with or without
terminating this Lease, Landlord may re-enter, terminate Tenant's right of
possession, and take possession of the Premises. The provisions of this Section
shall operate as a notice to quit, any other notice to quit or of Landlord's
intention to re-enter the Premises being hereby expressly waived. If necessary,
Landlord may proceed to recover possession of the Premises under and by virtue
of the laws of the Commonwealth of Virginia, or by such other proceedings,
including re-entry and possession, as may be applicable. If Landlord elects to
terminate this Lease and/or elects to terminate Tenant's right of possession,
then everything contained in this Lease to be done and performed by Landlord
shall cease, without prejudice, however, to Landlord's right to recover from
Tenant all rent and other sums due under the terms and conditions of this Lease.
Whether or not this Lease and/or Tenant's right of possession is terminated,
Landlord may, but shall not be obligated to, relet the Premises or any part
thereof, alone or together with other premises, for such rent and upon such
terms and conditions (which may include concessions, free rent, or alterations
of the Premises) as Landlord, in its sole discretion, may determine, but
Landlord shall not be liable for, nor shall Tenant's obligations be diminished
by reason of, Landlord's failure to relet the Premises or collect any rent
30
due upon such reletting. Whether or not this Lease is terminated, Tenant
nevertheless shall remain liable for any rent, additional rent or damages which
may be due or sustained prior to such default, and all costs, fees and expenses
(including without limitation reasonable attorneys' fees, brokerage fees,
expenses incurred in placing the Premises in a first-class rentable condition
and tenant finish necessitated to obtain the new tenant) incurred by Landlord in
pursuit of its remedies and in renting the Premises to others from time to time.
Tenant shall also be liable for additional damages which, at Landlord's
election, shall be either:
(i) an amount equal to the rent and additional rent which would
have become due during the remainder of the Lease Term, less the amount of
rental, if any, which Landlord receives during such period from others to whom
the Premises may be rented (other than any additional rent payable as a result
of any failure of such other person to perform any of its obligations), which
damages shall be computed and payable in monthly installments, in advance, on
the first day of each calendar month following Tenant's default and continuing
until the date on which the Lease Term would have expired but for Tenant's
default. Separate suits may be brought to collect any such damages for any
month(s), and such suits shall not in any manner prejudice Landlord's right to
collect any such damages for any subsequent month(s), or Landlord may defer any
such suit until after the expiration of the Lease Term, in which event the cause
of action shall be deemed not to have accrued until the expiration of the Lease
Term; or
(ii) an amount equal to the present value (as of the date of
Tenant's default) of the rent and additional rent which would have become due
during the remainder of the Lease Term, less the rent received by Landlord under
any reletting of the Premises, which damages shall be payable to Landlord in one
lump sum on demand; provided that Landlord has relet the Premises which
reletting may occur at any time up to the date on which the Lease Term would
have expired but for Tenant's default. For purposes of this subparagraph (ii),
present value shall be computed by discounting at a rate equal to one (1) whole
percentage point above the discount rate then in effect at the Federal Reserve
Bank of New York. Tenant waives any right of redemption, re-entry or restoration
of the operation of this Lease under any present or future law, including any
such right which Tenant would otherwise have if Tenant shall be dispossessed for
any cause.
(b) Landlord's rights and remedies set forth in this Lease are
cumulative and in addition to Landlord's other rights and remedies at law or in
equity, including those available as a result of any anticipatory breach of this
Lease. Landlord's exercise of any such right or remedy shall not prevent the
concurrent or subsequent exercise of any other right or remedy. Landlord's
delay or failure to exercise or enforce any of Landlord's rights or remedies or
Tenant's obligations shall not constitute a waiver of any such rights, remedies
or obligations. Landlord shall not be deemed to have waived any default unless
such waiver expressly is set forth in an instrument signed by Landlord. If
Landlord waives in writing any default, then such waiver shall not be construed
as a waiver of any covenant or condition set forth in this Lease except as to
the specific circumstances described in such written waiver. Neither Tenant's
payment of a lesser amount than the sum due hereunder nor Tenant's endorsement
or statement on any check or letter
31
accompanying such payment shall be deemed an accord and satisfaction, and
Landlord may accept the same without prejudice to Landlord's right to recover
the balance of such sum or to pursue any other remedy available to Landlord.
Landlord's re-entry and acceptance of keys shall not be considered an acceptance
of a surrender of this Lease.
(c) If more than one natural person and/or entity shall execute this
Lease as Tenant, then the liability of each such person or entity shall be joint
and several. Similarly, if Tenant is a general partnership or other entity the
partners or members of which are subject to personal liability, then the
liability of each such partner or member shall be joint and several.
(d) If Tenant fails to perform any covenant or observe any condition
to be performed or observed by Tenant hereunder or acts in violation of any
covenant or condition hereof or fails to make any payment to any third party
related to the use or operation of the Building, Landlord may, but shall not be
required to on behalf of Tenant, perform such covenant and/or take such steps,
including entering upon the Premises, as may be necessary or appropriate, in
which case Landlord shall have the right to proceed immediately and all costs
and expenses incurred by Landlord in so doing, including reasonable legal fees,
shall be paid by Tenant to Landlord upon demand, plus interest thereon at the
rate per annum ("Default Rate") equal to the greater of (i) eighteen percent
(18%) per annum; provided such rate is not usurious or (ii) the highest non-
usurious rate permitted under the laws of the jurisdiction where the Building is
located, from the date of expenditure(s) by Landlord, as additional rent.
Landlord's proceeding under the rights reserved to Landlord under this Section
shall not in any way prejudice or waive any rights Landlord might otherwise have
against Tenant by reason of Tenant's default.
(e) Any concessions of the Landlord (which may include among other
items: (i) brokerage fees; (ii) moving allowances; (iii) Tenant improvements;
(iv) Lease assumptions; (v) unamortized portions of the buildout; and (vi) any
other cash allowances or payments, all of which are individually or collectively
referred to as "Landlord's Concessions") are subject to the condition that,
throughout the Lease Term, Tenant will perform and comply with all of the terms,
covenants and conditions of this Lease to be performed or complied with by
Tenant. If, after the occurrence of an Event of Default, Landlord terminates
this Lease or reenters and takes possession of the Premises without such a
termination, all Landlord's Concessions shall cease to apply and Tenant shall be
obligated, within ten (10) days after demand, to pay to Landlord the value of
all Landlord's Concessions. Landlord's right to recover the value of all
Landlord's Concessions shall be in addition to any other remedies available to
Landlord.
22. SURRENDER OF PREMISES.
---------------------
No act done and no failure to act by Landlord or its agents during the
Lease Term shall be deemed an acceptance of a surrender of the Premises, and no
agreement to accept a surrender of the Premises shall be valid unless the same
be made in writing and signed by Landlord. At the termination of this Lease by
lapse of time or otherwise, Tenant shall surrender possession of the Premises to
Landlord and deliver all keys to the Premises and all locks therein
32
to Landlord and make known to Landlord the combination of all combination locks
in the Premises, and shall return the Premises and all equipment and fixtures of
Landlord therein to Landlord in broom clean condition and in as good condition
as when Tenant originally took possession, ordinary wear and tear excepted,
failing which Landlord may restore the Premises and such equipment and fixtures
to such condition and Tenant shall pay the cost thereof to Landlord on demand.
All obligations of Tenant under this Section shall survive the termination of
this Lease by lapse of time or otherwise.
23. ATTORNEYS' FEES.
---------------
If either party to this Lease brings an action to enforce the terms
hereof or declare rights hereunder, the prevailing party in any such action
shall be entitled to recover its reasonable attorneys' fees and costs from the
losing party. The losing party shall reimburse the prevailing party within ten
(10) days following written demand therefor.
24. LANDLORD'S LIEN.
---------------
In addition to any statutory Landlord's lien, Landlord shall have, at
all times, and Tenant hereby grants to Landlord, a valid security interest to
secure payment of all rentals and other sums of money becoming due hereunder
from Tenant, and to secure payment of any damages or loss which Landlord may
suffer by reason of the breach by Tenant of any covenant, agreement or condition
contained herein, upon all goods, wares, equipment, fixtures, furniture,
improvements and other personal property ("Personal Property") of Tenant
presently or which may hereafter be situated on the Premises, and all proceeds
therefrom; and such Personal Property shall not be removed therefrom without the
consent of Landlord until all arrearages in rent as well as any and all other
sums of money then due to Landlord hereunder shall first have been paid and
discharged and all the covenants, agreements and conditions hereof have been
fully complied with and performed by Tenant. Upon the occurrence of any Event
of Default, Landlord may, in addition to any other remedies provided herein,
enter upon the Premises and take possession of any and all Personal Property of
Tenant situated on the Premises, without liability for trespass or conversion,
and sell the same at public or private sale. Any surplus shall be paid to Tenant
or as otherwise required by law; and Tenant shall pay any deficiencies therein
to Landlord forthwith. Upon request by Landlord, Tenant agrees to execute and
deliver to Landlord a financing statement in form sufficient to perfect the
security interest of Landlord in the aforementioned property and proceeds
thereof under the provisions of the Uniform Commercial Code in force in the
jurisdiction in which the Building is located. Notwithstanding anything in this
Section 24 to the contrary, and subject to the conditions contained herein,
Landlord agrees at Tenant's written request to subordinate Landlord's lien in
Tenant's Personal Property (except for Landlord's Superior Lien Amount, as
hereinafter defined) to the lien of any bona fide financial lending institution
("Lender"), which Lender requires a security interest in Tenant's Personal
Property as a condition of making a loan to Tenant in connection with the
operation of Tenant's business. The term "Landlord's Superior Lien Amount" shall
mean the sum of (i) the amount equal to three (3) months, Basic Rental as
escalated pursuant to Section 4 of the
33
Lease, (ii) the amount equal to three (3) months of Tenant's Proportionate Share
of Real Estate Taxes and (iii) the amount equal to three (3) months of Tenant's
Proportionate Share of Basic Costs. The foregoing subordination shall be
conditioned upon Lender (x) giving Landlord prior written notice of Lender's
intent to remove Tenant's Personal Property and (xi) submitting to Landlord with
Lender's written notice the amount of Landlord's Superior Lien Amount. Provided
the Lender has give Landlord written notice and paid to Landlord Landlord's
Superior Lien Amount as aforesaid, Lender may enter the Premises and remove
Tenant's Personal Property, or any part thereof, at any time in the exercise of
Lender's rights to Tenant's Personal Property.
