Initial Public Offering (IPO): Registration Statement (General Form) — Form S-1
Filing Table of Contents
Document/Exhibit Description Pages Size
1: S-1 Cynosure, Inc. Form S-1 HTML 1.11M
18: COVER ¶ Comment-Response or Cover Letter to the SEC HTML 5K
2: EX-3.1 EX-3.1 Certificate of Incorporation of the 21 58K
Registrant, as Amended
3: EX-3.2 EX-3.2 Form of Restated Certificate of 19 77K
Incorporation of the Registrant
4: EX-3.3 EX-3.3 Bylaws of the Registrant 16 53K
5: EX-3.4 EX-3.4 Form of Amended and Restated Bylaws of the 21 100K
Registrant
6: EX-10.1 EX-10.1 1992 Stock Option Plan 12 43K
15: EX-10.10 EX-10.10 Lease, Dated January 31, 2005 46 244K
7: EX-10.2 EX-10.2 2004 Stock Option Plan, as Amended 11 56K
8: EX-10.3 EX-10.3 2005 Stock Incentive Plan 13 65K
9: EX-10.4 EX-10.4 Employment Agreement, Dated September 2003 11 40K
10: EX-10.5 EX-10.5 Employment Agreement, Dated January 1, 9 38K
2003
11: EX-10.6 EX-10.6 Employment Agreement, Dated September 2003 10 38K
12: EX-10.7 EX-10.7 Exclusive Distribution Agreement 14 46K
13: EX-10.8 EX-10.8 Exclusive Distribution Agreement 16 50K
14: EX-10.9 EX-10.9 Promissory Note, Dated October 1, 2004 3 20K
16: EX-21.1 EX-21.1 Subsidiaries of the Registrant 1 6K
17: EX-23.1 EX-23.1 Consent of Ernst & Young LLP 1 7K
‘EX-10.10’ — EX-10.10 Lease, Dated January 31, 2005
Exhibit Table of Contents
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EXHIBIT 10.10
TABLE OF CONTENTS
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1. LEASE OF PREMISES................................................................ 1
2. DEFINITIONS...................................................................... 1
3. EXHIBITS AND ADDENDA............................................................. 2
4. DELIVERY OF POSSESSION........................................................... 2
5. INTENDED USE OF THE PREMISES..................................................... 3
6. RENT............................................................................. 3
6.1. Payment of Rent........................................................ 3
6.2. Adjusted Base Rent..................................................... 3
6.3. Additional Rent for Increases in Tax Costs and Operating Expenses...... 3
6.4. Determination and Payment of Tax Costs and Operating Expenses.......... 5
6.5. Definition of Rent..................................................... 5
6.6. Taxes on Tenant's Use and Occupancy.................................... 5
7. LATE CHARGES..................................................................... 6
8. SECURITY DEPOSIT................................................................. 6
9. TENANTS USE OF THE PREMISES...................................................... 6
9.1. Use.................................................................... 6
9.2. Observance of Law...................................................... 7
9.3. Insurance.............................................................. 7
9.4. Nuisance and Waste..................................................... 7
9.5. Load and Equipment Limits.............................................. 7
9.6. Hazardous Material..................................................... 7
10. SERVICES AND UTILITIES........................................................... 8
11. REPAIRS AND MAINTENANCE.......................................................... 9
11.1. Landlord's Obligations................................................. 9
11.2. Tenant's Obligations................................................... 9
11.3. Compliance with Law.................................................... 9
11.4. Notice of Defect....................................................... 9
11.5. Landlord's Liability................................................... 9
12. CONSTRUCTION, ALTERATIONS AND ADDITIONS.......................................... 10
12.1. Landlord's Construction Obligations.................................... 10
12.2. Tenant's Construction Obligations...................................... 10
12.3. Tenant's Alterations and Additions..................................... 10
12.4. Payment................................................................ 10
12.5. Property of Landlord................................................... 10
13. LEASEHOLD IMPROVEMENTS; TENANTS PROPERTY......................................... 10
13.1. Leasehold Improvements................................................. 10
13.2. Tenant's Property...................................................... 10
14. INDEMNIFICATION................................. ................................ 11
14.1. Tenant Indemnification................................................. 11
14.2. Landlord Not Liable.................................................... 11
15. TENANT'S INSURANCE............................................................... 11
15.1. Insurance Requirement.................................................. 11
15.2. Minimum scope of Coverage............................................. 11
15.3. Minimum Limits of Insurance............................................ 12
15.4. Deductible and Self-Insured Retention.................................. 12
15.5. Increases in Insurance Policy Limits................................... 12
15.6. Waiver of Subrogation.................................................. 12
15.7. Landlord's Right to Obtain Insurance for Tenant........................ 12
16. DAMAGE OR DESTRUCTION............................................................ 12
16.1. Damage................................................................. 12
16.2. Repair of Premises in Excess of One Hundred Eighty Days................ 13
16.3. Repair Outside Premises................................................ 13
16.4. Tenant Repair.......................................................... 13
16.5. Election Not to Perform Landlord's Work................................ 13
16.6. Express Agreement...................................................... 13
17. EMINENT DOMAIN................................................................... 13
17.1. Whole Taking........................................................... 13
17.2. Partial Taking......................................................... 13
17.3. Proceeds............................................................... 13
17.4. Landlord's Restoration................................................. 13
18. ASSIGNMENT AND SUBLETTING........................................................ 14
18.1. No Assignment or Subletting............................................ 14
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18.2. Landlord's Consent..................................................... 14
18.3. Tenant Remains Responsible............................................. 15
18.4. Conversion to a Limited Liability Entity............................... 15
18.5. Payment of Fees........................................................ 15
19. DEFAULT.......................................................................... 16
19.1. Tenant's Default....................................................... 16
19.2. Landlord Remedies...................................................... 16
19.3. Damages Recoverable.................................................... 17
19.4. Landlord's Right to Cure Tenant's Default.............................. 17
19.5. Landlord's Default..................................................... 17
19.6. Mortgage Protection.................................................... 17
19.7. Tenant's Right to Cure Landlord's Default.............................. 17
20. WAIVER........................................................................... 18
21. SUBORDINATION AND ATTORNMENT..................................................... 18
22. TENANT ESTOPPEL CERTIFICATES..................................................... 18
22.1. Landlord Request for Estoppel Certificate.............................. 18
22.2. Failure to Execute..................................................... 18
23. NOTICE........................................................................... 18
24. TRANSFER OF LANDLORD'S INTEREST.................................................. 19
25. SURRENDER OF PREMISES............................................................ 19
25.1. Clean and Same Condition............................................... 19
25.2. Failure to Deliver Possession.......................................... 19
25.3. Property Abandoned..................................................... 19
26. HOLDING OVER..................................................................... 19
27. RULES AND REGULATIONS............................................................ 19
28. CERTAIN RIGHTS RESERVED BY LANDLORD.............................................. 19
28.1. Name................................................................... 20
28.2. Signage................................................................ 20
28.3. Access................................................................. 20
28.4. Physical Changes....................................................... 20
28.5. Inspection............................................................. 20
28.6. Entry.................................................................. 20
28.7. Common Area Regulation........................... ..................... 20
29. ADVERTISEMENTS AND SIGNS......................................................... 20
30. RELOCATION OF PREMISES........................................................... 20
31. GOVERNMENT ENERGY OR UTILITY CONTROLS............................................ 20
32. FORCE MAJEURE.................................................................... 20
33. BROKERAGE FEES................................................................... 21
34. QUIET ENJOYMENT.................................................................. 21
35. TELECOMMUNICATIONS............................................................... 21
35.1. Telecommunications Companies........................................... 21
35.2. Tenant's Obligations................................................... 21
35.3. Landlord's Consent..................................................... 21
35.4. Indemnification........................................................ 22
35.5. Landlord's Operation of Building Telecommunications Lines and Systems.. 22
36. MISCELLANEOUS.................................................................... 22
36.1. Accord and Satisfaction; Allocation of Payments........................ 22
36.2. Addenda................................................................ 22
36.3. Attorneys' Fees...................... ................................. 22
36.4. Captions and Section Numbers........................................... 22
36.5. Changes Requested by Lender............................................ 22
36.6. Choice of Law.......................................................... 22
36.7. Consent................................................................ 22
36.8. Authority.............................................................. 22
36.9. Waiver of Right to Jury Trial.......................................... 23
36.10. Counterparts........................................................... 23
36.11. Execution of Lease; No Option.......................................... 23
36.12. Furnishing of Financial Statements; Tenant's Representations........... 23
36.13. Further Assurances..................................................... 23
36.14. Prior Agreements; Amendments........................................... 23
36.15. Recording.............................................................. 23
36.16. Severability........................................................... 23
36.17. Successors and Assigns................................................. 23
36.18. Time Is of the Essence................................................. 23
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LEASE
This lease between Glenborough Fund V, Limited Partnership, a Delaware limited
partnership (herein Landlord), and Cynosure, Inc., a Delaware corporation
(herein Tenant), is dated for reference purposes only as of this 31 day of
January, 2005.
1. LEASE OF PREMISES.
In consideration of the Rent (as defined in Section 6.) and the provisions of
this Lease, Landlord leases to Tenant and Tenant leases from Landlord the
Premises shown by diagonal lines on the floor plan attached hereto as Exhibit
"A", and further described in Section 2.13. The Premises are located within the
Building and Project (as described in Sections 2.13. and 2.14.). Tenant shall
have the nonexclusive right (unless otherwise provided herein) in common with
Landlord, other tenants, subtenants and invitees, to use the Common Area (as
defined in Section 2.5.). This Lease confers no rights either to the subsurface
of the land below the ground level of the Building in which the Premises is
located or to airspace, interior or exterior, above the ceiling of the Building.
2. DEFINITIONS.
As used in this Lease the following terms shall have the following meanings:
2.1. ADJUSTMENT DATE: INTENTIONALLY OMITTED.
2.2. ANNUAL BASE RENT:
$697,712.50 beginning April 1, 2005 ending March 31, 2006
$711,666.75 beginning April 1, 2006 ending March 31, 2007
$767,483.75 beginning April 1, 2007 ending March 31, 2009
$823,300.75 beginning April 1, 2009 ending March 31, 2011
$879,117.75 beginning April 1, 2011 ending March 31, 2012
2.3. BASE YEAR: Calendar Year 2005 for Operating Expenses; Fiscal Year
2005 for Tax Costs.
2.4. COMMENCEMENT DATE: April 1, 2005. If the Commencement Date is other
than the first day of a month, then the Expiration Date of the Lease
shall be extended to the last day of the month in which the Lease
expires.
2.5. COMMON AREA: The building lobbies, common corridors and hallways,
rest rooms, parking areas and other generally understood public or
common areas.
2.6. EXPIRATION DATE: March 31, 2012, unless otherwise sooner terminated
in accordance with the provisions of this Lease.
2.7. INDEX (Section 6.2.): INTENTIONALLY OMITTED
2.8. LANDLORD'S ADDRESS FOR NOTICE:
c/o Glenborough Realty Trust Incorporated
400 South El Camino Real, Suite 1100
San Mateo, CA 94402-1708
ATTN: Legal Department
RENT PAYMENT ADDRESS:
Glenborough Fund V, Limited Partnership
PO Box 6022
Hicksville, NY 11802-6022
TENANTS MAILING ADDRESS:
Cynosure, Inc.
10 Elizabeth Drive
Chelmsford, MA 01824
With a courtesy copy to:
Hanify & King P.C.
1 Beacon Street, 21st Floor
Boston, MA 02108
Attn: Daniel J. Lyne, Esq.
2.9. LISTING AND LEASING AGENT(S): Grubb & Ellis and CB Richard
Ellis/Whitter Partners.
2.10. MONTHLY INSTALLMENTS OF BASE RENT:
$58,142.71 beginning April 1, 2005 ending March 31, 2006
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$59.305.56 beginning April 1, 2006 ending March 31, 2007
$63,956.98 beginning April 1, 2007 ending March 31, 2009
$68.608.40 beginning April 1, 2009 ending March 31, 2011
$73,259.81 beginning April 1, 2011 ending March 31, 2012
2.11. NOTICE: Except as otherwise provided herein, Notice shall mean any
notices, approvals and demands permitted or required to be given
under this Lease. Notice shall be given in the form and manner set
forth in Section 23.
2.12. PARKING: Tenant shall be entitled to the nonexclusive use of one
hundred ninety-five (195) parking spaces. The charge for parking
shall be $0.00 per month per parking space for the initial term of
this Lease. Landlord may permit Tenant to rent additional spaces,
if available, at the then current parking rate. Each such additional
parking space, however, shall not be a part of this Lease, and
Landlord reserves the right to adjust the parking rate for each
additional parking space at any time and to terminate the rental of
such additional parking spaces at any time.
2.13. PREMISES: That portion of the entire first lst floor and a portion
of the second 2nd floor(s) of the Building located at 5 Carlisle
Road. Westford. Massachusetts, commonly referred to as suite 100 and
suite 200, as shown by diagonal lines on Exhibit "A". For purposes
of this Lease, the Premises is deemed to contain approximately
55,817 square feet of Rentable Area.
2.14. PROJECT: The building of which the Premises are a part (the
Building) and any other buildings or improvements on the real
property (the Property) located at 5 Carlisle Road. Westford,
Massachusetts and further described in Exhibit "B". The Project is
commonly known as Westford Corporate Center.
2.15. RENTABLE AREA: As to both the Premises and the Project, the
respective measurements of floor area as may from time to time be
subject to lease by Tenant and all tenants of the Project,
respectively, as determined by Landlord and applied on a consistent
basis throughout the Project.
2.16. SECURITY DEPOSIT (Section 8.): $200,000.00, subject to section 41 of
this lease.
2.17. STATE: The Commonwealth of Massachusetts.
2.18. TENANT'S FIRST ADJUSTMENT DATE (Section 6.2.): INTENTIONALLY
OMITTED.
2.19. TENANT'S PROPORTIONATE SHARE: 68.4%. Such share is a fraction, the
numerator of which is the Rentable Area of the Premises, and the
denominator of which is the Rentable Area of the Project, as
determined by Landlord from time to time. The Project consists of
one (1) Building, and, for purposes of this Lease, the Building is
deemed to contain approximately 81,632 square feet of Rentable Area.
2.20. TENANT'S USE (Section 9.): Executive office and research and
development use for a medical and aesthetic laser company and
assembly of laser devices.
2.21. TERM: The period commencing on the Commencement Date and expiring at
midnight on the Expiration Date.
3. EXHIBITS AND ADDENDA.
The exhibits and addenda listed below (unless lined out) are attached hereto and
incorporated by reference in this Lease:
3.1. Exhibit A - Floor Plan showing the Premises.
3.2. Exhibit B - Site Plan of the Project.
3.3. Exhibit C - Building Standard Tenant Improvements.
3.4. Exhibit D - Work Letter and Drawings.
3.5. Exhibit E - Rules and Regulations.
3.6. Exhibit F - Sign Criteria.
Addenda: Attached hereto and made a part of this Lease by reference are
Sections 37-41.
4. DELIVERY OF POSSESSION.
If for any reason Landlord does not deliver possession of the Premises to Tenant
on the Commencement Date, and such failure is not caused by an act or omission
of Tenant, the Expiration Date shall be extended by the number of days the
Commencement Date has been delayed and the validity of this Lease shall not be
impaired nor shall Landlord be subject to any liability for such failure; but
Rent shall be abated until delivery of
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possession. Provided, however, if the Commencement Date has been delayed by an
act or omission of Tenant then Rent shall not be abated until delivery of
possession and the Expiration Date shall not be extended. Notwithstanding the
foregoing to the contrary, if Landlord has not delivered the Premises to Tenant,
with all of Landlord's Work substantially complete, on or before August 1, 2005,
for any reason other than delays caused by Tenant and force majeure, then
Landlord shall reimburse Tenant for any holdover rent that Tenant's current
landlord charges Tenant and that Tenant actually pays for not vacating Tenant's
current space up and until Landlord delivers possession. Delivery of possession
shall be deemed to occur on the earlier of the date Landlord receives a
Certificate of Occupancy or upon substantial completion of the Premises (as
certified by Landlord's architect) but not earlier than April 1, 2005. If
Landlord permits Tenant to enter into possession of the Premises before the
Commencement Date, such possession shall be subject to the provisions of this
Lease, including, without limitation, the payment of Rent (unless otherwise
agreed in writing).
Following the full execution of the Lease and Landlord's receipt of Certificates
of Insurance evidencing coverage as required under the Lease, Tenant shall be
entitled to enter the Premises prior to the Commencement Date solely for the
purpose of installing its wiring, trade fixtures, equipment and personal
property therein (provided however, such installation activities shall not
interfere with the completion of Landlord's Work.)
Within ten (10) days of delivery of possession Landlord shall deliver to Tenant
and Tenant shall execute an Acceptance of Premises in which Tenant shall
certify, among other things, that (a) Landlord has satisfactorily completed
Landlord's Work to the Premises pursuant to Exhibit "D", unless written
exception is set forth thereon, and (b) that Tenant accepts the Premises.
Tenant's failure to execute and deliver the Acceptance of Premises shall be
conclusive evidence, as against Tenant, that Landlord has satisfactorily
completed Landlord's Work to the Premises pursuant to Exhibit "D".
In the event Tenant fails to take possession of the Premises following execution
of this Lease, Tenant shall reimburse Landlord promptly upon demand for all
costs incurred by Landlord in connection with entering into this Lease
including, but not limited to, broker fees and commissions, sums paid for the
preparation of a floor and/or space plan for the Premises, costs incurred in
performing Landlord's Work pursuant to Exhibit "D", loss of rental income,
attorneys' fees and costs, and any other damages for breach of this Lease
established by Landlord.
5. INTENDED USE OF THE PREMISES.
The statement in this Lease of the nature of the business to be conducted by
Tenant in the Premises does not constitute a representation or guaranty by the
Landlord as to the present or future suitability of the Premises for the conduct
of such business in the Premises, or that it is lawful or permissible under the
Certificate of Occupancy issued for the Building, or is otherwise permitted by
law. Tenant's taking possession of the Premises shall be conclusive evidence, as
against Tenant, that, at the time such possession was taken, the Premises were
satisfactory for Tenant's intended use.
