Exhibit 10.27.6
DEED OF LEASE
BY AND BETWEEN
SMII FAIRFAX, LLC
("LANDLORD")
AND
EUROTECH, LTD.
("TENANT")
WILLOW WOOD II
10306 ▇▇▇▇▇ PLACE
FAIRFAX, VIRGINIA
HOLLAND & KNIGHT LLP
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇ (FAX)
TABLE OF CONTENTS
PAGE
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1. BASIC LEASE TERMS........................................................1
2. PREMISES.................................................................1
3. TERM AND COMMENCEMENT OF TERM............................................2
4. RENT.....................................................................2
5. SECURITY DEPOSIT.........................................................5
6. USE......................................................................7
7. ASSIGNMENT AND SUBLETTING................................................8
8. IMPROVEMENTS AND FIXTURES...............................................10
9. UTILITIES AND SERVICES..................................................10
10. RIGHTS OF LANDLORD......................................................12
11. LIABILITY...............................................................13
12. INSURANCE...............................................................13
13. FIRE OR CASUALTY........................................................14
14. EMINENT DOMAIN ..........................................................14
15. SUBORDINATION AND ESTOPPEL CERTIFICATES.................................15
16. DEFAULT AND REMEDIES....................................................15
17. BANKRUPTCY..............................................................17
18. PAYMENT OF TENANTS OBLIGATIONS BY LANDLORD AND UNPAID RENT..............18
19. VOLUNTARY SURRENDER.....................................................18
20. ABANDONMENT OF PERSONAL PROPERTY........................................18
21. HOLD-OVER...............................................................19
22. INTENTIONALLY OMITTED...................................................19
23. PARKING.................................................................19
24. NOTICES.................................................................19
25. BROKERS.................................................................19
26. ENVIRONMENTAL CONCERNS..................................................19
27. LANDLORD'S LIEN.........................................................20
28. RULES AND REGULATIONS...................................................20
29. QUIET ENJOYMENT.........................................................20
30. MISCELLANEOUS PROVISIONS................................................20
i
LIST OF EXHIBITS
EXHIBIT A: Floor Plan of Premises
EXHIBIT B: Work Agreement
EXHIBIT C: Declaration of Commencement Date
EXHIBIT D: Rules and Regulations
ii
DEED OF LEASE
THIS DEED OF LEASE (this "Lease") is made AS of the 30th day of August,
2000 (the "Effective Date"), by and between SMII FAIRFAX, LLC, a Delaware
limited liability company ("Landlord") and EUROTECH, LTD., A District of
Columbia corporation ("Tenant"), who agree as follows:
1. BASIC LEASE TERMS. The following terms shall have the following
meanings in this Lease:
a. PREMISES: Approximately 7,861 rentable square feet of
space and located on the Second (2nd) floor
of the Building (described in Section 1.b.,
below), all as outlined on the floor plan
attached hereto as Exhibit A.
b. BUILDING: ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ (the
"Building"), containing approximately
120,426 rentable square feet of space.
c. COMMENCEMENT DATE: September 1, 2000
TERM: Five (5) years
d. INITIAL ANNUAL
BASE RENT*: $28.50 per rentable square foot
$224,038.50 per annum *
$ 18,669.88 per month
['subject to escalation as provided for in this Lease]
** BASE YEAR: Calendar Year 2001
f. TENANT'S PRO RATA SHARE 6.53 %*
OF OPERATING EXPENSES:
TENANT'S PRO RATA SHARE 6.53 %*
OF REAL ESTATE TAXES:
[*subject to adjustments provided for in this Lease]
g. ADDRESS FOR NOTICES:
TO LANDLORD: SMII Fairfax, LLC
c/▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇ Realty Advisors, Inc.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
WITH A COPY TO: Holland & Knight UP
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇, Esquire
TO TENANT: (before occupancy) ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇. ▇.▇. ▇▇▇▇▇
(after occupancy) At the Premises
h. SECURITY DEPOSIT: $224,038.50
2. PREMISES.
a. PREMISES. In consideration of Tenant's agreement to pay Annual Base
Rent (hereinafter defined) and Additional Rent (hereinafter defined) and subject
to the covenants and conditions hereinafter set forth, Landlord hereby leases to
Tenant and Tenant hereby hires and leases from Landlord, upon the terms and
conditions set forth herein, those certain premises described in Section 1a.
hereof and located in the Building (the "Premises"). The Premises are located in
the Building described in Section 1.b. hereof. The Lease of the Premises to
Tenant includes the right, together with other tenants of the Building
(hereinafter defined) and members of the public, to use the common public areas
of the Project (hereafter defined), but includes no other rights not
specifically set forth. The parties hereto acknowledge that the Building
constitutes one of two (2) office buildings owned by Landlord in the office
project known
as "Willow Wood Plaza,' the other building having a street addresses of ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ (collectively, along with the Building, the
"Buildings"). For all purposes hereunder, the Buildings, the land on which the
Buildings are located (the "Project Land") and all common areas, roadways and
public areas therein or thereon are collectively referred to herein as the
"Project." As used herein, the term "Land" shall mean the land on which the
Building is located. The rentable square footage of the Premises has been
determined in accordance with the Greater Washington Commercial Association of
Realtors Standard Method of Measurement (June 13, 1995).
b. IMPROVEMENTS.
(i) Landlord shall deliver the Premises to Tenant in their
"as-is" condition, and Landlord shall not be required to perform or install any
alterations, decorations or improvements to the Premises. Tenant shall construct
in the Premises, at Tenant's sole cost and expense, subject, however, to
application of the Improvement Allowance (hereinafter defined), the Tenant
Improvements (hereinafter defined), all in accordance with the terms of the Work
Agreement attached hereto as EXHIBIT B (the "Work Agreement"). In the event that
Landlord and Tenant have not finally agreed upon the scope and details of the
Tenant Improvements as of the Effective Date, Tenant's submission to Landlord of
plans and specifications detailing such work shall be subject to Landlord's
written approval in accordance with the Work Agreement. The Tenant Improvements
shall be subject to Landlord's prior written approval, and Tenant shall insure
that all of the Tenant Improvements comply with all applicable building codes,
laws and regulations (including without limitation the Americans With
Disabilities Act, as amended), do not include any changes to or modifications of
any of the mechanical, electrical, plumbing or other systems of the Building,
and are otherwise constructed strict accordance with the terms of the Work
Agreement.
(ii) The cost of all design, architectural and engineering
work, demolition costs, construction costs, construction supervision,
contractors' overhead and profit, licenses and permits, and all other costs and
expenses incurred in connection with the Tenant Improvements shall be at
Tenant's sole cost and expense, subject to the application of the Improvement
Allowance. Landlord shall pay the Improvement Allowance as provided in the Work
Agreement. All costs incurred in respect of the Tenant Improvements in excess of
the Improvement Allowance shall be paid by Tenant.
c. Acceptance. The taking of possession of the Premises by Tenant on
the Commencement Date shall constitute an acknowledgment by Tenant that the
Premises are in good condition and that Landlord has no obligations with respect
to the construction of any improvements in or to the Premises.
3. TERM AND COMMENCEMENT OF TERM.
a. Term. This Lease shall be in full force and effect from the
Effective Date. The term of this Lease (the "Term") shall commence on the
Commencement Date (hereinafter defined) and shall expire on the last day of the
fifth (5th) Lease Year (hereinafter defined) (the "Lease Expiration Date"),
unless such Term is otherwise extended or terminated in accordance with the
terms hereof. As used herein, the "Commencement Date" shall be the date shown in
Section I.e. hereof. As used herein, the term "Lease Year" means (a) each twelve
(12)-month period commencing on the Commencement Date, except that if the
Commencement Date does not occur on the first day of a calendar month, the first
Lease Year shall commence on the Commencement Date and terminate on the last day
of the twelfth (12th) full calendar month after the Commencement Date, and (b)
each successive period of twelve (12) calendar months thereafter during the
Term. Reference is made to the form of Declaration of Commencement Date (the
"Declaration") attached hereto as EXHIBIT C. After the Commencement Date
Landlord shall complete the Declaration and deliver the completed Declaration to
Tenant. Within five (5) days after Tenant receives the completed Declaration
from Landlord, Tenant shall execute and return the Declaration to Landlord to
confirm the Commencement Date, the Term and the actual number of rentable square
feet in the Premises. Failure to execute the Declaration shall not affect the
commencement or expiration of the Term.
b. Delays. No delay by Landlord in delivering the Premises to Tenant
shall render Landlord liable to Tenant for such delay or otherwise affect the
enforceability of this Lease.
4. RENT. Beginning on the Commencement Date, Tenant covenants and agrees to pay
as Rent (hereinafter defined) for the Premises the following amounts set forth
in this Section 4 and as otherwise provided in this Lease. "Additional Rent"
shall mean such costs, expenses, charges and other payments to be made by (or on
behalf of) Tenant to Landlord (or to a third party if required under this
Lease), whether or not the same be designated as such. "Rent" or "rent" shall
mean all Annual Base Rent (hereinafter defined) and Additional Rent due
hereunder.
a. ANNUAL BASE RENT.
(i) During each Lease Year, Tenant shall pay the annual base
rent in the amount set forth in Section 1d hereof, subject, however, to annual
adjustments thereto set forth below (the "Annual Base Rent"). Annual Base Rent
shall be payable in equal monthly installments (the "Monthly Base Rent"), in
advance, on the first day of each calendar month during the Term. Effective on
the first day of the second (2nd) Lease Year, and continuing on the first day of
each Lease Year thereafter during the Term, the Annual Base Rent shall be
increased as provided in Section 4.b. hereof.
2
(ii) In addition to the payment of Annual Base Rent Tenant
shall be responsible for the payment of Tenant's Pass-Through Costs (hereinafter
defined) pursuant to Section 4.c. hereof.
(iii) All installments of Monthly Base Rent shall be payable
in advance, with the first monthly installment due and payable upon execution of
this Lease. If the Commencement Date shall be a day other than the first day of
a calendar month, (1) the Annual Base Rent for the first Lease Year shall be an
amount equal to the sum of (x) the amount of Monthly Base Rent for the partial
month in which the Commencement Date occurs, plus (y) the amount of the Annual
Base Rent set forth in Section 1.d., above, and (2) Monthly Base Rent for such
partial month shall be the prorated amount of the Monthly Base Rent payable
hereunder during the first Lease Year, which proration shall be based upon the
actual number of days of such partial month. The prorated Monthly Base Rent for
such partial month shall be payable on the first day of the calendar month after
the month in which the Commencement Date occurs.
b. Annual Base Rent Adjustment. Commencing on the first day of the
second (2nd) Lease Year, and on the first day of each Lease Year thereafter
during the Term (the "Adjustment Date"), Annual Base Rent shall be increased by
an amount (the "Adjustment Amount") equal to three percent (30%) of the Annual
Base Rent for the immediately-preceding Lease Year. On the Adjustment Date,
Monthly Base Rent shall be increased by an amount equal to one-twelfth (1/12rh)
of such Adjustment Amount. Adjustments to Annual Base Rent pursuant to this
Section 4 b shall be in addition to the Additional Rent sent forth in Section
4.c., below.
c. TENANT'S PASS-THROUGH COSTS.
(i) As used in this Lease:
(1) "Operating Expenses" shall mean any and all
expenses, costs and disbursements (but not specific costs billed to and paid by
specific tenants) of every kind and nature incurred by Landlord in connection
with the ownership, management, operation, maintenance, servicing and repair of
the Building and appurtenances thereto, including without limitation the common
areas thereof, and the land underlying the Building (the "Land"), including but
not limited to employees' wages, salaries, welfare and pension benefits and
other fringe benefits; payroll taxes; telephone service; painting of common
areas of the Building; exterminating service, detection and security services;
concierge services; sewer rents and charges; premiums for fire and casualty,
liability, rent, workmen's compensation, sprinkler, water damage and other
insurance; repairs and maintenance; building supplies; uniforms and dry
cleaning; snow removal; the cost of obtaining and providing electricity, water
and other public utilities to all areas of the Building; trash removal;
janitorial and cleaning supplies; and janitorial and cleaning services; window
cleaning, service contracts for the maintenance of elevators, boilers, HVAC and
other mechanical, plumbing and electrical equipment; fees for all licenses and
permits required for the ownership and operation of the Project Land and the
Building; business license fees and taxes, including those based on Landlord's
rental income from the Building; the rental value of the management office
maintained in the Building; all costs of operating, maintaining and replacing
equipment in the health and fitness facility located in the Building; sales, use
and personal property taxes payable in connection with tangible personal
property and services purchased for the management operation, maintenance,
repair, cleaning, safety and administration of the Project Land and the
Building; legal fees; accounting fees relating to the determination of Operating
Expenses and the tenants' share thereof and the preparation of statements
required by tenant's leases; management fees, whether or not paid to any '
person having an interest in or under common ownership with Landlord; purchase
and installation of indoor plants in the common areas; and landscaping
maintenance and the purchase and replacement of landscaping services, plants and
shrubbery. If Landlord makes an expenditure for a capital improvement to the
Project Land (or any portion thereof) and/or the Building by installing energy
conservation or labor-saving devices to reduce Operating Expenses, or to comply
with any law, ordinance or regulation pertaining to the Project Land and/or the
Building, and if, under generally accepted accounting principles, such
expenditure is not a current expense, then the cost thereof shall be amortized
over a period equal to the useful life of such improvement, determined in
accordance with generally accepted accounting principles, and the amortized
costs allocated to each calendar year during the Term, together with an imputed
interest amount calculated on the unamortized portion thereof using an interest
rate of twelve percent (12%) per annum, shall be treated as an Operating
Expense. Operating Expenses shall not include costs and expenses directly
resulting from the gross negligence or willful misconduct of Landlord or its
employees, contractors or agents or any amounts paid to any person, firm or
corporation related to or otherwise affiliated with Landlord or any general
partner, officer, director or shareholder of Landlord or any of the foregoing,
to the extent the same exceeds arm's length, competitive prices paid in the
Fairfax, Virginia area by landlords of first-class office buildings for similar
services or goods.
(2) "Real Estate Taxes" shall mean all taxes,
assessments and charges levied upon or with respect to the Project Land (or any
portion thereof), the Building, and any improvements adjacent thereto (computed
as payable in installments as permitted by law regardless of whether so paid),
including without limitation vault rents, if any. franchise taxes, any tax, fee
or excise on rents, on the square footage of the Premises including the Fairfax
County Business License Tax, on the act of entering into this Lease, on the
occupancy of Tenant, on account of the rent hereunder or the business of renting
space now or hereafter levied or assessed against Landlord by the United States
of America or the state, county, city or town in which the Building are located,
or any political subdivision, public corporation, district or other political or
public entity; and shall also include any other tax to the extent that such tax
is imposed in lieu of or in addition to such Real Estate Taxes. Reasonable legal
fees, costs and disbursements incurred by Landlord in connection with any
proceedings for appeal or reduction of any Real Estate Taxes shall also be
considered Real Estate Taxes for the year in question.
3
(3) "Tenant's Pro Rata Share of Operating Expenses,"
as of the date hereof, shall be as provided in Section 1.f.. representing the
ratio that the rentable area of the Premises bears to the total rentable area of
office space in the Building If either the rentable area of the Premises or the
total rentable area of the Building shall be increased or decreased, as
reasonably determined by Landlord, Tenant's Pro Rata Share of Operating Expenses
shall be adjusted accordingly
(4) "Tenant's Pro Rata Share of Real Estate Taxes,"
as of the date hereof, shall be as provided in Section 1.f.. representing the
ratio that the area of the Premises bears to the total rentable area of the
Building. If either the rentable area of the Premises or the total rentable area
of the Building shall be increased or decreased, as reasonably determined by
Landlord, Tenant's Pro Rata Share of Real Estate Taxes shall be adjusted
accordingly
(5) "Base Year" means calendar year 2001.
(ii) If, in any calendar year during the Term, the total
amount of Operating Expenses for the Building exceeds the amount of Operating
Expenses in the Base Year, then Tenant shall pay to Landlord, as Additional
Rent, an amount which is the product of (1) the amount of such increase in
Operating Expenses, multiplied by (2) Tenant's Pro Rata Share of Operating
Expenses, Tenant's Pro Rata Share of Operating Expenses for any partial calendar
year during the Term shall be determined by multiplying the amount of Tenant's
Pro Rata Share of Operating Expenses for the full calendar year by a fraction,
the numerator of which is the number of days during such calendar year falling
within the Term and the denominator of which is three hundred sixty five (365)
If in any calendar year during the Term, the amount of Real Estate Taxes exceeds
the amount of Real Estate Taxes for the Base Year, then Tenant shall pay. as
Additional Rent, an amount which is the product of (x) the amount of such
increase in Real Estate Taxes, multiplied by (y) Tenant's Pro Rata Share of Real
Estate Taxes Tenant's Pro Rata Share of Real Estate Taxes for any partial
calendar year during the Term shall be determined by multiplying the amount of
Tenant's Pro Rata Share of Real Estate Taxes for the full calendar year by a
fraction, the numerator of which is the number of days during such calendar year
falling within the Term and the denominator of which is three hundred sixty five
(365)
(iii) If at any time during the Base Year, or during any
subsequent calendar year ("Subsequent Year"), less than ninety-five percent
(95%) of the total rentable square feet of office space IN THE Building is
occupied by tenants, the amount of Operating Expenses for the Base Year, or for
any such Subsequent Year, as the case may be, shall be deemed to be the amount
of Operating Expenses as reasonably estimated by Landlord that would have been
incurred if the percentage of occupancy of the Building during the Base Year or
any such Subsequent Year was ninety-five percent (95%), If at any time during
any calendar year, any part of the Building is leased to a tenant (hereinafter
referred to as a "Special Tenant") who, in accordance with the terms of its
lease, provides its own utilities, cleaning OR janitorial services or other
services or is not otherwise required to pay a share of Operating Expenses IN
accordance with the methodology set forth in this Section 4 c., and Landlord
does not incur the COST OF such services, Operating Expenses for such calendar
year shall be increased by the additional costs for cleaning and janitorial
services and such other applicable expenses as reasonably estimated by Landlord
that would have been incurred by Landlord if Landlord had furnished and paid for
cleaning and janitorial services and such other services for the space occupied
by the Special Tenant, or if Landlord had included such costs in "operating
expenses" as defined in the Special Tenant's lease,
(iv) During the month of December. 2001. and thereafter during
the month of December of each Lease Year, Landlord shall use reasonable efforts
to furnish to Tenant a statement of Landlord's estimate of Tenant's Pass-Through
Costs for the next calendar year. "Tenant's Pass-Through Costs" shall be an
amount equal to the sum of (1) Tenant's Pro Rata Share of Operating Expenses
multiplied by the difference between Operating Expenses incurred during any
calendar year during the Term, and Operating Expenses incurred in the Base Year,
plus (2) Tenant's Pro Rata Share of Real Estate Taxes multiplied by the
difference between Real Estate Taxes for any calendar year during the Term and
Real Estate Taxes incurred during the Base Year. Such statement shall show the
amount of Tenant's Pass-Through Costs, if any, payable by Tenant for such
calendar year pursuant to this Section 4c on the basis of Landlord's estimate.