25. MECHANICS' LIENS.
----------------
Tenant shall not permit any mechanics' lien or other liens to be
placed upon the Premises, the Building or improvements thereon or the Land
during the Lease Term, caused by or resulting from any work performed, materials
furnished or obligation incurred by or at the request of Tenant. In the case of
the filing of any such lien or notice of intent with respect thereto Tenant will
promptly, and in any event within thirty (30) days after the filing thereof,
satisfy or release such lien by means of payment thereof, bonding Landlord
against any loss occasioned thereby (in which case Tenant shall have the right
in due diligence to contest and dispute such lien so long as such bond remains
in place), or take such other action as may be otherwise acceptable to Landlord.
Tenant hereby agrees to indemnify and save Landlord harmless from any legal
expenses which Landlord may reasonably incur as a result of the filing of the
lien or notice of intent and/or from any loss or liability incurred as a result
of any lien filed against the Premises, the Building or improvements thereon,
the Land and/or Tenant. If Tenant shall fail to discharge any such mechanics,
or materialmen's lien, Landlord may, at its option, discharge the same and treat
the cost thereof as additional rent payable with the monthly installment of
Basic Rental next becoming due; it being hereby expressly covenanted and agreed
that such discharge by Landlord shall not he deemed to waive or release the
default of Tenant in not discharging the same.
26. WAIVER OF SUBROGATION; INSURANCE.
--------------------------------
(a) Throughout the Lease Term, Tenant shall insure the contents of the
Premises, including, without limitation, Alterations, decorations, furnishings,
fixtures and equipment used or installed in the Premises by or on behalf of
Tenant, and the other personal property of Tenant in the Premises, against loss
due to fire and other property risks included in standard all risk coverage
insurance policies, in an amount equal to the replacement cost thereof and
covering loss of income from such property risk. All insurance carried by
Tenant hereunder shall be primary and not contributing with any insurance
carried by Landlord.
(b) Landlord and Tenant agree that the insurance policy to be carried
under Section 26(a) shall either permit or contain an express waiver of any
right of recovery (by subrogation or otherwise) by the insurance company against
Landlord, its managing agent and any mortgagee of Landlord. Landlord and Tenant
hereby release the other from any and all
34
liability or responsibility to the other or anyone claiming through or under
them by way of subrogation or otherwise for any loss or damage to property, but
only to the extent that such loss or damage is covered by any insurance then in
force, or would have been covered under the insurance policies required
hereunder if such insurance policies had been maintained as required pursuant to
this Lease, even if such fire or other casualty shall have been caused by the
fault or negligence of the other party, or anyone for whom such party may be
responsible; provided, however, that such release shall be applicable and in
force and effect only with respect to any loss or damage occurring during such
time as the policy or policies of insurance covering said loss shall contain a
clause or endorsement to the effect that this release shall not adversely affect
or impair said insurance or prejudice the right of the insured to recover
thereunder.
(c) Tenant shall maintain throughout the Lease Term, at Tenant's sole
cost and expense, commercial general liability insurance on an occurrence basis
protecting against any liability occasioned by any occurrence on or about the
Premises, Building or Land and containing contractual liability coverages. Such
limits shall be in an amount as may be reasonably required by Landlord from time
to time, but in any event not less than Three Million Dollars ($3,000,000) per
occurrence for death or injury and Three Million Dollars ($3,000,000) per
occurrence for property damage or destruction. All insurance policies shall
name Landlord, Landlord's Building manager, (and, at Landlord's or such
mortgagee's or paramount lessor's or installment seller's request) any mortgagee
of all or any portion of the Building and any paramount lessor, or installment
seller as additional insured parties, and shall provide that the insurance
policies shall not be modified or cancelled without at least thirty (30) days,
prior written notice to Landlord and any other party designated as aforesaid.
All insurance policies shall be issued by insurers of recognized responsibility
licensed to do business in the jurisdiction in which the Building is located and
acceptable to Landlord. on or before the Commencement Date and not less than
thirty (30) days prior to the expiration dates of such policies, Tenant shall
provide copies of all such policies certified by the insurers to be true and
complete to Landlord and such mortgagees, paramount lessors and installment
sellers or certificates of insurance (Accord 27) evidencing the coverage
required under this Section 26.
(d) Tenant shall also maintain throughout the Lease Term, at Tenant's
sole cost and expense, workers' compensation in statutory limits and Employer's
Liability in an amount not less than $100,000 per occurrence.
(e) Landlord makes no representation that the limits of liability
specified to be carried by Tenant under the terms of this Lease are adequate to
protect Tenant against Tenant's undertaking under this Lease, and in the event
Tenant believes that any such insurance coverage called for under this Lease is
insufficient, Tenant shall provide, at its own expense, such additional
insurance as Tenant deems adequate.
35
27. INTENTIONALLY DELETED.
28. BROKERAGE.
---------
Landlord recognizes the Broker(s) as the sole broker(s) procuring this
Lease and shall pay said Broker(s) a commission therefor pursuant to a separate
agreement between said Broker(s) and Landlord. Landlord and Tenant each
represent and warrant to one another that except as set forth herein neither of
them has employed any broker, agent or finder in carrying on the negotiations
relating to this Lease. Landlord shall indemnify and hold Tenant harmless, and
Tenant shall indemnify and hold Landlord harmless, from and against any claim or
claims for brokerage or other commissions arising from or out of any breach of
the foregoing representation and warranty by the respective indemnitors.
29. ESTOPPEL CERTIFICATES.
---------------------
Tenant shall from time to time, within ten (10) days after Landlord
shall have requested the same of Tenant, execute, acknowledge and deliver to
Landlord a written instrument in recordable form and otherwise in such form as
required by Landlord (i) certifying that this Lease is in full force and effect
and has not been modified, supplemented or amended in any way (or, if there have
been modifications, supplements or amendments thereto, that it is in full force
and effect as modified, supplemented or amended and stating such modifications,
supplements and amendments); (ii) stating the rent payable and dates to which
the rent and other charges hereunder have been paid by Tenant; (iii) stating
whether or not to the best knowledge of Tenant, Landlord is in default in the
performance of any covenant, agreement or condition contained in this Lease, and
if so, specifying each such default of which Tenant may have knowledge; (iv)
stating the commencement and expiration dates of this Lease, including any
optional renewals; and (v) stating any other fact or certifying any other
condition reasonably requested by Landlord or requested by any mortgagee or
prospective mortgagee or purchaser of the Building or Land or of any interest
therein. In the event that Tenant shall fail to return a fully executed copy of
such certificate to Landlord within the foregoing ten (10) day period, then
Tenant shall be deemed to have approved and confirmed all of the terms,
certifications and representations contained in such certificate, and Tenant
irrevocably authorizes and appoints Landlord as its attorney-in-fact to execute
such certificate on behalf of Tenant. Any such statement delivered pursuant
hereto may be relied upon by any owner of the Building or the Land, any
mortgagee or prospective mortgagee or purchaser of the Building, Land or any
interest therein or any prospective assignee of any mortgagee.
30. NOTICES.
-------
Each provision of this Lease or of any applicable governmental laws,
ordinances, regulations and other requirements with reference to the sending,
mailing or delivery of any notice or the making of any payment by Landlord to
Tenant or with reference to the sending,
36
mailing or delivery or the making of any payment by Tenant to Landlord shall be
deemed to he complied with when and if the following steps are taken:
(a) All rent and other payments required to be made by Tenant to
Landlord hereunder shall be payable to Landlord at the address for Landlord set
forth below or at such other address as Landlord may specify from time to time
by written notice delivered in accordance herewith. Tenant's obligation to pay
rent and any other amounts to Landlord under the terms of this Lease shall not
be deemed satisfied until such rent or other amounts have been actually received
by Landlord.
(b) All payments required to be made by Landlord to Tenant hereunder
shall be payable to Tenant at the address set forth below, or at such other
address within the continental United States as Tenant may specify from time-to-
time by written notice delivered in accordance herewith.
(c) With the exception of subsection (a) above, any notice or document
required or permitted to be delivered hereunder shall be deemed to be delivered
(i) when delivered personally or (ii) whether actually received or not, when
deposited in the United States Mail, postage prepaid, registered or certified
mail, return receipt requested, addressed to the parties hereto at the
respective addresses set out below, or at such other address as they have
previously specified by written notice delivered in accordance herewith.