6. RENT.
6.1. Payment of Rent. Tenant shall pay Rent for the Premises. Monthly
Installments of Rent shall be payable in advance on the first day of each
calendar month of the Term. If the Term begins (or ends) on other than the first
(or last) day of a calendar month, Rent for the partial month shall be prorated
based on the number of days in that month. Rent shall be paid to Landlord at the
Rent Payment Address set forth in Section 2.8., or to such other person at such
place as Landlord may from time to time designate in writing, without any prior
demand therefor and without deduction or offset, in lawful money of the United
States of America. Tenant shall pay Landlord the first Monthly Installment of
Base Rent upon execution of this Lease.
6.2. Adjusted Base Rent. INTENTIONALLY OMITTED.
6.3. Additional Rent for Increases in Tax Costs and Operating Expenses.
If, in any calendar year during the Term of this Lease, Landlord's Tax Costs and
Operating Expenses (as hereinafter defined) for the Project (hereinafter
sometimes together referred to as Direct Costs) shall be higher than in the Base
Year specified in Section 2.3., Additional Rent for such Direct Costs payable
hereunder shall be increased by an amount equal to Tenant's Proportionate Share
of the difference between Landlord's actual Direct Costs for such calendar year
and the actual Direct Costs of the Base Year. However, if during any calendar
year of the Term the occupancy of the Project is less than ninety-five percent
(95%), then Landlord shall make an appropriate adjustment of the variable
components of Operating Expenses, as reasonably determined by Landlord, to
determine the amount of Operating Expenses that would have been incurred had the
Project been ninety-five percent (95%) occupied during that calendar year. This
estimated amount shall be deemed the amount of Operating Expenses for that
calendar year. For purposes hereof, "variable components' shall include only
those Operating Expenses that are affected by variations in occupancy levels.
6.3.1. Definitions. As used in this Section 6.3.1., the following
terms shall have the following meanings:
6.3.1.1. Tax Costs shall mean any and all real estate taxes,
other similar charges on real property or improvements, assessments,
water and sewer charges and all other charges (but in no event
Landlord's income or estate taxes) assessed, levied, imposed or
becoming a lien upon part or all of the Project or the appurtenances
thereto, or
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attributable thereto, or on the rents, issues, profits or income received
or derived therefrom which may be imposed, levied, assessed or charged by
the United States or the State, County or City in which the Project is
located, or any other local government authority Agency or political
subdivision thereof. Tax Costs for each tax year shall be apportioned to
determine the Tax Costs for the subject calendar years.
Landlord at Landlord's sole discretion, may contest any taxes levied
or assessed against the Building or Project during the Term. If Landlord
contests any taxes levied or assessed during the Term, Tenant shall pay
Landlord Tenant's Proportionate Share of all costs incurred by Landlord in
connection with the contest.
6.3.1.2. Operating Expenses shall mean any and all expenses incurred
by Landlord in connection with the management, maintenance, operation, and
repair of the Project, the equipment, adjacent walks, Common Area, parking
areas, the roof, landscaped areas, including, but not limited to,
salaries, wages, benefits, pension payments, payroll taxes, worker's
compensation, and other costs related to employees engaged in the
management, operation, maintenance and/or repair of the Project; any and
all assessments or costs incurred with respect to Covenants, Conditions
and/or Restrictions, Reciprocal Easement Agreements or similar documents
affecting the Building or Project, if any; the cost of all charges to
Landlord for electricity, natural gas, air conditioning, steam, water, and
other utilities furnished to the Project including any taxes thereon;
reasonable attorneys' fees and/or consultant fees incurred by Landlord in
contracting with a company or companies to provide electricity (or any
other utility) to the Project, any fees for the installation, maintenance,
repair or removal of related equipment, and any exit fees or stranded cost
charges mandated by the State; the cost and expense for third-party
consultants, accountants and attorneys; a management fee not greater than
five percent (5%) of the gross Base Rent and Additional Rent received for
the project; energy studies and the amortized cost of any energy or other
cost saving equipment used by Landlord to provide services pursuant to the
terms of the Lease (including the amortized cost to upgrade the efficiency
or capacity of Building telecommunication lines and systems if
responsibility therefor is assumed by Landlord as discussed in Section 35.
hereof); reasonable reserves for replacements as may be customary in the
geographic area in which the Project is located; the cost of license fees
related to the Project; the cost of all charges for property (all risk),
liability, rent loss and all other insurance for the Project to the extent
that such insurance is required to be carried by Landlord under any lease,
mortgage or deed of trust covering the whole or a substantial part of the
Project or the Building, or, if not required under any such lease,
mortgage or deed of trust, then to the extent such insurance is carried by
owners of properties comparable to the Project; the cost of all building
and cleaning supplies and materials; the cost of all charges for security
services, cleaning, maintenance and service contracts and other services
with independent contractors, including but not limited to the
maintenance, operation and repair of all electrical, plumbing and
mechanical systems of the Project and maintenance, repair and replacement
of any intra-building cabling network ("ICN"); and the cost of any
janitorial, utility or other services to be provided by Landlord.
Notwithstanding the foregoing, the following shall not be included
within Operating Expenses: (i) costs of capital improvements, including to
the roof and foundation (except any improvements that might be deemed
"capital improvements" related to the enhancement or upgrade of the ICN
and related equipment) and costs of curing design or construction defects;
(ii) depreciation; (iii) interest and principal payments on mortgages and
other debt costs and ground lease payments, if any, and any penalties
assessed as a result of Landlord's late payments of such amounts; (iv)
real estate broker leasing commissions or compensation; (v) any cost or
expenditure (or portion thereof) for which Landlord is reimbursed, whether
by insurance proceeds or otherwise; (vi) attorneys' fees, costs,
disbursements, advertising and marketing and other expenses incurred in
connection with the negotiation of leases with prospective tenants of the
Building; (vii) rent for space which is not actually used by Landlord in
connection with the management and operation of the Building; (viii) all
costs or expenses (including fines, penalties and legal fees) incurred due
to the violation by Landlord, its employees, agents, contractors or
assigns of the terms and conditions of the Lease, or any valid, applicable
building code, governmental rule, regulation or law; (ix) except for the
referenced management compensation, any overhead or profit increments to
any subsidiary or affiliate of Landlord for services on or to the
Building, to the extent that the costs of such services exceed competitive
costs for such services; (x) the cost of constructing tenant improvements
for Tenant or any other tenant of the Building or Project; (xi) Operating
Expenses specially charged to and paid by any other tenant of the Building
or Project; (xii) the cost of special services, goods or materials
provided to any other tenant of the Building or Project (xiii) any cost
incurred by Landlord to test, survey, clean up, contain, abate, remove or
otherwise remedy any Hazardous Materials not caused or brought into the
Building by Tenant or any of Tenant's agents, assigns or invitees (as
defined in Section 9.6 herein) which was in violation of applicable laws
at time of introduction; (xiv) costs incurred by Landlord to rectify any
violation of the Americans with Disabilities Act of 1990 (including
amendments) which violation is in effect on the date hereof; (xv) other
than specifically with respect to Building operations,
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costs relating to maintaining Landlord's existence, either as a
corporation, partnership, or other entity such as trustee's fees,
annual fees, partnership or organization or administration expenses
and deed recordation expenses.
6.4. Determination and Payment of Tax Costs and Operating Expenses.
6.4.1. On or before the last day of each December during the Term of
this Lease, Landlord shall furnish to Tenant a written statement showing
in reasonable detail Landlord's projected Direct Costs for the succeeding
calendar year. If such statement of projected Direct Costs indicates the
Direct Costs will be higher than in the Base Year, then the Rent due from
Tenant hereunder for the next succeeding year shall be increased by an
amount equal to Tenant's Proportionate Share of the difference between the
projected Direct Costs for the calendar year and the Base Year. If during
the course of the calendar year Landlord determines that actual Direct
Costs will vary from its estimate by more than five percent (5%), Landlord
may deliver to Tenant a written statement showing Landlord's revised
estimate of Direct Costs. On the next payment date for Monthly
Installments of Rent following Tenant's receipt of either such statement,
Tenant shall pay to Landlord an additional amount equal to such monthly
Rent increase adjustment (as set forth on Landlord's statement).
Thereafter, the monthly Rent adjustment payments becoming due shall be in
the amount set forth in such projected Rent adjustment statement from
Landlord. Neither Landlord's failure to deliver nor late delivery of such
statement shall constitute a default by Landlord or a waiver of Landlord's
right to any Rent adjustment provided for herein.
6.4.2. On or before the first day of each April during the Term of
this Lease, Landlord shall furnish to Tenant a written statement of
reconciliation (the Reconciliation) showing in reasonable detail
Landlord's actual Direct Costs for the prior year, together with a full
statement of any adjustments necessary to reconcile any sums paid as
estimated Rent adjustments during the prior year with those sums actually
payable for such prior year. In the event such Reconciliation shows that
additional sums are due from Tenant, Tenant shall pay such sums to
Landlord within thirty (30) days of receipt of such Reconciliation. In the
event such Reconciliation shows that a credit is due Tenant, such credit
shall be credited against the sums next becoming due from Tenant, unless
this Lease has expired or been terminated pursuant to the terms hereof
(and all sums due Landlord have been paid), in which event such sums shall
be refunded to Tenant. Neither Landlord's failure to deliver nor late
delivery of such Reconciliation to Tenant by April first shall constitute
a default by Landlord or operate as a waiver of Landlord's right to
collect all Rent due hereunder.
6.4.3. So long as Tenant is not in default under the terms of the
Lease and provided Notice of Tenant's request is given to Landlord within
thirty (30) days after Tenant's receipt of the Reconciliation, Tenant may
inspect Landlord's Reconciliation accounting records relating to Direct
Costs at Landlord's corporate office, during normal business hours, for
the purpose of verifying the charges contained in such statement. The
audit must be completed within sixty (60) days of Landlord's receipt of
Tenant's Notice, unless such period is extended by Landlord (in Landlord's
reasonable discretion). Before conducting any audit however, Tenant must
pay in full the amount of Direct Costs billed. Tenant may only review
those records that specifically relate to Direct Costs. Tenant may not
review any other leases or Landlord's tax returns or financial statements.
In conducting an audit, Tenant must utilize an independent certified
public accountant experienced in auditing records related to commercial
property operations. The proposed accountant is subject to Landlord's
reasonable prior approval. The audit shall be conducted in accordance with
generally accepted rules of auditing practices. Tenant may not conduct an
audit more often than once each calendar year. Tenant may audit records
relating to a calendar year only one time. No audit shall cover a period
of time other than the calendar year from which Landlord's Reconciliation
was generated. Upon receipt thereof, Tenant shall deliver to Landlord a
copy of the audit report and all accompanying data. Tenant and Tenant's
auditor shall keep confidential any agreements involving the rights
provided in this section and the results of any audit conducted hereunder.
As a condition precedent to Tenant's right to conduct an audit, Tenant's
auditor shall sign a confidentiality agreement in a form reasonably
acceptable to Landlord. However, Tenant shall be permitted to furnish
information to its attorneys, accountants and auditors to the extent
necessary to perform their respective services for Tenant. In the event
Tenant's audit of Landlord's books and records reveals an error in
Landlord's computation of Direct Costs such that Direct Costs for the
Building for the year in question were overstated in an amount greater
than five percent (5%) Landlord shall promptly reimburse Tenant for the
reasonable costs expended by Tenant in performing such audit, excluding
travel expenses. If such audit reveals that Landlord has over-charged
Tenant, then Landlord shall promptly reimburse to Tenant the amount of
such over-charge.
6.5. Definition of Rent. All costs and expenses other than Base Rent, that
Tenant assumes or agrees or is obligated to pay to Landlord under this Lease
shall be deemed Additional Rent (which, together with the Base Rent, is
sometimes referred to as Rent).
6.6. Taxes on Tenant's Use and Occupancy. In addition to the Rent and any
other charges to be paid by Tenant hereunder, Tenant shall pay Landlord upon
demand for any and all taxes payable by Landlord (other than net income taxes)
which are not otherwise reimbursable under this Lease, whether or not now
customary or within the contemplation of the parties, where such taxes are upon,
measured by or reasonably attributable to (a) the cost or value of Tenant's
equipment, furniture, fixtures and other personal property located in the
Premises, or the cost or value of any leasehold improvements made in or to the
Page 5
Premises by or for Tenant, other than Building Standard Tenant Improvements made
by Landlord, regardless of whether title to such improvements is held by Tenant
or Landlord; (b) the gross or net Rent payable under this Lease, including,
without limitation, any rental or gross receipts tax levied by any taxing
authority with respect to the receipt of the Rent hereunder; (c) the possession,
leasing, operation, management, maintenance, alteration, repair, use or
occupancy by Tenant of the Premises or any portion thereof; or (d) this
transaction or any document to which Tenant is a party creating or transferring
an interest or an estate in the Premises. If it becomes unlawful for Tenant to
reimburse Landlord for any costs as required under this Lease, the Base Rent
shall be revised to net Landlord the same net Rent after imposition of any tax
or other charge upon Landlord as would have been payable to Landlord but for the
reimbursement being unlawful.
7. LATE CHARGES.
If Tenant fails to pay when due any Rent or other amounts or charges which
Tenant is obligated to pay under the terms of this Lease, then Tenant shall pay
Landlord a late charge equal to ten percent (10%) of each such installment if
any such installment is not received by Landlord within five (5) days from the
date it is due. Tenant acknowledges that the late payment of any Rent will cause
Landlord to lose the use of that money and incur costs and expenses not
contemplated under this Lease including, without limitation, administrative
costs and processing and accounting expenses, the exact amount of which is
extremely difficult to ascertain. Landlord and Tenant agree that this late
charge represents a reasonable estimate of such costs and expenses and is fair
compensation to Landlord for the loss suffered as a result of such late payment
by Tenant. However, the late charge is not intended to cover Landlord's
attorneys' fees and costs relating to delinquent Rent. Acceptance of any late
charge shall not constitute a waiver of Tenant's default with respect to such
late payment by nor prevent Landlord from exercising any other rights or
remedies available to Landlord under this Lease. Late charges are deemed
Additional Rent.
In no event shall this provision for the imposition of a late charge be deemed
to grant to Tenant a grace period or an extension of time within which to pay
any Rent due hereunder or prevent Landlord from exercising any right or remedy
available to Landlord upon Tenant's failure to pay such Rent when due.
8. SECURITY DEPOSIT.
Upon execution of this Lease, Tenant agrees to deposit with Landlord a Security
Deposit in the amount set forth in Section 2.16. as security for Tenant's
performance of its obligations under this Lease. Landlord and Tenant agree that
the Security Deposit may be commingled with funds of Landlord and Landlord shall
have no obligation or liability for payment of interest on such deposit. Tenant
shall not mortgage, assign, transfer or encumber the Security Deposit without
the prior written consent of Landlord and any attempt by Tenant to do so shall
be void, without force or effect and shall not be binding upon Landlord.
If Tenant fails to timely pay any Rent or other amount due under this Lease, or
fails to perform any of the terms hereof, Landlord may, at its option and
without prejudice to any other remedy which Landlord may have, appropriate and
apply or use all or any portion of the Security Deposit for Rent payments or any
other amount then due and unpaid, for payment of any amount for which Landlord
has become obligated as a result of Tenant's default or breach, and for any loss
or damage sustained by Landlord as a result of Tenant's default or breach. If
Landlord so uses any of the Security Deposit, Tenant shall, within ten (10)
business days after written demand therefor, restore the Security Deposit to the
full amount originally deposited. Tenant's failure to do so shall constitute an
act of default hereunder and Landlord shall have the right to exercise any
remedy provided for in Section 19 hereof.
If Tenant defaults under this Lease more than two (2) times during any calendar
year, irrespective of whether such default is cured, then, without limiting
Landlord's other rights and remedies, Landlord may, in Landlord's sole
discretion, modify the amount of the required Security Deposit. Within ten (10)
business days after Notice of such modification, Tenant shall submit to Landlord
the required additional sums. Tenant's failure to do so shall constitute an act
of default, and Landlord shall have the right to exercise any remedy provided
for in Section 19 hereof.
If Tenant complies with all of the terms and conditions of this Lease, and
Tenant is not in default on any of its obligations hereunder, then upon the
earlier of (i) thirty (30) days from the Expiration Date or (ii) within the time
period statutorily prescribed after Tenant vacates the Premises, Landlord shall
return to Tenant (or, at Landlord's option, to the last subtenant or assignee of
Tenant's interest hereunder) the Security Deposit less any expenditures made by
Landlord to repair damages to the Premises caused by Tenant and to clean the
Premises upon expiration or earlier termination of this Lease.
9. TENANT'S USE OF THE PREMISES.
The provisions of this Section are for the benefit of the Landlord and are not
nor shall they be construed to be for the benefit of any tenant of the Building
or Project.
9.1. Use. Tenant shall use the Premises solely for the purposes set forth
in Section 2.20. No change in the Use of the Premises shall be permitted, except
as provided in this Section 9.
Page 6
9.1.1. If, at any time during the Term hereof, Tenant desires to
change the Use of the Premises, including any change in Use associated
with a proposed assignment or sublet of the Premises, Tenant shall provide
Notice to Landlord of its request for approval of such proposed change in
Use. Tenant shall promptly supply Landlord with such information
concerning the proposed change in Use as Landlord may reasonably request.
Landlord shall have the right to approve such proposed change in Use,
which approval shall not be unreasonably withheld. Landlord's consent to
any change in Use shall not be construed as a consent to any subsequent
change in Use.