Commencing on January 1, 2002, and continuing on each monthly rent payment date
thereafter until further adjustment pursuant to this Section 4.c. (iv), Tenant
shall pay to Landlord one-twelfth (1/12) of the amount of said estimated
Tenant's Pass-Through Costs. Within one hundred twenty (120) days after the
expiration of each calendar year during the Term, Landlord shall furnish to
Tenant a statement (the "Expense Statement") showing the actual Operating
Expenses and Real Estate Taxes for such calendar year. The Expense Statement
shall be conclusive and binding on Tenant, unless objected to in writing by
Tenant within six (6) months following Tenant's receipt thereof. In case of an
underpayment, Tenant shall, within thirty (30) days after the receipt of such
statement, pay to Landlord an amount equal to such underpayment. In case of an
overpayment. Landlord shall credit the next monthly rental payment by Tenant
with an amount equal to such overpayment. Additionally, if this Lease shall have
expired, Landlord shall apply such excess against any sums due from Tenant to
Landlord and shall refund any remainder to Tenant within one hundred and twenty
(120) days after the expiration of the Term, or as soon thereafter as possible,
(v) All monies received from Tenant as Tenant's Pass-Through
Costs shall be received by Landlord to pay Operating Expenses and Real Estate
Taxes of the Building and the Land. Notwithstanding the foregoing, Landlord
shall have the right to commingle Tenant's Pass-Through Costs with other funds
collected by Landlord.
(vi) Tenant's obligation to pay Tenant's Pass-Through Costs
pursuant to the provisions of this Section 4 C shall survive the expiration or
other termination of this Lease with respect to
4
any period during the Term hereof and with respect to any holdover period of
occupancy following the expiration of the Term.
(vii) Notwithstanding anything contained in this Section 4.b
to the contrary, Landlord reserves the right, at any time in the future, to
calculate some or all of the Operating Expenses on the basis of the aggregate
expenses incurred in connection with the operation of the Building together with
the other buildings constituting a part of Willow Wood Plaza, in which event
Tenant's Pro Rata Share shall be adjusted accordingly.
d. Payment of Rent All Rent shall be paid in lawful money of the United
States of America without deduction, diminution, set-off, counterclaim or prior
notice or demand, at the office of Landlord as provided in Section 1g hereof or
at such other place as Landlord may hereafter designate in writing, on the first
day of every calendar month during the Term. AH such payments shall be made by
good checks payable to Landlord or such other person, firm or corporation as
Landlord may hereafter designate in writing. No payment by Tenant or receipt and
acceptance by Landlord of a lesser amount than the Monthly Base Rent or
Additional Rent shall be deemed to be other than partial payment of the full
amount then due and payable; nor shall any endorsement or statement on any check
or any letter accompanying any check, payment of Rent or other payment, be
deemed an accord and satisfaction; and the Landlord may accept, but is not
obligated to accept, such partial payment without prejudice to the Landlord's
right to recover the balance due and payable or to pursue any other remedy
provided in this Lease or by law. If Landlord shall at any time or times accept
Rent after it becomes due and payable, such acceptance shall not excuse a
subsequent delay or constitute a waiver of Landlord's rights hereunder. Any Rent
owed by Tenant to Landlord, including without limitation Annual Base Rent,
Additional Rent, Tenant's Pass-Through Costs and Late Charges, which is not paid
within five (5) days after the date such payment is due shall bear interest from
the due date at a rate equal to the prime rate on corporate loans quoted in the
WALL STREET JOURNAL (the "Prime Rate") plus four percent (4%). In addition, if
any amount of Rent required to be paid by Tenant to Landlord under the terms of
this Lease is not paid within five (5) days after the date such payment is due,
then in addition to paying the amount of Rent then due, Tenant shall pay to
Landlord a late charge (the "Late Charge") equal to five percent (5%) of the
amount of Rent then required to be paid, provided, however on the first occasion
of the late payment of Rent in any twelve (12) month period, and no more than
once in any twelve (12) month period, Landlord agrees to waive its right to
collect such Late Charge on such payment of Rent if such payment is made no
later than the fifth (5*) day after Landlord delivers to Tenant written notice
of such late payment of Rent. Payment of such Late Charge will not excuse the
untimely payment of Rent. In the event Tenant makes any payment of Rent by check
and said check is returned by the bank unpaid, Tenant shall pay to Landlord the
sum of One Hundred Dollars ($100.00) to cover the costs and expenses of
processing the returned check, in addition to the Rent payment and any other
charges provided for herein. Any interest, Late Charge and other amounts charged
hereunder shall constitute Additional Rent.
e. Separate Metering and Rent Reduction. Landlord may elect to
discontinue the distribution or furnishing of electricity and/or water to the
Premises if such services may feasibly be 'furnished directly to Tenant by the
utility company supplying same. In the event of any such election by Landlord:
(i) Landlord agrees to give reasonable advance notice of such discontinuance to
Tenant; (ii) Landlord agrees to permit Tenant to receive electricity and/or
water directly from the utilities supplying such service to the Building and to
permit the existing feeders, risers, wiring, pipes and other facilities serving
the Premises to be used by Tenant for such purpose to the extent they are
suitable and safely capable of carrying Tenant's requirements; (iii) Landlord
agrees to pay such charges and costs, if any, as such public utility may impose
in connection with the installation of Tenant's meters; and (iv) the amount of
Additional Rent payable in respect to the Operating Expenses shall be decreased
appropriately to reflect such discontinuance. This Lease shall remain in full
force and effect and such discontinuance shall not constitute an actual or
constructive eviction, in whole or in part, or relieve Tenant from any of its
obligations under this Lease.
5. SECURITY DEPOSIT.
a. On or before the date which is ten (10) days after the Effective
Date (the "Security Deposit Delivery Date"), time being of the essence, Tenant
shall deliver to Landlord a security deposit in the amount set forth in Section
1h hereof (the "Security Deposit") to be held by Landlord during the Term as
collateral security (and not prepaid rent), for the payment of Annual Base Rent
and Additional Rent and for the faithful performance by Tenant of all other
covenants, conditions and agreements of this Lease. Failure by Tenant to deliver
the Security Deposit to Landlord on or before the Security Deposit Delivery Date
shall constitute an Event of Default (hereinafter defined) under this Lease.
Landlord shall not be obligated to hold the Security Deposit in a separate
account. Any portion of the Security Deposit tendered by Tenant in cash shall be
referred to as the "Cash Security Deposit." The Cash Security Deposit shall not
earn interesL If any sum payable by Tenant to Landlord shall be overdue and
unpaid, or if Landlord makes any payment(s) on behalf of Tenant, or if, after
all applicable notice and cure periods (except in the event of an emergency), if
any. under the Lease, Tenant fails to perform any of the terms of this Lease,
then Landlord, at its option and without prejudice to any other remedy which
Landlord may have, may apply all or part of the Security Deposit to compensate
Landlord for the payment of Annual Base Rent or. Additional Rent, or any loss or
damage sustained by Landlord. Tenant shall restore the Security Deposit to the
original sum deposited after written notice from Landlord specifying the portion
of the Security Deposit applied by Landlord. Subject to the provisions of
Section 5.e, below, and provided that Tenant shall have made all payments and
performed all covenants and agreements of this Lease, Landlord shall return the
Security Deposit to Tenant (except to the extent of any portion of the Security
Deposit which has been applied by Landlord and not restored by Tenant) within
forty-five (45)
5
days after the expiration of this Lease or the vacation of the Premises by
Tenant, whichever is later, or as soon thereafter as possible.
b. In lieu of the Cash Security Deposit under Section 5a above, Tenant
may deliver to Landlord, on or before the Security Deposit Delivery Date, an
unconditional and irrevocable letter of credit reasonably acceptable to Landlord
issued by the Bank (hereinafter defined) in the face amount of Two Hundred
Twenty-Four Thousand Thirty-Eight and 50/100 Dollars ($224,038.50) (the "Letter
of Credit"), as a security deposit to be held by Landlord until applied or
disposed of in accordance with the provisions of this Section 5. As used herein,
the term "Security Deposit" shall mean, collectively, the Cash Security Deposit
and the Letter of Credit. As used herein, the term "Bank" shall mean
federally-insured banking institution reasonably acceptable to Landlord, having
offices in the Washington, D.C. metropolitan area, and having total assets of at
least Three Billion Dollars ($3,000,000,000) and a Standard & Poor's commercial
paper rating of at least A-1. If the Letter of Credit (or any replacement
thereof) is issued for an effective period of time less than the remaining Term
of this Lease (or any renewal thereof), Tenant shall from time to time, and not
later than sixty (60) days prior to the expiration of the Letter of Credit,
replace each such expiring Letter of Credit with a new Letter of Credit in the
same amount and upon the same terms. The Letter of Credit (and any replacement
thereof) may be drawn upon by Landlord under the terms and conditions as
provided in this Section 5. Failure of Tenant to renew the Letter of Credit at
least sixty (60) days prior to its expiration shall constitute an Event of
Default under this Lease and shall entitle Landlord, in addition to the other
remedies contained in this Lease, to draw upon the Letter of Credit.
c. Landlord (or the beneficiary under the Letter of Credit, if such
beneficiary is not Landlord) shall have the right to draw upon the Letter of
Credit in any of the following circumstances (in addition to any other right to
draw on the Letter of Credit that is set forth in this Section 5): (i) if the
total assets of the Bank are at anytime less than Three Billion Dollars
($3,000,000,000), or the Bank has a Standard & Poor's commercial paper rating of
less than A-1 (provided if at anytime the current Standard & Poor's commercial
paper rating system is no longer in existence, a comparable rating of a
comparable commercial paper rating system from a comparable company shall be
selected by Landlord, in its reasonable discretion, for purposes of this Section
5) and Tenant fails to deliver to Landlord a replacement Letter of Credit
complying with the terms of this Lease within thirty (30) days of request
therefor from Landlord, (ii) if the credit rating of the Bank is downgraded from
the credit rating of such issuer at the time of the issuance of the Letter of
Credit, the Bank shall enter into any supervisory agreement with any
governmental authority, or the Bank shall fail to meet any capital requirements
imposed by applicable law, and Tenant fails to deliver to Landlord (or the
beneficiary under the Letter of Credit, if such beneficiary is not Landlord) a
replacement Letter of Credit complying with the terms of this Lease within
thirty (30) days of request from Landlord, (iii) if Tenant fails to provide
Landlord with any renewal or replacement Letter of Credit complying with the
terms of this Lease at least sixty (60) days prior to expiration of the
then-current Letter of Credit where the Bank has advised Landlord of its
intention not to renew the Letter of Credit, (iv) if Tenant fails to provide
Landlord with any renewal or replacement Letter of Credit complying with the
terms of this Lease at least sixty (60) days prior to the final expiration date
(I.E., the date that, by the terms of the Letter of Credit, the Letter of Credit
expires and is either not subject to any automatic renewal or extension or the
conditions to such automatic renewal or extension have not then been satisfied)
of the then-current Letter of Credit if such Letter of Credit expires prior to
the date that is thirty (30) days after the end of the Term, or (v) any
voluntary in involuntary proceedings are filed by or against Tenant or any
Guarantor of this Lease under any bankruptcy, insolvency or similar laws. In the
event the Letter of Credit is drawn upon due solely to the circumstances
described in the foregoing clauses (i), (ii), (iii), (iv) or (v), the amount
drawn shall be held by Landlord as an additional Cash Security Deposit in
accordance with the terms of this Section 5, and shall be otherwise retained,
expended or disbursed by Landlord for any amounts or sums due under this Lease
to which the proceeds of the Letter of Credit could have been applied pursuant
to this Lease, and Tenant shall be liable to Landlord for restoration, in cash
or Letter of Credit complying with the terms of this Lease, of any amount so
expended to the same extent as set forth in this Section 5.
d. In the event of the sale or transfer of Landlord's interest in the
Building, Landlord shall have the right to transfer the Cash Security Deposit
and/or the Letter of Credit to the purchaser or assignee, and upon notification
to Tenant of such transfer Tenant shall look only to the new landlord for the
return of the Cash Security Deposit, and Landlord shall thereupon be released
from all liability to Tenant for the return of the Cash Security Deposit or
Letter of Credit. Tenant hereby agrees not to look to the mortgagee, as
mortgagee, mortgagee in possession, or successor in title to the property, for
accountability for any Security Deposit required by the Landlord hereunder,
unless said sums have actually been received by said mortgagee AS security for
Tenant's performance of this Lease. In the event of any permitted assignment of
Tenant's interest in this Lease, the Cash Security Deposit and the Letter of
Credit may, at Landlord's sole option, be held by Landlord as a deposit made by
the assignee, and Landlord shall have no further liability to Tenant with
respect to the return of the Cash Security Deposit or the Letter of Credit.
e. Notwithstanding anything to the contrary set forth herein, provided
that (i) no default then exists under the Lease, and (ii) Tenant is then
occupying 100% of the Premises, on the first day of the second (2nd), third
(3rd) and fourth (4th) Lease Years during the Term, the Security Deposit shall
be reduced by Thirty-Seven Thousand Three Hundred Thirty-Nine and 76/100ths
Dollars ($37,339.76). The aforesaid reductions shall be effectuated by, at
Landlord's option, a reduction of the Cash Security Deposit (with the reduction
being refunded to Tenant or applied to Tenant's next due obligations for Rent),
and/or the replacement of the Letter of Credit for the appropriate reduced
amount issued to Landlord in accordance with the terms of this Lease. If the
Security Deposit is in the form of a Letter of Credit, no reduction in the
Letter of Credit shall be effected unless and until Landlord confirms in
6
writing that the conditions set forth in subsections 5.e(i)-{iii) have been met.
The balance of the Cash Security Deposit or the Letter of Credit, as applicable,
which has not been reduced as aforesaid shall t>e retained by Landlord
throughout the Term.
f. Tenant will deliver to Landlord, no later than May 15th of each
calendar year. Tenant's annual report for the immediately-preceding calendar
year on Form 10K filed with the Securities and Exchange Commission, (which Form
10K shall be sworn to as complete and correct by Tenant's chief financial
officer in a certificate addressed to Landlord and appended to the Form 10K).
Tenant will prepare unaudited financial statements on a quarterly basis
(consisting of a Balance Sheet, Income Statement and Cash Flow Statement, and
related footnotes, prepared in accordance with generally accepted accounting
principles). Tenant shall, from time-to-time, upon fifteen (15) days notice from
Landlord, provide Landlord with a copy of Tenant's most recent quarterly and/or
annual financial statements, as requested by Landlord.. Quarterly statements
must be certified by a certified public accountant or sworn to as to their
accuracy by Tenant's President or Chief Financial Officer. The financial
statements provided must be as of a date not more than fifteen (15) months prior
to the date of request Landlord shall retain such statements in confidence, but
may provide copies to lenders and potential lenders as required.
6. USE.
a. Tenant covenants with the Landlord not to use the Premises for any
purpose other than general office use for the conduct of the Tenant's business.