If to Landlord, at:
New 1211 Connecticut, Inc.
c/o The ▇▇▇▇▇ ▇▇▇▇▇▇▇ Company
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
If to Tenant, at:
American Schools of Professional Psychology, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
If and when included within the term "Landlord", as used in this instrument,
there are more than one person, firm or corporation, all shall jointly arrange
among themselves for their joint execution of such notice specifying some
individual at the specific address for the receipt of notices and payments to
Landlord if and when included within the term "Tenant", as used in this
instrument, there are more than one person, firm or corporation, all shall
jointly arrange among themselves for their joint execution of such notice
specifying some individual at some specific
37
address within the continental United States for the receipt of notices and
payment to Tenant. All parties included within the terms "Landlord" and
"Tenant", respectively, shall be bound by notices given in accordance with the
provisions of this Section to the same effect as if each had received such
notice.
31. FORCE MAJEURE.
-------------
Whenever a period of time is herein prescribed for action to be taken
by Landlord or whenever Landlord is otherwise obligated to perform hereunder,
Landlord shall not be liable or responsible for, and there shall be excluded
from the computation for any such period of time, any delays or failures to
perform due to strikes, riots, acts of God, shortages of labor or materials,
war, governmental laws, regulations or restrictions or any other causes of any
kind whatsoever which are beyond the reasonable control of Landlord.
32. SEVERABILITY.
------------
If any clause or provision of this Lease is illegal, invalid or
unenforceable under present or future laws effective during the Lease Term, then
and in that event, the remainder of this Lease shall not be affected thereby.
Each covenant and agreement contained in the Lease shall be construed as a
separate and independent covenant or agreement.
33. AMENDMENTS; WAIVER; BINDING EFFECT.
----------------------------------
The provisions of this Lease may not be waived, altered, changed or
amended, except by instrument in writing signed by both parties hereto, and such
instrument may be subject to the approval of any mortgagees and ground lessors
of record. The terms and conditions contained in this Lease shall apply to,
inure to the benefit of, and be binding upon the parties hereto, and upon their
respective successors in interest and legal representatives, except as otherwise
herein expressly provided. Landlord may freely assign its interest hereunder.
34. QUIET ENJOYMENT.
---------------
Provided Tenant has performed all of the terms and conditions of this
Lease, including the payment of rent, to be performed by Tenant, Tenant shall
peaceably and quietly hold and enjoy the Premises for the Lease Term, without
hindrance from Landlord or others claiming through Landlord, subject to the
terms and conditions of this Lease and to all mortgages, ground leases and other
encumbrances to which this Lease is subject and subordinate.
35. LIABILITY OF TENANT.
-------------------
If there is a guarantor of Tenant's obligations hereunder, the
obligations hereunder imposed upon Tenant shall be the joint and several
obligations of Tenant and such guarantor, and Landlord need not first proceed
against Tenant before proceeding against such guarantor nor
38
shall any such guarantor be released from its guaranty for any reason
whatsoever, including without limitation any extensions or renewals hereof, any
amendments hereto, any waivers hereof or failure to give such guarantor any
notices hereunder.
36. LANDLORD LIABILITY.
------------------
(a) The liability of Landlord and all officers, employees,
shareholders, venturers or partners (general or limited) of Landlord to Tenant
for any default by Landlord under the terms of this Lease shall be non-recourse
and limited to the interest of Landlord in the Building, and Landlord or any
officer, employee, shareholder, venturer or partner (general or limited) of
Landlord shall have the right to sell or transfer all or any portion of the Land
or the Building to any third party, and upon any such sale or other transfer of
all of the Building or the Land, and the corresponding assignment of this Lease,
the previous Landlord shall have no further liability or obligation to Tenant
hereunder or otherwise.
(b) In the event that at any time during the Lease Term Tenant shall
have a claim against Landlord, Tenant shall not have the right to deduct the
amount allegedly owed to Tenant from any rent or other sums payable to Landlord
hereunder, it being understood that Tenant's sole method for recovering upon
such claim shall be to institute an independent action against Landlord. Tenant
shall not seek the consolidation of any such action brought by Tenant with any
action brought by Landlord hereunder.
37. CERTAIN RIGHTS RESERVED BY LANDLORD.
-----------------------------------
Landlord shall have the following rights, exercisable without notice,
except as provided herein, and without liability to Tenant for damage or injury
to property, persons or business and without effecting an eviction, constructive
or actual, or disturbance of Tenant's use or possession or giving rise to any
claim or setoff or abatement of rent or affecting any of Tenant's obligations
hereunder;
(a) To change the name by which the Building is designated upon four
(4) months written notice to Tenant.
(b) To decorate and to make repairs, alterations, additions, changes
or improvements, whether structural or otherwise, in and about the Building, or
any part thereof, and for such purposes to enter upon the Premises and, during
the continuance of any such work, to temporarily close doors, entry ways, public
space and corridors in the Building, to interrupt or temporarily suspend
Building services and facilities and to change the arrangement and location of
entrances or passageways, doors and doorways, corridors, elevators, stairs,
toilets, or other public parts of the Building, so long as the Premises are
reasonably accessible.
39
(c) To grant to anyone the exclusive right to conduct any business or
render any service in or to the Building, provided such exclusive right shall
not operate to exclude Tenant from the use expressly permitted herein.
(d) To take all such reasonable measures as Landlord may deem
advisable for the security of the Building and its occupants, including without
limitation, the search of all persons entering or leaving the Building, the
evacuation of the Building for cause, suspected cause, or for drill purposes,
the temporary denial of access to the Building, and the closing of the Building
after normal business hours and on Saturdays, Sundays and holidays; subject,
however, to Tenant's right to admittance when the Building is closed after
normal business hours under such reasonable regulations as Landlord may
prescribe from time to time which may include, by way of example but not of
limitation, that person entering or leaving the Building, whether or not during
normal business hours, identify themselves to a security officer by registration
or otherwise and that such persons establish their right to enter or leave the
Building.
38. FINANCIAL STATEMENTS.
--------------------
Tenant agrees to provide to Landlord within fourteen (14) days of
request by Landlord (but no more than one (1) time in any twelve (12) month
period unless there shall exist an Event of Default under the terms and
provisions of this Lease), the most recent audited annual financial statements
of Tenant, including balance sheets, income statements, and financial notes
("Statements"). Tenant consents that Landlord may release the Statements to
Landlord's subsidiaries, affiliates, lenders, advisors, joint venture partners,
or potential purchasers of the property for the purposes of evaluating Tenant's
financial condition with respect to performance under the Lease or to any third
party pursuant to any order of any governmental agency or court. Landlord agrees
to keep the Statements confidential and not to release the Statements to third
parties except as set forth herein.
39. REPRESENTATIONS.
---------------
(a) Any approval by Landlord and Landlord's architects and/or
engineers of any of Tenant's drawings, plans and specifications which are
prepared in connection with any construction of improvements in the Premises
shall not in any way be construed or operate to bind Landlord or to constitute a
representation or warranty of Landlord as to the adequacy or sufficiency of such
drawings, plans and specifications, or the improvements to which they relate, or
any use, purpose, or condition, but such approval shall merely be the consent of
Landlord as may be required hereunder in connection with Tenant's construction
of improvements in the Premises in accordance with such drawings, plans and
specifications.
(b) Each and every covenant and agreement contained in this Lease is,
and shall be construed to be, a separate and independent covenant and agreement.
40
(c) Neither Landlord nor Landlord's agents or brokers have made any
representations or promises with respect to the Premises, the Building or the
Land except as herein expressly set forth and no rights, easements or licenses
are acquired by Tenant by implication or otherwise except as expressly set forth
in the provisions of this Lease.
(d) The submission of this Lease to Tenant shall not be construed as
an offer, nor shall Tenant have any rights with respect thereto unless and until
Landlord shall, or shall cause its managing agent to, execute a copy of this
Lease and deliver the same to Tenant.
40. ADDITIONAL RENT.
---------------
The Tenant shall pay as additional rent any money required to be paid
pursuant to the provisions of this Lease whether or not the same be designated
"additional rent". If such amounts or charges are not paid at the time provided
in this Lease, they shall nevertheless, if not paid when due, be collectable as
additional rent with the next installment of rent thereafter falling due
hereunder, but nothing herein contained shall be deemed to suspend or delay the
payment of any amount of money or charge at the time the same becomes due and
payable hereunder, or limit any other remedy of the Landlord.
41. ENTIRE AGREEMENT.
----------------
The Lease contains all covenants and agreements between Landlord and
Tenant relating in any manner to the rent, use and occupancy of Premises and
Tenant's use of the Building and other matters set forth in this Lease. No
prior agreement or understanding pertaining to the same shall be valid or of any
force or effect and the covenants and agreements of this Lease shall not be
altered, modified or added to except in writing signed by Landlord and Tenant.
42. WAIVER OF JURY TRIAL.
--------------------
LANDLORD AND TENANT AND ALL GUARANTORS AND GENERAL PARTNERS HEREBY
WAIVE THE RIGHT TO A JURY TRIAL IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
BETWEEN TENANT AND LANDLORD OR THEIR SUCCESSORS ARISING OUT OF THIS LEASE OR
TENANT'S OCCUPANCY OF THE PREMISES OR TENANT'S RIGHT TO OCCUPY THE SAME OR THE
RELATIONSHIP OF LANDLORD AND TENANT HEREUNDER, OR ANY CLAIM OF INJURY OR DAMAGES
AND/OR ANY MATTER ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS LEASE.
43. LAWS AND REGULATIONS.
--------------------
41
Tenant agrees at Tenant's expense to comply with all applicable laws,
ordinances, rules, and regulations, whether now in effect or hereafter enacted
or promulgated, of any governmental entity or agency having jurisdiction of the
Premises.