9.2. Observance of Law. Tenant shall not use or occupy the Premises or
permit anything to be done in or about the Premises in violation of any
declarations, covenant, condition or restriction, or law, statute, ordinance or
governmental rules, regulations or requirements now in force or which may
hereafter be enacted or promulgated. Tenant shall, at its sole cost and expense,
upon Notice from Landlord, immediately discontinue any use of the Premises which
is declared by any governmental authority having jurisdiction to be a violation
of law or of the Certificate of Occupancy. Tenant shall promptly comply, at its
sole cost and expense, with all laws, statutes, ordinances and governmental
rules, regulations or requirements now in force or which may hereafter be
imposed which shall by reason of Tenant's Use or occupancy of the Premises,
impose any duty upon Tenant or Landlord with respect to Tenant's Use or
occupation. Further, Tenant shall, at Tenant's sole cost and expense, bring the
Premises into compliance with all such laws, including the Americans With
Disabilities Act of 1990, as amended (ADA), whether or not the necessity for
compliance is triggered by Tenant's Use, and Tenant shall make, at its sole cost
and expense, any changes to the Premises required to accommodate Tenant's
employees with disabilities (any work performed pursuant to this Section shall
be subject to the terms of Section 12. hereof). Landlord agrees to construct the
Landlord's Work to be performed in the Premises pursuant to Section 12.1 of this
Lease (subject to the Allowance), in compliance with all applicable laws,
including the ADA. The judgment of any court of competent jurisdiction or the
admission by Tenant in any action or proceeding against Tenant, whether Landlord
is a party thereto or not, that Tenant has violated any such law, statute,
ordinance, or governmental regulation, rule or requirement in the use or
occupancy of the Premises, Building or Project shall be conclusive of that fact
as between Landlord and Tenant. Landlord, at its sole cost and expense (except
to the extent properly included in Operating Expenses), shall be responsible for
correcting any violations of the ADA with respect to the Premises and the Common
Areas of the Building, provided that Landlord's obligation with respect to the
Premises shall be limited to violations that arise out of the Landlord's Work
(as defined in Section 37 of the Addendum) to be performed pursuant to Exhibit
"D" attached hereto and/or the condition of the Premises prior to the
installation of any furniture, equipment and other personal property to Tenant.
Notwithstanding the foregoing, Landlord may contest any alleged violations,
including, without limitation, the right to apply for and obtain a waiver or
deferment of compliance, may assert any and all defenses permitted by law and
may appeal any decisions, judgments or rulings as permitted by law.
9.3. Insurance. Tenant shall not do or permit to be done anything which
will contravene, invalidate or increase the cost of any insurance policy
covering the Building or Project and/or property located therein, and shall
comply with all rules, orders, regulations, requirements and recommendations of
Landlord's insurance carrier(s) or any board of fire insurance underwriters or
other similar body now or hereafter constituted, relating to or affecting the
condition, use or occupancy of the Premises, excluding structural changes not
related to or affected by Tenant's improvements or acts. Tenant shall promptly
upon demand reimburse Landlord for any additional premium charged for violation
of this Section.
9.4. Nuisance and Waste. Tenant shall not do or permit anything to be done
in or about the Premises which will in any way obstruct or interfere with the
rights of other tenants or occupants of the Building or Project, or injure or
annoy them, or use or allow the Premises to be used for any improper, unlawful
or objectionable purpose. Tenant shall not cause, maintain or permit any
nuisance in, on or about the Premises. Tenant shall not commit or suffer to be
committed any waste in or upon the Premises.
9.5. Load and Equipment Limits. Tenant shall not place a load upon any
floor of the Premises which exceeds the load per square foot which such floor
was designed to carry as determined by Landlord or Landlord's structural
engineer. The cost of any such determination made by Landlord's structural
engineer in connection with Tenant's occupancy shall be paid by Tenant upon
Landlord's demand. Tenant shall not install business machines or mechanical
equipment which will in any manner cause noise objectionable to or injure other
tenants in the Project. Tenant shall have reasonable access to two (2) shared
loading docks located on the first (1st) floor of the Premises.
9.6. Hazardous Material. Unless Tenant obtains the prior written consent
of Landlord, Tenant shall not create, generate, use, bring, allow, emit,
dispose, or permit on the Premises, Building or Project any toxic or hazardous
gaseous, liquid, or solid material or waste, or any other hazardous material
defined or listed in any applicable federal, state or local law, rule,
regulation or ordinance ("Hazardous Material"). If Landlord grants its consent,
Tenant shall comply with all applicable laws with respect to such Hazardous
Material, including all laws affecting the use, storage and disposal thereof. If
the presence of any Hazardous Material brought to the Premises, Building or
Project by Tenant or Tenant's employees, agent or contractors results in
contamination, Tenant shall promptly take all actions necessary, at Tenant's
sole cost and expense, to remediate the contamination and restore the Premises,
Building or Project to the condition that existed before introduction of such
Hazardous Material. Tenant shall first obtain Landlord's approval of the
proposed remedial action and shall keep Landlord informed during the process of
remediation.
Page 7
Tenant shall indemnify, defend and hold Landlord harmless from any claims,
liabilities, costs or expenses incurred or suffered by Landlord arising from
such bringing, allowing, using, permitting, generating, creating, emitting, or
disposing of toxic or Hazardous Material whether or not consent to same has been
granted by Landlord. Tenant's duty to defend, hold-harmless and indemnify
Landlord hereunder shall survive the expiration or termination of this Lease.
The consent requirement contained herein shall not apply to ordinary office
products that may contain de minimis quantities of Hazardous Material; however,
Tenant's indemnification obligations are not diminished with respect to the
presence of such products. Tenant acknowledges that Tenant has an affirmative
duty to immediately notify Landlord of any release or suspected release of
Hazardous Material in the Premises or on or about the Project.
Landlord represents that, to its actual knowledge and without the requirement of
further investigation, any emission, handling, transportation, storage,
treatment or usage of hazardous materials that has occurred on the Premises
prior to the execution date of the Lease has been substantially in compliance
with all applicable federal state, and local laws, regulations and ordinances.
Notwithstanding the foregoing, Landlord shall indemnify Tenant for any damages,
costs, liability, etc. to the extent arising from any hazardous materials
existing in the Premises as of the date of execution hereof, as well as any
hazardous materials introduced onto the Premises by Landlord after the date of
execution of the Lease.
Medical waste and any other waste, the removal of which is regulated, shall be
contracted for and disposed of by Tenant, at Tenant's expense, in accordance
with all applicable laws and regulations. No material shall be placed in Project
trash boxes, receptacles or Common Areas if the material is of such a nature
that it cannot be disposed of in the ordinary and customary manner of removing
and disposing of trash and garbage in the State without being in violation of
any law or ordinance.
10. SERVICES AND UTILITIES.
Landlord agrees to furnish services and utilities to the Premises during normal
business hours on generally recognized business days subject to the Rules and
Regulations of the Building or Project and provided that Tenant is not in
default hereunder. Services and utilities shall include reasonable quantities of
electricity, heating, ventilation and air conditioning (HVAC) as required in
Landlord's reasonable judgment for the comfortable use and occupancy of the
Premises; lighting replacement for building standard lights; window washing and
janitor services in a manner that such services are customarily furnished to
comparable office buildings in the area. Landlord shall supply common area water
for drinking, cleaning and restroom purposes only. Tenant, at Tenant's sole cost
and expense, shall supply all paper and other products used within the Premises.
During normal business hours on generally recognized business days, Landlord
shall also maintain and keep lighted the common stairs, common entries and
restrooms in the Building and shall furnish elevator service and restroom
supplies. Landlord may provide telecommunications lines and systems as discussed
in Section 35, hereof. Landlord represents that it previously replaced two (2)
of the roof top HVAC units and that Landlord shall replace the two (2)
non-dedicated primary rooftop HVAC units within two (2) years of the date of
execution of this Lease, at Landlord's sole cost and expense.
If permitted by law, Landlord shall have the right, in Landlord's reasonable
discretion, at any time and from time to time during the Term, to contract for
the provision of electricity (or any other utility) with, and to switch from,
any company providing such utility. Tenant shall cooperate with Landlord and any
such utility provider at all times, and, as reasonably necessary, Tenant shall
allow such parties access to the electric (or other utility) lines, feeders,
risers, wiring and other machinery located within the Premises.
Landlord shall not be in default hereunder or be liable for any damages directly
or indirectly resulting from, nor shall Rent be abated by reason of (a) the
installation, use or interruption of use of any equipment in connection with the
furnishing of any of the foregoing services, or (b) failure to furnish or delay
in furnishing any such services where such failure or delay is caused by
accident or any condition or event beyond the reasonable control of Landlord, or
by the making of necessary repairs or improvements to the Premises, Building or
Project, or (c) any change, failure, interruption, disruption or defect in the
quantity or character of the electricity (or other utility) supplied to the
Premises or Project, or (d) the limitation, curtailment or rationing of, or
restrictions on, use of water, electricity, gas or any other form of energy
serving the Premises, Building or Project. Landlord shall not be liable under
any circumstances for a loss of or injury to property or business, however
occurring, through, in connection with or incidental to the failure to furnish
any such services. Notwithstanding the foregoing, if the HVAC and electrical
services Landlord is required to provide to the Premises hereunder are not
provided to the Premises for a period of more than five (5) consecutive days
following Landlord's notice from Tenant of the absence of such service(s), and
if a materially adverse effect on Tenant's ability to conduct its business in
the Premises results from the absence of such service(s), such that Tenant is
prevented from using and does not use the Premises or any portion thereof, then
all rental under this Lease shall abate starting of the sixth (6th) consecutive
day and continuing during the period such service(s) is not provided in
proportion to the portion of the Premises that Tenant is prevented from using
and does not use and such abatement shall continue until such date and time as
such service(s) is re-established.
Tenant shall not, without the prior written consent of Landlord, use any
apparatus or device in the Premises, including, without limitation, electronic
data processing machines, punch card machines, word processing equipment,
personal computers, or machines using in excess of 220 volts, which consumes
more electricity than is usually furnished or supplied for the use of desk top
office equipment and photocopy equipment ordinarily in use in premises
designated as general office space, as determined by Landlord.
Page 8
Tenant shall not connect any apparatus to electric current except through
existing electrical outlets in the Premises.
Notwithstanding anything contained herein to the contrary, if Tenant is granted
the right to purchase electricity from a provider other than the company or
companies used by Landlord, Tenant shall indemnify, defend, and hold harmless
Landlord from and against all losses, claims, demands, expenses and judgments
caused by, or directly or indirectly arising from, the acts or omissions of
Tenant's electricity provider (including, but not limited to, expenses and/or
fines incurred by Landlord in the event Tenant's electricity provider fails to
provide sufficient power to the Premises, as well as damages resulting from the
improper or faulty installation or construction of facilities or equipment in or
on the Premises by Tenant or Tenant's electricity provider.
Tenant acknowledges and agrees that separate metering of utilities is currently
furnished to the Premises and accounts for all such separately metered utilities
shall be in Tenant's name and paid for by Tenant.
If Tenant uses heat generating machines or equipment in the Premises that
affects the temperature otherwise maintained by the HVAC 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 therefor.
Tenant shall not dispose of more than five (5) gallons of water from
manufacturing operations in any consecutive three (3) hour time period.
11. REPAIRS AND MAINTENANCE.
11.1. Landlord's Obligations. Landlord shall make structural repairs
except as specified herein and shall maintain in good order, condition and
repair the Building and all other portions of the Premises not the obligation of
Tenant or of any other tenant in the Building. If applicable, Landlord shall
also maintain in good order, condition and repair the ICN, the cost of which is
a reimbursable expense unless responsibility therefor is assigned to a
particular tenant.
11.2. Tenant's Obligations.
11.2.1. Tenant shall, at Tenant's sole expense and except for
services furnished by Landlord pursuant to Section 10. hereof, maintain
the Premises in good order, condition and repair. For the purposes of this
Section 11.2.1., the term Premises shall be deemed to include all items
and equipment installed by or for the benefit of or at the expense of
Tenant, including without limitation the interior surfaces of the
ceilings, walls and floors; all doors; all interior and exterior windows;
dedicated heating, ventilating and air conditioning equipment; all
plumbing, pipes and fixtures; electrical switches and fixtures; internal
wiring as it connects to the ICN, if applicable; and Building Standard
Tenant Improvements, if any.
11.2.2. Tenant shall be responsible for all repairs and alterations
in and to the Premises, Building and Project and the facilities and
systems thereof to the satisfaction of Landlord, the need for which arises
out of (a) Tenant's use or occupancy of the Premises, (b) the
installation, removal, use or operation of Tenant's Property (as defined
in Section 13.) in the Premises, (c) the moving of Tenant's Property into
or out of the Building, or (d) the act, omission, misuse or negligence of
Tenant, its agents, contractors, employees or invitees.
11.2.3. If Tenant fails to maintain the Premises in good order,
condition and repair, Landlord shall give Notice to Tenant to do such acts
as are reasonably required to so maintain the Premises. If Tenant fails to
promptly commence such work and diligently prosecute it to completion,
then Landlord shall have the right to do such acts and expend such funds
at the expense of Tenant as are reasonably required to perform such work.
11.3. Compliance with Law. Landlord and Tenant shall each do all acts
necessary to comply with all applicable laws, statutes, ordinances, and rules of
any public authority relating to their respective maintenance obligations as set
forth herein. The provisions of Section 9.2. are deemed restated here.
11.4. Notice of Defect. If it is Landlord's obligation to repair, Tenant
shall give Landlord prompt Notice, regardless of the nature or cause, of any
damage to or defective condition in any part or appurtenance of the Building's
mechanical, electrical, plumbing, HVAC or other systems serving, located in, or
passing through the Premises.
11.5. Landlord's Liability. Except as otherwise expressly provided in this
Lease, Landlord shall have no liability to Tenant nor shall Tenant's obligations
under this Lease be reduced or abated in any manner by reason of any
inconvenience, annoyance, interruption or injury to business arising from
Landlord's making any repairs or changes which Landlord is required or permitted
by this Lease or by any other tenant's lease or required by law to make in or to
any portion of the Project, Building or Premises. Landlord shall nevertheless
use reasonable efforts to minimize any interference with Tenant's conduct of its
business in the Premises.
Page 9
12. CONSTRUCTION, ALTERATIONS AND ADDITIONS.
12.1. Landlord's Construction Obligations. Landlord shall perform
Landlord's Work to the Premises as described in Exhibit "D".
12.2. Tenant's Construction Obligations. NONE.
12.3. Tenant's Alterations and Additions. Except as provided in Section
12.2. above, Tenant shall not make any other additions, alterations or
improvements to the Premises without obtaining the prior written consent of
Landlord. Landlord's consent may be conditioned, without limitation, on Tenant
removing any such additions, alterations or improvements upon the expiration of
the Term and restoring the Premises to the same condition as on the date Tenant
took possession. All of Tenant's Work described in Exhibit "D", as well as any
addition, alteration or improvement, shall comply with all applicable laws,
ordinances, codes and rules of any public authority (including, but not limited
to the ADA) and shall be done in a good and professional manner by properly
qualified and licensed personnel approved by Landlord. All work shall be
diligently prosecuted to completion. Upon completion, Tenant shall furnish
Landlord "as-built" plans. Prior to commencing any such work, Tenant shall
furnish Landlord with plans and specifications; names and addresses of
contractors; copies of all contracts; copies of all necessary permits; evidence
of contractor's and subcontractor's insurance coverage for Builder's Risk at
least as broad as Insurance Services Office (ISO) special causes of loss form CP
10 30, Commercial General Liability at least as broad as ISO CG 00 01, workers'
compensation, employer's liability and auto liability, all in amounts reasonably
satisfactory to Landlord; and indemnification in a form reasonably satisfactory
to Landlord. The work shall be performed in a manner that will not interfere
with the quiet enjoyment of the other tenants in the Building in which the
Premises is located.
Landlord may require, in Landlord's sole discretion and at Tenant's sole
cost and expense, that Tenant provide Landlord with a lien and completion bond
in an amount equal to at least one and one-half (1-1/2) times the total
estimated cost of any additions, alterations or improvements to be made in or to
the Premises. Nothing contained in this Section 12.3. shall relieve Tenant of
its obligation under Section 12.4. to keep the Premises, Building and Project
free of all liens.
12.4. Payment. Tenant shall pay the costs of any work done on the Premises
pursuant to Sections 12.2. and 12.3., and shall keep the Premises, Building and
Project free and clear of liens of any kind. Tenant hereby indemnifies, and
agrees to defend against and keep Landlord free and harmless from all liability,
loss, damage, costs, attorneys' fees and any other expense incurred on account
of claims by any person performing work or furnishing materials or supplies for
Tenant or any person claiming under Tenant.
Tenant shall give Notice to Landlord at least ten (10) business days prior
to the expected date of commencement of any work relating to alterations,
additions or improvements to the Premises. Landlord retains the right to enter
the Premises and post such notices as Landlord deems proper at any reasonable
time.
12.5. Property of Landlord. Except as otherwise set forth herein, all
additions, alterations and improvements made to the Premises shall become the
property of Landlord and shall be surrendered with the Premises upon the
expiration of the Term unless their removal is required by Landlord as provided
in Section 12.3., provided, however, Tenant's equipment, machinery and trade
fixtures shall remain the Property of Tenant and shall be removed, subject to
the provisions of Section 12.2.
13. LEASEHOLD IMPROVEMENTS; TENANT'S PROPERTY.
13.1. Leasehold Improvements. All fixtures, equipment (including
air-conditioning or heating systems), improvements and appurtenances attached to
or built into the Premises at the commencement or during the Term of the Lease
(Leasehold Improvements), whether or not by or at the expense of Tenant, shall
be and remain a part of the Premises, shall be the property of Landlord and
shall not be removed by Tenant, except as expressly provided in Section 12.5 and
13.2. unless Landlord, by Notice to Tenant not later than thirty (30) days
prior to the expiration of the Term, elects to have Tenant remove any Leasehold
Improvements installed by Tenant. In such case, Tenant, at Tenant's sole cost
and expense and prior to the expiration of the Term, shall remove the Leasehold
Improvements and repair any damage caused by such removal.