Tenant shall not use the Premises or allow the Premises to be used for any other
purpose without the prior written consent of the Landlord. Tenant, at Tenant's
expense, shall comply with all laws, codes, rules, orders, ordinances,
directions, regulation, and requirements of federal, state, county, and
municipal authorities, now in force or which may hereafter be in force, which
shall impose any duty upon Landlord or Tenant with respect to the condition,
maintenance, use, occupation, operation or alteration of the Premises, or the
conduct of Tenant's business therein, including without limitation the Americans
With Disabilities Act, as amended and all applicable zoning, recycling and
environmental laws and regulations. Tenant hereby agrees to indemnify and hold
harmless Landlord and its agents, officers, directors and employees from and
against any cost, damage, claim, liability and expense (including attorneys'
fees) arising out of claims or suits brought by third parties against Landlord,
its agents, officers, directors and employees alleging or relating to the
failure of the Premises to comply with the terms of the Americans With
Disabilities Act, as amended, or any other law or regulation applicable to the
Premises and/or its occupancy by Tenant. Without limiting the foregoing,
Landlord shall be responsible for removing barriers in the common areas of the
Building to the extent that Landlord or an appropriate governmental authority
determines that such removal is required by the Americans with Disabilities Act,
as amended and to the extent that such removal was not caused by any action or
inaction of Tenant. Tenant shall not use or permit the Premises or any part
thereof to be used in any manner that constitutes waste, nuisance or
unreasonable disturbances to other tenants of the Building or for any
disorderly, unlawful or hazardous purpose and will not store or maintain therein
any hazardous, toxic or highly combustible items other than usual and customary
office supplies intended for Tenant's use and in such event, only in such
amounts as permitted by applicable law. Tenant covenants not to change Tenant's
use of the Premises without the prior written approval of Landlord.
b. Tenant shall not put the Premises to any use, the effect of which
use is reasonably likely to cause cancellation of any insurance covering the
Premises or the Building, or an increase in the premium rates for such
insurance. In the event that Tenant performs or commits any act, the effect of
which is to raise the premium rates for such insurance, Tenant shall pay
Landlord the amount of the additional premium, as Additional Rent payable by
Tenant upon demand therefor by Landlord. The Premises shall not be used for any
illegal purpose or in violation of any regulation of any governmental body or
the regulations or directives of Landlord's insurance carriers, or in any manner
which interferes with the quiet enjoyment of any other tenant of the Building.
Tenant will not install or operate in the Premises any electrical or other
equipment, other than such equipment as is commonly used in modern offices
(specifically excluding mainframe computers), without first obtaining the prior
written consent of Landlord, who may condition such consent upon the payment by
Tenant of Additional Rent in compensation for excess consumption of water,
electricity and/or other utilities, excess wiring and other similar
requirements, and any changes, replacements or additions to any base building
system, as may be occasioned by the operation of said equipment or machinery.
c. Tenant agrees to maintain the Premises, and the Tenant Improvements
and other Alterations (hereinafter defined) therein, in good order, repair and
condition during the Term at Tenant's sole cost and expense, and Tenant will, at
the expiration or other termination of the Term, surrender and deliver the same
and all keys, locks and other fixtures connected therewith (excepting only
Tenant's personal property) in good order, repair and condition, as the same
shall be at the Commencement Date, except as repaired, rebuilt, restored,
altered or added to pursuant to this Lease, and except for ordinary wear and
tear. Landlord shall have no obligation to Tenant to make any repairs in or to
the Premises, the Tenant Improvements or any Alterations. Any and all damage or
injury to the Premises (including, but not limited to, the Tenant Improvements),
the Building or the Land caused by Tenant, or by any employee, agent,
contractor, assignee, subtenant, invitee or customer of Tenant shall be promptly
reported to Landlord and repaired by Tenant at Tenant's sole cost; provided,
however, that Landlord shall have the option of repairing any such damage, in
which case Tenant shall reimburse Landlord for all costs incurred by Landlord in
respect thereof as Additional Rent within fifteen (15) days after Tenant
receives Landlord's notice of such costs.
7
D. Tenant shall not place a TOAD UPON the floor of the Premises
exceeding the designated floor load capacity of the Building (e.g. 100 POUNDS
per square foot: 80 pounds per square foot, live bad. and 20 pounds per square
foot dead load) without Landlord's prior written consent Business machines,
mechanical equipment and materials belonging to Tenant which cause vibration,
noise, cold, heat or fumes that may be transmitted to the Building or to any
other leased SPACE THEREIN to such a degree as to be objectionable to Landlord
or to any other tenant in the Building shall be placed, maintained, isolated,
stored and/or vented by Tenant at its sate expense so as to absorb and prevent
such vibration, noise, cold, heat or fumes.
7. ASSIGNMENT AND SUBLETTING.
A. Tenant shall not, without the prior written consent of Landlord
(which consent may be granted or withheld by Landlord in its sole discretion
except as expressly set forth below) in each instance: (i) assign or otherwise
transfer this Lease or any of Tenant's rights hereunder. (ii) sublet the
Premises or any part thereof, or permit the use of the Premises or any part
thereof by any persons other than Tenant or its employees, agent and invitees,
or (iii) permit the assignment or other transfer of this Lease or any of
Tenant's rights hereunder by operation of law. Landlord's consent to a proposed
assignment or sublease shall not be unreasonably withheld, conditioned or
delayed, provided Landlord determines that the proposed assignee or subtenant
(A) is of a type and quality consistent with the first- class nature of the
Building, (B) has the financial capacity and creditworthiness to undertake and
perform the obligations of this Lease or the sublease, (C) is not a party by
whom any suit or action could be defended on the ground of sovereign immunity or
diplomatic immunity and (D) will not impose any additional material burden upon
Landlord in the operation of the Building (to an extent greater than the burden
to which Landlord would have been had Tenant continued to use such part of the
Premises), In addition, the following conditions must be satisfied at the time
Tenant requests Landlord's consent to an assignment or sublease
(1) no Event of Default (hereinafter defined) exists and no
event has occurred WHICH, with notice and/or the passage of time, would
constitute an Event of Default if not cured within THE time, including
any applicable grace period, specified herein
(2) Landlord receives at least thirty (30) days' prior written
notice of Tenant's intention to assign this Lease or sublet any portion
of the Premises;
(3) the proposed use of the Premises will not violate any
agreement affecting the Premises or the Building;
(4) Tenant submits to Landlord at least thirty (30) days prior
to the proposed DATE OF subletting or assignment whatever information
Landlord reasonably requests in order to PERMIT Landlord to make a
judgment on the proposed subletting or assignment, including without
limitation the name, business experience, financial history, net worth
and business references of the proposed assignee or subtenant (and each
of its principals), an in-depth description of the transaction, and the
consideration delivered to Tenant for the assignment or sublease;
(5) the proposed assignee or subtenant is not a tenant of the
Building or a prospective tenant who, within the six (6) months prior
to Tenant's request, has talked to Landlord or its brokers or agents
about the possibility of leasing space in the Building;
(6) Tenant has not requested approval of a sublease within the
prior twelve (12) months and Tenant has not previously sublet more than
twenty-five percent (25%) of the rentable square feet of the Premises;
and
(7) Tenant has paid to Landlord an administrative fee in the
amount of Seven Hundred Fifty Dollars ($750,00) which shall be retained
by Landlord whether or not such consent is granted.
b. All proposed subleases and assignments shall be on Landlord's
approved form of sublease or assignment, whichever is applicable; and shall
contain, inter alia, the following provisions: (i) any such assignment or
sublease shall include an assumption by the assignee or subtenant, from and
after the effective date of such assignment or sublease, of the performance and
observance of the covenants and conditions to be performed and observed on the
part of Tenant as contained in this Lease, and (ii)any such sublease or
assignment shall specify that this Lease or sublease shall not be further
assigned nor the Premises further sublet and shall specify that the term of such
sublease shall not extend beyond one (1) day prior to the expiration of this
Lease. The consent by Landlord to any assignment, transfer or subletting to any
person or entity shall not be construed as a waiver or release of Tenant from
any provision of this Lease, unless expressly agreed to in writing by Landlord
(it being understood that Tenant shall remain primarily liable as a principal
and not as a guarantor or surety), nor shall the collection or acceptance of
rent from any such assignee, transferee, subtenant or occupant constitute a
waiver or release of Tenant from any such provision. No consent by Landlord to
any such assignment, transfer or subletting in any one instance shall constitute
a waiver of the necessity for such consent in a subsequent instance.
c. In the event that Tenant assigns this Lease or sublets all or any
portion of the Premises. Tenant shall pay to Landlord as Additional Rent an
amount equal to fifty percent (50%) of the difference between (i) all sums paid
to Tenant or its agent by or on behalf of such assignee or subtenant under the
8
assignment or sublease, and (ii) the Annual Base Rent and Additional Rent paid
by Tenant under this Lease and attributable to the portion of the Premises
assigned or sublet.
d. For purposes of this Section, a transfer, conveyance, grant or
pledge, directly or indirectly, in one or more transactions, of an interest in
Tenant (whether stock, partnership interest or other form of ownership or
control, or the issuance of new interests) by which an aggregate of more than
fifty percent (50%) of the beneficial interest in Tenant shall be vested in a
party or parties who are not holders of such interests) as of the date hereof)
shall be deemed an assignment of this Lease; provided, however, that this
limitation shall not apply to any corporation, all of the outstanding voting
stock of which is listed on a national securities exchange as defined in the
Securities Exchange Act of 1934. The merger or consolidation of Tenant into or
with any other entity, the sale of all or substantially all of Tenant's assets,
or the dissolution of Tenant shall each be deemed to be an assignment within the
meaning of this Section.
e. Any assignment or subletting not in conformance with the terms of
this Lease shall be void AB INITIO and shall, subject to the provisions of
Section 16, constitute a default under the Lease.
f. Upon receipt of the notice referred to in Section 7.a.(2), above,
Landlord may, at its option, in lieu of approving or rejecting the proposed
assignment or subletting, exercise all or any of the following rights by written
notice to Tenant of Landlord's intent to do so within fifteen (15) business days
of Landlord's receipt of Tenant's notice:
(i) with respect to a proposed assignment of this Lease, the
right to terminate this Lease on the effective date of proposed
assignment as though it were the Lease Expiration Date;
(ii) with respect to a proposed sublease of the entire Premises,
the right to terminate this Lease on the effective date of the sublease
as though it were the Lease Expiration Date;
(iii) with respect to a proposed sublease of less than the entire
Premises, the right to terminate this Lease as to the portion of the
Premises affected by such sublease on the effective date of the
sublease, as though it were the Lease Expiration Date, in which case
Tenant shall execute and deliver to Landlord an appropriate modification
of this Lease, in form satisfactory to Landlord in all respects within
ten (10) days of Landlord's notice of partial termination, which
modification of this Lease shall provide that the number of rentable
square feet of the Premises shall be decreased by, and the Monthly Base
Rent and Additional Rent payable by Tenant hereunder shall be adjusted
in proportion to, the number of rentable square feet of the Premises
affected by such termination, as determined by Landlord; or
(iv) with respect to a proposed sublease for less than the
balance of the Term, the right to sublet the portion of the Premises
from Tenant upon the same terms and conditions (including Annual Base
Rent and Additional Rent) set forth in this Lease for the term of the
proposed sublease.
9. If Landlord exercises any of its options under Section 7.f., above,
Landlord may then lease (or sublease) the Premises or any portion thereof to
Tenant's proposed assignee or subtenant, AS the case may be, without any
liability whatsoever to Tenant.
h. Upon any assignment of this Lease or sublease of all or a portion of
the Premises, any and all option rights, rights of first refusal, rights of
first negotiation, and expansion rights shall terminate, it being understood
that any and all such rights are personal to Tenant (and not to any assignee or
subtenant) and are not appurtenant to the Premises or this Lease. Further,
Tenant shall not have the right to exercise any such rights unless Tenant (and
not any assignee or subtenant of Tenant) shall be in occupancy of all of the
Premises at the time of the exercise of any such right. In addition to the
administrative fee described in Section 7.a.(7), above, Tenant shall reimburse
Landlord for its attorneys' fees and other third party expenses incurred in
reviewing any requested consent whether or not such consent is granted. Tenant
shall not collaterally assign, mortgage, pledge, hypothecate or otherwise
encumber this Lease or any of Tenant's rights hereunder without the prior
written consent of Landlord, which consent Landlord may withhold in its sole
discretion.
i. Notwithstanding any consent by Landlord to an assignment or
subletting, Tenant shall remain primarily liable for the performance of all
covenants and obligations contained in this Lease. Each approved assignee or
subtenant shall also automatically become liable for the obligations of Tenant
hereunder. Landlord shall be permitted to enforce the provisions of this Lease
directly against Tenant and/or against any assignee or sublessee without
proceeding in any way against any other person. Collection or acceptance of
Annual Base Rent or Additional Rent from any such assignee, subtenant or
occupant shall not constitute a waiver or release of Tenant from the terms of
any covenant or obligation contained in this Lease, nor shall such collection
or acceptance in any way be construed to relieve Tenant from obtaining the
prior written consent of Landlord to such assignment or subletting or any
subsequent assignment or subletting.
8. IMPROVEMENTS AND FIXTURES.
a. Tenant shall neither make nor allow any alterations, decorations,
replacements, changes, additions or improvements (collectively referred to as
"Alterations") to the Premises or any part thereof that will or may affect the
mechanical, electrical, plumbing, HVAC or other systems or the exterior or
9
structure of the Building, without the prior written consent of Landlord, which
may be withheld by Landlord in its sole discretion. Tenant shall not make or
allow any other kind of Alterations to the Premises or any part thereof without
the prior written consent of Landlord, which consent shall not be unreasonably
withheld, conditioned or delayed. All of such Alterations, structural or
otherwise, must conform to all rules and regulations established from time to
time by Landlord, must be performed in a good and workmanlike manner, must
comply with all applicable building codes, laws and regulations (including
without limitation the Americans With Disabilities Act, as amended), shall not
require any changes to or modifications of any of the mechanical, electrical,
plumbing, HVAC or other systems or the exterior or structure of the Building,
and shall otherwise be constructed in strict accordance with the terms and
conditions of this Section 8. Prior to undertaking any Alterations in the
Premises, Tenant shall furnish to Landlord duplicate original policies or
certificates thereof of worker's compensation insurance (covering all persons to
be employed by Tenant, and Tenant's contractors and subcontractors in connection
with such Alteration), builder's all-risk insurance, and comprehensive public
liability insurance (including property damage coverage) in such form, with such
companies, for such periods and in such amounts as Landlord may reasonably
require, naming Landlord and its agents, and any mortgagee as additional
insureds.
b. It is understood and agreed by Landlord and Tenant that any
Alterations undertaken in the Premises shall be constructed at Tenant's sole
expense. The costs of Alterations shall include without limitation the cost of
all architectural work, engineering studies, materials, supplies, plans, permits
and insurance. If requested by Landlord, Tenant shall provide to Landlord
satisfactory evidence of Tenant's ability to pay for such Alterations
(including, but not limited to, a payment or performance bond). No consent by
Landlord to any Alterations shall be deemed to be an agreement or consent by
Landlord to subject Landlord's interest in the Premises, the Building or the
Land to any mechanic's or materialman's liens which may be filed in respect to
such Alterations made by or on behalf of Tenant. If Landlord gives its consent
as specified in Section 8a above, Landlord may impose as a condition to such
consent such requirements as Landlord may deem necessary or desirable, in its
sole discretion exercised in good faith, including without limitation the right
to approve the plans and specifications for any work, supervision of the work by
Landlord or its agents or by Landlord's architect or contractor and the payment
to Landlord or its agents, architect or contractor of a construction supervision
fee in connection therewith, the right to require security for the full payment
of any work and the right to impose requirements as to the manner in which or
the time or times at which work may be performed. Landlord shall also have the
right to approve the contractor or contractors who shall perform any
Alterations, repairs in, to or about the Premises and to post notices of
non-responsibility and similar notices, as appropriate. In addition, immediately
after completion of any Alterations, Tenant shall assign to Landlord any and all
warranties applicable to such Alterations and shall provide Landlord with
as-built plans of the Premises depicting such Alterations.
c. Tenant shall keep the Premises free from any liens arising out of
any work performed on, or materials furnished to, the Premises, or arising from
any other obligation incurred by Tenant. If any mechanic's or materialmen's lien
is filed against the Premises, the Building and/or the Land for work claimed to
have been done for or materials claimed to have been furnished to Tenant, such
lien shall be discharged by Tenant within ten (10) days thereafter, at Tenant's
sole cost and expense, by the payment thereof or by filing any bond required by
law. If Tenant shall fail to timely discharge any such mechanic's or
materialman's lien, Landlord may, at its option, discharge the same and treat
the cost thereof as Additional Rent payable with the installment of rent next
becoming due; it being expressly covenanted and agreed that such discharge by
Landlord shall not be deemed to waive or release the default of Tenant in not
discharging the same. Tenant shall indemnify and hold harmless Landlord, the
Premises and the Building from and against any and all expenses, liens, claims,
actions or damages to person or property in connection with any such lien or the
performance of such work or the furnishing of such materials. Tenant shall be
obligated to, and Landlord reserves the right to, post and maintain on the
Premises at any time such notices as shall in the reasonable judgment of
Landlord be necessary to protect Landlord against liability for all such liens
or actions.
d. Any Alterations of any kind to the Premises or any part thereof,
except Tenant's furniture and moveable trade fixtures, shall at once become part
of the realty and belong to Landlord and shall be surrendered with the Premises,
as a part thereof, at the end of the Term hereof; provided, however, that
Landlord may, by written notice to Tenant at least thirty (30) days prior to the
end of the Term, require Tenant to remove any Alterations and to repair any
damage to the Premises caused by such removal, all at Tenant's sole expense. Any
article of personal property, including business and trade fixtures, not
attached to or built into the Premises, which were installed or placed in the
Premises by Tenant at its sole expense, shall be and remain the property of
Tenant and may be removed by Tenant at any time during the Term as long as
Tenant is not in default hereunder and provided that Tenant repairs any damage
to the Premises or the Building caused by such removal. Notwithstanding the
foregoing, Tenant shall not be required to remove the initial Tenant
Improvements performed by Tenant in accordance with the Work Agreement attached
hereto as EXHIBIT B.