44. SIGNAGE.
-------
No sign, advertisement or notice shall be inscribed, painted, affixed
or otherwise displayed on any part of the outside or inside of the Building
except on the directories and doors of offices, and then only in such place,
number, size, color and style as approved by Landlord. If any such sign,
advertisement or notice is nevertheless exhibited by Tenant, Landlord shall have
the right to remove the same and Tenant shall be liable for any and all expenses
incurred by Landlord in such removal. On the Commencement Date, Landlord shall,
at Landlord's sole cost and expense, provide Tenant with building standard
signage on Tenant's suite entrance door and four (4) directory strips on the
Building's directory. In the event Tenant requests any changes or modifications
to such suite entrance door or such directory, all such changes or modifications
shall be at Tenant's sole cost and expense. In addition, on the Commencement
Date, Landlord shall, at Landlord's cost and expense, provide and install
Tenant's signage on the northeast corner of the first floor outside facade of
the Building; provided, however, that (a) the installation of such sign shall be
subject to Landlord's ability to obtain, using its reasonable efforts, all
necessary government, community and other permits and approvals (Landlord agrees
to use its reasonable efforts to obtain such permits and governmental approvals
at Landlord's cost and expense up to Four Thousand and 00/100 Dollars
($4,000.00); and Tenant shall be responsible for and shall pay all costs and
expenses for obtaining the permits and governmental approvals for such sign in
excess of Four Thousand and 00/100 Dollars ($4,000.00) as additional rent due
hereunder within thirty (30) days of Landlord's invoice for same); (b) the size,
materials, color, design, location and other aspects of such sign shall be
acceptable to Landlord in its sole discretion and in accordance with Exhibit D,
letter O; (c) all costs related to such sign other than its provision and
installation, including maintenance and utilities, shall be borne by Tenant; and
(d) Landlord shall have the right to remove such sign at the expiration or
earlier termination of the Lease Term at Landlord's expense.
45. RENEWAL OPTION.
--------------
(a) Landlord hereby grants to Tenant the conditional right,
exercisable at Tenant's option, to renew the term of this Lease for one (1) term
("Renewal Term") of sixty (60) months. If exercised, and if the conditions
applicable thereto have been satisfied, the Renewal Term shall commence
immediately on the day following the date the Lease Term would otherwise have
ended as provided in this Lease. The right of renewal herein granted to Tenant
with respect to the Renewal Term shall be subject to, and shall be exercised in
accordance with, the following terms and conditions:
42
(i) Tenant shall exercise its right of renewal with respect to
the Renewal Term by giving Landlord written notice ("Renewal Option Notice")
thereof not later than twelve (12) months prior to the expiration date of the
then-current Lease Term.
(ii) In the event the Renewal Option Notice is not given timely
or is not given, Tenant's right of renewal with respect to the Renewal Term
shall lapse and be of no further force or effect.
(iii) The renewal option may be exercised only with respect to
the entire Premises, not with respect to only a part of the Premises.
(iv) In the event there exists an Event of Default under this
Lease on the date the Renewal Option Notice is sent or any time thereafter up to
and including the date such Renewal Term is to commence, then, at Landlord's
option, such Renewal Term shall not commence and the Lease Term shall expire on
the date the Lease Term would have expired without such renewal.
(v) If at the time Tenant provides the Renewal Option Notice
described in subsection (a) hereof, or at any time thereafter until the Renewal
Term is to commence, Tenant has assigned or subleased the Premises, then, at
Landlord's option, Tenant's rights pursuant to this Section 45 shall lapse and
be of no further force or effect.
(vi) Landlord and Tenant must execute a lease for the Renewal
Term nine (9) months prior to the expiration date of the then-current Lease
Term. If Landlord and Tenant do not execute a lease in accordance with the
foregoing sentence, then Tenant's right pursuant to this Section 45 shall lapse
and be of no further force or effect.
(b) During the Renewal Term, all the terms, conditions, covenants and
agreements set forth in this Lease, including but not limited to the full pass-
through of Common Area Costs and Real Estate Taxes shall continue to apply and
be binding upon Landlord and Tenant, except that: (i) the Basic Rental for the
Premises shall be determined as provided in Section 45(c); (ii) in no event
shall Tenant have the right to renew the Lease Term beyond the expiration of the
Renewal Term provided for in this Section 45; and (iii) Landlord shall have the
right to terminate the Lease as provided in Section 45(d).
(c) Following the giving of the Renewal Option Notice, Landlord and
Tenant shall commence negotiations concerning the amount of the Basic Rental
payable during the Renewal Term. The parties shall have thirty (30) days after
the date Tenant delivers its Renewal Option Notice in which to agree on such
Basic Rental. If, during such negotiation period, the parties are unable in
good faith to agree on such Basic Rental, then Tenant's right of renewal shall
lapse and be of no further force or effect.
43
(d) Notwithstanding the foregoing, at any time during the Renewal
Term, Landlord shall have the right to terminate this Lease upon one hundred
eighty (180) days written notice to Tenant ("Termination Notice"). Tenant shall
vacate and surrender the Premises on or prior to the date specified in
Landlord's Termination Notice ("Termination Date") and this Lease shall
terminate at 11:59 p.m. on the Termination Date. In the event Landlord elects
to terminate this Lease as provided in this Section 45(d), Landlord shall pay to
Tenant a moving allowance ("Moving Allowance") in the amount of One Dollar
($1.00) per rentable square foot of the Premises, said Moving Allowance to be
paid to Tenant after Tenant vacates aid surrenders the Premises to Landlord.
46. RIGHT OF FIRST OFFER.
--------------------
(a) Landlord hereby grants to Tenant the conditional, continual right
throughout the Lease Term, exercisable at Tenant's option, to lease all or any
portion of the approximately 6,669 rentable square feet located on the first
(1st) floor of the Building ("Expansion Area"), and identified as set forth on
Exhibit A-3 attached hereto and incorporated herein for all purposes, subject to
the terms and conditions set forth in this Section 46.
(b) Landlord shall give Tenant written notice that it has received a
bona fide, written and signed offer from a prospective tenant for all or any
portion of the Expansion Area (an "Expansion Area Notice"). Each space that is
offered to Tenant pursuant to the Expansion Area Notice is, at the time of such
offering, referred to as the "Expansion Premises".
(c) Tenant shall have a period of seven (7) days following receipt of
Landlord's Expansion Area Notice to notify Landlord in writing whether Tenant
desires to lease all or any portion of the Expansion Premises ("Tenant's
Expansion Premises Acceptance Notice"). In the event Tenant elects to lease
less than all of the Expansion Premises, then the portion of the Expansion
Premises that Tenant leases must comply with all applicable building and safety
codes. In addition, all of the remaining Expansion Premises not leased by
Tenant must also (i) comply with all applicable building and safety codes, (ii)
be regular in shape with adequate means of ingress and egress and (iii) be
suitable and marketable for normal renting purposes as office space. For
purposes hereinbelow, the term "Expansion Premises" shall be deemed to include
all of or that portion of the Expansion Premises actually leased by Tenant. If
the Expansion Premises is leased to Tenant, the lease term shall be coterminous
with the term of this Lease, as the same may be extended pursuant to the terms
hereof. The leasing of the Expansion Premises shall be on the same terms and
conditions as are set forth in this Lease except that W the Base Rent for the
Expansion Premises shall be the Market Rent determined as provided in Section
46(i) below, and (ii) the abatement of rent provided in Section 3(a) and all
buildout and other allowances shall not be applicable. Landlord shall prepare,
and Landlord and Tenant shall promptly execute, an amendment to this Lease
confirming the lease to Tenant of the Expansion Premises upon such terms and
conditions. Upon the delivery of the Expansion Premises to Tenant, the Expansion
Premises shall become part of the Premises. If Tenant does not timely provide
Landlord with Tenant's Expansion Premises Acceptance Notice to lease all or
44
a portion of the Expansion Premises or does not lease the Expansion Premises,
then Landlord shall be free to lease all of the Expansion Premises or any
portion thereof to any other person or entity (the "Expansion Premises
Occupant") on such terms and conditions as Landlord in its sole discretion may
determine. Upon the expiration of an Expansion Premises Occupant's lease, Tenant
shall once again have the conditional right, exercisable at Tenant's option, to
lease all or any portion of the Expansion Premises Occupant's leased premises,
upon and subject to the terms and conditions as set forth in this Section 46.
(d) In the event there exists an Event of Default under this Lease on
the date of Tenant's Expansion Premises Acceptance Notice, or at any time
thereafter up to and including the date possession of the Expansion Premises is
to be delivered to Tenant, then, at Landlord's option, possession of the
Expansion Premises shall not be delivered to Tenant and Tenant's rights to lease
the Expansion Premises shall lapse and be of no further force or effect and
Landlord may freely lease the Expansion Premises to an Expansion Premises
Occupant on such terms and conditions as Landlord in its sole discretion may
determine.
(e) Landlord shall incur no liability, and the expiration date of the
term for which the Expansion Premises is leased shall not be extended, if
Landlord is unable to deliver possession of the Expansion Premises to Tenant due
to any holdover tenant's refusal to vacate, or for any other reason not within
Landlord's reasonable control.
(f) Tenant's rights under this Section 46 may be exercised only by
Tenant, and shall not be exercised by any assignee, transferee, mortgagee or
subtenant of Tenant.
(g) Notwithstanding anything in this Section 46 to the contrary,
Landlord shall not be obligated to send Tenant an Expansion Area Notice, and
Tenant shall have no rights hereunder, with respect to any space (i) that
Landlord proposes to lease to the then-current tenant of such space or (ii) that
becomes available for leasing at a time when less than twelve (12) months remain
in the Lease Term and Tenant has not exercised its renewal option hereunder.