13.2. Tenant's Property. All signs, notices, displays, movable partitions,
business and trade fixtures, machinery and equipment (excluding air-conditioning
or heating systems, whether installed by Tenant or not), personal
telecommunications equipment and office equipment located in the Premises and
acquired by or for the account of Tenant, without expense to Landlord, which can
be removed without structural damage to the Building, and all furniture,
furnishings and other articles of movable personal property owned by Tenant and
located in the Premises (collectively, Tenant's Property) shall be and shall
remain the property of Tenant and may be removed by Tenant at any time during
the Term; provided that if any of Tenant's Property is removed, Tenant shall
promptly repair any damage to the Premises or to the Building resulting from
such removal, including without limitation repairing the flooring and patching
and painting the walls where required by Landlord to Landlord's reasonable
satisfaction, all at Tenant's sole cost and expense.
Page 10
14. INDEMNIFICATION.
14.1. Tenant Indemnification. Tenant shall indemnify and hold Landlord
harmless from and against any and all liability and claims of any kind for loss
or damage to any person or property arising out of: (a) Tenant's use and
occupancy of the Premises, or the Building or Project, or any work, activity or
thing done, allowed or suffered by Tenant in, on or about the Premises, the
Building or the Project; (b) any breach or default by Tenant of any of Tenant's
obligations under this Lease; or (c) any negligent or otherwise tortious act or
omission of Tenant, its agents, employees, subtenants, licensees, customers,
guests, invitees or contractors (including agents or contractors who perform
work outside of the Premises for Tenant). At Landlord's request, Tenant shall,
at Tenant's expense, and by counsel satisfactory to Landlord, defend Landlord in
any action or proceeding arising from any such claim. Tenant shall indemnify
Landlord against all costs, attorneys' fees, expert witness fees and any other
expenses or liabilities incurred in such action or proceeding. As a material
part of the consideration for Landlord's execution of this Lease, Tenant hereby
assumes all risk of damage or injury to any person or property in, on or about
the Premises from any cause and Tenant hereby waives all claims in respect
thereof against Landlord, except in connection with damage or injury resulting
solely from the gross negligence or willful misconduct of Landlord or its
authorized agents.
14.2. Landlord Not Liable. Landlord shall not be liable for injury or
damage which may be sustained by the person or property of Tenant, its
employees, invitees or customers, or any other person in or about the Premises,
caused by or resulting from fire, steam, electricity, gas, water or rain which
may leak or flow from or into any part of the Premises, or from the breakage,
leakage, obstruction or other defects of pipes, sprinklers, wires, appliances,
plumbing, air conditioning, lighting fixtures or mechanical or electrical
systems, whether such damage or injury results from conditions arising upon the
Premises or upon other portions of the Building or Project or from other
sources, unless the condition was the sole result of Landlord's gross negligence
or willful misconduct. Landlord shall not be liable for any damages arising from
any act or omission of any other tenant of the Building or Project or for the
acts of persons in, on or about the Premises, Building or the Project who are
not the authorized agents of Landlord or for losses due to theft, vandalism or
like causes.
Tenant acknowledges that Landlord's election to provide mechanical surveillance
or to post security personnel in the Building or on the Project is solely within
Landlord's discretion. Landlord shall have no liability in connection with the
decision whether or not to provide such services, and, to the extent permitted
by law, Tenant hereby waives all claims based thereon.
15. TENANT'S INSURANCE.
15.1.Insurance Requirement. Tenant shall procure and maintain insurance
coverage in accordance with the terms hereof, either as specific policies or
within blanket policies. Coverage shall begin on the date Tenant is given access
to the Premises for any purpose and shall continue until expiration of the Term,
except as otherwise set forth in the Lease. The cost of such insurance shall be
borne by Tenant.
Insurance shall be with insurers licensed to do business in the State, and
acceptable to Landlord. The insurers must have a current A.M. Best's rating of
not less than A: VII, or equivalent (as reasonably determined by Landlord) if
the Best's rating system is discontinued.
Tenant shall furnish Landlord with original certificates and amendatory
endorsements effecting coverage required by this Section 15. before the date
Tenant is first given access to the Premises. All certificates and endorsements
are to be received and approved by Landlord before any work commences. Landlord
reserves the right to inspect and/or copy any insurance policy required to be
maintained by Tenant hereunder, or to require complete, certified copies of all
required insurance policies, including endorsements effecting the coverage
required herein at any time. Tenant shall comply with such requirement within
thirty (30) days of demand therefor by Landlord. Tenant shall furnish Landlord
with renewal certificates and amendments or a "binder" of any such policy at
least twenty (20) days prior to the expiration thereof. Each insurance policy
required herein shall be endorsed to state that coverage shall not be canceled,
except after thirty (30) days prior written notice to Landlord and Landlord's
lender (if such lender's address is provided).
The Commercial General Liability policy, as hereinafter required, shall contain,
or be endorsed to contain, the following provisions: (a) Landlord and any
parties designated by Landlord shall be covered as additional insureds as their
respective interests may appear; and (b) Tenant's insurance coverage shall be
primary insurance as to any insurance carried by the parties designated as
additional insureds. Any insurance or self-insurance maintained by Landlord
shall be excess of Tenant's insurance and shall not contribute with it.
15.2.Minimum Scope of Coverage. Coverage shall be at least as broad as set
forth herein. However, if, because of Tenant's Use or occupancy of the Premises,
Landlord determines, in Landlord's reasonable judgment, that additional
insurance coverage or different types of insurance are necessary, then Tenant
shall obtain such insurance at Tenant's expense in accordance with the terms of
this Section 15.
15.2.1. Commercial General Liability (ISO occurrence form CG 00 01)
which shall cover liability arising from Tenant's Use and occupancy of the
Premises, its operations therefrom, Tenant's independent contractors,
products-completed operations, personal injury and advertising injury, and
liability assumed under an insured contract.
Page 11
15.2.2. Workers' Compensation insurance as required by law, and
Employers Liability insurance.
15.2.3. Commercial Property Insurance (ISO special causes of loss
form CP 10 30) against all risk of direct physical loss or damage
(including flood, if applicable), earthquake excepted, for: (a) all
leasehold improvements (including any alterations, additions or
improvements made by Tenant pursuant to the provisions of Section 12.
hereof) in, on or about the Premises; and (b) trade fixtures, merchandise
and Tenant's Property from time to time in, on or about the Premises. The
proceeds of such property insurance shall be used for the repair or
replacement of the property so insured. Upon termination of this Lease
following a casualty as set forth herein, the proceeds under (a) shall be
paid to Landlord, and the proceeds under (b) above shall be paid to
Tenant.
15.2.4. Business Auto Liability.
Landlord shall, during the Term hereof, maintain in effect similar insurance on
the Building and Common Area.
15.2.5. Business Interruption and Extra Expense Insurance.
15.3. Minimum Limits of Insurance. Tenant shall maintain limits not less
than:
15.3.1. Commercial General Liability: $1,000,000 per occurrence. If
the insurance contains a general aggregate limit, either the general
aggregate limit shall apply separately to this location or the general
aggregate limit shall be at least twice the required occurrence limit.
15.3.2. Employer's Liability: $1,000,000 per accident for bodily
injury or disease.
15.3.3. Commercial Property Insurance: 100% replacement cost with no
coinsurance penalty provision.
15.3.4. Business Auto Liability: $1,000,000 per accident.
15.3.5. Business Interruption and Extra Expense Insurance: In a
reasonable amount and comparable to amounts carried by comparable tenants
in comparable projects.
15.4. Deductible and Self-Insured Retention. Any deductible or
self-insured retention in excess of $25,000 per occurrence must be declared to
and approved by Landlord. At the option of Landlord, either the insurer shall
reduce or eliminate such deductible or self-insured retention or Tenant shall
provide separate insurance conforming to this requirement.
15.5. Increases in Insurance Policy Limits. If the coverage limits set
forth in this Section 15. are deemed inadequate by Landlord or Landlord's
lender, then Tenant shall increase the coverage limits to the amounts reasonably
recommended by either Landlord or Landlord's lender. Landlord agrees that any
such required increases in coverage limits shall not occur more frequently than
once every three (3) years.
15.6. Waiver of Subrogation. Landlord and Tenant each hereby waive all
rights of recovery against the other and against the officers, employees, agents
and representatives, contractors and invitees of the other, on account of loss
by or damage to the waiving party or its property or the property of others
under its control, to the extent that such loss or damage is insured against
under any insurance policy which may have been in force at the time of such loss
or damage.
15.7. Landlord's Right to Obtain Insurance for Tenant. If Tenant is in
default for failing to obtain the insurance coverage or provide certificates and
endorsements as required by this Lease, Landlord may, at its option, obtain such
insurance for Tenant. Tenant shall pay, as Additional Rent, the reasonable cost
thereof together with a twenty-five percent (25%) service charge.
16. DAMAGE OR DESTRUCTION.
16.1. Damage. If, during the Term of this Lease, the Premises or the
portion of the Building necessary for Tenant's occupancy is damaged by fire or
other casualty covered by fire and extended coverage insurance carried by
Landlord, Landlord shall promptly repair the damage provided (a) such repairs
can, in Landlord's opinion, be completed, under applicable laws and regulations,
within one hundred eighty (180) days of the date a permit for such construction
is issued by the governing authority, (b) insurance proceeds are available to
pay eighty percent (80%) or more of the cost of restoration, and (c) Tenant
performs its obligations pursuant to Section 16.4, hereof. In such event, this
Lease shall continue in full force and effect, except that if such damage is not
the result of the negligence or willful misconduct of Tenant, its agents or
employees, Tenant shall be entitled to a proportionate reduction of Rent to the
extent Tenant's use of the Premises is impaired, commencing with the date of
damage and continuing until completion of the repairs required of Landlord under
Section 16.4. If the damage is due to the fault or neglect of Tenant, its agents
or employees and loss of rental income insurance is denied as a result, there
shall be no abatement of Rent.
Notwithstanding anything contained in the Lease to the contrary, in the
event of partial or total damage or destruction of the Premises during the last
twelve (12) months of the Term, either party shall
Page 12
have the option to terminate this Lease upon thirty (30) days prior Notice to
the other party provided such Notice is served within thirty (30) days after the
damage or destruction. For purposes of this Section 16.1., "partial damage or
destruction" shall mean the damage or destruction of at least thirty-three and
one-third percent (33 and 1/3%) of the Premises, as determined by Landlord in
Landlord's reasonable discretion.
16.2. Repair of Premises in Excess of One Hundred Eighty Days. If in
Landlord's opinion, such repairs to the Premises or portion of the Building
necessary for Tenant's occupancy cannot be completed under applicable laws and
regulations within one hundred eighty (180) days of the date a permit for such
construction is issued by the governing authority, Landlord may elect, upon
Notice to Tenant given within thirty (30) days after the date of such fire or
other casualty, to repair such damage, in which event this Lease shall continue
in full force and effect, but Rent shall be partially abated as provided in this
Section 1. If Landlord does not so elect to make such repairs, this Lease shall
terminate as of the date of such fire or other casualty.
16.3. Repair Outside Premises. If any other portion of the Building or
Project is totally destroyed or damaged to the extent that in Landlord's opinion
repair thereof cannot be completed under applicable laws and regulations within
one hundred eighty (180) days of the date a permit for such construction is
issued by the governing authority, Landlord may elect upon Notice to Tenant
given within thirty (30) days after the date of such fire or other casualty, to
repair such damage, in which event this Lease shall continue in full force and
effect, but Rent shall be partially abated as provided in this Section 16. If
Landlord does not elect to make such repairs, this Lease shall terminate as of
the date of such fire or other casualty.
16.4. Tenant Repair. If the Premises are to be repaired under this Section
16., Landlord shall repair at its cost any injury or damage to the Building and
Building Standard Tenant Improvements, if any. Notwithstanding anything
contained herein to the contrary, Landlord shall not be obligated to perform
work other than Landlord's Work performed previously pursuant to Section 12.1.
hereof. Tenant shall be responsible at its sole cost and expense for the repair,
restoration and replacement of any other Leasehold Improvements and Tenant's
Property (as well as reconstructing and reconnecting Tenant's internal
telecommunications wiring and related equipment). Landlord shall not be liable
for any loss of business, inconvenience or annoyance arising from any repair or
restoration of any portion of the Premises, Building or Project as a result of
any damage from fire or other casualty.
16.5. Election Not to Perform Landlord's Work. Notwithstanding anything to
the contrary contained herein, Landlord shall provide Notice to Tenant of its
intent to repair or replace the Premises (if Landlord elects to perform such
work), and, within ten (10) days of its receipt of such Notice, Tenant shall
provide Notice to Landlord of its intent to reoccupy the Premises. Should Tenant
fail to provide such Notice to Landlord, then such failure shall be deemed an
election by Tenant not to re-occupy the Premises and Landlord may elect not to
perform the repair or replacement of the Premises. Such election shall not
result in a termination of this Lease and all obligations of Tenant hereunder
shall remain in full force and effect, including the obligation to pay Rent.
16.6. Express Agreement. This Lease shall be considered an express
agreement governing any case of damage to or destruction of the Premises,
Building or Project by fire or other casualty, and any present or future law
which purports to govern the rights of Landlord and Tenant in such circumstances
in the absence of an express agreement shall have no application.
17. EMINENT DOMAIN.
17.1. Whole Taking. If the whole of the Building or Premises is lawfully
taken by condemnation or in any other manner for any public or quasi-public
purpose, this Lease shall terminate as of the date of such taking, and Rent
shall be prorated to such date.
17.2. Partial Taking. If less than the whole of the Building or Premises
is so taken, this Lease shall be unaffected by such taking, provided that (a)
Tenant shall have the right to terminate this Lease by Notice to Landlord given
within ninety (90) days after the date of such taking if twenty percent (20%) or
more of the Premises is taken and the remaining area of the Premises is not
reasonably sufficient for Tenant to continue operation of its business, and (b)
Landlord shall have the right to terminate this Lease by Notice to Tenant given
within ninety (90) days after the date of such taking. If either Landlord or
Tenant so elects to terminate this Lease, the Lease shall terminate on the
thirtieth (30th) calendar day after either such Notice. Rent shall be prorated
to the date of termination. If this Lease continues in force upon such partial
taking, Base Rent and Tenant's Proportionate Share shall be equitably adjusted.
17.3. Proceeds. In the event of any taking, partial or whole, all of the
proceeds of any award, judgment or settlement payable by the condemning
authority shall be the exclusive property of Landlord, and Tenant hereby assigns
to Landlord all of its right, title and interest in any award, judgment or
settlement from the condemning authority; however, Tenant shall have the right,
to the extent that Landlord's award is not reduced or prejudiced, to claim from
the condemning authority (but not from Landlord) such compensation as may be
recoverable by Tenant in its own right for relocation expenses and damage to
Tenant's Property and damage to Leasehold Improvements installed at the sole
expense of Tenant.
17.4. Landlord's Restoration. In the event of a partial taking of the
Premises which does not result in a termination of this Lease, Landlord shall
restore the remaining portion of the Premises as nearly as practicable to its
condition prior to the condemnation or taking; provided however, Landlord shall
not be
Page 13
obligated to perform work other than Landlord's Work performed previously
pursuant to Section 12.1. hereof. Tenant shall be responsible at its sole cost
and expense for the repair, restoration and replacement of Tenant's Property and
any other Leasehold Improvements.
18. ASSIGNMENT AND SUBLETTING.
No assignment of this Lease or sublease of all or any part of the Premises shall
be permitted, except as provided in this Section 18.
18.1. No Assignment or Subletting. Tenant shall not, without the prior
written consent of Landlord, assign or hypothecate this Lease or any interest
herein or sublet the Premises or any part thereof, or permit the use of the
Premises or any part thereof by any party other than Tenant. Any of the
foregoing acts without such consent shall be voidable and shall, at the option
of Landlord, constitute a default hereunder. This Lease shall not, nor shall any
interest of Tenant herein, be assignable by operation of law without the prior
written consent of Landlord.
18.1.1. For purposes of this Section 18., the following shall be
deemed an assignment:
18.1.1.1. If Tenant is a partnership, any withdrawal or
substitution (whether voluntary, involuntary, or by operation of
law, and whether occurring at one time or over a period of time) of
any partner(s) owning twenty-five (25%) or more (cumulatively) of
any interest in the capital or profits of the partnership, or the
dissolution of the partnership;
18.1.1.2. If Tenant is a corporation, any dissolution, merger,
consolidation, or other reorganization of Tenant, any sale or
transfer (or cumulative sales or transfers) of the capital
stock of Tenant in excess of twenty-five percent (25%), or
any sale (or cumulative sales) or transfer of fifty-one (51%)
or more of the value of the assets of Tenant provided,
however, the foregoing shall not apply to corporations the
capital stock of which is publicly traded. Notwithstanding the
foregoing, so long as Tenant's Use does not change. Tenant
shall have the right to assign the Lease without Landlord's
consent to: i) Tenant's wholly-owned subsidiary; ii) Tenant's
parent corporation, or subsidiary of parent corporation: iii)
the surviving entity if Tenant merges or consolidates (it
being agreed that such merger or consolidation shall be
permitted subject to the provisions of this clause (iii)),
provided that the surviving entity has a net worth at least
equal to that of Tenant prior to such merger or consolidation:
iv) in the event of a public offering of Tenant's shares on a
major national stock exchange, or (v) in the event of a sale
of substantially all assets of the Tenant. In the event of
such an assignment. Tenant shall provide Landlord prior
written notice of the assignment, which notice shall include
the identity of the assignee, the anticipated date of the
assignment and the forwarding address of the assignor, if
applicable. Nothing contained herein shall relieve Tenant (or
the assignor, as the case may be) of its obligations under the
Lease.