9. UTILITIES AND SERVICES.
a. Landlord shall furnish the following utilities and services to the
Premises: electric current (for lighting and operation of normal desk-type
office machines); hot and cold water; lavatory supplies; heat and
air-conditioning during the appropriate seasons of the year as reasonably
required; elevator service; and trash removal, cleaning and char service (after
normal business hours Monday through Friday, excluding Holidays (hereinafter
defined)). Heating and air conditioning shall be provided to the Premises only
during normal business hours (;.e., Monday through Friday 8:00 a.m. to 6:00
p.m., and Saturday 8:00 a.m. to 1:00 p.m.. excluding Holidays). As used herein,
the term "Holidays" shall mean New Year's Day, ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇'▇ Birthday,
President's Day, Memorial Day, Independence Day,
10
Labor Day. Columbus Day, Thanksgiving Day and Christmas Day. At times other than
the normal business hours and days aforesaid, central air conditioning and
heating shall be provided to Tenant upon at least twenty-four (24) hours' prior
notice from Tenant, and upon payment by Tenant of the hourly charge established
by Landlord from time to time for each hour (or a portion thereof) of
after-hours usage. The current hourly charge for each hour (or portion thereof)
of after-hours usage of central air conditioning and heating is $20 per hour (or
portion thereof). Landlord shall use reasonable efforts to ensure that at least
one (1) passenger elevator is operating in the Building twenty-four (24) hours
per day, seven (7) days per week. All light bulbs and tubes in the Premises
shall be replaced at Tenant's expense. In addition, Landlord may impose a
reasonable additional charge for any additional or unusual services required to
be provided by Landlord to Tenant because of the carelessness of Tenant, the
nature of Tenant's business or the removal of any refuse and rubbish from the
Premises except for discarded material placed in wastepaper baskets and left for
emptying as an incident to Tenant's normal cleaning of the Premises. In the
event that Landlord must temporarily suspend or curtail services because of
accident and repair, Landlord shall have no liability to Tenant for such
suspension or curtailment or due to any restrictions on use arising therefrom or
relating thereto, and Landlord shall proceed diligently to restore such service.
No interruption or malfunction of any such services shall constitute an actual
or constructive eviction or disturbance of Tenant's use and possession of the
Premises, the Building or the parking garage or parking areas in or around the
Building or constitute a breach by Landlord of any of its obligations hereunder
or render Landlord liable for damages or entitle Tenant to be relieved from any
of Tenant's obligations hereunder (including the obligation to pay rent) or
grant Tenant any right of setoff or claim against Landlord or constitute a
constructive or other eviction of Tenant. In the event of any such interruption,
Landlord shall use reasonable diligence to restore such services.
b. Tenant will not, without the prior written consent of Landlord, use
any apparatus or device in the Premises, including without limitation electric
data processing machines, punch card machines and machines using current in
excess of 110 volts which will in any way increase the amount of the electricity
or water which would otherwise be furnished or supplied for the intended use of
the Premises under this Section 9; and Tenant will not connect to electric
current any apparatus or device for the purpose of using electric current or
water, except through existing electrical outlets in the Premises or water
pipes. If Tenant shall require water or electricity in excess of that which
would otherwise be furnished or supplied for the intended use of the Premises,
Tenant shall first secure the written consent of Landlord for the use thereof,
which consent Landlord may refuse in its absolute discretion. Landlord may
condition its consent upon the requirement that a water meter or electric
current meter be installed in the Premises, so as to measure the amount of water
and electric current consumed for any such excess use. The cost of such meters
and installation, maintenance and repair thereof, the cost of any such excess
utility use as shown by said meter, the cost of any new or additional utility
installations, including without limitation wiring and plumbing, resulting from
such excess utility use, and the cost of any additional expenses incurred in
keeping count of such excess utility use shall be paid by Tenant promptly upon
demand by Landlord or, if Tenant is billed separately therefor, promptly upon
receipt of a ▇▇▇▇ for same. Whenever heat generating machines or equipment are
used in the Premises which affect the temperature otherwise maintained by the
air conditioning system, Landlord reserves the right to install supplementary
air conditioning units in the Premises and the cost thereof, including the cost
of installation, operation and maintenance thereof, shall be paid by Tenant to
Landlord upon demand by Landlord.
c. Tenant shall have the right to install and operate in the Premises
personal computers and other electrically operated office equipment normally
used in modern offices. Tenant shall not install equipment of any kind or nature
whatsoever nor engage in any practice or use which will or may necessitate any
changes, replacements or additions to, or in the use of, the water system,
heating system, plumbing system, air conditioning system, electrical system,
floor load capacities, or other mechanical or structural system of the Premises
or the Building without first obtaining the prior written consent of Landlord,
which consent may be conditioned upon, but not limited to, Tenant first securing
at its expense additional capacity for any said service in the Building;
provided, however, Tenant shall be responsible for paying for any excess utility
consumption arising from any such change, replacement, use or addition, such
payments to be based on Landlord's reasonable estimate or, at Landlord's option,
a submeter or similar device to measure such usage (said device to be installed
at Tenant's expense). Additionally, in the event that Landlord reasonably
determines that Tenant's electrical consumption exceeds standard office use,
Tenant shall pay the amount of such excess electrical consumption, as reasonably
determined by Landlord, within thirty (30) days after demand therefor. Machines,
equipment and materials belonging to Tenant which cause vibration, noise, cold,
heat, fumes or odors that may be transmitted outside of the Premises to such a
degree as to be objectionable to Landlord in Landlord's sole opinion or to any
other tenant in the Building shall be treated by Tenant at its sole expense so
as to eliminate such objectionable condition, and shall not be allowed to
operate until such time as the objectionable condition is remedied to Landlord's
satisfaction.
d. Tenant shall comply, at its sole cost and expense, with all orders,
requirements and conditions now or hereafter imposed by any ordinances, laws,
orders and/or regulations (hereinafter collectively called "regulations") of any
governmental body having jurisdiction over the Premises or the Building, whether
required of Landlord or otherwise, regarding the collection, sorting, separation
and recycling of waste products, garbage, refuse and trash (hereinafter
collectively called "waste products") including but not limited to the
separation of such waste products into receptacles reasonably approved by
Landlord and the removal of such receptacles in accordance with any collection
schedules prescribed by such regulations. Landlord reserves the right (i) to
refuse to accept from Tenant any waste products that are not prepared for
collection in accordance with any such regulations, (ii) to require Tenant to
arrange for waste product collection at Tenant's sole cost and expense,
utilizing a contractor reasonably satisfactory to Landlord, and (iii) to require
Tenant to pay all costs, expenses, fines, penalties, or damages that may be
imposed on Landlord or Tenant by reason of Tenant's failure to comply with any
11
such regulations. Notwithstanding the foregoing, if Tenant is unable to comply
with Landlord's standard procedures regarding the internal collection, sorting,
separation and recycling of waste products, Landlord shall use reasonable
efforts to arrange for alternative procedures for Tenant, and Tenant shall pay
Landlord all additional costs incurred by Landlord with respect thereto.
10. RIGHTS OF LANDLORD.
a. Landlord reserves the following rights:
(i) to change the name or street address of the Building with
thirty (30) days prior notice or liability to Tenant, provided,
however, if the name of the Building is changed by Landlord, and such
change is not made, directed, or requested by the postal service or any
public, governmental or quasi-governmental authority, then Landlord
shall reimburse Tenant for the reasonable costs, not in excess of Five
Hundred Dollars ($500.00), of any of Tenant's letterhead, stationery
and business cards then on hand that bears the old address and cannot
be used by Tenant as a result thereof;
(ii) to approve the design, location, number, size and color
of all signs or lettering on the Premises or visible from the exterior
of the Premises, provided, however, that Landlord shall provide a
single listing of Tenant's name in the Building directory, if any, and
the initial Building standard suite identification signage near
Tenant's suite entry door at no charge to Tenant;
(iii) to have pass keys and/or access cards to the Premises
and key codes or cards for the telephone access system installed by
Tenant;
(iv) to grant to anyone the exclusive right to conduct any
particular business or undertaking in the Building;
(v) to enter the Premises at any reasonable time for
inspection upon reasonable prior notice to Tenant (which notice may be
oral), or at any time, without prior notice, in the event of any
emergency; to supply any service to be provided by Landlord hereunder
to submit the Premises to prospective purchasers or tenants; to post
notices of non-responsibility; to affix and display "For Rent" signs;
and to make repairs, alterations, additions or improvements to the
Premises or the Building; and
(vi) to approve the design, location, number, size and color
of all signs located on the exterior of the Building.
b. Without limiting the generality of the provisions of Section 10a,
above, at any time during the Term of this Lease, Landlord shall have the right
to remove, alter, improve, renovate or rebuild the common areas of the Building
(including but not limited to the lobby, hallways and corridors thereof), and to
install, repair, replace, alter, improve or rebuild in the Premises, other
tenants' premises and/or the common areas of the Building (including the lobby,
hallways and corridors thereof), any mechanical, electrical, water, sprinkler,
plumbing, heating, air conditioning and ventilating systems, at any time during
the Term of this Lease. In connection with making any such installations,
repairs, replacements, alterations, additions and improvements under the terms
of this Section 10, Landlord shall have the right to access through the Premises
as well as the right to take into and upon and through the Premises or any other
part of the Building, all materials that may be required to make any such
repairs, replacements, alterations, additions or improvements, as well as the
right in the course of such work to close entrances, doors, corridors, elevators
or other facilities located in the Building or temporarily to cease the
operations of any services or facilities therein or to take portion(s) of the
Premises reasonably necessary in connection with such work, without being deemed
or held guilty of an eviction of Tenant; provided, however that Landlord agrees
to use all reasonable efforts not to interfere with or interrupt Tenant's
business operation in the Premises. Landlord shall have the right to install,
use and maintain pipes and conduits in and through the Premises, including
without limitation telephone and computer installations, provided that they do
not permanently materially adversely affect Tenant's access to or use of the
Premises.
c. Landlord shall not be liable to Tenant for any expense, injury, toss
or damage resulting from Landlord's exercise of any rights under this Section
10, all claims against Landlord for any and all such liability being hereby
expressly released by Tenant. Except for injury, loss or damage to Tenant
resulting directly from Landlord's gross negligence or willful misconduct
Landlord shall not be liable for damages to Tenant's property, business or
person to Tenant by reason of interference with the business of Tenant or
inconvenience or annoyance to Tenant or the customers of Tenant, provided,
however that in any event Landlord shall not be liable for consequential or
punitive damages. The Rent reserved herein shall not ▇▇▇▇▇ while the Landlord's
rights under this Section 10 are exercised, and Tenant shall not be entitled to
any set-off or counterclaims for damages of any kind against Landlord by reason
thereof, all such claims being hereby expressly released by Tenant
d. Landlord shall have the right to use any and all means which
Landlord may deem proper to open all of the doors in, upon and about the
Premises, excluding Tenant's vaults and safes, in any emergency in order to
obtain entry to the Premises. Any entry to the Premises obtained by Landlord by
any of said means shall not be construed or deemed to be a forcible or unlawful
entry into, or a detainer of, the Premises, or an eviction of Tenant from the
Premises or any portion thereof.
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11. LIABILITY.
a. Landlord and its agents, officers, directors and employees assume no
liability or responsibility whatsoever with respect to the conduct or operation
of the business to be conducted in the Premises and shall have no liability for
any claim of loss of business or interruption of operations (or any claim
related thereto). Landlord and its agents, officers, directors and employees
shall not be liable for any accident to or injury to any person or persons or
property in or about the Premises which are caused by the conduct and operation
of said business or by virtue of equipment or property of Tenant in said
Premises. Tenant agrees to hold Landlord and its agents, officers, directors and
employees harmless against all such claims, except to the extent resulting from
Landlord's negligence or willful misconduct Landlord and its agents, officer,
directors and employees shall not be liable to Tenant, its employees, agents,
business invitees, licensees, customers, clients, family members or guests for
any damage, compensation or claim arising out of or related to managing the
Premises or the Building, repairing any portion of the Premises or the Building,
the interruption in the use of the Premises, accident or damage resulting from
the use or operation (by Landlord and its agents, officers, directors and
employees, Tenant, or any other person or persons whatsoever) or failure of
elevators, or heating, cooling, electrical or plumbing equipment or apparatus,
or the termination of this Lease by reason of the destruction of the Premises,
or from any fire, robbery, theft, mysterious disappearance and/or any other
casualty, or from any leakage in any part of portion of the Premises or the
Building, or from water, rain or snow that may leak into or flow from any part
of the Premises or the Building, or from any other cause whatsoever, unless
occasioned by the willful misconduct or acts of negligence of Landlord. In no
event shall Landlord be liable for punitive or consequential damages, nor shall
Landlord be liable with respect to utilities furnished to the Premises, or the
lack of any utilities. Any goods, property or personal effects, stored or placed
by Tenant in or about the Premises or in the Building, shall be at the sole risk
of Tenant, and Landlord and its agents, officers, directors and employees shall
not in any manner be held responsible therefor, except if such injury or damage
results from Landlord's negligence or willful misconduct. The agents and
employees of Landlord are prohibited from receiving any packages or other
articles delivered to the Building for Tenant, and if any such agent or employee
receives any such package or articles, such agent or employee shall be the agent
of Tenant for such purposes and not of Landlord.
b. Tenant hereby agrees to indemnify and hold Landlord and its agents,
officers, directors and employees harmless from and against any cost, damage,
claim, liability or expense (including attorneys' fees) incurred by or claimed
against Landlord and its agents, officers, directors and employees, directly or
indirectly, as a result of or in any way arising from (i) Tenant's use and
occupancy of the Premises or in any other manner which relates to the business
of Tenant, including, but not limited to, any cost, damage, claim, liability or
expense arising from any violation of any zoning, health, environmental or other
law, ordinance, order, rule or regulation of any governmental body or agency;
(ii) the negligence or willful misconduct of Tenant, its officers, directors,
employees and agents; (iii) any default, breach or violation of this Lease by
Tenant; or (iv) injury or death to individuals or damage to property sustained
in or about the Premises.
c. Notwithstanding any other provision of this Lease to the contrary,
Landlord and Tenant agree that in the event that the Building, the Premises or
the contents thereof are damaged or destroyed by fire or other casualty, each
party hereto waives its rights, if any, against the other party with respect to
such damage or destruction to the extent such damage or destruction is covered
under the property insurance policy(ies) of the party waiving such rights (or
would have been covered had the party waiving such rights carried the property
insurance required hereunder to be carried by such party); provided however, if
any fire or other casualty caused by Tenant shall have damaged or destroyed any
part of the Building or the contents thereof, Tenant shall be responsible for
any deductible amount under Landlord's property insurance policy(ies). All
policies of fire and/or extended coverage or other insurance covering the
Premises or the contents thereof obtained by Landlord or Tenant shall contain a
clause or endorsement providing in substance that (i) such insurance shall not
be prejudiced if the insureds thereunder have waived in whole or in part the
right of recovery from any person or persons prior to the date and time of loss
or damage, if any, and (ii) the insurer waives any rights of subrogation against
Landlord (in the case of Tenant's insurance policy) or Tenant (in the case of
Landlord's insurance policy), as the case may be.
12. INSURANCE.
a. Tenant shall maintain at all times during the Term hereof and at its
sole cost and expense, broad-form commercial general liability insurance for
bodily injury and property damage naming Landlord as an additional insured, in
such amounts as are adequate to protect Landlord and Landlord's managing agents
against liability for injury to or death of any person in connection with the
use, operation or condition of the Premises. Such insurance at all times shall
be in an amount of not less than Three Million Dollars ($3,000,000) combined
single limit aggregate for bodily injury or death or damage to property. If, in
the opinion of the insurance broker retained by Landlord, the amount of public
liability and property damage insurance coverage at any time during the Term is
not adequate, Tenant shall increase the insurance coverage as required by
Landlord's insurance broker. In no event shall the limits of such policy be
considered as limiting the liability of Tenant under this Lease.
b. Tenant shall at all times during the Term hereof maintain in effect
policies of insurance covering the Leasehold Improvements (including any
Alterations, additions or improvements as may be made by Tenant after the
Commencement Date), plate glass, trade fixtures, merchandise and all other
personal property from time to time in or on the Premises, in an amount not less
than one hundred percent (100%) of their actual replacement cost, providing
protection against all risks covered by standard
13
form of "Fire and Extended Coverage Insurance," together with insurance against
vandalism and malicious mischief. Tenant shall also maintain at its sole cost
and expense ▇▇▇▇▇▇▇'▇ compensation insurance in the maximum amount required by
law.
c. All insurance required to be carried by Tenant shall be issued by
responsible insurance companies, qualified to do business in the Commonwealth of
Virginia and reasonably acceptable to Landlord. Each policy shall name Landlord,
Landlord's mortgagee and the property management company retained by Landlord at
the Building, as additional insureds, and shall contain a provision that the
same may not be cancelled or reduced without providing Landlord not less than
thirty (30) days' prior written notice. Copies of all policies or, at Landlord's
option, certificates of insurance (▇▇▇▇▇ 27 only) evidencing the existence and
amounts of said insurance shall be delivered to Landlord no later than five (5)
days prior to the Commencement Date, and renewals thereof shall be delivered to
Landlord at least ten (10) days prior to the expiration of any such policy. If
Tenant fails to adhere to the requirements of this Section 12, Landlord may
order such insurance and charge the cost thereof to Tenant, which amount shall
be deemed Additional Rent hereunder and shall be payable by Tenant upon demand.