(h) Notwithstanding any provisions of this Section 46, or any other
provision of this Lease, Tenant shall have no rights pursuant to this Section
46, as if this Section 46 had not been included in this Lease, if Tenant has
assigned this Lease in whole or in part or has subleased the Premises. The
preceding sentence shall not impair Tenant's lease of the Expansion Premises
that Tenant has leased pursuant to this Section before the occurrence of one of
the events set forth above in this subsection. Without limiting the other
provisions of this Lease with respect to which time is of the essence, time is
of the essence of each of the provisions of this Section with respect to the
exercise by Tenant of its options.
(i) "Market Rent" shall be the fair market amount of Basic Rental
(including escalations) determined as follows:
45
(1) Following the giving of the Expansion Premises Acceptance
Notice, Landlord and Tenant shall commence negotiations concerning the amount of
Basic Rental that shall constitute Market Rent. The parties shall have thirty
(30) days after the date Tenant delivers its option notice in which to agree on
such Market Rent. If, during such negotiation period, the parties are unable to
agree on such Market Rent, then Tenant's right of first offer pursuant to this
Section 46 shall lapse and be of no force or effect.
(2) Among the factors to be considered in determining Market Rent
shall be the rental rates then being quoted by (a) Landlord for space in the
Building, and (b) other landlords for similar space in comparable office
buildings in the vicinity of the Building. All determinations shall reflect
market conditions expected to exist as of the date Basic Rental based on Market
Rent is to commence (including base rents, escalations, concessions, buildouts
and other terms expected to be agreed to in market leases entered into at such
time).
47. EXHIBITS.
--------
(i) Exhibit A - Outline of Premises
(ii) Exhibit ▇-▇ - ▇-▇ ▇▇▇▇▇▇▇▇
(▇▇▇) ▇▇▇▇▇▇▇ ▇-▇ - ▇-▇ Premises
(iv) Exhibit A-3 - Expansion Area
(v) Exhibit B - Legal Description
(vi) Exhibit C - Rules and Regulations
(vii) Exhibit D - Specifications for Construction
(viii) Exhibit E - Tenant Space Plan
(ix) Exhibit F - Tenant Acceptance Letter for the A-1 Premises
(x) Exhibit G - Tenant Acceptance Letter for the A-2 Premises
46
IN WITNESS WHEREOF, the parties hereto have executed this Lease under
seal and affixed their seals as of the date first above written.
Tenant:
WITNESS/ATTEST: AMERICAN SCHOOLS OF
PROFESSIONAL PSYCHOLOGY
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, CFO By: /s/ ▇▇▇▇▇▇ ▇. ▇'▇▇▇▇▇▇▇
--------------------------- ------------------------------(SEAL)
Name: ▇▇▇▇▇▇ ▇. ▇'▇▇▇▇▇▇▇
----------------------------------
Title: President
---------------------------------
Landlord:
ARLINGTON PARK REALTY
CORPORATION
WITNESS/ATTEST:
/s/ ▇▇▇▇ By: /s/ R. ▇▇▇▇ ▇▇▇▇▇▇▇
------------ ------------------------------(SEAL)
Name: R. ▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Title: Vice President
---------------------------------
STATE OF ILLINOIS )
) ss:
COUNTY OF ▇▇▇▇ )
On this the 7th day of April, 1994, before me, ▇▇▇▇ ▇. ▇▇▇▇▇, the
undersigned, personally appeared ▇▇▇▇▇▇ ▇. ▇'▇▇▇▇▇▇▇, known to me (or
satisfactorily proven) to be the person whose name is subscribed to the
foregoing document, and acknowledged that he/she executed the foregoing document
for the purposes therein contained and that he/she is duly authorized to execute
said document.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------------
Notary Public
My Commission Expires:
_____________________________
48
DISTRICT OF )
) ss:
COLUMBIA )
On this the 4th day of May, 1994, before me, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, the
undersigned, personally appeared R. ▇▇▇▇ ▇▇▇▇▇▇▇, known to me (or satisfactorily
proven) to be the person whose name is subscribed to the foregoing document, and
acknowledged that he/she executed the foregoing document for the purposes
therein contained and that he/she is duly authorized to execute said document.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------------
Notary Public
My Commission Expires:
6-1-95
------------------------
49
EXHIBIT B
---------
Property Description
--------------------
All of Lots Numbered one (1), Two (2), Three (3), Four (4) and Five (5) in
Block numbered Ten (10), "▇▇▇▇▇▇▇'▇ ADDITION TO FORT ▇▇▇▇▇ HEIGHTS," as shown on
Plat of said subdivision duly recorded among the Land Records of Arlington
County, Virginia in Deed Book M-4, Page 557, LESS AND EXCEPT all that portion of
Lot numbered one (1) conveyed to the County of Arlington, State of Virginia, by
Deed from ▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇, et vir, dated December 12, 1929 and recorded on
December 28, 1931, in Deed Book 329, Page 236, among said Land Records, as more
particularly described by metes and bounds as follows:
Beginning at a point in 17th Street, North, said point
marking the Northwest corner of Lot 6 and the Southwest
corner of ▇▇▇ ▇, ▇▇▇▇▇▇▇'▇ ▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇;
thence with North Oak Street N 1' 35" 00" W 242.70 feet to a
point in ▇▇▇▇▇▇ Boulevard marking the Northwest corner of
Part of Lot 1 of said subdivision; thence with ▇▇▇▇▇▇
Boulevard S 85' 55" 40" E 43.28 feet to a point; thence
continuing with ▇▇▇▇▇▇ Boulevard N. 89' 08" 00" E 107.34
feet to a point marking the Northeast corner of Part of Lot
1; thence with North ▇▇▇▇ Street S 1' 35" 00" E 237.06 feet
to a point marking the Southeast corner of Lot 5 and the
Northeast corner of Lot 6 of said subdivision; thence with
17th Street North S 88' 25" 00" W 150.62 feet to the point
and place of beginning containing approximately 35,938
square feet of land, as shown on plat of survey made by
Schiller & Associates dated June 13, 1966, and recertified
July 11, 1983.
EXHIBIT C
---------
RULES AND REGULATIONS
No part or the whole of the sidewalks, plaza areas, entrance, passages,
courts, elevators, vestibules, stairways, corridors or halls of the
Building or the Land shall be obstructed or encumbered by any tenant or
used for any purpose other than ingress or egress to and from the space
demised to such tenant.
2. No awnings or other projections shall be attached to the outside walls or
windows of the Building. No curtains, blinds, shades, or screens (other
than those furnished by Landlord as part of Landlord's Work) shall be
attached to or hung in, or used in connection with, any window or door of
the space demised to any tenant.
3. No sign, advertisement, object, notice, or other lettering shall be
exhibited or inscribed on any part of the outside or inside of the space
demised to any tenant or of the Building or the Land. Interior signs on
doors and directory tablets, if any, shall be inscribed, painted, or
affixed for each tenant by Landlord at Tenant's expense, and shall be of a
size, color, and style approved by Landlord.
4. No show cases or other articles shall be put in front of or affixed to any
part of the exterior of the Building, nor placed in the halls, corridors,
vestibules, or other public parts of the Building.
5. The water and wash closets and other plumbing fixtures shall not be used
for any purposes other than those for which they were constructed, and no
sweepings, rubbish, rags, or other substances (including, without
limitation, coffee grounds) shall be thrown therein.
6. No tenant shall bring or keep, or permit to be brought or kept, any
inflammable, combustible, or explosive fluid, material, chemical, or
substance in or about the space demised to such tenant.
7. No tenant shall ▇▇▇▇, paint, drill into, or in any way deface, any part of
the Building or the space demised to such tenant. No boring, cutting, or
stringing of wires shall he permitted.
8. No cooking shall be done or permitted in the Building by any tenant, except
for use of microwave ovens and coffee machines by Tenant's employees for
their own consumption. Tenant may install microwave ovens and coffee
machines in the kitchen and lounge areas of the Premises; however, no other
microwave ovens or coffee machines may be installed in any other area of
the Premises without Landlord's prior written approval of such equipment
and its location. No tenant shall cause or permit any unusual or
objectional odors to emanate from the space demised to such tenant.
9. Neither the whole nor any part of the space demised to any tenant shall be
used for manufacturing, for the storage of merchandise, or for the sale of
merchandise, goods, or property of any auction.
10. No tenant shall make, or permit to be made, any unseemly or disturbing
noises or disturb or interfere with other tenants or occupants of the
Building or neighboring buildings or premises whether by the use of any
musical instrument, radio, television set, or other audio device, unmusical
noise, whistling, singing or in any other way. Tenant shall not construct,
maintain, use or operate within the Premises any electrical device, wiring
or apparatus in connection with a loud speaker system or other sound system
without Landlord's prior written consent. Tenant shall not construct,
maintain, use or operate any such loud speaker or sound system outside of
the Premises. Nothing shall be thrown out of any doors, windows, or
skylights or down any passageways.
11. No additional locks or bolts of any kind shall be placed upon any of the
doors or windows in the space demised to any tenant, nor shall any changes
be made in locks or the mechanism thereof. Each tenant must, upon the
termination of his tenancy, restore to Landlord all keys to offices and
toilet rooms, either furnished to, or otherwise procured by, such tenant,
and in the event of the loss of any such keys, such tenant shall pay
Landlord the reasonable cost of replacement keys.