18.2. Landlord's Consent. If, at any time or from time to time during the
Term hereof, Tenant desires to assign this Lease or sublet all or any part of
the Premises, and if Tenant is not then in default under the terms of the Lease,
Tenant shall submit to Landlord a written request for approval setting forth the
terms and provisions of the proposed assignment or sublease, the identity of the
proposed assignee or subtenant, and a copy of the proposed form of assignment or
sublease. Tenant's request for consent shall be submitted to Landlord at least
thirty (30) days prior to the intended date of such transfer. Tenant shall
promptly supply Landlord with such information concerning the business
background and financial condition of such proposed assignee or subtenant as
Landlord may reasonably request. Landlord shall have the right to approve such
proposed assignee or subtenant, which approval shall not be unreasonably
withheld. In no event however, shall Landlord be required to consent to any
assignment or sublease (a) to an existing tenant in the Project or (b) that may
violate any restrictions contained in any mortgage, lease or agreement affecting
the Project. Landlord's consent to any assignment shall not be construed as a
consent to any subsequent assignment, subletting, transfer of partnership
interest or stock, occupancy or use.
18.2.1. Landlord's approval shall be conditioned, among other
things, on Landlord's receiving adequate assurances of future performance
under this Lease and any sublease or assignment. In determining the
adequacy of such assurances, Landlord may base its decision on such
factors as it deems appropriate, including but not limited to:
18.2.1.1. that the source of rent and other consideration due
under this Lease, and, in the case of assignment, that the financial
condition and operating performance and business experience of the
proposed assignee and its guarantors, if any, shall be equal to or
greater than the financial condition and operating performance and
experience of Tenant and its guarantors, if any, as of the time
Tenant became the lessee under this Lease;
18.2.1.2. that any assumption or assignment of this Lease will
not result in increased cost or expense, wear and tear, greater
traffic or demand for services and
Page 14
utilities provided by Landlord pursuant to Section 10. hereof and
will not disturb or be detrimental to other tenants of Landlord;
18.2.1.3. whether the proposed assignee's use of the Premises
will include the use of Hazardous Material, or will in any way
increase any risk to Landlord relating to Hazardous Material; and
18.2.1.4.
18.2.2. The assignment or sublease shall be on the same terms and
conditions set forth in the written request for approval given to
Landlord, or, if different, upon terms and conditions consented to by
Landlord;
18.2.3. No assignment or sublease shall be valid and no assignee or
sublessee shall take possession of the Premises or any part thereof until
an executed counterpart of such assignment or sublease has been delivered
to Landlord;
18.2.4. No assignee or sublessee shall have a further right to
assign or sublet except on the terms herein contained;
18.2.5. Any sums or other economic considerations received by Tenant
as a result of such assignment or subletting, however denominated under
the assignment or sublease, which exceed, in the aggregate (a) the total
sums which Tenant is obligated to pay Landlord under this Lease (prorated
to reflect obligations allocable to any portion of the Premises
subleased), plus (b) any real estate brokerage commissions or fees payable
to third parties in connection with such assignment or subletting, shall
be shared equally by Tenant and Landlord as Additional Rent under this
Lease without effecting or reducing any other obligations of Tenant
hereunder.
If Landlord consents to the proposed transfer, Tenant shall deliver to Landlord
three (3) fully executed original documents (in the form previously approved by
Landlord) and Landlord shall attach its consent thereto. Landlord shall retain
one (1) fully executed original document. No transfer of Tenant's interest in
this Lease shall be deemed effective until the terms and conditions of this
Section 18. have been fulfilled.
18.3. Tenant Remains Responsible. No subletting or assignment shall
release Tenant of Tenant's obligations under this Lease or alter the primary
liability of Tenant to pay the Rent and to perform all other obligations to be
performed by Tenant hereunder. The acceptance of Rent by Landlord from any other
person shall not be deemed to be a waiver by Landlord of any provision hereof.
Consent to one assignment or subletting shall not be deemed consent to any
subsequent assignment or subletting. In the event of default by an assignee or
subtenant of Tenant or any successor of Tenant in the performance of any of the
terms hereof, Landlord may proceed directly against Tenant without the necessity
of exhausting remedies against such assignee, subtenant or successor. Landlord
may consent to subsequent assignments or sublets of the Lease or amendments or
modifications to the Lease with assignees of Tenant, without notifying Tenant,
or any successor of Tenant, and without obtaining its or their consent thereto
and any such actions shall not relieve Tenant of liability under this Lease.
18.4. Conversion to a Limited Liability Entity. Notwithstanding anything
contained herein to the contrary, if Tenant is a limited or general partnership
(or is comprised of two (2) or more persons, individually or as co-partners, or
entities), the change or conversion of Tenant to (a) a limited liability
company, (b) a limited liability partnership, or (c) any other entity which
possesses the characteristics of limited liability (any such limited liability
entity is collectively referred to herein as a "Successor Entity") shall be
prohibited unless the prior written consent of Landlord is obtained, which
consent may be withheld in Landlord's sole discretion.
18.4.1. Notwithstanding the preceding paragraph, Landlord agrees not
to unreasonably withhold or delay such consent provided that:
18.4.1.1. The Successor Entity succeeds to all or
substantially all of Tenant's business and assets;
18.4.1.2. The Successor Entity shall have a tangible net worth
(Tangible Net Worth), determined in accordance with generally
accepted accounting principles, consistently applied, of not less
than the greater of the Tangible Net Worth of Tenant on (a) the date
of execution of the Lease, or (b) the day immediately preceding the
proposed effective date of such conversion; and
18.4.1.3. Tenant is not in default of any of the terms,
covenants, or conditions of this Lease on the propose effective date
of such conversion.
18.5. Payment of Fees. If Tenant assigns the Lease or sublets the Premises
or requests the consent of Landlord to any assignment, subletting or conversion
to a limited liability entity, then Tenant shall, upon demand, pay Landlord,
whether or not consent is ultimately given, an administrative fee not to exceed
Three Hundred and 00/100 Dollars ($300.00) so long as Tenant does not request
changes to the Lease or Landlord's standard form of consent.
Page 15
19. DEFAULT.
19.1. Tenant's Default. The occurrence of any one or more of the following
events shall constitute a default and breach of this Lease by Tenant.
19.1.1. If Tenant abandons the Premises or vacates the Premises for
three (3) consecutive months.
19.1.2. If Tenant fails to pay any Rent or Additional Rent or any
other charges required to be paid by Tenant under this Lease and such
failure continues for three (3) days after receipt of Notice thereof from
Landlord to Tenant.
19.1.3. If Tenant fails to promptly and fully perform any other
covenant, condition or agreement contained in this Lease and such failure
continues for thirty (30) days after Notice thereof from Landlord to
Tenant, or, if such default cannot reasonably be cured within thirty (30)
days, if Tenant fails to commence to cure within that thirty (30) day
period and diligently prosecute to completion.
19.1.4. Tenant's failure to occupy the Premises within sixty (60)
days after delivery of possession (as defined in Section 4. hereof).
19.1.5. Tenant's failure to provide any document, instrument or
assurance as required by Sections 12., 15., 18. and/or 35. if the failure
continues for seven (7) days after receipt of Notice from Landlord to
Tenant.
19.1.6. To the extent provided by law:
19.1.6.1. If a writ of attachment or execution is levied on
this Lease or on substantially all of Tenant's Property; or
19.1.6.2. If Tenant or Tenant's Guarantor makes a general
assignment for the benefit of creditors; or
19.1.6.3. If Tenant files a voluntary petition for relief or
if a petition against Tenant in a proceeding under the federal
bankruptcy laws or other insolvency laws is filed and not withdrawn
or dismissed within ninety (90) days thereafter, or if under the
provisions of any law providing for reorganization or winding up of
corporations, any court of competent jurisdiction assumes
jurisdiction, custody or control of Tenant or any substantial part
of its property and such jurisdiction, custody or control remains in
force unrelinquished, unstayed or unterminated for a period of
ninety (90) days; or
19.1.6.4. If in any proceeding or action in which Tenant is a
party, a trustee, receiver, agent or custodian is appointed to take
charge of the Premises or Tenant's Property (or has the authority to
do so); or
19.1.6.5. If Tenant is a partnership or consists of more than
one (1) person or entity, if any partner of the partnership or other
person or entity is involved in any of the acts or events described
in Sections 19.1.6.1. through above.
19.2. Landlord Remedies. In the event of Tenant's default hereunder, then,
in addition to any other rights or remedies Landlord may have under any law or
at equity, Landlord shall have the right to collect interest on all past due
sums (at the maximum rate permitted by law to be charged by an individual), and,
at Landlord's option and without further notice or demand of any kind, to do the
following:
19.2.1. Terminate this Lease and Tenant's right to possession of the
Premises and reenter the Premises and take possession thereof, and Tenant
shall have no further claim to the Premises or under this Lease; or
19.2.2. Continue this Lease in effect, reenter and occupy the
Premises for the account of Tenant, and collect any unpaid Rent or other
charges which have or thereafter become due and payable; or
19.2.3. Reenter the Premises under the provisions of Section
19.2.2., and thereafter elect to terminate this Lease and Tenant's right
to possession of the Premises.
If Landlord reenters the Premises under the provisions of Sections 19.2.2. or
19.2.3. above, Landlord shall not be deemed to have terminated this Lease or the
obligation of Tenant to pay any Rent or other charges thereafter accruing unless
Landlord notifies Tenant in writing of Landlord's election to terminate this
Lease. Acts of maintenance, efforts to relet the Premises or the appointment of
a receiver on Landlord's initiative to protect Landlord's interest under this
Lease shall not constitute a termination of Tenant's obligations under the
Lease. In the event of any reentry or retaking of possession by Landlord,
Landlord shall have the right, but not the obligation, to remove all or any part
of Tenant's Property in the Premises and to place such property in storage at a
public warehouse at the expense and risk of Tenant. If Landlord elects to relet
Page 16
the Premises for the account of Tenant, the rent received by Landlord from such
reletting shall be applied as follows: first, to the payment of any indebtedness
other than Rent due hereunder from Tenant to Landlord; second, to the payment of
any costs of such reletting; third, to the payment of the cost of any
alterations or repairs to the Premises; fourth to the payment of Rent due and
unpaid hereunder; and the balance, if any, shall be held by Landlord and applied
in payment of future Rent as it becomes due. If that portion of Rent received
from the reletting which is applied against the Rent due hereunder is less than
the amount of the Rent due, Tenant shall pay the deficiency to Landlord promptly
upon demand by Landlord. Such deficiency shall be calculated and paid monthly.
Tenant shall also pay to Landlord, as soon as determined, any costs and expenses
incurred by Landlord in connection with such reletting or in making alterations
and repairs to the Premises which are not covered by the rent received from the
reletting. Provided, however, (i) Landlord shall be obligated to use reasonable
efforts to mitigate all damages due to Landlord as a result of any event of
default and (ii) any and all of Landlord's remedies described herein below
resulting from any event of default shall be exercised only in accordance with,
and to the extent permitted by applicable law.
19.3. Damages Recoverable. Should Landlord elect to terminate this Lease
under the provisions of Section 19.2., Landlord may recover as damages from
Tenant the following:
19.3.1. Past Rent. The worth at the time of the award of any unpaid
Rent that had been earned at the time of termination including the value
of any Rent that was abated during the Term of the Lease (except Rent that
was abated as a result of damage or destruction or condemnation); plus
19.3.2. Rent Prior to Award. The worth at the time of the award of
the amount by which the unpaid Rent that would have been earned between
the time of the termination and the time of the award exceeds the amount
of unpaid Rent that Tenant proves could reasonably have been avoided; plus
19.3.3. Rent After Award. The worth at the time of the award of the
amount by which the unpaid Rent for the balance of the Term after the time
of award exceeds the amount of the unpaid Rent that Tenant proves could be
reasonably avoided; plus
19.3.4. Proximately Caused Damages. Any other amount necessary to
compensate Landlord for all detriment proximately caused by Tenant's
failure to perform its obligations under this Lease or which in the
ordinary course of things would be likely to result therefrom, including,
but not limited to, any costs or expenses (including attorneys' fees),
incurred by Landlord in (a) retaking possession of the Premises, (b)
maintaining the Premises after Tenant's default, (c) preparing the
Premises for reletting to a new tenant, including any repairs or
alterations, and (d) reletting the Premises, including brokers'
commissions.
"The worth at the time of the award" as used in Sections 19.3.1. and 19.3.2.
above, is to be computed by allowing interest at the maximum rate permitted by
law to be charged by an individual. "The worth at the time of the award" as used
in Section 19.3.3. above, is to be computed by discounting the amount at the
discount rate of the Federal Reserve Bank situated nearest to the Premises at
the time of the award plus one percent (1%).
19.4. Landlord's Right to Cure Tenant's Default. If Tenant defaults in the
performance of any of its obligations under this Lease and Tenant has not timely
cured the default after Notice, Landlord may (but shall not be obligated to),
without waiving such default, perform the same for the account and at the
expense of Tenant. Tenant shall pay Landlord all costs of such performance
immediately upon written demand therefor, and if paid at a later date these
costs shall bear interest at the maximum rate permitted by law to be charged by
an individual.
19.5. Landlord's Default. If Landlord fails to perform any covenant,
condition or agreement contained in this Lease within thirty (30) days after
receipt of Notice from Tenant specifying such default, or, if such default
cannot reasonably be cured within thirty (30) days if Landlord fails to commence
to cure within that thirty (30) day period and diligently prosecute to
completion, then Landlord shall be liable to Tenant for any damages sustained by
Tenant as a result of Landlord's breach; provided, however, it is expressly
understood and agreed that if Tenant obtains a money judgment against Landlord
resulting from any default or other claim arising under this Lease, that
judgment shall be satisfied only out of the rents, issues, profits, and other
income actually received on account of Landlord's right, title and interest in
the Premises, Building or Project, and no other real, personal or mixed property
of Landlord (or of any of the partners which comprise Landlord, if any),
wherever situated, shall be subject to levy to satisfy such judgment.
19.6. Mortgagee Protection. Tenant agrees to send by certified or
registered mail to any first mortgagee or first deed of trust beneficiary of
Landlord whose address has been furnished to Tenant, a copy of any notice of
default served by Tenant on Landlord. If Landlord fails to cure such default
within the time provided for in this Lease, then such mortgagee or beneficiary
shall have such additional time to cure the default as is reasonably necessary
under the circumstances.
19.7. Tenant's Right to Cure Landlord's Default. If, after Notice to
Landlord of default, Landlord (or any first mortgagee or first deed of trust
beneficiary of Landlord) fails to cure the default as provided herein, then
Tenant shall have the right to cure that default at Landlord's expense. Tenant
shall not have the right to terminate this Lease or to withhold, reduce or
offset any amount against any payments of
Page 17
Rent or any other charges due and payable under this Lease except as otherwise
specifically provided herein. Tenant expressly waives the benefits of any
statute now or hereafter in effect which would otherwise afford Tenant the right
to make repairs at Landlord's expense or to terminate this Lease because of
Landlord's failure to keep the Premises in good order, condition and repair.
20. WAIVER.
No delay or omission in the exercise of any right or remedy of Landlord upon any
default by Tenant shall impair such right or remedy or be construed as a waiver
of such default. The receipt and acceptance by Landlord of delinquent Rent shall
not constitute a waiver of any other default: it shall constitute only a waiver
of timely payment for the particular Rent payment involved (excluding the
collection of a late charge or interest).
No act or conduct of Landlord, including, without limitation, the acceptance of
keys to the Premises, shall constitute an acceptance of the surrender of the
Premises by Tenant before the expiration of the Term. Only written
acknowledgement from Landlord to Tenant shall constitute acceptance of the
surrender of the Premises and accomplish a termination of this Lease.
Landlord's consent to or approval of any act by Tenant requiring Landlord's
consent or approval shall not be deemed to waive or render unnecessary
Landlord's consent to or approval of any subsequent act by Tenant.
Any waiver by Landlord of any default must be in writing and shall not be a
waiver of any other default concerning the same or any other provision of this
Lease.
21. SUBORDINATION AND ATTORNMENT.
This Lease is and shall be subject and subordinate to all ground or underlying
leases (including renewals, extensions, modifications, consolidations and
replacements thereof) which now exist or may hereafter be executed affecting the
Building or the land upon which the Building is situated, or both, and to the
lien of any mortgages or deeds of trust in any amount or amounts whatsoever
(including renewals, extensions, modifications, consolidations and replacements
thereof) now or hereafter placed on or against the Building or on or against
Landlord's interest or estate therein, or on or against any ground or underlying
lease, without the necessity of the execution and delivery of any further
instruments on the part of Tenant to effectuate such subordination.
Nevertheless, Tenant covenants and agrees to execute and deliver upon demand,
without charge therefor, such further instruments evidencing such subordination
of this Lease to such ground or underlying leases, and to the lien of any such
mortgages or deeds of trust as may be required by Landlord.
Notwithstanding anything contained herein to the contrary, if any mortgagee,
trustee or ground lessor shall elect that this Lease is senior to the lien of
its mortgage, deed of trust or ground lease, and shall give written notice
thereof to Tenant, this Lease shall be deemed prior to such mortgage, deed of
trust or ground lease, whether this Lease is dated prior or subsequent to the
date of said mortgage, deed of trust, or ground lease, or the date of the
recording thereof.
In the event of any foreclosure sale, transfer in lieu of foreclosure or
termination of the lease in which Landlord is lessee, Tenant shall attorn to the
purchaser, transferee or lessor as the case may be, and recognize that party as
Landlord under this Lease, provided such party acquires and accepts the Premises
subject to this lease. Upon written request of Tenant as a condition precedent
to the future subordination of this Lease to a future mortgage. Landlord shall
use reasonable efforts to secure, at no cost to Landlord, a subordination,
nondisturbance and attornment agreement, in form and substance reasonably
acceptable to Tenant, to Landlord and to the lender, from any future lender on
the Building.
22. TENANT ESTOPPEL CERTIFICATES.
22.1. Landlord Request for Estoppel Certificate. Within ten (10) days
after receipt of a written request from Landlord, Tenant shall execute and
deliver to Landlord or Landlord's designee, in the form requested by Landlord, a
written statement certifying, among other things, (a) that this Lease is
unmodified and in full force and effect, or that it is in full force and effect
as modified and stating the modifications; (b) the amount of Base Rent and the
date to which Base Rent and Additional Rent have been paid in advance; (c) the
amount of any security deposited with Landlord; and (d) that Landlord is not in
default hereunder or, if Landlord is claimed to be in default, stating the
nature of any claimed default. Any such statement may be conclusively relied
upon by a prospective purchaser, assignee or encumbrancer of the Premises.