Tenant's failure to provide and keep in force the aforementioned insurance shall
be regarded as a material default hereunder, entitling Landlord to exercise any
or all of the remedies provided in this Lease. Any policy may be carried under
so-called "blanket coverage" form of insurance policies. Tenant shall obtain and
furnish evidence to Landlord of the waiver by Tenant's insurance carriers of any
right of subrogation against Landlord and Landlord's management company at the
Building.
d. Each party hereby waives any and every right or cause of action for
any and all loss of, or damage to, any of its property (whether or not such loss
or damage is caused by the fault or negligence of the other party or anyone for
whom said other party may be responsible), which loss or damage is covered by
valid and collectible fire, extended coverage, "All Risk" or similar policies,
maintained by such party or required to be maintained by such party under this
Lease, but only to the extent that such loss or damage is recovered under said
insurance policies (if such policy or policies have been obtained) or would have
been recovered if such party had obtained the required insurance coverage
hereunder. Written notice of the terms of said mutual waivers shall be given to
each insurance carrier and said insurance policies shall be properly endorsed,
if necessary, to prevent the invalidation of said insurance coverages by reason
of said waivers.
13. FIRE OR CASUALTY.
a. If the Premises or any part thereof shall be damaged by fire or any
other cause, Tenant shall give prompt notice thereof to Landlord. If, in the
reasonable judgment of Landlord's architect, restoration of the Premises is
feasible within a period of nine (9) months from the date of the damage, and
provided such damage was not caused by Tenant, its agents, servants or invitees,
Landlord shall restore the Premises to the extent of the Tenant Improvements set
forth in the Work Agreement, provided that adequate insurance proceeds are made
available to Landlord. Tenant agrees to make all proceeds of Tenant's insurance
policies available to Landlord in accordance with Tenant's insurance obligations
set forth in Section 12, above. In addition, Tenant shall repair and restore, at
Tenant's sole expense, all Alterations, furniture, fixtures and other property
of Tenant located in the Premises prior to such casualty. If the Premises are
unusable, in whole or in part, during such restoration, the Monthly Base Rent
and Additional Rent hereunder shall be abated to the extent and for the period
that the Premises are unusable; provided, however, that if such damage or
destruction shall result from the act or omission of Tenant, its employees,
agents or invitees, Tenant shall not be entitled to any abatement of Monthly
Base Rent or Additional Rent.
b. If restoration is not feasible in the reasonable judgment of
Landlord's architect within the aforesaid nine (9) month period, Landlord shall
so notify Tenant, and Landlord and Tenant shall each have the right to terminate
this Lease by giving written notice thereof to the other party within sixty (60)
days after the occurrence of such damage, in which event this Lease and the
tenancy hereunder shall terminate as of the date of such damage or destruction
and the Monthly Base Rent and Additional Rent will be apportioned as of the date
of such damage or destruction. If neither party exercises its right of
termination, the Premises shall be restored as provided above.
c. In case the Building is so severely damaged by fire or other
casualty (although the Premises may not be affected) that Landlord shall decide
in its sole discretion not to rebuild or reconstruct such Building, then this
Lease and the tenancy hereunder shall terminate on the date specified by
Landlord in a notice given no later than sixty (60) days after the date of such
casualty.
14. EMINENT DOMAIN, if the Premises or any part thereof shall be taken by any
governmental or quasi-governmental authority pursuant to the power of eminent
domain, Tenant shall make no claim for compensation in such proceedings and
shall have no right to participate in any condemnation proceedings under any
statutes, laws or ordinances of the Commonwealth of Virginia. All sums awarded
or agreed upon between Landlord and the condemning authority for the taking of
the interest of Landlord or Tenant, whether as damages or as compensation, will
be the property of Landlord. In the event of such taking, Rent shall be paid to
the date of vesting of title in the condemning authority. Notwithstanding the
foregoing, Tenant shall have the right to make a separate claim with the
condemning authority for Tenant's expenses associated with moving from the
Premises and Tenant's personal property, including without limitation, Tenant's
equipment located in the Premises; provided said claim in no way affects or
reduces Landlord's claims hereunder.
14
15. SUBORDINATION AND ESTOPPEL CERTIFICATES.
a. This Lease shall be subject and subordinate at all times to all
ground or underlying leases which now exist or may hereafter be executed
affecting the Building or any part thereof or the Land, and to the lien of any
mortgages or deeds of trust in any amount or amounts whatsoever now or hereafter
placed on or against the Building or any part thereof or the Land, or on or
against Landlord's interest or estate therein or on or against any ground or
underlying lease without the necessity of having further instruments on the part
of Tenant to effect such subordination. Upon request of Landlord, Tenant will
execute any further written instrument necessary to subordinate its rights
hereunder to any such underlying leases or liens. If, at any time, or from time
to time during the Term, any mortgagee shall request that this Lease have
priority over the lien of such mortgage, and if Landlord consents thereto, this
Lease shall have priority over the lien of such mortgage and all renewals,
modifications, replacements, consolidations and extensions thereof and all
advances made thereunder and interest thereon, and Tenant shall, within ten (10)
days after receipt of a request therefor from Landlord, execute, acknowledge and
deliver any and all documents and instruments confirming the priority of this
Lease. In any event, however, if this Lease shall have priority over the lien of
a first mortgage, this Lease shall not become subject or subordinate to the lien
of any subordinate mortgage, and Tenant shall not execute any subordination
documents or instruments for any subordinate mortgagee, without the written
consent of the first mortgagee.
b. In the event oft (i) a transfer of Landlord's interest in the
Building, (ii) the termination of any ground or underlying lease of the
Building, or the Land, or both, or (iii) the purchase or other acquisition of
the Building, or Landlord's interest therein in a foreclosure sale or by deed in
lieu of foreclosure under any mortgage or deed of trust, or pursuant to a power
of sale contained in any mortgage or deed of trust, then in any of such events
Tenant shall, at the request of Landlord or Landlord's successor in interest,
attorn to and recognize the transferee or purchaser of Landlord's interest or
the interest of the lessor under the terminated ground or underlying lease, as
the case may be, as "Landlord" under this Lease for the balance then remaining
of the Term, and thereafter this Lease shall continue as a direct lease between
such person or entity, as "Landlord," and Tenant, as "Tenant," except that such
lessor, transferee or purchaser shall not be liable for any act or omission of
Landlord before such lease termination or before such person's succession to
title, nor be subject to any offset, defense or counterclaim accruing before
such lease termination or before such person's succession to title, nor be bound
by any payment of Monthly Base Rent or Additional Rent before such lease
termination or before such person's succession to title for more than one month
in advance.
c. Tenant agrees, at any time, and from time to time, upon not less
than fifteen (15) days' prior notice by Landlord, to execute, acknowledge and
deliver to Landlord, a statement in writing certifying that (i) this Lease is
unmodified and in full force and effect (or if there have been modifications,
that the same is in full force and effect as modified and stating the
modifications); (ii) the Term of the Lease has commenced and the full rental is
now accruing hereunder; (iii) Tenant has accepted possession of the Premises and
is presently occupying the same; (iv) all improvements required by the terms of
the Lease to be made by Landlord have been completed and all tenant improvement
allowances have been paid in full; (v) there are no offsets, counterclaims,
abatements or defenses against or with respect to the payment of any rent or
other charges due under the Lease; (vi) no rent under the Lease has been paid
more than thirty (30) days in advance of its due date; (vii) to the best of the
knowledge of the Tenant, Landlord is not in default in the performance of any
covenant, agreement, provision or condition contained in the Lease or, if so,
specifying each such default of which Tenant may have knowledge; (viii) the
address for notices to be sent to Tenant; (ix) the only security deposit
tendered by Tenant is as set forth in the Lease, and such security deposit has
been paid to Landlord; and (x) any other information requested by Landlord or
any mortgagee or ground lessor of the Building and/or the Land it being intended
that any such statement delivered pursuant hereto may be relied upon by any
prospective purchaser or lessee of the Building or any part thereof, any
mortgagee or prospective mortgagee thereof, any prospective assignee of any
mortgage thereof, any ground lessor or prospective ground lessor of the Land
and/or the Building, or any prospective assignee of any such ground lease.
Tenant also agrees to execute and deliver from time to time such estoppel
certificates as an institutional lender may require with respect to this Lease.
16. DEFAULT AND REMEDIES.
a. If Tenant shall (i) fail to pay any installment of Monthly Base
Rent, although no legal or formal demand has been made therefor, within five (5)
calendar days after the due date therefor, or (ii) fail to make any payment of
Additional Rent or any other payment required by the terms and provisions
hereof, within five (5) days after notice or demand therefor; or (iii) convey,
assign, mortgage or sublet this Lease, the Premises or any part thereof, or
Tenant's interest therein, or attempt any of the foregoing, without the prior
written consent of Landlord; or (iv) abandon the Premises for a period of ten
(10) consecutive calendar days; or (v) commit or suffer to exist an Event of
Bankruptcy (hereinafter defined), or (vi)fail to maintain the insurance coverage
required by Section 12, above, or (vii) violate or fail to perform any of the
other terms, conditions, covenants, or agreements herein made by Tenant and
fails to cure such default within fifteen (15) calendar days after notice,
provided, however, that if the nature of Tenant's failure is such that more than
fifteen (15) days are reasonably required for its cure, then Tenant shall not be
in default if it begins such cure within the fifteen (15) day period described
above and thereafter diligently prosecutes such cure to completion within an
additional fifteen (15) days; then there shall be deemed to have been committed
an "Event of Default". Notwithstanding the foregoing cure periods, in the event
that Tenant breaches its covenant set forth in Section 6.a. hereof on more than
two (2) occasions in any twelve (12) consecutive month period, or on more than
three (3) occasions in any
15
twenty-four (24) consecutive month period, then any subsequent breach of such
covenant during the Term of this Lease shall be deemed to be an immediate Event
of Default. Upon such immediate Event of Default, at Landlord's option, this
Lease shall terminate without prejudice, however to the right of Landlord to
recover from Tenant all rent and any other sums accrued up to the later of: (a)
the date of termination of this Lease or (b) the date Landlord recovers
possession of the Premises, and without release of Tenant from any
indemnification obligations to Landlord under this Lease, which indemnification
obligations arose or accrued prior to the later oft (a) the date of termination
of this Lease or (b) the date Landlord recovers possession of the Premises. The
foregoing is not intended to, and shall not, limit Landlord in the exercise of
any other remedy for such immediate Event of Default.
b. In the event of any Event of Default by Tenant as defined in ▇▇▇▇▇▇▇
▇▇▇, ▇▇▇▇▇▇▇▇ may at any time thereafter, without notice and demand and without
limiting Landlord in the exercise of any other right or remedy which Landlord
may have by reason of such default or breach do any of the following:
(i) Landlord may terminate this Lease, by giving written
notice of such termination to Tenant, whereupon this Lease shall automatically
cease and terminate and Tenant shall be immediately obligated to quit the
Premises. Any other notice to quit or notice of Landlord's intention to re-enter
the Premises is hereby expressly waived. If Landlord elects to terminate this
Lease, everything contained in this Lease on the part of Landlord to be done and
performed shall cease without prejudice, subject, however, to the right of
Landlord to recover from Tenant all rent and any other sums accrued up to the
time of termination or recovery of possession by Landlord, whichever is later.
(ii) With or without the termination of this Lease, Landlord
may proceed to recover possession of the Premises under and by virtue of the
provisions of the laws of the jurisdiction in which the Building is located, or
by such other proceedings, including re-entry and possession, as may be
applicable. If this Lease is terminated or Landlord recovers possession of the
Premises before the expiration of the Term by reason of Tenant's default as
hereinabove provided, or if Tenant shall abandon or vacate the Premises before
the Lease Expiration Date without having paid the full rental for the remainder
of such Term, Landlord shall have the option to take reasonable steps to relet
the Premises for such rent and upon such terms as are not unreasonable under the
circumstances and, if the full rental reserved under this Lease (and any of the
costs, expenses or damages indicated below) shall not be realized by Landlord,
Tenant shall be liable for all damages sustained by Landlord, including without
limitation deficiency in rent during any period of vacancy or otherwise; the
costs of removing and storing the property of Tenant or of any other occupant;
the then-remaining unamortized portion of the Improvement Allowance described in
the Work Agreement; all reasonable expenses incurred by Landlord in enforcing
Landlord's remedies, including without limitation reasonable attorneys' fees and
Late Charges as provided herein, and advertising, brokerage fees and expenses of
placing the Premises in first class rentable condition. Landlord, in putting the
Premises in good order or preparing the same for rerental may, at Landlord's
option, make such alterations, repairs, or replacements in the Premises as
Landlord, in its sole judgment, considers advisable and necessary for the
purpose of reletting the Premises, and the making of such alterations, repairs,
or replacements shall not operate or be construed to release Tenant from
liability hereunder as aforesaid.
(iii) Any damage or loss of rent sustained by Landlord may be
recovered by Landlord, at Landlord's option, at the time of termination of this
Lease, the time of the reletting, or in separate actions, from time to time, as
said damage shall have been made more easily ascertainable by successive
relettings, or at Landlord's option in a single proceeding deferred until the
expiration of the Term (in which event Tenant hereby agrees that the cause of
action shall not be deemed to have accrued until the date of expiration of said
Term) or in a single proceeding prior to either the time of reletting or the
expiration of the Term. If the Landlord elects to repossess the Premises without
terminating this Lease, then Tenant shall be liable for and shall pay to
Landlord all Rent and other indebtedness accrued to the date of such
repossession, plus Rent required to be paid by Tenant to Landlord during the
remainder of this Lease until the date of expiration of the Term, diminished by
any net sums thereafter received by Landlord through reletting the Premises
during such period (after deducting expenses incurred by Landlord as provided in
Section 16.b.(ii), above). In no event shall Tenant be entitled to any excess of
any Rent obtained by reletting over and above the Rent herein reserved. Actions
to collect amounts due from Tenant as provided in this Section 16(a)(iii) may be
brought from time to time, on one or more occasions, without the necessity of
Landlord's waiting until expiration of this Lease term. Upon termination of this
Lease or repossession of the Premises following a default hereunder, Landlord
shall have no obligation to relet or attempt to relet the Premises or any
portion thereof or to collect rental after reletting; and in the event of
reletting Landlord may relet the whole or any portion of the Premises for any
period, to any tenant, and for any use and purpose on such terms and at such
rentals as Landlord in its exclusive judgment may determine.
c. Notwithstanding the foregoing, if Landlord terminates this Lease
pursuant to Section 16.b.(i), above, Landlord shall be entitled to recover from
Tenant, and Tenant shall pay to Landlord on demand, as and for liquidated and
agreed final damages for Tenant's default, an amount equal to the difference
between (i) all Monthly Base Rent, Additional Rent and other sums which would
t>e payable under this Lease from the date of such demand (or, if it is earlier,
the date to which Tenant shall have satisfied in full its obligations under
Section 16b(ii), above) for what would be the then unexpired Term in the absence
of such termination, and (ii) the fair market rental value of the Premises over
the same period (net of all expenses and all vacancy periods reasonably
projected by Landlord to be incurred in connection with the reletting of the
Premises), with such differential discounted at the rate of five percent (5%)
per annum. Nothing herein shall be construed to affect or prejudice Landlord's
right to prove, and claim in full, unpaid Rent or any other amounts accrued
prior to termination of this Lease.
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d. Notwithstanding anything herein to the contrary, upon the occurrence
of an Event of Default hereunder, Landlord, with or without terminating the
Lease, may immediately reenter and take possession of the Premises and evict
Tenant therefrom, without legal process of any kind, using such force as may be
necessary, without being liable for or guilty of trespass, forcible entry or any
other tort. Landlord's right to exercise such "self-help" remedy shall be in
addition to, and not in limitation of. Landlord's other rights and remedies
hereunder for a breach by Tenant of its obligations under the Lease.
e. Tenant hereby expressly waives any and all rights of redemption
granted by or under any present of future laws in the event Tenant is evicted or
dispossessed for any cause, or in the event Landlord obtains possession of the
Premises, by reason of the violation by Tenant of any of the covenants and
conditions of this Lease or otherwise. In addition, Tenant hereby expressly
waives any and all rights to bring any action whatsoever against any tenant
taking possession after Tenant has been dispossessed or evicted hereunder, or to
make any such tenant or party to any action brought by Tenant against Landlord.
f. Landlord and Tenant shall and each does hereby waive trial by jury
in any action, proceeding or counterclaim brought by either of the parties
hereto against the other on any matters whatsoever arising out of or in any way
connected with this Lease or its termination, the relationship of Landlord and
Tenant, Tenant's use or occupancy of the Premises or any claim of injury or
damage and any emergency statutory or any other statutory remedy. In the event
Landlord commences any summary proceeding for nonpayment of Rent or Additional
Rent, or commences any other action or proceeding against Tenant in connection
with this Lease, Tenant will interpose no counterclaim of whatever nature or
description in any such proceeding.
9. Nothing contained herein shall prevent the enforcement of any claim
Landlord may have against Tenant for anticipatory breach of the unexpired Term.
In the event of a breach or anticipatory breach by Tenant of any of the
covenants or provisions hereof, Landlord shall have the right of injunction and
the right to invoke any remedy allowed at law or in equity as if reentry,
summary proceedings and other remedies were not provided for herein.
h. In the event of any default by Landlord, Tenant's exclusive remedy
shall be an action for damages (Tenant hereby waiving the benefit of any laws
granting Tenant a lien upon the property of Landlord or upon Rent due Landlord),
but prior to any such action Tenant will give Landlord notice specifying such
default with particularity, and Landlord shall have thirty (30) days after
receipt of such notice in which to cure any such default; provided, however,
that if such default cannot, by its nature, be cured within such period,
Landlord shall not be deemed in default if Landlord shall within such period
commence to cure such default and shall diligently prosecute the same to
completion. Unless and until Landlord fails so to cure any default after notice,
Tenant shall have no remedy or cause of action by reason thereof. All
obligations of Landlord hereunder will be construed as covenants, not
conditions; all such obligations will be binding upon Landlord only during the
period of its ownership of the Building and not thereafter; and no default or
alleged default by Landlord shall relieve or delay performance by Tenant of its
obligations to continue to pay Annual Base Rent and Additional Rent hereunder as
and when the same shall be due.