12. All removals from the Building, or the carrying in or out of the Building
or the space demised to any tenant of any safes, freight, furniture, or
bulky matter of any description must take place during such hours and in
such manner as Landlord or its agents may prescribe. Tenant shall
coordinate in advance with Landlord's property management department all
deliveries to the Building so that arrangements can be made to minimize
interference to other tenants.
13. No tenant shall use or occupy or permit any portion of the space demised to
such tenant to be used or occupied as an employment bureau or for the
storage, manufacture, or sale of liquor, narcotics or drugs. No tenant
shall engage or pay any employees in the Building, except those actually
working for such tenant in the Building, nor advertise for laborers giving
an address at the Building.
14. Landlord shall have the right to prohibit any advertising by any tenant
which, in Landlord's reasonable opinion, tends to impair the reputation of
the Building or its desirability as a building for offices, and upon notice
from Landlord, such tenant shall refrain from or discontinue such
advertising.
15. Landlord reserves the right to control and operate the public portions of
the Building and the public facilities, as well as facilities furnished for
the common use of the tenants, in such manner as it deems best for the
benefit of the tenants generally, including, without limitation, the right
to exclude from the Building, between the hours of 6:00 p.m. to 8:00 a.m.
on business days and at all hours on Saturdays, except 9:00 a.m. to 1:00
p.m.,
Sundays and holidays, all persons who do not present a pass to the Building
signed by Landlord or other suitable identification satisfactory to
Landlord. Landlord will furnish passes to persons for whom any tenant
requests such passes. Each tenant shall be responsible for all persons for
whom it requests such passes and shall be liable to Landlord for all acts
of such persons. Tenant shall not permit the visit to the Premises of
persons in such numbers or under such conditions as to interfere with the
use and enjoyment of the entrances, corridors, elevators and other public
portions or facilities of the Building by other tenants.
16. Each tenant, before closing and leaving the space demised to such tenant at
any time, shall see that all entrance doors and windows are locked and that
all lights are turned off.
17. No space demised to any tenant shall be used, or permitted to be used, for
lodging or sleeping or for any immoral or illegal purpose.
18. The requirements of tenants will be attended to only upon application at
the office of Landlord. Building employees shall not be required to
perform, and shall not be requested by any tenant to perform, any work
outside of their regular duties, unless under specific instructions from
the office of the Landlord.
19. Canvassing, soliciting, and peddling in the Building are prohibited, and
each tenant shall cooperate in seeking their prevention.
20. There shall not be used in the Building, either by any tenant or by its
agents or contractors, in the delivery or receipt of merchandise, freight,
or other matter, any hand trucks or other means of conveyance except those
equipped with rubber tires, rubber side guards, and such other safeguards
as Landlord may require. Tenant shall be responsible for any loss or
damage resulting from any deliveries made by or for Tenant.
21. No animals, bicycles, vehicles, birds or pets of any kind shall be brought
into or kept about the Building by any tenant.
22. No tenant shall place, or permit to be placed, on any part of the floor or
floors of the space demised to such tenant a load exceeding the floor load
per square foot which such floor was designed to carry and which is allowed
by law.
23. Landlord reserves the right to specify where in the space demised to any
tenant business machines and mechanical equipment shall be placed or
maintained in order, in Landlord's judgment, to absorb and prevent
vibration, noise, and annoyance to other tenants of the Building.
24. No vending machines shall be permitted to be placed or installed in any
part of the Building by any tenant, except that Tenant may place and
install vending machines in the
lounge or kitchen area of Tenant's Premises. Landlord reserves the right to
place or install vending machines in any of the common areas of the
Building.
25. Tenant will cooperate with Landlord in complying with all present and
future laws, orders, and regulations of the state, federal, municipal, and
local governments, departments, commissions, agencies and boards regarding
the collection, sorting, separation, and recycling of trash. Tenant shall
sort and separate its trash into such categories as are provided by law.
Each separately sorted category of trash shall be placed in separate
receptacles as directed by Landlord. Landlord reserves the right to refuse
to collect or accept from Tenant any trash that is not separated and sorted
as may be required by law.
26. Tenant will not conduct or permit to be conducted any activity, or place
any equipment in or about the Premises or the Building, which will in any
way increase the rate of fire insurance or other insurance on the Building;
and if any increase in the rate of fire insurance or other insurance is
stated by any insurance company or by the applicable insurance Rating
Bureau to be due to any activity or equipment of Tenant in or about the
Premises or the Building, such statement shall be conclusive evidence that
the increase in such rate is due to such activity or equipment and as a
result thereof, Tenant shall be liable for such increase and shall
reimburse Landlord therefor upon demand and any such sum shall be
considered additional rent payable hereunder.
27. Landlord may, upon request of Tenant, waive Tenant's compliance with any of
the rules, provided that (a) no waiver shall be effective unless signed by
Landlord, (b) no waiver shall relieve Tenant from the obligation to comply
with such rule in the future unless otherwise agreed in writing by
Landlord, (c) no waiver granted to any tenant shall relieve any other
tenant from the obligation of complying with these rules and regulations,
and (d) no waiver shall relieve Tenant from any liability for any loss or
damage resulting form Tenant, failure to comply with any rule.
28. Landlord reserves the right, at any time and from time to time, to rescind,
alter, or waive, in whole or in part, any of these Rules and Regulations
when it is deemed necessary, desirable, or proper, in Landlord's judgment,
for its best interest or for the best interest of the tenants.
EXHIBIT D
Specifications on Materials for Construction of Demised Premises for American
Schools of Professional Psychology at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇.
A. Partitions: Partitions are constructed of 2 1/2" steel
studs and channel framing from slab to
underside of finished ceiling with 1/2"
gypsum wallboard panels having no visible
joints. Demising partitions between the
Demised Premises and building corridors will
be slab to slab and sound insulated. Interior
partitioning around classrooms and seminar
rooms will be slab to slab fire-rated drywall
and will be sound insulated. Vinyl wall base
will be included.
B. Doors: As required by Tenant plans, up to one 3'-0"
x 7'-0" solid core, interior painted door
with cylindrical latchset and all necessary
hardware and metal frame for each 250 square
feet of rentable area leased. Four (4) of
these will be 3'0" x 7'0" solid core with
integral vertical insulated glass lite 0'8" x
6'0" with jambs and drop seals. Hardware
shall be Schlage S-Series Saturn with lever
in polished chrome (interior door) or split
finish (suite entry door). One (1) suite
entrance door into office portion of Premises
shall be 3'0" x 7'0" solid core, stain grade
with adjacent 3'0" x 7'0" glass side lite in
hollow metal frame. One (1) entry/exit door
with electronic strike plate at back-end of
students lounge along building facade with
metal frame to match adjacent mullions. The
existing glass double suite entrance doors
from the building lobby into the Demised
Premises will be retained provided they are
not in violation of any codes.
C. Painting and
Wall Covering: All partitions, columns, walls and door
frames will be primed and painted in flat
finish. The color will be chosen by the
Tenant from color samples provided by the
Landlord. Landlord will provide vinyl
wallcovering on all office and school
corridor walls and in the reception area.
D. Ceiling: Landlord will provide a suspended 2' x 2'
tegular acoustical ceiling tile (▇▇▇▇▇▇▇▇▇
Tundra, White) with exposed grid at a height
of 8'6", unless agreed to otherwise.
E. Window Covering: Landlord will provide thin line horizontal
venetian blinds for all exterior windows
within suites. Blind color shall be off
white.
F. Lighting: Landlord will provide one fully recessed 2' x
4' fluorescent light fixture with a parabolic
lens for each 80 square feet of rentable
area. Landlord will also provide 6 recessed
incandescent with dimmers in the reception
area and 8 in the conference room.
G. Telephone and
Electrical: Outlets: Two duplex 110 volt electrical wall
outlets per 150 square feet of rentable area
and one telephone wall outlet (plate and pull
string only) for each 150 rentable area.
Included in this ratio shall be 3 duplexes in
each classroom and seminar room, 6 duplexes
on a dedicated circuit for personal computers
in the computer area, and a reasonable number
of dedicated outlets (including 2-30 amp
copier outlets, 1-15 amp server outlet, 1-15
amp telephone closet outlet) to service
copies, file servers, and phone switches.
Wall plate finish is brushed stainless.
H. Suite Entry
Signage: The Landlord will provide one building
standard plaque with tenant name and suite
number. Landlord will also provide signage
either over or on the back entrance/exit
door.
I. Sprinkler: An automatic sprinkler system has been
installed within the building. There shall be
one sprinkler head for every 150 square feet
of rentable space. Sprinkler heads are semi-
recessed, chrome finish. Landlord shall
relocate existing heads per Tenant's plans.
J. Floor Covering: 30 oz nylon cut pile commercial grade glue
down carpet (Wellco: Vogue) will be provided
throughout Tenant's suite. Tenant may select
color for carpeting throughout premises from
color samples provided by Landlord. Tenant
may designate areas to be covered
with vinyl floor tile, colors samples to be
provided by Landlord.
K. Floor Load: Floors are designed for 80 pounds per square
foot live load and 20 pounds per square foot
dead load unless noted otherwise.
L. Millwork: Landlord will provide one (1) 8 foot long
plastic laminated counter and cabinet below
and a reasonable amount of shelving in each
of the two (2) file rooms. Landlord will also
provide a 5 foot long plastic laminate
counter with wall and base cabinets (merrilat
or equal) and a cold water supply line in the
galley area near the reception area.
M. HVAC: The building is heated and cooled via two
hydronic water loops, circulating heated or
chilled water through main air handier units,
exterior wall mounted fan coil units and
newly installed floor space fan coil units.