22.2. Failure to Execute. Tenant's failure to execute and deliver such
statement within the reasonable time required shall at Landlord's election be a
default under this Lease and shall also be conclusive upon Tenant that: (a) this
Lease is in full force and effect and has not been modified except as
represented by Landlord; (b) there are no uncured defaults in Landlord's
performance and that Tenant has no right of offset, counter-claim or deduction
against Rent and (c) not more than one month's Rent has been paid in advance.
23. NOTICE.
Notice shall be in writing and shall be deemed duly served or given if
personally delivered, sent by certified or registered U.S. Mail, postage prepaid
with a return receipt requested, or sent by overnight courier service, fee
prepaid with a return receipt requested, as follows: (a) if to Landlord, to
Landlord's Address for
Page 18
Notice with a copy to the Building manager, and (b) if to Tenant, to Tenant's
Mailing Address; provided, however, Notices to Tenant shall be deemed duly
served or given if delivered or sent to Tenant at the Premises. Landlord and
Tenant may from time to time by Notice to the other designate another place for
receipt of future Notice. Notwithstanding anything contained herein to the
contrary, when an applicable State statute requires service of Notice in a
particular manner, service of that Notice in accordance with those particular
requirements shall replace rather than supplement any Notice requirement set
forth in the Lease.
24. TRANSFER OF LANDLORD'S INTEREST.
In the event of any sale or transfer by Landlord of the Premises, Building or
Project, and assignment of this Lease by Landlord, Landlord shall be and is
hereby entirely freed and relieved of any and all liability and obligations
contained in or derived from this Lease arising out of any act, occurrence or
omission relating to the Premises, Building, Project or Lease occurring after
the consummation of such sale or transfer, provided the purchaser shall
expressly assume all of the covenants and obligations of Landlord under this
Lease. This Lease shall not be affected by any such sale and Tenant agrees to
attorn to the purchaser or assignee provided all of Landlord's obligations
hereunder are assumed by such transferee. If any security deposit or prepaid
Rent has been paid by Tenant, Landlord shall transfer the security deposit or
prepaid Rent to Landlord's successor and upon such transfer, Landlord shall be
relieved of any and all further liability with respect thereto.
25. SURRENDER OF PREMISES.
25.1. Clean and Same Condition. Upon the Expiration Date or earlier
termination of this Lease, Tenant shall peaceably surrender the Premises to
Landlord clean and in the same condition as when received, except for (a)
reasonable wear and tear, (b) loss by fire or other casualty, and (c) loss by
condemnation. Tenant shall remove Tenant's Property no later than the Expiration
Date. If Tenant is required by Landlord to remove any additions, alterations, or
improvements under Section 12.3., Tenant shall complete such removal no later
than the Expiration Date. Any damage to the Premises, including any structural
damage, resulting from removal of any addition, alteration, or improvement made
pursuant to Section 12.3. and/or from Tenant's use or from the removal of
Tenant's Property pursuant to Section 13.2. shall be repaired (in accordance
with Landlord's reasonable direction) no later than the Expiration Date by
Tenant at Tenant's sole cost and expense. On the Expiration Date, Tenant shall
surrender all keys to the Premises.
25.2. Failure to Deliver Possession. If Tenants fails to vacate and
deliver possession of the Premises to Landlord on the expiration or sooner
termination of this Lease as required by Section 12.3., Tenant shall indemnify,
defend and hold Landlord harmless from all claims, liabilities and damages
resulting from Tenant's failure to vacate and deliver possession of the
Premises, including, without limitation, claims made by a succeeding tenant
resulting from Tenant's failure to vacate and deliver possession of the Premises
and rental loss which Landlord suffers.
25.3. Property Abandoned. If Tenant abandons or surrenders the Premises,
or is dispossessed by process of law or otherwise, any of Tenant's Property left
on the Premises shall be deemed to be abandoned, and, at Landlord's option,
title shall pass to Landlord under this Lease as by a bill of sale. If Landlord
elects to remove all or any part of such Tenant's Property, the cost of removal,
including repairing any damage to the Premises or Building caused by such
removal, shall be paid by Tenant.
26. HOLDING OVER.
Tenant shall not occupy the Premises after the Expiration Date without
Landlord's consent. If after expiration of the Term, Tenant remains in
possession of the Premises with Landlord's permission (express or implied),
Tenant shall become a tenant from month to month only upon all the provisions of
this Lease (except as to the term and Base Rent). Monthly Installments of Base
Rent payable by Tenant during this period shall be increased one hundred fifty
percent (150%) of the Monthly Installments of Base Rent payable by Tenant in the
final month of the Term. The tenancy may be terminated by either party,
effective on the last day of a calendar month, by delivering a Notice to the
other party at least thirty (30) days prior thereto. Nothing contained in this
Section 26. shall be construed to limit or constitute a waiver of any other
rights or remedies available to Landlord pursuant to this Lease or at law.
27. RULES AND REGULATIONS.
Tenant agrees to comply with (and cause its agents, contractors, employees and
invitees to comply with) the rules and regulations attached hereto as Exhibit
"E" and with such reasonable modifications thereof and additions thereto as
Landlord may from time to time make. Landlord agrees to enforce the rules and
regulations uniformly against all tenants of the Project. Landlord shall not be
liable, however, for any violation of said rules and regulations by other
tenants or occupants of the Building or Project.
28. CERTAIN RIGHTS RESERVED BY LANDLORD.
Landlord reserves the following rights, exercisable without (a) liability to
Tenant for damage or injury to property, person or business; (b) being found to
have caused an actual or constructive eviction from the Premises; or (c) being
found to have disturbed Tenant's use or possession of the Premises.
Page 19
28.1. Name. To name the Building and Project and to change the name or
street address of the Building or Project.
28.2. Signage. To install and maintain all signs on the exterior and
interior of the Building and Project.
28.3. Access. To have pass keys to the Premises and all doors within the
Premises, excluding Tenant's files, vaults and safes. Tenant shall have access
to the Building and the Premises twenty-four (24) hours per day, seven (7) days
per week, fifty-two (52) weeks per year, subject to any of Landlord's reasonable
security procedures.
28.4. Physical Changes. To stripe or re-stripe, re-surface, enlarge,
change the grade or drainage of and control access to the parking lot; to assign
and reassign spaces for the exclusive or nonexclusive use of tenants (including
Tenant); and to locate or relocate parking spaces assigned to Tenant.
28.5. Inspection. At any time during the Term, and on reasonable prior
telephonic notice to Tenant, to inspect the Premises, and to show the Premises
to any person having an existing or prospective interest in the Project or
Landlord, and during the last six months of the Term, to show the Premises to
prospective tenants thereof.
28.6. Entry. To enter the Premises upon reasonable prior notice to Tenant
(except in the event of an emergency) for the purpose of making inspections,
repairs, alterations, additions or improvements to the Premises or the Building
(including, without limitation, checking, calibrating, adjusting or balancing
controls and other parts of the HVAC system), and to take all steps as may be
necessary or desirable for the safety, protection, maintenance or preservation
of the Premises or the Building or Landlord's interest therein, or as may be
necessary or desirable for the operation or improvement of the Building or in
order to comply with laws, orders or requirements of governmental or other
authority. Landlord agrees to use its best efforts (except in an emergency) to
minimize interference with Tenant's business in the Premises in the course of
any such entry.
28.7. Common Area Regulation. To exclusively regulate and control use of
the Common Area.
29. ADVERTISEMENTS AND SIGNS.
Subject to Section 40. Tenant shall not affix, paint, erect or inscribe any
sign, projection, awning, signal or advertisement of any kind to any part of the
Premises, Building or Project, including without limitation the inside or
outside of windows or doors, without the prior written consent of Landlord.
Landlord shall have the right to remove any signs or other matter installed
without Landlord's permission, without being liable to Tenant by reason of such
removal, and to charge the cost of removal to Tenant as Additional Rent
hereunder, payable within ten (10) days of written demand by Landlord.
30. RELOCATION OF PREMISES.
Upon the prior written consent of Tenant, said consent shall not be unreasonably
withheld. Landlord shall have the right to relocate the Premises to another part
of the Building at any time after the execution and delivery of the Lease upon
at least one hundred twenty(120) days prior Notice to Tenant. The new premises
shall be similar in size to the Premises described in this Lease and shall be
leased to Tenant on the same terms and conditions as provided in the Lease,
except that if the new premises contains more or less square footage, then there
shall be a proportionate adjustment in Rent. Landlord shall pay reasonable
expenses incurred by Tenant as a result of the relocation, including without
limitation, moving Tenant's Property to the new premises. Upon completion of
such relocation, the new premises shall be the Premises for all purposes under
the Lease and the parties shall immediately execute an amendment to this Lease
setting forth the relocation of the Premises and the reduction of Base Rent, if
any.
31. GOVERNMENT ENERGY OR UTILITY CONTROLS.
In the event of imposition of federal, state or local government controls,
rules, regulations, or restrictions on the use or consumption of energy or other
utilities (including telecommunications) during the Term, both Landlord and
Tenant shall be bound thereby. In the event of a difference in interpretation by
Landlord and Tenant of any such controls, the interpretation of Landlord shall
prevail and Landlord shall have the right to enforce compliance therewith,
including the right of entry into the Premises to effect compliance.
32. FORCE MAJEURE.
Any prevention, delay or stoppage of work to be performed by Landlord or Tenant
which is due to strikes, labor disputes, inability to obtain labor, materials,
equipment or reasonable substitutes therefor, acts of God, governmental
restrictions or regulations or controls, judicial orders, enemy or hostile
government actions, civil commotion, fire or other casualty, or other causes
beyond the reasonable control of the party obligated to perform hereunder, shall
excuse performance of the work by that party for a period equal to the duration
of that prevention, delay or stoppage. Nothing in this Section 32. shall excuse
or delay Tenant's obligation to pay Rent or other charges under this Lease.
Page 20
33. BROKERAGE FEES.
Tenant warrants and represents that it has not dealt with any real estate broker
or agent in connection with this Lease or its negotiation except the Listing and
Leasing Agent(s) set forth in Section 2.9. of this Lease. Tenant shall
indemnify, defend and hold Landlord harmless from any cost, expense or liability
(including costs of suit and reasonable attorneys' fees) for any compensation,
commission or fees claimed by any other real estate broker or agent in
connection with this Lease or its negotiation by reason of any act of Tenant.
34. QUIET ENJOYMENT.
Tenant, upon payment of Rent and performance of all of its obligations under
this Lease, shall peaceably, quietly and exclusively enjoy possession of the
Premises without unwarranted interference by Landlord or anyone acting or
claiming through Landlord, subject to the terms of this Lease and to any
mortgage, lease, or other agreement to which this Lease may be subordinate.
35. TELECOMMUNICATIONS.
35.1. Telecommunications Companies. Tenant and Tenant's telecommunications
companies, including but not limited to local exchange telecommunications
companies and alternative access vendor services companies ("Telecommunications
Companies"), shall have no right of access to and within the lands or Buildings
comprising the Project for the installation and operation of telecommunications
lines and systems including but not limited to voice, video, data, and any other
telecommunications services provided over wire, fiber optic, microwave, wireless
and any other transmission systems, for part or all of Tenant's
telecommunications within the Building and from the Building to any other
location (hereinafter collectively referred to as "Telecommunications Lines"),
without Landlord's prior written consent, which Landlord may withhold in its
sole and absolute discretion. Notwithstanding the foregoing, Tenant may perform
any installation, repair and maintenance to its Telecommunications Lines without
Landlord's consent where the equipment being installed, repaired or maintained
is not located in an area in which the Telecommunications Lines or any part
thereof of any other tenant or of Landlord are located.
35.2. Tenant's Obligations. If at any time, Tenant's Telecommunications
Companies or appropriate governmental authorities relocate the point of
demarcation from the location of Tenant's telecommunications equipment in
Tenant's telephone equipment room or other location, to some other point, or in
any other manner transfer any obligations or liabilities for telecommunications
to Landlord or Tenant, whether by operation of law or otherwise, upon Landlord's
election, Tenant shall, at Tenant's sole expense and cost: (1) within thirty
(30) days after notice is first given to Tenant of Landlord's election, cause to
be completed by an appropriate telecommunications engineering entity approved in
advance in writing by Landlord, all details of the Telecommunications Lines
serving Tenant in the Building which details shall include all appropriate
plans, schematics, and specifications; and (2) if Landlord so elects,
immediately undertake the operation, repair and maintenance of the
Telecommunications Lines serving Tenant in the Building; and (3) upon the
termination of the Lease for any reason, or upon expiration of the Lease,
immediately effect the complete removal of all or any portion or portions of the
Telecommunications Lines serving Tenant in the Building and repair any damage
caused thereby (to Landlord's reasonable satisfaction).
Prior to the commencement of any alterations, additions, or modifications
to the Telecommunications Lines serving Tenant in the Building, except for minor
changes, Tenant shall first obtain Landlord's prior written consent by written
request accompanied by detailed plans, schematics, and specifications showing
all alterations, additions and modifications to be performed, with the time
schedule for completion of the work, and the identity of the entity that will
perform the work, for which, except as otherwise provided in Section 35.3.
below, Landlord may withhold consent, said consent not to be unreasonably
withheld, delayed, or conditioned.
35.3. Landlord's Consent. Without in any way limiting Landlord's right to
withhold its consent to a proposed request for access, or for alterations,
additions or modifications of the Telecommunications Lines serving Tenant in the
Building, Landlord shall consider the following factors in making its
determination:
35.3.1. If the proposed actions of Tenant and its Telecommunications
Companies will impose new obligations on Landlord, or expose Landlord to
liability of any nature or description, or increase Landlord's insurance
costs for the Building, or create liabilities for which Landlord is unable
to obtain insurance protection, or imperil Landlord's insurance coverage;
35.3.2. If Tenant's Telecommunications Companies are unwilling to
pay reasonable monetary compensation for the use and occupation of the
Building for the Telecommunications Lines;
35.3.3. If Tenant and its Telecommunications Companies would cause
any work to be performed that would adversely affect the land and Building
or any space in the Building in any manner;
35.3.4. If Tenant encumbers or mortgages its interest in any
telecommunications wiring or cabling; or
35.3.5. If Tenant is in default under this Lease.
Page 21
35.4. Indemnification. Tenant shall indemnify, defend and hold harmless
Landlord and its employees, agents, officers and directors from and against any
claims, demands, penalties, fines, liabilities, settlements, damages, costs, or
expenses of any kind or nature, known or unknown, contingent or otherwise,
arising out of or in any way related to the acts and omissions of Tenant,
Tenant's officers, directors, employees, agents, contractors, subcontractors,
subtenants and invitees with respect to (1) any Telecommunications Lines serving
Tenant in the Building which are on, from, or affecting the Project and
Building; (2) any bodily injury (including wrongful death) or property damage
(real or personal) arising out of or related to any Telecommunications Lines
serving Tenant in the Building which are on, from, or affecting the Building
(except to the extent caused by the gross negligence or willful misconduct of
Landlord); (3) any lawsuit brought settlement reached, or governmental order
relating to such Telecommunications Lines; (4) any violations of laws, orders,
regulations, requirements, or demands of governmental authorities, or any
reasonable policies or requirements of Landlord, which are based upon or in any
way related to such Telecommunications Lines, including, without limitation,
attorney and consultant fees, court costs and litigation expenses. This
indemnification and hold harmless agreement will survive this Lease. Under no
circumstances shall Landlord be required to maintain, repair or replace any
Building systems or any portions thereof, when such maintenance, repair or
replacement is caused in whole or in part by the failure of any such system or
any portions thereof, and/or the requirements of any governmental authorities.
Under no circumstances shall Landlord be liable for interruption in
telecommunications services to Tenant or any other entity affected, for
electrical spikes or surges, or for any other cause whatsoever, whether by Act
of God or otherwise, even if the same is caused by the ordinary negligence of
Landlord, Landlord's contractors, subcontractors, or agents or other tenants,
subtenants, or their contractors, subcontractors, or agents.
35.5. Landlord's Operation of Building Telecommunications Lines and
Systems. Notwithstanding anything contained herein to the contrary, if the point
of demarcation is relocated, Landlord may, but shall not be obligated to,
undertake the operation, repair and maintenance of telecommunications lines and
systems in the Building. If Landlord so elects, Landlord shall give Notice of
its intent to do so, and Landlord shall, based on Landlord's sole business
discretion, make such lines and systems available to tenants of the Building
(including Tenant) in the manner it deems most prudent. Landlord may include in
Operating Expenses all or a portion of the expenses related to the operation,
repair and maintenance of the telecommunications lines and systems.
36. MISCELLANEOUS.
36.1. Accord and Satisfaction; Allocation of Payments. No payment by
Tenant or receipt by Landlord of a lesser amount than the Rent provided for in
this Lease shall be deemed to be other than on account of the earliest due Rent,
nor shall any endorsement or statement on any check or letter accompanying any
check or payment as Rent be deemed an accord and satisfaction, and Landlord may
accept such check or payment without prejudice to Landlord's right to recover
the balance of the Rent or pursue any other remedy provided for in this Lease.
In connection with the foregoing, Landlord shall have the absolute right in its
sole discretion to apply any payment received from Tenant to any account or
other payment of Tenant then not current and due or delinquent.
36.2. Addenda. If any provision contained in an addendum to this Lease is
inconsistent with any other provision herein, the provision contained in the
addendum shall control, unless otherwise provided in the addendum.
36.3. Attorneys' Fees. If any action or proceeding is brought by either
party against the other pertaining to or arising out of this Lease, the finally
prevailing party (i.e., the party that recovers the greater relief as a result
of the action or proceeding) shall be entitled to recover all costs and
expenses, including reasonable attorneys' fees, incurred on account of such
action or proceeding.
36.4. Captions and Section Numbers. The captions appearing in the body of
this Lease have been inserted as a matter of convenience and for reference only
and in no way define, limit or enlarge the scope or meaning of this Lease. All
references to Section numbers refer to Sections in this Lease.