17. BANKRUPTCY.
a. For purposes of this Lease, the following shall be deemed "Events of
Bankruptcy": (i) if a receiver or custodian is appointed for any or all of
Tenant's property or assets, or if there is instituted a foreclosure action on
any of Tenant's property; or (ii) if Tenant files a voluntary petition under 11
U.S.C. Article 101, ET SEQ., as amended (the "Bankruptcy Code"), or under the
insolvency laws of any jurisdiction (the "Insolvency Laws"); or (iii) if there
is filed an involuntary petition against Tenant as the subject debtor under the
Bankruptcy Code or Insolvency Laws, which is not dismissed within thirty (30)
days of filing; or (iv) if Tenant makes or consents to an assignment of its
assets, in whole or in part, for the benefit of creditors, or a common law
composition of creditors; or (v) if Tenant generally is not paying its debts as
its debts become due.
b. Upon the occurrence of an Event of Bankruptcy, Landlord, at its
option and sole discretion, may terminate this Lease by written notice to Tenant
(subject, however, to applicable provisions of the Bankruptcy Code or Insolvency
Laws during the pendency of any action thereunder). If this Lease is terminated
under this Section 17, Tenant shall immediately surrender and vacate the
Premises, waives all statutory or other notice to quit, and agrees that Landlord
shall have all rights and remedies against Tenant provided in Section 16 in case
of an Event of Default by Tenant.
c. If Tenant becomes the subject debtor in a case pending under the
Bankruptcy Code (the "Bankruptcy Case"), Landlord's right to terminate this
Lease under this Section 17 shall be subject to the applicable rights (if any)
of the debtor-in-possession or the debtor's trustee in bankruptcy (collectively,
the "Trustee") to assume or assign this Lease as then provided for in the
Bankruptcy Code, however, the Trustee must give to Landlord, and Landlord must
receive, proper written notice of the Trustee's assumption or rejection of this
Lease, within sixty (60) days (or such other applicable period as is provided
pursuant to the Bankruptcy Code, it being agreed that sixty (60) days is a
reasonable period of time for election of an assumption or rejection of this
Lease) after the commencement of the Bankruptcy Case; it being agreed that
failure of the Trustee to give notice of such assumption hereof within said
period shall conclusively and irrevocably constitute the Trustee's rejection of
this Lease and waiver of any right of the Trustee to assume or assign this
Lease. The Trustee shall not have the right to assume or assign this Lease
unless said Trustee (i) promptly and fully cures all defaults under this Lease,
17
(ii) promptly and fully compensates Landlord and any third party (including
other tenants) for all monetary damages incurred as a result of such default,
and (iii) provides to Landlord "adequate assurance of future performance."
Landlord and Tenant (which term may include the debtor or any permitted assignee
of debtor) hereby agree in advance that "adequate assurance of performance" as
used in this paragraph, shall mean that all of the following minimum criteria
must be met (1) the source of Monthly Base Rent, Additional Rent, and other
consideration due under this Lease, and the financial condition and operating
performance of Tenant, and its guarantor, if any, shall be similar to the
financial condition and operating performance of Tenant as of the Commencement
Date; (2) Trustee or Tenant must pay to Landlord all Monthly Base Rent and
Additional Rent payable by Tenant hereunder in advance, (3) Trustee or Tenant
must agree (by writing delivered to Landlord) that the use of the Premises shall
be used only for the permitted use as stated in this Lease, and that any
assumption or assignment of this Lease is subject to all of the provisions
thereof and will not violate or affect the rights or agreements of any other
tenants or occupants in the Building or of Landlord (including any mortgage or
other financing agreement for the Building, (4) Trustee or Tenant must pay to
Landlord at the time the next Monthly Base Rent is due under this Lease, in
addition to such installment of Monthly Base Rent, an amount equal to the
installments of Monthly Base Rent and Additional Rent due under this Lease for
the next six (6) months of this Lease, said amount to be held by Landlord in
escrow until either Trustee or Tenant defaults in its payment of Monthly Base
Rent and Additional Rent or other obligations under this Lease (whereupon
Landlord shall have the right to draw on such escrowed funds) or until the
expiration of this Lease (whereupon the funds shall be returned to Trustee or
Tenant except to the extent the funds have been drawn and not replaced); and (5)
Trustee or Tenant must agree to pay to Landlord at any time Landlord is
authorized to and does draw on the escrow account the amount necessary to
restore such escrow account to the original level required by clause (4), above.
The criteria stated above are not intended to be exhaustive or all-inclusive and
Landlord may determine that the circumstances of Tenant or of this Lease require
other or further assurances of future performance. In the event Tenant is unable
to: (a) cure its defaults, (b) reimburse Landlord for its monetary damages, (c)
pay the Monthly Base Rent and Additional Rent due under this Lease on time, or
(d) meet that criteria and obligations imposed by (1) through (5), above, then
Tenant hereby agrees in advance that it has not met its burden to provide
adequate assurance of future performance, and this Lease may be terminated by
Landlord in accordance with Section 17b, above.
18. PAYMENT OF TENANTS OBLIGATIONS BY LANDLORD AND UNPAID RENT. All covenants
and agreements to be performed by Tenant under any of the terms of this Lease
shall be performed by Tenant at Tenant's sole cost and expense. If Tenant shall
fail to pay any sum of money, other than Rent, required to be paid by it
hereunder or shall fail to perform any other act on its part to be performed
hereunder, and such failure shall continue beyond any applicable grace period
set forth in this Lease, Landlord may, without waiving or releasing Tenant from
any of its obligations hereunder, make any such payment or perform any such
other required act on Tenant's part. All sums so paid by Landlord, and all
necessary incidental costs, together with interest thereon at four percentage
points (4%) over the Prime Rate then in effect, from the date of such payment by
Landlord, shall be payable by Tenant to Landlord as Additional Rent hereunder,
on demand, and Tenant covenants and agrees to pay any such sums. Landlord shall
have (in addition to any other right or remedy of Landlord hereunder or at law)
the same rights and remedies in the event of the nonpayment thereof by Tenant as
in the case of default by Tenant in the payment of Additional Rent. In addition,
any Rent, including without limitation Annual Base Rent, Additional Rent,
Tenant's Pass-Through Costs and/or Late Charges, which is not paid timely will
accrue interest per annum at four percentage points (4%) over the Prime Rate
from the date such payment is due until the date paid in full (including all
accrued interest)-
19. VOLUNTARY SURRENDER, the voluntary or other surrender of this Lease by
Tenant, or a mutual cancellation thereof, shall not work a merger, and shall, at
the sole option of Landlord, terminate all or any existing subleases or
subtenancies, or may, at the sole option of Landlord, operate as an assignment
to Landlord of any or all such subleases or subtenancies; provided however, that
if Landlord elects to treat such termination as an assignment of any such
sublease, Landlord shall have no obligation or liability to the subtenant
thereunder for any claim, damage or injury which accrued prior to the date of
surrender or mutual cancellation hereunder.
20. ABANDONMENT OF PERSONAL PROPERTY. Upon the expiration of the Term or earlier
termination of this Lease, Tenant shall forthwith remove Tenant's goods and
effects and those of any other persons claiming through or under Tenant, or
subtenancies assigned to it, and quit and deliver the Premises to the Landlord
peaceably and quietly. Goods and effects not removed by Tenant after termination
of this Lease (or within forty-eight (48) hours after a termination by reason of
Tenant's default) shall be considered abandoned. Landlord shall give Tenant
notice of right to reclaim abandoned property pursuant to applicable local law
and may thereafter dispose of the same as Landlord deems expedient, including
public or private sale and/or storage in a public warehouse or elsewhere at the
sole cost, and for the account, of Tenant, and Tenant shall promptly upon demand
reimburse Landlord for any expenses incurred by Landlord in connection
therewith, including reasonable attorneys' fees.
21. HOLD-OVER, if Tenant shall not immediately surrender the Premises at the
expiration of the Term then Tenant shall, by virtue of the provisions of this
Section 21, become a tenant by the month. In such event Tenant shall be required
to pay (i) during the first sixty (60) days of such holdover by Tenant, One
Hundred Fifty Percent (150%) of the amount of the Monthly Base Rent in effect
during the last month of the Term and (ii) commencing on the sixty-first (61st)
day of such hold over by Tenant, twice the amount of the Monthly Base Rent in
effect during the last month of the Term of this Lease, escalated in accordance
with the provisions hereof, together, in each instance, with all Additional Rent
in effect during the last month of the Term, commencing said monthly tenancy
with the first day next after the end of the
18
Term; and said Tenant, as a month-to-month tenant, shall be subject to all of
the conditions and covenants of this Lease as though the same had originally
been a monthly tenancy, except as otherwise provided above with respect to the
payment of Rent. Each party hereto shall give to the other at least thirty (30)
days' written notice to quit the Premises, except in the event of non-payment of
Rent provided for herein when due, or of the breach of any other covenant by the
said Tenant, in which event, Tenant shall not be entitled to any notice to quit,
the usual thirty (30) days' notice to quit being expressly waived; provided,
however, that in the event that Tenant shall hold over after expiration of the
Term, and if Landlord shall desire to regain possession of said Premises
promptly at the expiration of the Term, then at any time prior to the acceptance
of the Rent by Landlord from Tenant, as a monthly tenant hereunder. Landlord, at
its election or option, may reenter and take possession of the Premises
forthwith, without process, or by any legal action or process in the
Commonwealth of Virginia.
22. INTENTIONALLY OMITTED.
23. PARKING.
a. Tenant shall be provided, without charge, twenty-five (25)
unreserved parking spaces (or 3.22 spaces per 1,000 r.s.f. of the Premises then
being leased by Tenant) located on the surface lot adjacent to the Building, for
use by Tenant's employees, agents and guests.
b. Tenant agrees that it and its employees shall observe reasonable
safety precautions in the use of the surface parking lot, and shall at all times
abide by all rules and regulations promulgated by Landlord or the parking
operator governing the use of the surface parking lot. Tenant understands and
agrees that Landlord does not assume any responsibility for any damage or loss
to any automobiles parked on the surface parking lot, or to any personal
property located therein or thereon, or for any injury, sustained by any person
in or about the surface parking lot.
24. NOTICES. Any and all notices or demands required or permitted herein shall
be in writing and served (a) personally, (b) by certified mail, return receipt
requested, or (c) by guaranteed overnight courier, at the addresses provided in
Section 1.g. above. If served personally, service shall be conclusively deemed
made at the time of such delivery. If served by certified mail, service shall be
conclusively deemed made forty-eight (48) hours after the deposit thereof in the
United States mail, postage prepaid, pursuant to this Section 24. If served by
overnight courier, service shall be conclusively deemed made one (1) business
day after deposit with such courier. Either party may specify a different
address according to the terms of this Section 24.
25. BROKERS. Landlord and Tenant recognize Insignial ESG, Inc. and CB ▇▇▇▇▇▇▇
▇▇▇▇▇ (collectively, the "Brokers") as the sole brokers with respect to this
Lease and Landlord agrees to be responsible for the payment of any leasing
commissions owed to the aforesaid Brokers in accordance with the terms of
separate commission agreements entered into between Landlord and each of said
Brokers. Landlord and Tenant each represents and warrants to the other that,
except for the Brokers, no other broker has been employed in carrying on any
negotiations relating to this Lease and shall each indemnify and hold harmless
the other from any claim for brokerage or other commission arising from or out
of any breach of the foregoing representation and warranty.
26. ENVIRONMENTAL CONCERNS.
a. Tenant, its agents, employees, contractors or invitees shall not (i)
cause or permit any Hazardous Materials (hereinafter defined) to be brought
upon, stored, used or disposed on, in or about the Premises and/or the Building,
or (ii) knowingly permit the release, discharge, spill or emission of any
Hazardous Material in or from the Premises.
b. Tenant hereby agrees that it is and shall be fully responsible for
all costs, expenses, damages or liabilities (including, but not limited to those
incurred by Landlord and/or its mortgagee) which may occur from the use,
storage, disposal, release, spill, discharge or emissions of Hazardous Materials
by Tenant whether or not the same may be permitted by this Lease. Tenant shall
defend, indemnify and hold harmless Landlord, its mortgagee and its agents from
and against any claims, demands, administrative orders, judicial orders,
penalties, fines, liabilities, settlements, damages, costs or expenses
(including, without limitation, reasonable attorney and consultant fees, court
costs and litigation expenses) of whatever kind or nature, known or unknown,
contingent or otherwise, arising out of or in any way related to the use,
storage, disposal, release, discharge, spill or emission of any Hazardous
Material, or the violation of any Environmental Laws, by Tenant, its agents,
employees, contractors or invitees. The provisions of this Section 26 shall be
in addition to any other obligations and liabilities Tenant may have to Landlord
at law or in equity and shall survive the transactions contemplated herein or
any termination of this Lease.
c. As used in this Lease, the term "Hazardous Materials" shall include,
without limitation:
(i) those substances included within the definitions of
"hazardous substances", "hazardous materials," toxic substances," or
"solid waste" in the Comprehensive Environmental Response Compensation
and Liability Act of 1980 (42 U.S.C.ss.9601 EL SEQ.) ("CERCLA"), as
amended by Superfund Amendments and Reauthorization Act of 1986
("▇▇▇▇"), the Resource
19
Conservation and Recovery Act of 1976 ("RCRA"), and the Hazardous
Materials Transportation Act, and in the regulations promulgated
pursuant to said laws, all as amended;
(ii) those substances listed in the United States Department of
Transportation Table (49 CFR 172.101 and amendments thereto) or by the
Environmental Protection Agency (of any successor agency) as hazardous
substances (40 CFR Part 302 and amendments thereto); and
(iii) any material, waste or substance which is (A) petroleum,
(B) asbestos, (C) polychlorinated biphenyl, (D) designated as a
"hazardous substance" pursuant to Section 311 of the Clean Water Act,
33 U.S.C.ss.1251 ET SEQ. (33 U.S.C.ss.1321) or listed pursuant to
Section of the Clean Water Act (33 U.S.C. ss.1317); (E) flammables or
explosives; or (F) radioactive materials.
d. All federal, state or local laws, statutes, regulations, rules,
ordinances, codes, standards, orders, licenses and permits of any governmental
authority or issued or promulgated thereunder shall be referred to as the
"Environmental Laws".
27. LANDLORD'S LIEN. TO secure the payment of all Rent and Additional Rent due
and to become due hereunder and to assure the faithful performance of all of the
other covenants of this Lease required to be performed by Tenant, Tenant hereby
grants to Landlord an express contractual lien on and security interest in all
property, chattels or merchandise which may be placed in the Premises and also
upon all proceeds of any insurance which may accrue to Tenant by reason of
damage to or destruction of any such property, chattels or merchandise. All
exemption laws are hereby waived by Tenant. Such contractual lien and security
interest are: granted in addition to Landlord's statutory and common law liens
and shall be cumulative thereto; and may be foreclosed with or without court
proceedings, by public or private sale, upon not less than three (3) days' prior
notice. Landlord shall have the right to become purchaser upon being the highest
bidder at such sale. Upon request of Landlord, Tenant shall execute Uniform
Commercial Code financing statements relating to the aforesaid security
interest.
28. RULES AND REGULATIONS. Tenant shall at all times comply with the rules and
regulations set forth in EXHIBIT D attached hereto and with any reasonable
additions thereto and modifications thereof adopted from time to time by
Landlord; Tenant shall be given five (5) days' written notice of any such
additions and modifications. Each such rule or regulation shall be deemed to be
a covenant of this Lease to be performed and observed by Tenant.
29. QUIET ENJOYMENT. Landlord covenants that, if Tenant is not in default
hereunder, Tenant shall at all times during the Term peaceably and quietly have,
hold and enjoy the Premises without disturbance from Landlord, subject to the
terms of this Lease and to the rights of the parties presently or hereinafter
secured by any deed of trust or mortgage against the Building.