Additional cooling capacity has also been
recently added to the building by means of a
plate-to-plate heat changer. Heating water is
generated by means of a single hot water
boiler located in the mechanical penthouse.
Chilled water is generated by means of a
single centrifical chiller located in the
mechanical penthouse. Two main air handlers,
located in the mechanical penthouse, deliver
tempered air to the interior space on all
floors. The building is divided into a north
zone and a south zone; however, the main
building system must be turned on for after
hours use. This building does not have floor-
by-floor after hours flexibility. The air is
returned to the mechanical room via two large
return air fans, located in the mechanical
penthouse. Exterior floor space conditioning
is handled by fan coils at each level,
mounted on the interior of perimeter walls.
The units have on/off air speed. Landlord
will provide one (1) thermostatic control for
every 300 rentable square feet.
All heating and air conditioning equipment
are monitored and controlled via automatic
pneumatic control equipment. The domestic hot
water is
produced by one free standing atmospheric gas
fired hot water heater.
The estimated charge for after hours usage is
$90.00 per hour.
Landlord shall provide and install
supplementary HVAC equipment in a
configuration according to either option A or
B outlined below. (Tenant to select an option
prior to lease execution).
Option A: 12 tons of HVAC capacity comprised of (1) 6
ton supplemental split system serving those
areas requiring evening and weekend
operation, and one 6 ton heat pump unit
tapped into the building condenser water
system to service the office function areas.
Option B: (2) 1 ton water source heat pump for 2
seminar rooms.
(2) 2 ton water source heat pumps for 2
classrooms.
(2) 2 ton water source heat pumps for the
lounge and library areas.
N. Fire and Life
Safety Systems: The building's renovation included a fire and
life safety system which meets state and
local codes and federal requirements. This
includes a fire control room with annunciator
panel, a voice communication system and fully
sprinklered floors. Landlord will provide
code-compliant exit lights per Tenant's
plans.
O. Exterior Signage: Landlord shall provide and install
individual, back-lighted letters in a size,
nature and configuration in compliance with
all applicable codes and in the reasonable
but sole discretion of the Landlord. These
letters shall read "American Schools of
Professional Psychology, Inc" and be affixed
to the Northeast corner of the first floor
facade.
P. Design Services: Landlord shall provide design services for
space planning and architectural and
engineering construction documents.
EXHIBIT F
TENANT ACCEPTANCE LETTER
------------------------
Arlington Park Realty Corporation
c/o Equitable Real Estate Investment
Management, Inc.
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
The undersigned, by the execution of this letter, hereby confirms that the
Commencement Date of the Lease Term of that certain lease agreement (the "Lease
Agreement") by and between Arlington Park Realty Corporation (the "Landlord")
and the undersigned (the "Tenant") is ____________________, 199__, and Tenant
hereby accepts delivery of the A-1 Premises and recognizes that the Landlord has
fulfilled all obligations regarding the delivery of the A-1 Premises. All
capitalized terms not defined herein shall have the meanings assigned to them in
the Lease Agreement.
ACCEPTED AND AGREED to this _____ day of ____________________, 199__.
AMERICAN SCHOOLS OF PROFESSIONAL PSYCHOLOGY, INC.
By:_______________________________________
Title:_____________________________________
EXHIBIT G
TENANT ACCEPTANCE LETTER
------------------------
Arlington Park Realty Corporation
c/o Equitable Real Estate Investment
Management, Inc.
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
The undersigned, by the execution of this letter, hereby confirms that
the Commencement Date of the Lease Term of that certain lease agreement (the
"Lease Agreement") by and between Arlington Park Realty Corporation (the
"Landlord") and the undersigned (the "Tenant") is _______________________,
199__, and Tenant hereby accepts delivery of the A-2 Premises and recognizes
that the Landlord has fulfilled all obligations regarding the delivery of the ▇-
▇ Premises. All capitalized terms not defined herein shall have the meanings
assigned to them in the Lease Agreement.
ACCEPTED AND AGREED to this _____ day of ____________________, 199__.
AMERICAN SCHOOLS OF PROFESSIONAL PSYCHOLOGY, INC.
By:_______________________________________
Title:_____________________________________
AMENDMENT TO LEASE AGREEMENT
----------------------------
This Amendment to Lease Agreement (the "Amendment") is made and entered
into this 13th day of September 1996, between ARLINGTON PARK REALTY CORPORATION
("Landlord") and AMERICAN SCHOOLS OF PROFESSIONAL PSYCHOLOGY, INC. ("Tenant").
WHEREAS, Landlord and Tenant entered into a Lease Agreement, dated May 3,
1994 (the "Lease") for 6,620 rentable square feet of space (the "Premises") on
the first (1st) floor of the building located at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ (the "Building"); and
WHEREAS, the Lease is scheduled to terminate on August 31, 1999; and
WHEREAS, pursuant to the provisions of Section 46 of the Lease, Tenant has
a conditional right of first offer to lease additional space on the first floor
of the Building; and
WHEREAS, space on the first floor of the Building has become available; and
WHEREAS, Tenant wishes, among other matters, to expand the Premises it
leases from Landlord in the Building.
NOW THEREFORE, in consideration of the foregoing, and other good and
valuable consideration, the receipt and sufficiency of which is acknowledged by
the parties, the parties agree as follows:
1. Expansion Premises. Landlord hereby demises and leases to Tenant
------------------
and Tenant hereby leases and accepts from Landlord, for a term
and upon the conditions hereinafter provided, an additional one
thousand three hundred fifty-six (1,356) rentable square feet of
space on the first (1st) floor of the Building, known as Suite
150, outlined on the floor plan attached hereto and incorporated
herein by reference as Exhibit A (the "Expansion Premises").
---------
2. Expansion Premises Term. The Lease for the Expansion Premises
-----------------------
will commence upon Substantial Completion of the Expansion
Premises (the "Expansion Premises Commencement Date"), and expire
on August 31, 1999 or upon the earlier termination of the Lease
(the "Expansion Premises Term"). The Anticipated Expansion
Premises Commencement Date is November 1, 1996; provided,
however, that, if Landlord shall be unable to tender possession
of the Expansion Premises on the Anticipated Expansion Premises
Commencement Date, Landlord shall not be liable for any damage
caused thereby, nor shall the Lease or this Amendment be void or
voidable by Tenant. In no event shall the Expansion Premises
Commencement Date be prior to September 1, 1996.
3. Expansion Premises Basic Rental. Tenant shall pay Landlord as
-------------------------------
Basic Rental for the Expansion Premises, in legal tender, the
annual sum of twenty-nine thousand eight hundred thirty-two and
00/100 dollars ($29,832.00) (the "Expansion Premises Basic
Rental"), payable in equal monthly installments of two thousand
four hundred eighty-six and 00/100 dollars ($2,486.00), in
advance, promptly on the first day of each calendar month of the
Expansion Premises Term (except for the first month's installment
which is due and payable upon Tenant's execution of this
Amendment), without notice or demand, the same being hereby
waived, and without any setoff, deduction, counterclaim, or
recoupment whatsoever; provided, however, that the installment of
Expansion Premises Basic Rental for the second calendar month
shall be prorated based on one-three hundred sixtieth (1/360th)
of the current annual Expansion Premises Basic Rental for each
day of the first partial month, if any, of the Expansion Premises
Term and shall be due and payable as aforesaid. The Expansion
Premises Basic Rental provided in this paragraph shall be in
addition to any other rent due to the Landlord under the Lease
with respect to the Premises.
4. Escalation in Expansion Premises Basic Rental. The Basic Rental
---------------------------------------------
for the Expansion Premises shall be increased annually, effective
on each anniversary of the Expansion Premises Commencement Date
during the term hereof, by an amount equal to two and one-half
percent (2.5%) of the escalated Expansion Premises Basic Rental
then in effect, payable as follows
ANNUAL
YEAR RENT MONTHLY RENT
------ -------- --------------
1 $29,832.00 $2,486.00
2 $30,577.80 $2,548.15
3 $31,342.25 $2,611.85
5. Expansion Premises Operating Expenses. Beginning with the first
-------------------------------------
anniversary of the Expansion Premises Commencement Date, Tenant
shall pay as additional rent an amount (per each square foot
within the Expansion Premises) equal to the excess ("Excess")
from time to time of the per square foot Basic Cost over the Base
Year Stop for the Expansion Premises, all as more fully provided
in Section 8 of the Lease. The Base Year Stop for the Expansion
Premises shall be the per square foot Basic Cost incurred during
the 1996 calendar year. Tenant's proportionate share (for the
Expansion Premises) of any such costs or expenses shall be 1.28%.
This proportionate share is solely for the Expansion Premises,
and
-2-
is in addition to any proportionate share of Basic Cost to be
paid by Tenant for the Premises.
6. Expansion Premises Real Estate Taxes.
------------------------------------
(a) During each calendar year or portion thereof included in the
Expansion Premises Term, and any renewal or extension thereof, Tenant shall pay
to Landlord as additional rent, Tenant's proportionate share for the Expansion
Premises of any increase of Real Estate Taxes over the Expansion Premises Base
Real Estate Taxes, all as more fully provided in Section 19 of the Lease. The
Expansion Premises Base Real Estate Taxes shall be Real Estate Taxes paid during
the 1996 calendar year. Tenant's proportionate share of Real Estate Taxes for
the Expansion Premises shall be 1.28%. This proportionate share is solely for
the Expansion Premises, and is in addition to any proportionate share of Real
Estate Taxes to be paid by Tenant for the Premises.
(b) Commencing on the first anniversary of the Expansion Premises
Commencement Date, Landlord may deliver the statement provided for in Section
19(b) of the Lease.