36.5. Changes Requested by Lender. Neither Landlord nor Tenant shall
unreasonably withhold its consent to changes or amendments to this Lease
requested by the lender on Landlord's interest, so long as such changes do not
alter the basic business terms of this Lease or otherwise materially diminish
any rights or materially increase any obligations of the party from whom consent
to such change or amendment is requested.
36.6. Choice of Law. This Lease shall be construed and enforced in
accordance with the Laws of the State.
36.7. Consent. Notwithstanding anything contained in this Lease to the
contrary, Tenant shall have no claim, and hereby waives the right to any claim
against Landlord for money damages, by reason of any refusal, withholding or
delaying by Landlord of any consent, approval or statement of satisfaction, and,
in such event, Tenant's only remedies therefor shall be an action for specific
performance, injunction or declaratory judgment to enforce any right to such
consent, approval or statement of satisfaction.
36.8. Authority. If Tenant is not an individual signing on his or her own
behalf, then each individual signing this Lease on behalf of the business entity
that constitutes Tenant represents and warrants that the individual is duly
authorized to execute and deliver this Lease on behalf of the business entity,
and that this Lease is binding on Tenant in accordance with its terms. Tenant
shall, at Landlord's request, deliver a
Page 22
certified copy of a resolution of its board of directors, if Tenant is a
corporation, or other memorandum of resolution if Tenant is a limited
partnership, general partnership or limited liability entity, authorizing such
execution.
36.9. Waiver of Right to Jury Trial. Landlord and Tenant hereby waive
their respective rights to a trial by jury of any claim, action, proceeding or
counterclaim by either party against the other on any matters arising out of or
in any way connected with this Lease, the relationship of Landlord and Tenant,
and/or Tenant's Use or occupancy of the Premises, Building or Project (including
any claim of injury or damage or the enforcement of any remedy under any current
or future laws, statutes, regulations, codes or ordinances).
36.10. Counterparts. This Lease may be executed in multiple counterparts,
all of which shall constitute one and the same Lease.
36.11. Execution of Lease; No Option. The submission of this Lease to
Tenant shall be for examination purposes only and does not and shall not
constitute a reservation of or option for Tenant to Lease, or otherwise create
any interest of Tenant in the Premises or any other premises within the Building
or Project. Execution of this Lease by Tenant and its return to Landlord shall
not be binding on Landlord, notwithstanding any time interval, until Landlord
has in fact signed and delivered this Lease to Tenant.
36.12. Furnishing of Financial Statements; Tenant's Representations. In
order to induce Landlord to enter into this Lease, but not more often than once
per calendar year, unless Tenant is in default or in the event of a sale or
refinance of the Building. Tenant agrees that it shall promptly furnish
Landlord, from time to time, upon Landlord's written request, financial
statements reflecting Tenant's current financial condition. Tenant, to the best
of its knowledge, represents and warrants that all financial statements, records
and information furnished by Tenant to Landlord in connection with this Lease
are true, correct and complete in all respects.
36.13. Further Assurances. The parties agree to promptly sign all
documents reasonably requested to give effect to the provisions of this Lease.
36.14. Prior Agreements; Amendments. This Lease and the schedules and
addenda attached, if any, form a part of this Lease together with the rules and
regulations set forth on Exhibit "E" attached hereto, and set forth all the
covenants, promises, assurances, agreements, representations, conditions,
warranties, statements, and understandings (Representations) between Landlord
and Tenant concerning the Premises and the Building and Project, and there are
no Representations, either oral or written, between them other than those in
this Lease.
This Lease supersedes and revokes all previous negotiations, arrangements,
letters of intent, offers to lease, lease proposals, brochures, representations,
and information conveyed, whether oral or in writing, between the parties hereto
or their respective representatives or any other person purporting to represent
Landlord or Tenant. Tenant acknowledges that it has not been induced to enter
into this Lease by any Representations not set forth in this Lease, and that it
has not relied on any such Representations. Tenant further acknowledges that no
such Representations shall be used in the interpretation or construction of this
Lease, and that Landlord shall have no liability for any consequences arising as
a result of any such Representations.
Except as otherwise provided herein, no subsequent alteration, amendment,
change, or addition to this Lease shall be binding upon Landlord or Tenant
unless it is in writing and signed by each party.
36.15. Recording. Tenant shall not record this Lease without the prior
written consent of Landlord. Tenant or Landlord, upon the request of the other
party shall execute and acknowledge a short form memorandum of this Lease
(Notice of Lease) for recording purposes.
36.16. Severability. A final determination by a court of competent
jurisdiction that any provision of this Lease is invalid shall not affect the
validity of any other provision, and any provision so determined to be invalid
shall, to the extent possible, be construed to accomplish its intended effect.
36.17. Successors and Assigns. This Lease shall apply to and bind the
heirs, personal representatives, and successors and assigns of the parties.
36.18. Time Is of the Essence. Time is of the essence of this Lease.
[REMAINDER OF THE PAGE LEFT BLANK INTENTIONALLY]
[SIGNATURES APPEAR ON THE NEXT PAGE]
Page 23
IN WITNESS WHEREOF, the parties hereto have executed this Lease as of the date
first set forth on Page 1.
LANDLORD:
GLENBOROUGH FUND V, LIMITED PARTNERSHIP,
a Delaware limited partnership
By: GRTV, Inc.,
a Delaware corporation
Its General Partner
By: /s/ [ILLEGIBLE]
-------------------
Its [ILLEGIBLE]
TENANT:
CYNOSURE, INC.,
a Delaware corporation
By: /s/ [ILLEGIBLE]
---------------------
Its CFO
By: _____________________
Its__________________
Page 24
ADDENDUM TO LEASE BY AND BETWEEN
GLENBOROUGH FUND V, LIMITED PARTNERSHIP,
a Delaware limited partnership ("Landlord")
and
CYNOSURE, INC.,
a Delaware corporation ("Tenant")
DATED: January 31, 2005
37. TENANT IMPROVEMENTS.
Section 37. adds to and amends the Lease as follows:
(a) Subject to the Allowance (as such term is defined below), Landlord has
agreed to construct certain leasehold improvements in the Premises prior
to Tenant's occupancy using Building standard methods, materials and
finishes and in accordance with the terms and conditions of the Work
Letter attached to the Lease as Exhibit D (the "Leasehold Improvements"
or, for purposes of Section 12.1. of this Lease, "Landlord's Work").
Tenant does not intend to construct any additional leasehold improvements,
and therefore there is no "Tenant's Work" for purposes of Section 12.2.
(b) Landlord has agreed to contribute a maximum amount of $781,438.00 towards
the hard costs of the Leasehold Improvements (the "Allowance"); provided,
however, that Tenant may use a portion of the Allowance in an amount not
to exceed (i) $83,725.50 for the cost of preparing design and construction
documents and mechanical and electrical plans for the Leasehold
Improvements, and (ii) $55,817.00 (the "Furniture Allowance") for the cost
of relocating the furniture currently existing in the Premises as of the
date of this Lease.
(c) Promptly following full execution of this Lease, Landlord shall cause its
space planner and/or architect (the "Space Planner") to prepare a space
plan with specifications (collectively, the "Space Plan") in sufficient
detail for Landlord's general contractor ("General Contractor") to price
the Leasehold Improvements. Tenant shall provide information required by
the Space Planner to prepare the Space Plan within not more than twenty
four (24) hours of request and shall provide approvals within not more
than forty eight (48) hours of submission of the preliminary Space Plan
and final Space Plan. Any delays by Tenant in responding to the Space
Planner's requests for information, excessive revisions, or delay in
approving the preliminary and any final Space Plan shall constitute Tenant
Delay. The final Space Plan shall be initialed and dated by each party and
a copy thereof shall be attached to each original of this Lease as Exhibit
"D-l."
(d) Landlord shall cause General Contractor to price the construction contract
for the Leasehold Improvements. In the event the Allowance will be
exceeded, Landlord shall provide Tenant with an opportunity to revise the
scope of the Leasehold Improvements. In no event shall this Lease be
terminable on the basis of the pricing for the Leasehold Improvements.
(e) Promptly after approval of the Space Plan, Landlord shall cause Space
Planner to prepare construction drawings and specifications (collectively,
the "Construction Drawings") based on the Space Plan for Tenant's review
and approval. Tenant shall not delay or unreasonably withhold its approval
of the Construction Drawings. Tenant shall have not more than forty eight
(48) hours to review and approve the Construction Drawings. When approved,
the Construction Drawings shall be dated and initialed by Landlord and
Tenant and attached to each original of this Lease as Exhibit "D-2."
(f) Any portion of the Allowance which exceeds the cost of the Leasehold
Improvements or is otherwise remaining after December 31, 2005 shall
accrue to the sole benefit of Landlord, it being agreed that Tenant shall
not be entitled to any credit, offset, abatement or payment with respect
thereto.
38. OPTION TO EXTEND.
Section 38. adds to and amends the Lease as follows:
(a) Tenant is hereby granted one (1) option to extend the Term of the Lease
(the "Option to Extend") for a period of five (5) years (the "Extended
Term"). Upon the proper exercise of the Option to Extend, the Term shall
be extended for the Extended Term. Tenant shall not
1
have the right to extend the initial Term if as of the date of delivery of
the Option Exercise Notice (as defined below), or as of the end of the
initial Term, Tenant is in default under the Lease beyond any applicable
notice and cure period.
(b) The Option to Extend shall be exercised by Tenant, if at all, by giving
written Notice of exercise (the "Option Exercise Notice") not more than
fifteen (15) months and not less than twelve (12) months prior to the
Expiration Date for the initial Term. If Tenant expands its Premises, the
Option to Extend shall cover the entirety of the Premises as of the
Expiration Date for the initial Term. Notwithstanding anything herein to
the contrary, in the event that Tenant does not properly exercise its
Option to Extend the initial Term for the Extended Term, then Tenant's
Option to Extend shall be null and void and of no further force or effect.
(c) Base Rent for each year of Extended Term shall be adjusted to fair market
Base Rent, as of the commencement of the Extended Term, for renewals of
comparable term and space in the Building and/or in similar class
buildings in the submarket in which the Premises is located.
(d) The parties shall have thirty (30) days after Landlord receives the Option
Exercise Notice in which to agree on fair market Base Rent during the
Extended Term. If the parties agree on the Base Rent for the Extended Term
during such thirty (30) day period, they shall immediately execute an
amendment to the Lease stating the new Base Rent.
(e) If the parties are unable to agree on fair market Base Rent for the
Extended Term within such thirty (30) day period, then within ten (10)
days after the expiration of that period each party, at its cost and by
giving written notice to the other party, shall appoint a real estate
broker with at least 5 years full-time commercial brokerage experience in
the area in which the Premises is located to estimate and set Base Rent
for the Extended Term. If a party does not appoint a broker within ten
(10) days after the other party has given notice of the name of its
broker, the single broker appointed shall be the sole broker and shall set
Base Rent for the Extended Term. If the two brokers are appointed by the
parties as stated in this Section 38., they shall meet promptly and
attempt to set Base Rent for the Extended Term. If they are unable to
agree within thirty (30) days after the second broker has been appointed,
they shall attempt to elect a third broker meeting the qualifications
stated in this Section 38. within ten (10) days after the last day the two
brokers are given to set Base Rent. If they are unable to agree on the
third broker, either of the parties to this Lease by giving ten (10) days
written notice to the other party can apply to the then president of the
county real estate board of the county in which the Premises are located,
or to the presiding judge of the superior court of that county, for the
selection of a third broker who meets the qualifications stated in this
Section 38. Each of the parties shall bear one half of the cost of
appointing the third broker and of paying the third broker's fee. The
third broker, however selected, shall be a person who has not previously
acted in any capacity for either party.
Within thirty (30) days after the selection of the third broker, a
majority of the brokers shall set Base Rent for the Extended Term.
In setting Base Rent, the broker or brokers shall consider the highest and
best use for the Premises without regard to the restriction on use of the
Premises contained in this Lease. If, however, the low estimate and/or the
high estimate are/is more than five percent (5%) lower and/or higher than
the middle estimate, the low estimate and/or the high estimate shall be
disregarded. If only one estimate is disregarded, the average of the
remaining two estimates shall be the Base Rent for the Premises during the
Extended Term. If both the low estimate and the high estimate are
disregarded as stated in this Section 38., the middle estimate shall be
the Base Rent for the Premises during the Extended Term. After Base Rent
for the Extended Term has been set, the broker shall immediately notify
the parties.
Landlord and Tenant shall immediately execute an Amendment to the Lease
setting forth Base Rent for the Extended Term.
(f) This Option to Extend is granted by Landlord to the Tenant originally
named in the Lease and to no other, and is personal as to such entity and
shall not be exercised or assigned, voluntarily or involuntarily, by or to
anyone or any other entity. Any assignment of this Option to Extend
without Landlord's prior written consent shall be null and void and, at
Landlord's election, shall constitute a default under the Lease.
Landlord's consent to an assignment of the Lease shall not also constitute
consent to assignment of the Option to Extend unless the Option to Extend
is expressly included in Landlord's consent.
2
39. RIGHT OF FIRST OFFER.
Section 39. adds to and amends the Lease as follows:
(a) Provided that Tenant is not in default under the Lease at the time of
offer, Landlord hereby grants to Tenant a one-time right of first offer
("Right of First Offer") to lease any available space ("Available Space")
in the Building which may become available for lease as provided
hereinbelow as determined by Landlord. For purposes hereof, the Available
Space shall become available for lease at such time as Landlord is
prepared to actively market such Available Space for lease to third
parties and/or to submit to a third party a bona fide proposal or letter
of intent to lease the Available Space. Notwithstanding anything herein to
the contrary, Tenant's Right of First Offer set forth herein shall be
subject and subordinate to all expansion, first offer and similar rights
set forth in any lease for space in the Building and Landlord may in all
cases renew or extend an existing tenant's lease of its existing premises
regardless of the existence of an extension or renewal option in such
tenant's lease. "One-time" means if Tenant declines any offer from
Landlord, Landlord shall not be required to make future offers to Tenant.
(b) Landlord shall notify Tenant, in writing (the "Availability Notice"), of
the availability of the Available Space and shall specify, in the
Availability Notice, the term and commencement date for the Available
Space, Monthly Base Rent for such term, any improvements allowance and any
other significant business terms for the Available Space (all of which
shall be consistent with terms being offered to other prospective
tenants). Tenant shall either accept Landlord's offer as set forth in the
Availability Notice, in which case the parties shall prepare and execute
an amendment to the Lease to add the Available Space to the Premises under
the terms indicated by Landlord, or Tenant shall counter-propose other
terms, each by written notice (the "Acceptance Notice" or the
"Counterproposal Notice," as applicable) returned to Landlord within five
(5) days of receipt of Landlord's Availability Notice. In the event that
Tenant fails to return an Acceptance Notice or a Counterproposal Notice
within the time period prescribed, this one-time Right of First Offer
shall be rendered null and void and Landlord may freely offer the
Available Space or any portion of it to any other party on any terms.
(c) If Tenant timely returns a Counterproposal Notice, and has countered
Landlord's offer, Landlord may either accept Tenant's counterproposal or
the parties shall thereafter endeavor, in good faith, promptly, and using
diligent efforts, to agree upon mutually satisfactory business terms. If
the parties fail to reach agreement on business terms within five (5) days
of Landlord's receipt of Tenant's timely Counterproposal Notice, and
neither party accepts the other's original proposal or counterproposal,
then this one-time Right of First Offer shall be rendered null and void
and Landlord may freely offer the Available Space or any portion of it to
any other party on any terms. If the parties reach agreement on business
terms within five (5) days of Landlord's receipt of Tenant's timely
Counterproposal Notice or the initial proposal or counterproposal has been
accepted within said five (5) days, they shall immediately execute an
amendment to the Lease stating the addition of the Available Space to the
Premises under the Lease for the agreed terms.
(d) This one-time Right of First Offer is not applicable during the last full
calendar year of the Lease Term unless Tenant has properly exercised its
option to extend the initial Term of the Lease.
(e) This one-time Right of First Offer is granted to the original Tenant
executing this Lease, and is personal as to such entity and shall not be
exercised or assigned, voluntarily or involuntarily, by or to anyone or
any other entity. Any assignment of this one-time Right of First Offer
without Landlord's prior written consent shall be null and void and, at
Landlord's election, shall constitute an immediate default under the
Lease. Landlord's consent to an assignment of the Lease shall not also
constitute consent to assignment of the Right of First Offer unless the
Right of First Offer is expressly included in Landlord's consent.
3
40. SIGNAGE.
Section 40. adds to and amends the Lease as follows:
Tenant is hereby granted the right to install, at its sole cost and
expense, a sign on the exterior of the Building. Such signage shall be subject
to (i) all applicable laws, statutes, codes, regulations, etc. set forth by any
governmental or quasi-governmental entity or entities having jurisdiction
thereof, (ii) all permit requirements set forth by local authorities, and (iii)
Landlord's approval as to size, location, placement, manner of placement, and
design of such sign. Any costs of construction, erection, maintenance,
utilities, repair, replacement, removal, or any other costs whatsoever related
to such sign shall be Tenant's expense. Notwithstanding anything herein to the
contrary, Tenant, at its sole cost and expense, shall remove such sign at the
expiration or earlier termination of the Lease, and shall repair any damage to
the Building caused by the installation, presence, removal, or other activity
related to such sign.
41. SECURITY DEPOSIT REDUCTION.
Section 41. adds to and amends the Lease as follows:
Notwithstanding anything to the contrary contained in the Lease, and
subject to the remaining terms of this Section 41, upon Tenant's satisfaction of
the First Milestone Requirement (as defined below), Tenant shall have the right
to provide Landlord with a written notice (the "First Security Deposit Reduction
Notice") advising Landlord that Tenant has satisfied the First Milestone
Requirement and requesting that Landlord reduce the amount of the Security
Deposit then held by Landlord under the Lease by one-third (1/3). Tenant's First
Security Deposit Reduction Notice shall be accompanied by financial statements
that have been certified by Tenant and reviewed by Tenant's public accounting
firm on an annual or quarterly basis evidencing the satisfaction of the First
Milestone Requirement. For purposes of the Lease, the "First Milestone
Requirement" shall be satisfied by Tenant if Tenant achieves not less than
$66,000,000.00 in net sales (as determined in accordance with generally accepted
accounting principles consistently applied ("GAAP")), and not less than
$15,000,000.00 in net income before interest and taxes (as determined in
accordance with GAAP).