30. MISCELLANEOUS PROVISIONS.
a. Time is of the essence with respect to each and every obligation
under this Lease.
b. The waiver by Landlord or Tenant of any term, covenant or condition
herein contained shall not be deemed to be a waiver of such term, covenant or
condition of any prior or subsequent breach of the same or any other term,
covenant or condition herein contained. The subsequent acceptance of rent
hereunder by Landlord shall not be deemed to be a waiver of any prior breach by
Tenant of any term, covenant or condition of this Lease, other than the failure
of Tenant to pay the particular rental so accepted, regardless of Landlord's
knowledge of such prior breach at the time of acceptance of such rent.
c. In the event of any action or proceeding brought by either party
against the other under this Lease, the prevailing party shall be entitled to
recover from the other party the fees of its attorneys in such action or
proceeding in such amount as the court may judge to be reasonable for such
attorneys' fees.
d. Except as expressly otherwise provided in this Lease, all of the
provisions of this Lease shall bind and inure to the benefit of the parties
hereto and to their heirs, successors, representatives, executors,
administrators, transferees and assigns. The term "Landlord," as used herein,
shall mean only the owner of the Building and the Land or of a lease of the
Building and the Land, at the time in question, so that in the event of any
transfer or transfers of title to the Building and the Land, or of Landlord's
interest in a lease of the Building and the Land, the transferor shall be and
hereby is relieved and freed of all obligations of Landlord under this Lease
accruing before such transfer, and it shall be deemed, without further
agreement, that such transferee has assumed and agreed to perform and observe
all obligations of Landlord herein during the period it is the holder of
Landlord's interest under this Lease.
e. At Landlord's request, Tenant will execute a memorandum of this
Lease in recordable form setting forth such provisions hereof as Landlord deems
desirable. Further, at Landlord's request, Tenant shall acknowledge before a
notary public its execution of this Lease, so that this Lease shall be in form
for recording. The cost of recording this Lease or memorandum thereof shall be
borne by Tenant.
f. Notwithstanding any provision to the contrary herein, Tenant shall
look solely to the estate and property of Landlord in and to the Land and the
Building in the event of any claim against
20
Landlord arising out of or in connection with this Lease, the relationship of
Landlord and Tenant, or Tenant's use of the Premises, and Tenant agrees that the
liability of Landlord arising out of or in connection with this Lease, the
relationship of Landlord and Tenant, or Tenant's use of the Premises, shall be
limited to such estate and property of Landlord in and to the Land and the
Building. No properties or assets of Landlord other than the estate and property
of Landlord in and to the Building and no property owned by any partner of
Landlord shall be subject to levy, execution or other enforcement procedures for
the satisfaction of any judgment (or other judicial process) or for the
satisfaction of any other remedy of Tenant arising out of or in connection with
this Lease, the relationship of Landlord and Tenant or Tenant's use of the
Premises.
g. Landlord and Landlord's agents have made no representations or
promises with respect to the Building, the Land or the Premises except as herein
expressly set forth.
h. Landlord and Tenant shall be excused from performing an obligation
or undertaking provided for in this Lease so long as such performance is
prevented or delayed, retarded or hindered by an Act of God, force majeure,
fire, earthquake, flood, explosion, action of the elements, war, invasion,
insurrection, riot, mob violence, sabotage, inability to procure or a general
shortage of labor, equipment, facilities, materials or supplies in the open
market, failure of transportation, strike, lockout, action of labor unions, a
taking by eminent domain, requisition, laws orders of government, or of civil,
military or naval authorities, or any other cause whether similar or dissimilar
to the foregoing, not within the reasonable control of Landlord or Tenant, as
applicable, including reasonable delays for adjustments of insurance
(collectively, "Force Majeure"); provided, however, that no such event or cause
shall relieve Tenant of its obligations hereunder to make full and timely
payments of Rent as provided herein.
i. Tenant hereby elects domicile at the Premises for the purpose of
service of all notices, writs of summons or other legal documents or process in
any suit, action or proceeding which Landlord or any mortgagee may undertake
under this Lease.
j. Landlord shall not be liable to Tenant for any damage caused by
other tenants or persons in the Building or caused by operations of others in
the construction of any private, public or quasi-public work.
k. If in this Lease it is provided that Landlord's consent or approval
as to any matter will not be unreasonably withheld or delayed, and it is
established by a court or body having final jurisdiction thereover that Landlord
has been unreasonable, the sole effect of such finding shall be that Landlord
shall be deemed to have given its consent or approval, but Landlord shall not be
liable to Tenant in any respect for money damages or expenses incurred by Tenant
by reason of Landlord having withheld its consent. Nothing contained in this
paragraph shall be deemed to limit Landlord's right to give or withhold consent
unless such limitation is expressly contained in the paragraph to which such
consent pertains.
l. If any governmental entity or authority hereafter imposes a tax or
assessment upon or against any of the rent or other charges payable by Tenant to
Landlord hereunder (whether such tax takes the form of a lease tax, sales tax or
other tax), Tenant shall be responsible for the timely payment thereof. Unless
Landlord and Tenant otherwise agree in writing with respect to the payment
thereof, Tenant shall pay the applicable tax to Landlord in monthly installments
on the date upon which Tenant pays to Landlord the installments of Monthly Base
Rent due under this Lease.
m. This Lease and the Exhibits hereto constitute the entire agreement
between the parties, and supersedes any prior agreements or understandings
between them. This Lease is not effective until executed and delivered by
Landlord and Tenant and approved by any current mortgagee of the Building and/or
the Project Land. The provisions of this Lease may not be modified in any way
except by written agreement signed by both parties.
n. This Lease shall be subject to and construed in accordance with the
laws of the Commonwealth of Virginia.
o. Landlord shall provide an electronic access system with computerized
card access at the front entrance of the Building. Landlord shall provide Tenant
with twelve (12) access cards free of charge. Any cards requested by Tenant in
excess of twelve (12) shall be provided at Tenant's sole cost and expense.
Landlord shall not be responsible for the quality, action or inaction of the
Building's or Premises' access system or for any damage or injury to Tenant, its
employees, agents, invitees or their respective property resulting from any
failure, action or inaction of the Building's and/or Premises' access systems.
21
IN WITNESS WHEREOF, duly authorized representatives of Landlord and
Tenant have executed this Deed of Lease under seal on the day and year first
above written.
SMII FAIRFAX, LLC. a Delaware limited liability company
/S/ MLA BY: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
[INITIALS] ---------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
WITNESS:
TENANT:
EUROTECH, LTD., a District of Columbia
corporation
/S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ By:
Name:
Title:
LIST OF EXHIBITS
EXHIBIT A: Floor Plan of Premises
EXHIBIT B: Work Agreement
EXHIBIT C: Declaration of Commencement Date
EXHIBIT D: Rules and Regulations
22
EXHIBIT A
FLOOR PLAN OF PREMISES
[FLOOR PLAN GRAPH APPEARS HERE]
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇
WORK AGREEMENT
This Work Agreement (the 'Work Agreement") is attached to and made a
part of that certain Deed of Lease (the "Lease") dated August _, 2000, by and
between SMII FAIRFAX, LLC, as landlord ("Landlord") and EUROTECH, LTD., as
tenant ('Tenant") for the premises (the "Premises") described therein in the
building known as ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ (the "Building"). It is
the intent of this Work Agreement that Tenant shall be permitted freedom in the
design and layout of the Premises, consistent with applicable building codes and
requirements of law, including without limitation the Americans With
Disabilities Act, as amended, and with sound architectural and construction
practice in first-class office buildings, provided that neither the design nor
the implementation of the Tenant Improvements (hereinafter defined) shall cause
any interference to the operation of the Building's HVAC, mechanical, plumbing,
life safety, electrical or other systems or to other Building operations or
functions, nor shall they increase maintenance or utility charges for operating
the Building. Capitalized terms not otherwise defined in this Work Agreement
shall have the meanings set forth in the Lease. In the event of any conflict
between the terms hereof and the terms of the Lease, the terms hereof shall
prevail for the purposes of design and construction of the Tenant Improvements.
A. LEASEHOLD IMPROVEMENTS.
1- Improvements. Except as set forth immediately below,
Landlord shall not be obligated to make any improvements in or to the Premises
and Tenant shall accept the Premises in "as is" condition as of the Commencement
Date.
2. Tenant Improvements. Tenant shall furnish and install in
the Premises in accordance with the terms of this Work Agreement, the
improvements set forth in the Tenant's Plans (hereinafter defined) which have
been approved by Landlord in accordance with Paragraph B-2, below (the "Tenant
Improvements"). The parties agree that (a) no furniture (including systems
furniture) or equipment shall be included in the Tenant Improvements; and (b) no
delay in installing Tenant's furniture (including systems furniture) or
equipment in the Premises shall delay or otherwise affect the Commencement Date
under the Lease. The costs of all design, space planning, and architectural and
engineering work for or in connection with the Tenant Improvements, including
without limitation all drawings, plans, specifications, permits or other
approvals relating thereto, and all insurance, bonds and other requirements and
conditions hereunder, and all costs of demolition and construction, including
supervision thereof, shall be at Tenant's sole cost and expense, subject to the
application of the Space Plan Allowance and the Improvement Allowance in
accordance with the terms of this Work Agreement.
B. PLANS AND SPECIFICATIONS
1. Space Planner. Tenant has retained the services of (the
"Space Planner"), who will design the Premises and prepare the Contract
Documents (hereinafter defined). The Space Planner shall meet with the
Construction Supervisor (hereinafter defined) from time to time to obtain
information about the Building and to insure that the improvements envisioned in
the Contract Documents do not interfere with and/or adversely affect the
Building or any systems therein. The Space Planner and the Engineers
(hereinafter defined), shall prepare all plans and specifications described in
Paragraph B.2, below, in conformity with the base Building plans and systems,
and the Space Planner shall coordinate its plans and specifications with the
Engineers and the Construction Supervisor. All fees of the Space Planner and the
Engineers shall be borne solely by Tenant, subject to application of the Space
Plan Allowance as hereinafter provided.
2. Engineers. Tenant shall retain the services of mechanical,
electrical, plumbing and structural engineers approved by Landlord in its
reasonable discretion (the "Engineers") to: (i) design the type, number and
location of all mechanical systems in the Premises, including without limitation
the heating, ventilating and air conditioning system therein, and to prepare all
of the mechanical plans; (ii) assist Tenant and the Space Planner in connection
with the electrical design of the Premises, including the location and capacity
of light fixtures, electrical receptacles and other electrical elements, and to
prepare all of the electrical plans; (iii) assist Tenant and the Space Planner
in connection with plumbing-related issues involved in designing the Premises
and to prepare all of the plumbing plans; and (iv) assist Tenant and the Space
Planner in connection with the structural elements of the Space Planner's design
of the Premises and to prepare all the structural plans. All fees of the
Engineers shall be borne solely by Tenant, subject to application of the
Improvement Allowance as hereinafter provided.
3. TIME SCHEDULE.
a. On or before September 8, 2000, Tenant shall
furnish to Landlord for its review and approval a proposed detailed space plan
for the Tenant Improvements (the "Final Space Plan") prepared by the Space
Planner, in consultation with the Construction Supervisor and the Engineers. The
Final Space Plan shall contain the information and otherwise comply with the
requirements therefor described in SCHEDULE B-1 attached hereto. Landlord shall
advise Tenant of Landlord's approval or disapproval of the Final Space Plan
within seven (7) days after Tenant submits the Final Space Plan to Landlord.
Tenant shall revise the proposed Final Space Plan to meet Landlord's objections,
if any, and resubmit the Final Space Plan to Landlord for its review and
approval within five (5) days after Landlord notifies Tenant of Landlord's
objections, if any.
b. Within ten (10) days following Landlord's approval
of the Final Space Plan, Tenant shall furnish to Landlord for its review and
approval, all architectural plans, working drawings and specifications (the
"Contract Documents") necessary and sufficient (i) for the construction of the
Tenant Improvements in accordance with the Final Space Plan; and (ii) to enable
the Contractor (hereinafter defined) to obtain a building permit for the
construction of the Tenant Improvements. The Contract Documents shall contain
the information and otherwise comply with the requirements therefore described
in SCHEDULE B-2 attached hereto. Landlord shall advise Tenant of Landlord's
approval or disapproval of the Contract Documents, or any of them, within seven
(7) days after Tenant submits the Contract Documents to Landlord. Tenant shall
revise the Contract Documents to meet Landlord's objections, if any, and
resubmit the Contract Documents to Landlord for its review and approval within
five (5) business days after Landlord notifies Tenant of Landlord's objections,
if any. Notwithstanding anything herein to the contrary, approval by Landlord of
the Contract Documents shall not constitute an assurance by Landlord that the
Contract Documents: (A) satisfy applicable code requirements, (B) are sufficient
to enable the Contractor to obtain a building permit for the undertaking of the
Tenant Improvements in the Premises, or (C) will not interfere with, and/or
otherwise adversely affect, base Building systems.
c. The Final Space Plan and the Contract Documents
are referred to collectively herein as the Tenant's Plans."
d. The Tenant's Plans shall be prepared in accordance
with a Data Cadd or convertible DXF format for working drawings in conformity
with the base Building plans and systems and with information furnished by and
in coordination with the Construction Supervisor and Engineers. Tenant's Plan
shall comply with all applicable building codes, laws and regulations (including
without limitation the Americans With Disabilities Act, as amended), shall not
interfere with or require any changes to or modifications of the base Building's
HVAC, mechanical, electrical, plumbing, life safety or other systems or to other
Building operations or functions, and shall not increase maintenance or utility
charges for operating the Building in excess of the standard requirements for
normal first-class office buildings in the ▇▇▇▇▇▇, Virginia area.
4. Base Building Changes. If Tenant requests work to be done
in the Premises or for the benefit of the Premises that necessitates revisions
or changes in the design or construction of the base Building or Building
systems, any such changes shall be subject to prior written approval of
Landlord, in its sole discretion, and Tenant shall be responsible for all costs
and delays resulting from such design revisions or construction changes,
including architectural and engineering charges, and any special permits or fees
attributed thereto. Before any such design and/or construction changes are made,
Tenant shall pay to Landlord the full costs incurred by Landlord in connection
with such changes including without limitation the Construction Supervision Fee
(hereinafter defined) attributable thereto.
5. CHANGES.
a. In the event that Tenant requests any changes to
the Final Space Plan or the Contract Documents after Landlord has approved same,
or if it is determined that the Contract Documents prepared in accordance with
the Final Space Plan deviate from the requirements of applicable law, or
interfere with, and/or otherwise adversely affect, base Building systems, Tenant
shall be responsible for all costs and expenses and for all delay resulting
therefrom, including without limitation costs or expenses relating to (i) any
additional architectural or engineering services and related design expenses,
(ii) any changes to materials in process of fabrication, (iii) cancellation or
modification of supply or fabricating contracts, or (iv) removal or alteration
of work or plans completed or in process. In addition, Tenant shall pay Landlord
or, at Landlord's direction, the Construction Supervisor (hereinafter defined),
a change order fee equal to five percent (5%) of any costs or expenses charged
in connection with a change or modification of the Contract Documents.
b. No changes shall be made to the Contract Documents
without the prior written approval of Landlord, which approval shall not be
unreasonably withheld, conditioned or delayed except to the extent such change
affects the base Building or Building systems. Landlord shall not be responsible
for delay in occupancy by Tenant, nor shall the Commencement Date shall be
delayed, because of any changes to the Final Space Plan or the Contract
Documents after approval by Landlord, or because of delay caused by or
attributable to any deviation from applicable code requirements contained in the
Contract Documents. Tenant shall be required to pay the costs incurred in
connection with any changes to the Contract Documents or Final Space Plan to
Landlord, in full, within ten (10) days after invoice.
C. COST OF TENANT IMPROVEMENTS
1. Construction Costs. All costs of design and construction of
the Tenant Improvements, including without limitation the costs of all space
planning, architectural and engineering work related thereto, all governmental
and quasi-governmental approvals and permits required therefor, all demolition
costs, all direct and indirect construction costs, insurance, bonds and other
requirements, any changes and the Construction Supervision Fee (collectively,
"Construction Costs"), shall be paid by Tenant, subject, however, to the
application of the Improvement Allowance described in Paragraph C.2 below, not
previously disbursed pursuant to this Work Agreement (collectively, the
"Available Allowance").
2. Improvement Allowance. Provided that Tenant has fully
performed all of its obligations under this Work Agreement and the Lease,
Landlord agrees to provide to Tenant an
EXHIBIT B. PAGE 2
allowance (the "Improvement Allowance") in the amount of up to Fifteen Thousand
Seven Hundred Twenty-Two Dollars ($15,722.00) (Two Dollars ($2.00) per rentable
square foot of the Premises), to be applied solely to the Construction Costs.
Subject to the provisions of Paragraph C.4, below, the Construction Costs shall
be reimbursed by Landlord to Tenant from the Available Allowance, as invoices
therefor are rendered to Landlord as and when Construction Costs are actually
incurred by Tenant; provided, however, that Landlord shall have received partial
lien waivers and such other documentation as Landlord may require from the party
requesting such payment.
3. Costs Exceeding Available Allowance. All Construction Costs
outstanding upon exhaustion of the Space Plan Allowance and Improvement
Allowance shall be borne exclusively by Tenant, and Tenant agrees to indemnify
Landlord from and against any such costs. All amounts payable by Tenant pursuant
to this Work Agreement shall be deemed to be Additional Rent for purposes of the
Lease. If required by Landlord, Tenant shall provide evidence satisfactory to
Landlord that Tenant has sufficient funds available to pay all Construction
Costs in excess of the Space Plan Allowance and Improvement Allowance.
4. Disbursement of Improvement Allowance. Not more than once
each calendar month, Tenant shall present to Landlord Tenant's request for
payment ("Draw Request") for such Tenant Improvements work which has been
completed to date. Each Draw Request shall include Tenant's certification that
the Tenant Improvements covered thereby have been completed, and shall be
substantiated by invoices or other evidence of payment for such Tenant
Improvements. Within thirty (30) days of Landlord's receipt of a complete and
correct Draw Request, Landlord shall make payment to Tenant (or to the
Contractor or Tenant's vendors, as hereinafter provided).
(i) All Draw Requests covering construction work shall be
accompanied by the AIA Application and Certificate for Payment
(AIA Documents G702 and G703), certified by Tenant's
architect, and covering only such work as is actually
installed in the Premises. All Certificates for Payment shall
include full, partial, or conditional releases of lien, as the
case may be, and other such documentation as Landlord may
reasonably request. Prior to substantial completion of Tenant
Improvements, all Certificates for Payment shall include
retainage of not less than ten percent (10%) of the value of
the work in place.
(ii) In the case of invoices greater than Five Thousand
Dollars ($5,000.00), Tenant may request that Landlord make
payment directly to the Contractor, or to any supplier or
vendor involved in the construction of the Tenant
Improvements. Any such request(s) shall be included in the
applicable Draw Request, and shall be accompanied by the
vendor's original invoice for the work.