(c) Commencing January 1, 1998, Landlord shall deliver to Tenant the
statement provided for in Section 19(c) of the Lease.
7. Tenant Improvements for Expansion Premises.
------------------------------------------
(a) Landlord and Tenant agree to comply with the following schedule
in buildout of the Expansion Premises:
(i) Landlord has prepared, and Tenant has approved a Space
Plan for the Expansion Premises, which Space Plan is attached hereto as EXHIBIT
B. Any modifications to the Space Plan made after such date shall be made at
Tenant's expense and, if delay in occupancy occurs as a result of such
modifications, Tenant shall be liable to Landlord for Expansion Premises Basic
Rental attributable to each day beyond the Anticipated Expansion Premises
Commencement Date that delivery of the Expansion Premises is delayed.
(ii) Landlord shall prepare and deliver to Tenant detailed
floor plan layouts, together with working drawings and written instructions
sufficiently detailed to enable Landlord to let firm contracts (herein called
"Tenant Plans") with respect to and reflecting the partitions and improvements
in the Premises. Tenant shall fully and completely cooperate with Landlord-in
the preparation of the Tenant Plans, shall promptly respond to Landlord's
requests for information and approvals within three (3) business days after
inquiry, and shall use its best efforts to assist Landlord to complete the
Tenant Plans as soon as possible. Tenant agrees to deliver to Landlord, not
later than three (3) business days after delivery of the Tenant Plans to Tenant,
an original executed copy of the Tenant Plans approved by Tenant; provided,
however, if
-3-
Tenant, in good faith, reasonably objects to any aspect of the Tenant Plans
submitted by Landlord, Tenant shall specify in detail any objection to such
Tenant Plans as submitted to Tenant in a written notice to Landlord within such
3-day period. Landlord shall, if applicable, modify such Tenant Plans to address
Tenant's written objections, and submit new Tenant Plans to Tenant for approval.
Notwithstanding the foregoing, the Tenant Plans shall remain subject to
Landlord's review and approval, which approval shall not be unreasonably
withheld, and shall be deemed modified to take account of any changes reasonably
required by Landlord. If Tenant fails to timely deliver the Tenant Plans as
required herein or makes modifications to the Tenant Plans after the deadlines
provided in this subsection, Tenant shall (1) pay to Landlord all reasonable
expenses incurred by Landlord due to Tenant's modifications and/or delay in
delivering the Tenant Plans; and (2) pay to Landlord as additional rent a per
diem Expansion premises Basic Rental charge for each day beyond the initially
Anticipated Expansion Premises Commencement Date that occupancy is delayed due
to Tenant's failure to timely comply with the requirements in this Section.
(iii) Time is of the essence as to all dates provided in this
subsection.
(b) Any changes to any approved Tenant Plans desired by Tenant shall
be submitted in writing and in detail to Landlord and shall be subject to
Landlord's consent, which consent shall not be unreasonably withheld.
(c) Landlord shall, in a good and workmanlike manner, cause the
Expansion Premises to be improved and completed in accordance with the Tenant
Plans by "Landlord's Contractor" (as hereinafter defined). Landlord reserves
the right however, (i) to make substitutions of material of equivalent grade and
quality when and if any specified material shall not be readily and reasonably
available, and (ii) to make changes necessitated by conditions met in the course
of construction, provided that Tenant's approval of any substantial change shall
first be obtained (which approval shall not be unreasonably withheld or delayed
so long as there shall be general conformity with Tenant Plans).
(d) In the completion and preparation of the Expansion Premises in
accordance with the Tenant Plans, Landlord agrees to perform at its own expense
up to the amount of the Expansion Premises Tenant Allowance (as defined in
subsection (f) below) those items of work set forth on EXHIBIT B - Tenant Space
Plan (all work therein referred to as "Standard Tenant Work"), to the extent
required by Tenant Plans. All work to be performed by Landlord in addition to
or in substitution for Standard Tenant Work is hereinafter referred to as
"Special Tenant Work." All Special Tenant Work shall be furnished, installed
and performed by Landlord, utilizing a general contractor or construction
manager ("Landlord's Contractor") selected by Landlord (which may be an
affiliate of Landlord or a partner in Landlord or an affiliate of a partner in
Landlord) for and on behalf of Tenant and at Tenant's sole expense, based on
Landlord's out-of-pocket contract or purchase price for materials, labor and
service, including, without limit, any reasonable contractor's fee for the
contractor's overhead and profit and charges for cutting, patching, cleaning up
and removal of waste and debris, plus architects, and engineers'
-4-
fees, plus the product obtained by multiplying all of the foregoing (as reduced
by appropriate credits for substituted Standard Tenant Work) by fifteen percent
(15%) for Landlord's expenses and profit in handling the substitution. Tenant
shall pay Landlord for all Special Tenant Work, within two (2) business days
after receiving an estimated invoice therefor, prior to Landlord's performing
such Special Tenant Work. Any amounts paid under such estimated invoice not
expended by Landlord for the Special Tenant Work shall be returned to Tenant
upon conclusion of the buildout.
(e) Within two (2) business days after receiving notice from Landlord
that the cost of the buildout of the Expansion Premises is estimated to exceed
the Expansion Premises Tenant Allowance, Tenant shall pay Landlord the amount by
which Landlord estimates the total costs will exceed the Expansion Premises
Tenant Allowance, as such estimate changes from time to time, prior to
Landlord's performing such work. Any amounts paid by Tenant pursuant to this
Section 7(e) not expended by Landlord for the buildout shall be returned to
Tenant upon conclusion of the buildout. Any failure by Tenant to pay for all
work in excess of the Expansion Premises Tenant Allowance or all Special Tenant
Work, in advance, shall constitute failure to pay rent when due and an Event of
Default by Tenant hereunder, giving rise to all remedies available to Landlord
under the Lease, this Amendment and at law or equity for non-payment of rent.
(f) Landlord shall contribute up to $37,968.00 (the "Expansion
Premises Tenant Allowance") towards the completion of the buildout of the
Expansion Premises, which Expansion Premises Tenant Allowance shall include the
cost of preparation of the Tenant Plans and the Space Plan, construction costs
and Landlord's construction management fee. Any costs in excess of the
Expansion Premises Tenant Allowance shall be paid solely by Tenant as set forth
in Section 7(e) above. The Expansion Premises Tenant Allowance is calculated at
a rate of $28.00 per rentable square foot of the Expansion Premises.
8. Additional Services for Expansion Premises. Should Tenant
------------------------------------------
require any additional work or service, including but not limited
to heating, ventilation and air conditioning ("HVAC") furnished
outside Landlord's normal operating hours, as such are defined in
the Lease, Landlord may, upon twenty-four (24) hours notice by
Tenant, furnish such additional services at a charge of $90.00
per hour, subject to upward adjustment in Landlord's discretion,
it being agreed that the cost to Landlord of such additional
services shall not be considered or treated as Basic Cost for the
Expansion Premises.
9. Parking for Expansion Premises. By virtue of its occupation of
------------------------------
the Expansion Premises, Tenant shall have the right to contract
for three (3) additional unreserved parking spaces on the
Building's parking lot at a charge equal to the rate charged by
Landlord or the third-party vendor for such spaces from time to
time.
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10. Tenant Access. Subject to Landlord's reasonable regulations,
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Tenant shall have access to the Expansion Premises 24 hours per
day, 365 days per year, except in the case of an emergency or
when the Building may be closed by governmental authorities.
Landlord shall provide Tenant with a restricted entry access
system for after-hours access to the Building.
11. Security Deposit for Expansion Premises. Upon execution of this
---------------------------------------
Amendment, the second paragraph of Section 5 of the Lease shall
be deleted in its entirety, and Tenant shall not be entitled to
the return of the $5,240.83 as set forth in clause (2) of such
second paragraph. The amount of $15,722.50, currently held by
Landlord as the Security Deposit at the time of execution of this
Amendment, shall be held as the Security Deposit for the Premises
and the Expansion Premises for the Lease Term and the Expansion
Premises Term.
12. Notices. Section (p) of the Data Sheet and Section 30(c) of the
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Lease shall be amended to reflect the following address for
notices to Landlord:
Arlington Park Realty Corporation
c/o The ▇▇▇▇▇ ▇▇▇▇▇▇▇ Company
▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
13. Inapplicable Lease Sections. Notwithstanding any other terms
---------------------------
contained herein, the second paragraph of Section 3(a) of the
Lease shall not be applicable to the Expansion Premises.
14. Defined Terms. Except as otherwise expressly provided herein,
-------------
all defined terms shall have the same meanings as provided in the
Lease.
15. Headings. Headings contained in this Amendment are for
--------
convenience only and are not substantive to the provisions of
this Amendment.
16. Lease Terms Ratified. Except as otherwise expressly provided
--------------------
herein, and unless inconsistent with the terms hereof, all other
terms, conditions and covenants of the Lease are hereby ratified
and confirmed and shall apply to the Expansion Premises.
IN WITNESS WHEREOF, the parties have executed this Amendment by affixing
their hands and seals as of the date noted above.
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Landlord:
ATTEST: ARLINGTON PARK REALTY
CORPORATION
/s/ By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------- ---------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------
Title: Vice President
------------------------------------
Tenant:
WITNESS/ATTEST: AMERICAN SCHOOLS OF
PROFESSIONAL PSYCHOLOGY, INC.
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇'▇▇▇▇▇▇▇
-------------------------- ---------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇'▇▇▇▇▇▇▇
-------------------------------------
Title: President
------------------------------------
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