In addition, subject to the remaining terms of this Section 41, and provided
that Tenant has satisfied the First Milestone Requirement and was entitled to
reduce the Security Deposit as provided herein, then upon Tenant's satisfaction
of the Second Milestone Requirement (as defined below), Tenant shall have the
right to provide Landlord with a written notice (the "Second Security Deposit
Reduction Notice") advising Landlord that Tenant has satisfied the Second
Milestone Requirement and requesting that Landlord reduce the amount of the
Security Deposit then held by Landlord under the Lease by one-third (1/3).
Tenant's Second Security Deposit Reduction Notice shall be accompanied by
financial statements that have been certified by Tenant and reviewed by Tenant's
public accounting firm on an annual or quarterly basis evidencing the
satisfaction of the Second Milestone Requirement. For purposes of the Lease, the
"Second Milestone Requirement" shall be satisfied by Tenant if Tenant achieves
not less than $113,000,000.00 in net sales (as determined in accordance with
GAAP) and not less than $39,000,000.00 in net income before interest and taxes
(as determined in accordance with GAAP).
Notwithstanding anything contained herein to the contrary, Tenant shall not have
the right to reduce the amount of the Security Deposit as provided herein if (i)
Tenant is in default under the Lease, beyond any applicable cure period, as of
the date that Landlord receives the First Security Deposit Reduction Notice or
the Second Security Deposit Reduction Notice, as the case may be, or as of the
date of the Refund (as defined below), or (ii) Tenant has been in default under
the Lease, beyond any applicable cure period, at any time during the Term prior
to Landlord's receipt of the First Security Deposit Reduction Notice or the
Second Security Deposit Reduction Notice, as the case may be, or at any time
during the Term prior to the date of the Refund.
If Tenant is entitled to reduce the Security Deposit as provided herein,
Landlord shall refund the applicable portion of the Security Deposit to Tenant
(the "Refund") within forty-five (45) days after Landlord's receipt of the First
Security Reduction Notice or the Second Security Reduction
4
Notice, as the case may be, together with all financial statements evidencing
the satisfaction of the First Milestone Requirement or the Second Milestone
Requirement, as the case may be.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Addendum
as of the date first above written.
LANDLORD:
GLENBOROUGH FUND V, Limited Partnership,
a Delaware limited partnership
By: GRTV, Inc.,
a Delaware corporation
Its General Partner
By: /s/ [ILLEGIBLE]
----------------------
Its [ILLEGIBLE]
TENANT:
CYNOSURE, INC.,
a Delaware corporation
By: /s/ [ILLEGIBLE]
-------------------
Its CFO
By: ___________________
Its _______________
5
[FIRST FLOOR PLAN]
EXHIBIT A
PROPOSED FIRST FLOOR PLAN
CYNOSURE
5 CARLISLE ROAD
WESTFORD, MASSACHUSETTS
[SECOND FLOOR PLAN]
EXHIBIT A
PROPOSED SECOND FLOOR PLAN
CYNOSURE
5 CARLISLE ROAD
WESTFORD, MASSACHUSETTS
EXHIBIT B
SITE PLAN OF THE PROJECT
WESTFORD CORPORATE CENTER
[SITE PLAN]
EXHIBIT C
BUILDING STANDARD TENANT IMPROVEMENTS
WESTFORD CORPORATE CENTER
1.) PARTITIONS
Ceiling height partitions consisting of 3 5/8" 20-gauge metal studs at 16"
O.C. with 5/8" gypsum board each side, taped and sanded to receive paint.
Maximum: One (1) lineal foot per 16 square feet of area.
2.) DOORS AND FRAMES
Tenant entry door shall be solid core with lockset and door closer. Tenant
is allowed one (1) entry door per suite up to 10,000 square feet of area,
and an additional entry door is allowed for suites greater than 10,000
square feet.
Tenant is allowed one (1) interior passage door for every 300 square feet
of area. All interior passage doors to be given standard latch set
hardware, and shall be 1 3/4" solid core Oak veneer door 7'0"x3'x0" with
metal frames
3.) CEILING
Suspended Building Standard 24"x48" grid configuration with Armstrong 769A
acoustical lay-in panels will be used throughout the premises.
4.) LIGHTING
24"x48" Building Standard three (3) tube 40 watt recessed fluorescent
fixtures with lenses. One (1) fixture per 80 square feet of area.
Any alterations or additions to said existing Building Standard pattern
required to accommodate Tenant Improvements shall be at Tenant's sole
expense.
Elevator lobbies and common toilet facilities will have lighting selected
by Landlord.
5.) LIGHT SWITCHES
One (1) Building Standard single pole wall mounted light switch per 300
square feet of area.
6.) ELECTRICAL OUTLETS
One (1) Building Standard 120V Duplex electrical wall mounted outlet for
each 175 square feet of area. Each outlet is 120 volts and is circuited
with similar outlets on a 20 amp circuit.
7.) LIGHTED EXIT LIGHTS
Building Standard exit signs are provided in the Premises to meet any
requirements by code.
8.) FLOOR COVERING AND BASE
Carpeting in elevator lobbies and common corridors on all multiple-tenancy
office floors in color and type as selected by Landlord; carpeting within
office space as required and selected by Tenant from Building Standard
selection of 28oz. loop carpeting.
Maximum: Two (2) lineal feet of base per twelve (12) square feet of space.
9.) PAINT
All wall surfaces except doors finished with one (1) coat primer sealer
and one (1) coat flat latex paint in colors to be selected by Tenant from
Building Standard selection, with not more than one (1) color to be in
premises.
10.) WINDOW COVERING
Building Standard vertical blinds on all exterior windows. No deletions or
substitutions allowed.
11.) HVAC
A complete year-round HVAC system engineered to handle normal office usage
with ducted supply air through ceiling diffusers, zoned and located in
existing Building Standard pattern. Return air though exhaust vents. Any
alterations or additions to said system required to accommodate Tenant
Improvements shall be at Tenant's sole expense and must be done by
Landlord-Approved Contractor.
12.) TENANT SIGNAGE
One (1) Building Standard tenant identification sign at Tenant's entry
door and inclusion in building lobby directory.
PROPOSED TENANT IMPROVEMENTS FOR
CYNOSURE
5 CARLISLE ROAD
WESTFORD MA
EXHIBIT D
1-4-2005
Work below applies to Areas of Work A, B and C, unless noted otherwise.
1. Interior Partitions:
New interior walls shall be constructed of 3-5/8" x 25 Ga. metal studs at 16"
O/C with 1/2"" gypsum wallboard on both sides. Walls shall extend to, not
through, the ceiling grid.
2. Doors, Frames and Hardware:
Reuse existing doors, frames and hardware wherever possible. Provide new units
(to match existing) as required by new layout.
3. Ceilings:
Existing tiles and grid to remain and be repaired, with new suspended ceiling
system (to match adjacent areas) only as required by new layout.
Exception:
Second floor (Area of Work C) shall receive new suspended ceiling tiles
(Armstrong Cortege Second Look II 2x4 tegular tiles) existing grid is to remain.
4. Lighting:
Existing fixtures shall be reused. Provide new fixtures (to match existing) as
required by new layouts. Each room and area shall be individually switched.
Provide new light fixtures within Area of Work C.
5. Receptacles:
Existing receptacles will be supplemented with new standard 115V duplex
receptacles, as required for a normal business use.
6. HVAC:
Existing system diffusers and ductwork will be relocated, with new ductwork and
diffusers as required by new layout.
7. Window treatment:
Existing to remain, modified as required at new perimeter rooms.
Cynosure
1-4-2005
Page 2 of 2
8. Floor Finishes:
Provide Bigelow Fairfield II 28 oz. loop pile carpet at all offices, conference
rooms, open offices and similar areas, with 1/8" x 4" vinyl base.
Provide Armstrong Standard Excelon 12x12x1/8" vinyl floor tile at lunchrooms,
stockroom, machine shop, tech shop, server room, sub assembly, incoming
inspection and manufacturing.
9. Paint:
Gypsum board walls shall be painted, and shall receive one primer and one finish
coat of latex eggshell finish paint.
Door frames shall receive a primer and two finish coats of semi gloss alkyd
paint
10. Fire Protection:
Existing sprinkler system to be modified as required by new layout
11. Work not included:
a. Installation of telephone and computer wiring, outlets and equipment.
b. Furnishings including, but not limited to, open office work stations and
reception desk.
c. Security system.
END
[FLOOR KEY PLAN]
EXHIBIT D SP1
[FLOOR KEY PLAN]
EXHIBIT D SP2
[FLOOR KEY PLAN]
EXHIBIT D D1
[FLOOR KEY PLAN]
EXHIBIT D D2
EXHIBIT E
RULES AND REGULATIONS
WESTFORD CORPORATE CENTER
1.) The entrances, lobbies, passages, corridors, elevators, halls, courts,
sidewalks, vestibules, and stairways shall not be encumbered or obstructed
by Tenant, Tenant's agents, servants, employees, licensees or visitors or
used by them for any purposes other than ingress or egress to and from the
Premises.
2.) The moving in or out of all safes, freight, furniture, or bulky matter of
any description shall take place during the hours which Landlord may
determine from time to time. Landlord reserves the right to inspect all
freight and bulky matter to be brought into the Building and to exclude
from the Building all freight and bulky matter which violates any of these
Rules and Regulations or the Lease of which these Rules and Regulations
are a part. Landlord reserves the right to have Landlord's structural
engineer review Tenant's floor loads on the Premises at Tenant's expense.
3.) Tenant, or the employees, agents, servants, visitors or licensees of
Tenant shall not at any time place, lease or discard any rubbish, paper,
articles, or objects of any kind whatsoever outside the doors of the
Premises or in the corridors or passageways of the Building. No animals or
birds shall be brought or kept in or about the Building. Bicycles shall
not be permitted in the Building.
4.) Tenant shall not place objects against glass partitions or doors or
windows or adjacent to any common space which would be unsightly from the
Building corridors or from the exterior of the Building and will promptly
remove the same upon notice from Landlord.
5.) Tenant shall not make noises, cause disturbances, create vibrations, odors
or noxious fumes or use or operate any electric or electrical devices or
other devices that emit sound waves or are dangerous to other tenants and
occupants of the Building or that would interfere with the operation of
any device or equipment or radio or television broadcasting or reception
from or within the Building or elsewhere, or with the operation of roads
or highways in the vicinity of the Building, and shall not place or
install nay projections, antennae, aerials, or similar devices inside or
outside of the Premises, without the prior written approval of Landlord.
6.) Tenant shall not: (a) use the Premises for lodging, manufacturing or for
any immoral or illegal purposes; (b) the Premises to engage in the
manufacture or sale of, or permit the use of spirituous, fermented,
intoxicating or alcoholic beverages on the Premises; (c) use the Premises
to engage in the manufacture or sale of, or permit the use of, any illegal
drugs on the Premises.
7.) No awning or other projection shall be attached to the outside walls or
window. No curtains, blinds, shades, screens or signs other than those
furnished by Landlord shall be attached to, hung in, or used in connection
with any window or door of the Premises without prior written consent of
Landlord.
8.) No signs, advertisement, object, notice or other lettering shall be
exhibited, inscribed, painted or affixed on any part of the outside or
inside of the Premises if visible from outside of the Premises. Interior
signs on doors shall be painted or affixed for Tenant by Landlord or by
sign painters first approved by Landlord at the expense of Tenant and
shall be of a size, color and style acceptable to Landlord.
9.) Tenant shall not use the name of the Building or use pictures or
illustrations of the Building in advertising or other publicity without
prior written consent of Landlord. Landlord shall have the right to
prohibit any advertising by Tenant
which, in Landlord's reasonable opinion, tens to impair the reputation of
the Building or its desirability for offices, and, upon written notice
from Landlord, Tenant will refrain from or discontinue such advertising.
10.) Door keys for doors in the Premises will be furnished at the Commencement
of the Lease by Landlord. Tenant shall not affix additional locks on doors
and shall purchase duplicate keys only from Landlord and will provide to
Landlord, prior to termination, the means of opening of safes, cabinets,
or vaults to be left on the Premises after termination. In the event of
the loss of any keys so furnished by Landlord, Tenant shall pay to
Landlord the cost thereof.
11.) Tenant shall cooperate and participate in all security programs affecting
the Building.
12.) Tenant assumes full responsibility for protecting its space from theft,
robbery and pilferage, which included keeping doors locked and other means
of entry to the Premises closed and secured.
13.) Tenant shall not make any room-to-room canvass to solicit business from
other tenants in the Building, and shall not exhibit, sell or offer to
sell, use, rent or exchange any item or services in or from the Premises
unless ordinarily embraced within Tenant's use of the Premises as
specified in its Lease. Canvassing, soliciting and peddling in the
Building are prohibited and Tenant shall cooperate to prevent the same.
Peddlers, solicitors and beggars shall be reported to the Management
Office.
14.) Tenant shall not wasted electricity or water and agrees to cooperate fully
with Landlord to assure the most effective operation of the Building's
heating and air conditioning and shall refrain from attempting to adjust
controls. Tenant shall keep corridor doors closed except when being used
for access.
15.) The water and wash closets and other plumbing fixtures shall not be used
for any purpose other than those for which they were constructed, and no
sweepings, rubbish, rags, or other substances shall be thrown therein.
16.) Building employees shall not be required to perform, and shall not be
requested by any tenant or occupant to perform, any work outside of their
regular duties, unless under specific instructions from the office of the
Managing Agent of the Building.
17.) Tenant may request heating and/or air conditioning during other periods in
addition to normal working hours by submitting its request in writing to
the office of the Managing Agent of the Building no later than 2:00 p.m.
the preceding work day (Monday through Friday). The request shall clearly
state the start and stop hours of the "off-hour" service. Tenant shall
submit to the Building Manage a list of personnel authorized to make such
request. When applicable, Tenant shall be charged for such operation in
the form of additional rent.
18.) Tenant covenants and agrees that its use of the Premises shall not cause a
discharge of sanitary (non-industrial) sewage which will result in a
violation of the sewage discharge permit (s) for the Building. Discharges
in excess of that amount, and any discharge of industrial sewage, shall
only be permitted if Tenant, at its sole expense, shall have obtained all
necessary permits and licenses therefore, including without limitation
permits from state and local authorities having jurisdiction thereof.
Tenant shall submit to Landlord on December 31 of each year of the Term of
this Lease a statement, certified by an authorized officer of Tenant,
which contains the following information: name of all chemicals, gases,
and hazardous substances (liquid, gas or granular); quantity used, stored
or generated per year; method of disposal;
permit number, if any, attributable to each substance, together with
copies of all permits for such substance; and permit expiration date for
each substance.
EXHIBIT F
SIGN CRITERIA
WESTFORD CORPORATE CENTER
Sign Standards for the Park
Tenant shall have the right to exterior "signs" in conformance with standards
and requirements as follows:
1.) BUILDING STANDARDS: Where the Tenant leases more than fifty percent
(50%) of the entire building, the Tenant, at its expense, may
install on the Building a sign (the "Building Sign") consisting of
the Tenants' logo and/or letters to spell out, as a maximum, the
corporate name of the tenant; such logo and/or letters to
individually affixed to the exterior of the building in a location
and manner reasonably acceptable to the Landlord. The logo and
individual letters (i) shall be no more than two (2) feet high nor
more than two (2) and a half inches deep, (ii) shall not be
internally illuminated or illuminated by lights bracketed off the
building, and (iii) shall be fabricated of no. 304 (18-8 alloy)
stainless steel with a stain finish, grain to be horizontal; the
minimum thickness of faces to be 18-gauge and sides to be 22-gauge.
The design, location, and proposed installation must be approved in
writing by the Landlord prior to installation, which approval shall
not be unreasonably withheld, delayed or conditioned.
2.) STREET SIGN: Where the Tenant is a major tenant (tenant of at least
20,000 square feet) of the building, the Tenant, at its expense, may
request that the Landlord include on either one or both faces of the
street address sign located at the entrance of the building site
(i.e. the Landlord furnished Westford Corporate Center sign of
nominal dimensions 4'-2" high 8'-0" wide which identifies the street
address of the building) lettering to spell out, the corporate name
of the Tenant. The background field area for lettering so requested
is limited to maximum size or 4 inches high by 72 inches long on the
signs of multi-tenanted buildings; on the signs of single-tenanted
buildings the maximum background filed area is 17 inches high by 72
inches long, and in addition to the corporate name may also include
lettering to identify a subdivision or special use group of the
Tenant pertinent to the building. The individual letters on these
signs shall be adhesive backed vinyl with a maximum height of 6
inches; they may be at the Tenant's option in the logo typeface of
Tenant's corporate graphic standards, or Helvetica medium which is
the standard of Westford Corporate Center. Unless otherwise approved
in writing by the Landlord, which approval of Landlord shall not
unreasonably withhold, delay or condition, the color of the letters
shall be black. The Tenant is responsible for graphic layout and for
the Landlord's costs of providing and installing the lettering.
3.) TRAFFIC DIRECTORY SIGNS: Where the Tenant is sole tenant of the
entire building, the Tenant, at its expense and with the prior
written approval of the Landlord, may install within the bounds of
the leased building site vehicular and/or pedestrian directory
signs. Such signs shall be identical in an construction, and have
the same background color, to the Westford Corporate Center standard
pole mounted "flag" type traffic control signs. The sign face shall
be rectilinear and shall not have an area exceeding 20 inches high
by 28 inches wide. The mounting height of such signs shall not
exceed the mounting height of the Westford Corporate Center traffic
control signs.
Dates Referenced Herein and Documents Incorporated by Reference
1 Subsequent Filing that References this Filing
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