(iii) In the event that Tenant is in default of the Lease,
Landlord shall have no obligation to make any disbursement of
the Improvement Allowance, until such time as Tenant has cured
the default.
(iv) Landlord shall have the right, but not the obligation, to
pay the Contractor or any workers, material and service
suppliers, and all other persons who have performed work or
supplied materials or services in connection with Tenant
Improvements if Tenant has failed to do so, and Tenant shall
pay Landlord on demand the amount Landlord has so paid (and
such amount shall constitute Additional Rent under the Lease),
unless such payment is made by Landlord prior to the
disbursement of ninety percent (90%) of the Improvement
Allowance, in which case the amount of such payment shall be
deducted from the Improvement Allowance.
D. CONSTRUCTION
1. Selection of General Contractor. Once Landlord has approved
the Contract Documents, Tenant shall prepare a bid package ('Bid Package"),
which Bid Package shall be subject to Landlord's approval in its reasonable
discretion. Tenant shall submit the Bid Package to at least three (3) general
contractors selected by Tenant and approved by Landlord, such approval not to be
unreasonably withheld (the "Approved Bidders"), in order to obtain from such
Approved Bidders market rate, fixed price bids (the "Bid Price") for the
contract for construction of the Tenant Improvements. Within three (3) business
days after Tenant receives bids from those Approved Bidders which timely submit
conforming bids, Tenant shall (a) discuss with the Approved Bidders the bids
they submitted; (b) select the contractor ("Contractor") which will undertake
construction of the Tenant Improvements from among the Approved Bidders
submitting conforming bids; and (c) enter into the Construction Contract
(hereinafter defined) and begin construction of the Tenant Improvements.
2. Construction Supervision. All Tenant Improvements shall be
performed by the Contractor selected in accordance with this Work Agreement.
Landlord shall retain LPC Commercial Services, Inc. ("Construction Supervisor")
as Landlord's construction supervisor in connection with the construction of the
Tenant Improvements, and Tenant shall pay the Construction Supervisor a
construction supervision fee ("Construction Supervision Fee") equal to five
percent (5.0%) of the total Construction Costs (excluding design and
architectural fees) incurred in connection with the Tenant Improvements, to
cover the costs of coordination and supervision of the Tenant Improvements work.
The Construction Supervision Fee shall be deducted from the Improvement
Allowance.
EXHIBIT B, PAGE 3
3. LANDLORD INSPECTION. Landlord and its representatives are
authorized by Tenant to make periodic inspections of the Premises during
construction of the Tenant Improvements to examipe the work being performed and
to discuss with the Contractor anything having to do with the Tenant
Improvements, the Building and/or the base Building systems. The Construction
Contract shall specify that the Contractor shall cooperate with Landlord and its
representatives, including the Construction Supervisor, in connection with the
undertaking of the Tenant Improvements, and that the Contractor shall provide
to, and discuss with, Landlord and its representatives whatever information that
Landlord reasonably requires.
4. DELAYS, if Tenant shall be delayed in substantially
completing the Tenant Improvements for any reason whatsoever, such delay (a
'Tenant Delay") shall not postpone or defer the Commencement Date or Tenant's
obligations under this Lease.
E. Contractor's Rules and Regulations. The Contractor and all
subcontractors, vendors, and materialmen who participate in the construction of
the Tenant Improvements shall observe all rules and regulations (the
"Construction Rules and Regulations") promulgated by Landlord in connection with
the performance of work in the Building, attached hereto as SCHEDULE B-3.
F. TENANT'S AGENT Tenant hereby designates ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, whose
address is ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇, to act as
Tenant's agent for purposes of authorizing and executing any and all documents,
workletters or other writings and changes thereto needed to effect this Work
Agreement, and any and all changes, additions or deletions to the work
contemplated herein, and Landlord shall have the right to rely on any documents
executed by such authorized party.
LIST OF SCHEDULES
SCHEDULE B-1 REQUIREMENTS FOR FINAL SPACE PLAN
SCHEDULE B-2 REQUIREMENTS FOR CONTRACT DOCUMENTS
SCHEDULE B-3 CONSTRUCTION RULES AND REGULATIONS
EXHIBIT B, PAGE 4
SCHEDULE B-1
REQUIREMENTS FOR FINAL SPACE PLAN
Floor plans, together with related information for mechanical,
electrical and plumbing design work, showing partition arrangement and reflected
ceiling plans (three (3) sets), including without limitation the following
information:
a. identify the location of conference rooms and density of
occupancy;
b. indicate the density of occupancy for all rooms;
c. identify the location of any food service areas or vending
equipment rooms;
d. identify areas, if any, requiring twenty-four (24) hour air
conditioning;
e. indicate those partitions that are to extend from floor to
underside of structural slab above or require special
acoustical treatment;
f. identify the location of rooms for, and layout of, telephone
equipment other than building core telephone closet;
g. identify the locations and types of plumbing required for
toilets (other than core facilities), sinks, drinking
fountains, etc.;
h. indicate light switches in offices, conference rooms and all
other rooms in the Premises;
i. indicate the layouts for specially installed equipment,
including computer and duplicating equipment, the size and
capacity of mechanical and electrical services required and
heat rejection of the equipment;
j. indicate the dimensioned location of: (A) electrical
receptacles (one hundred twenty (120) volts), including
receptacles for wall clocks, and telephone outlets and their
respective locations (wall or floor), (B) electrical
receptacles for use in the operation of Tenant's business
equipment which requires two hundred eight (208) volts or
separate electrical circuits, (C) electronic calculating and
CRT systems, etc., and (D) special audio-visual requirements;
k. indicate proposed layout of sprinkler and other life safety
and fire protection equipment, including any special equipment
and raised flooring;
l. indicate the swing of each door;
m. indicate a schedule for doors and frames, complete with
hardware, if applicable; and
n. indicate any special file systems to be installed.
SCHEDULE B-2
REQUIREMENTS FOR CONTRACT DOCUMENTS
Final architectural detail and working drawings, finish schedules and
related plans (three (3) reproducible sets) including without limitation the
following information and/or meeting the following conditions:
a. materials, colors and designs of wallcoverings, floor
coverings and window coverings and finishes;
b. paintings and decorative treatment required to complete all
construction;
c. complete, finished, detailed mechanical, electrical, plumbing
and structural plans and specifications for the Tenant
Improvements, including but not limited to the fire and life
safety systems and all work necessary to connect any special
or non-standard facilities to the Building's base mechanical
systems;
d. all final drawings and blueprints must be drawn to a scale of
one-eighth (1/8) inch to one (1) foot. Any architect or
designer acting for or on behalf of Tenant shall be deemed to
be Tenant's agent and authorized to bind Tenant in all
respects with respect to the design and construction of the
Premises;
e. for all new construction, Tenant shall purchase from Landlord
(or its suppliers) and install in the Premises the following
building standard equipment and materials: (1) ceiling tiles
and suspension system, (2) diffusers, (3) doors (interior and
exterior) and (4) door frames and hinges; and
f. notwithstanding anything to the contrary set forth herein, in
the Work Agreement or in the Lease, Tenant shall not request
any work which would: (1) require changes to structural
components of the Building or the exterior design of the
Building; (2) require any material modification to the
Building's mechanical installations or installations outside
the Premises; (3) not comply with all applicable laws, rules,
regulations and requirements of any governmental department
having jurisdiction over the construction of the Building
and/or the Premises, including specifically, but without
limitation, the Americans With Disabilities Act, as amended;
(4) be incompatible with the building plans filed with the
appropriate governmental agency from which a building permit
is obtained for the construction of the Tenant Improvements or
with the occupancy of the Building as a first- class office
building; or (5) delay the completion of the Premises or any
part thereof. Tenant shall not oppose or delay changes
required by any governmental agency affecting the construction
of the Building and/or the Tenant Improvements in the
Premises.
SCHEDULE B-3
CONSTRUCTION RULES AND REGULATIONS
1. Tenant and/or the general contractor will supply Landlord with a copy
of all permits prior to the start of any work.
2. Tenant and/or the general contractor will post applicable permits on a
wall of the construction site while work is being performed.
3. Public area corridor, and carpet, is to be protected by plastic runners
or a series of walk-off mats from the elevator to the suite under
reconstruction.
4. Walk-off mats are to be provided at entrance doors.
5. Contractors will remove their trash and debris daily, or as often as
necessary to maintain cleanliness in the building. Building trash
containers are not to be used for construction debris. Landlord
reserves the right to ▇▇▇▇ Tenant for any cost incurred to clean up
debris left by the general contractor or any subcontractor. Further,
the building staff is instructed to hold the driver's license of any
employee of the contractor while using the freight elevator to ensure
that all debris is removed from the elevator.
6. No utilities (electricity, water, gas, plumbing) or services to the
tenants are to be cut off or interrupted without first having
requested, in writing, and secured, in writing, the permission of the
Landlord.
7. No electrical services are to be put on the emergency circuit, without
specific written approval from the Landlord.
8. When utility meters are installed, the general contractor must provide
the property manager with a copy of the operating instructions for that
particular meter.
9. The Landlord will be notified of all work schedules of all workmen on
the job and will be notified, in writing, of names of those who may be
working in the building after "normal" business hours.
10. Passenger elevators shall not be used for moving building materials and
shall not be used for construction personnel except in the event of an
emergency. The designated freight elevator is the only elevator to be
used for moving materials and construction personnel. This elevator may
be used only when it is completely protected as determined by
Landlord's building engineer.
11. Contractors or personnel will use loading dock area for all deliveries
and will not use loading dock for vehicle parking.
12. Contractors will be responsible for daily removal of waste foods, milk
and soft drink containers, etc. to trash room and will not use any
building trash receptacles but trash receptacles supplied by them.
13. No building materials are to enter the building by way of main lobby,
and no materials are to be stored in any lobbies at any time.
14. Construction personnel are not to eat in the lobby or in front of
building nor are they to congregate in the lobby or in front of
building.
15. The Landlord is to be contacted by Tenant when work is completed for
inspection. All damage to building will be determined at that time.
16. All key access, fire alarm work, or interruption of security hours must
be arranged with the Landlord's building engineer.
17. There will be no radios allowed on job site.
18. All workers are required to wear a shirt, shoes, and full length
trousers.
19. Protection of hallway carpets, wall coverings, and elevators from
damage with masonite board, carpet, cardboard, or pads is required.
20. Public spaces-- corridors, elevators, bathrooms, lobby, etc.-- must be
cleaned immediately after use. Construction debris or materials found
in public areas will be removed at Tenant's cost
21. There will be no smoking, eating, or open food containers in the
elevators, carpeted areas or public lobbies.
EXHIBIT C
DECLARATION OF COMMENCEMENT DATE
This Declaration of Commencement Date is made as of ______________,
2000, by SMII FAIRFAX, LLC ("Landlord"), and EUROTECH, LTD. ('Tenant"), who
agree as follows:
1. Landlord and Tenant entered into a Deed of Lease dated August _,
2000, in which Landlord leased to Tenant and Tenant leased from Landlord certain
Premises described therein in the office building located at ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ (the "Building"). All capitalized terms herein are as defined
in the Lease.
2. Pursuant to the Lease, Landlord and Tenant agreed to and do hereby
confirm the following matters as of the Commencement Date of the Term:
a. the Commencement Date of the Lease is ________;
b. the Lease Expiration Date of the Lease is _______;
c. the number of rentable square feet of the Premises
is.
d. Tenant's Pro Rata Share of Operating Expenses is
_______%; and
e. Tenant's Pro Rata Share of Real Estate Taxes is
________%
3. Tenant confirms that:
a. it has accepted possession of the Premises as
provided in the Lease;
b. Landlord is not required to perform any work or
furnish any improvements to the Premises under the
Lease;
c. Landlord has fulfilled all of its obligations under
the Lease as of the date hereof;
d. the Lease is in full force and effect and has not
been modified, altered, or amended, except as
follows: ______________________; and
e. there are no set-offs or credits against Rent, and no
Security Deposit or prepaid Rent has been paid except
as provided by the Lease.
4. The provisions of this Declaration of Commencement Date shall inure
to the benefit of, or bind, as the case may require, the parties and their
respective successors and assigns, and to all mortgagees of the Building,
subject to the restrictions on assignment and subleasing contained in the Lease,
and are hereby attached to and made a part of this Lease.
LANDLORD:
WITNESS: SMII FAIRFAX, LLC, a Delaware limited
liability company
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------
Name: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------
Title: Vice President
TENANT:
WITNESS:
/S/ ▇▇▇▇▇▇ ▇ ▇▇▇▇▇ EUROTECH, LTD., a District of Columbia
------------------ corporation
▇▇▇▇▇▇ ▇ ▇▇▇▇▇
By: /S/ ▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: President & CEO
EXHIBIT D
RULES & REGULATIONS
1. 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. All damages
resulting from misuse of the fixtures shall be borne by Tenant if
Tenant or its servants, employees, agents, visitors or licensees shall
have caused the same.
2. No cooking (except for hot-plate and microwave cooking by Tenants'
employees for their own consumption, the location and equipment of
which is first approved by Landlord), sleeping or lodging shall be
permitted by any tenant on the Premises. No tenant shall cause or
permit any unusual or objectionable odors to be produced upon or
permeate from the Premises.
3. No inflammable, combustible, or explosive fluid, material, chemical or
substance shall be brought or kept upon, in or about the Premises. Fire
protection devices, in and about the Building, shall not be obstructed
or encumbered in any way.
4. Canvassing, soliciting and peddling in the Building is prohibited and
each tenant shall cooperate to prevent the same.
5. There shall not be used in any space, or in the public halls of the
Building, either by any tenant or by its agents, contractors, jobbers
or others, in the delivery or receipt of merchandise, freight, or other
matters, 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, and Tenant shall be responsible to
Landlord for any loss or damage resulting from any deliveries to Tenant
in the Building. Deliveries of mail, freight or bulky packages shall be
made through the freight entrance or through doors specified by
Landlord for such purpose.
6. Mats, trash or other objects shall not be placed in the public
corridors. The sidewalks, entries, passages, elevators, public
corridors and staircases and other parts of the Building which are not
occupied by Tenant shall not be obstructed or used for any other
purpose than ingress or egress.
7. Tenant shall not install or permit the installation of any awnings,
shades, draperies and/or other similar window coverings, treatments or
like items visible from the exterior of the Premises other than those
approved by the Landlord in writing.
8. Tenant shall not construct, maintain, use or operate within said
Premises or elsewhere in the Building or on the outside of the
Building, any equipment or machinery which produces music, sound or
noise which is audible beyond the Premises.
9. Bicycles, motor scooters or any other type of vehicle shall not be
brought into the lobby or elevators of the Building or into the
Premises except for those vehicles which are used by a physically
disabled person in the Premises.
10. All blinds for exterior windows shall be building standard and shall be
maintained by Tenant.
11. No additional locks shall be placed upon doors to or within the
Premises except as shall be necessary adequately to safeguard United
States Government security classified documents stored with the
Premises. The doors leading to the corridors or main hall shall be kept
closed during business hours, except as the same may be used for
ingress or egress.
12. Tenant shall maintain and clean all areas or rooms within the Premises
in which security classified work is being conducted or in which such
work is stored; Landlord shall not provide standard janitorial service
to such areas, the provisions of Section 9 of this Lease
notwithstanding.
13. Landlord reserves the right to shut down the air conditioning,
electrical systems, heating, plumbing and/or elevators when necessary
by reason of accident or emergency, or for repair, alterations,
replacements or improvement
14. No carpet, rug or other article shall be hung or shaken out of any
window of the Building; and Tenant shall not sweep or throw or permit
to be swept or thrown from the Premises any dirt or other substances
into any of the corridors or halls, elevator, or out of the doors or
windows or stairways of the Building. Tenant shall not use, keep or
permit to be used or kept any foul or noxious gas or substance in the
Premises, or permit or suffer the Premises to be occupied or used in a
manner offensive or objectionable to Landlord or other occupants of the
Building by reason of noise, odors and/or vibrations, or interfere in
any way with other tenants or those having business therein, nor shall
any animals or birds be kept in or about the Building. Smoking or
carrying lighted cigars or cigarettes in the elevators of the Building
is prohibited.
15. Landlord reserves the right to exclude from the Building on weekdays
between the hours of 6:00 p.m. and 8:00 a.m. and at all hours on
weekends and legal holidays, all persons who do not present a pass to
the Building signed by Landlord; provided, however, that reasonable
access for
Tenant's employees and customers shall be accorded. Landlord will
furnish passes to persons for whom Tenant requires same in writing.
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.
16. Tenant agrees to keep all windows closed at all times and to abide by
all rules and regulations issued by Landlord with respect to the
Building's air conditioning and ventilation systems.
17. Tenant will replace all broken or cracked plate glass windows and doors
at its own expense, with glass of like kind and quality, provided that
such windows and doors are not broken or cracked by Landlord, its
employees, agents or contractors.
18. In the event it becomes necessary for the Landlord to gain access to
the underfloor electric and telephone distribution system for purposes
of adding or removing wiring, then upon request by Landlord, Tenant
agrees to temporarily remove the carpet over the access covers to the
underfloor ducts for such period of time until work to be performed has
been completed. The cost of such work shall be borne by Landlord except
to the extent such work was requested by or is intended to benefit
Tenant or the Premises, in which case the cost shall be borne by
Tenant.
19. Violation of these rules, or any amendments thereof or additions
thereto, may be considered a default of Tenant's lease and shall be
sufficient cause for termination of this Lease at the option of
Landlord.
EXHIBIT C, PAGE 2
