LEASE AGREEMENT 645: AGGRESSIVELY PRO-TENANT CALL CENTER LEASE WITH EXPENSE STOP FOR CREDIT TENANT $99.95
THIS LEASE AGREEMENT (this Lease) is made as of _______________, 200_, by and between COMMERCIAL PROPERTY LANDLORD, a ____________ limited partnership (Landlord) and ACCEPTABLE TENANT, a _____________ corporation (Tenant).
Section 1.01 Definitions.
For purposes of this Lease, the following terms shall have the following meanings:
(a) Allowance: Shall mean an amount equal to ____ Dollars and No Cents ($_.00) per square foot of Tenant's Useable Square Feet in the Premises (as defined in Section 1.01(z) below) which is equal to _______________ Dollars ($________), plus an additional ________________ Dollars ($_________) to be used in space planning for a portion of the Premises located on the ______________ floor.
(b) Building: That certain parcel of real estate located within the ____________ Center as described on Exhibit B attached hereto and incorporated herein by this reference and the building and other improvements located thereon, all of which is commonly known as _____________________.
(c) Building Core: The area within the outermost finish face of that portion of the Building that incorporates those areas that provide service to the tenants of that floor and to the Building. These areas of service include: restroom facilities for men and women along with the vestibule and access, electrical, mechanical, and telephone rooms, janitor closets, elevators and service elevators along with lobby and stairs, vestibules, and all vertical floor penetrations for mechanical/electrical/plumbing for the Building.
(d) Building Shell: The condition of the Building completed with the following improvements: (i) outside walls (not including drywall), core walls, and elevator lobby areas completed to building standard condition for public areas; (ii) unfinished concrete floors throughout the Premises, broom clean; (iii) building standard 110 volt 220 amp. power supplied to the Building Core along with 277/480 volt fluorescent lighting power supplied to the Building Core; (iv) men's and ladies' restroom facilities with building standard finished located on each floor on which the Premises are located; (v) building standard voice communication speakers and smoke detectors in accordance with applicable building codes and provided only at the core; and (vi) mechanical, electrical, plumbing, life safety, heating, air conditioning and ventilation in Building Core area as required to connect to and service the Premises.
(e) Commencement Date shall mean _________, 200_.
(f) Common Building Areas: All areas and facilities outside the Premises and within the exterior boundary line of the Building and interior utility raceways within the Premises that are provided and designated by the Landlord from time to time for the general non-exclusive use of Landlord, Tenant and other tenants of the Building and their respective employees, suppliers, shippers, customers, contractors and invitees, including, without limitation, trash areas, roadways, sidewalks, walkways, landscaped areas, irrigation systems, lighting facilities, fences, gates, elevators, roof, common entrances, common areas within the Building, common pipes, conduits, wires and appurtenant equipment serving the Premises, exterior signs, Tenant directories, fire detection systems, sprinkler systems, security systems, and the parking facilities for the Building. Landlord has the right to change the Common Building Areas and to take other actions respecting these areas in accordance with Section 2.05 below.
(g) Declaration: Those certain Covenants, Conditions and Restrictions for The Crossing Business Center dated ____________, 199_ and filed for record with the County Recorder of _______ County, ____________ , as amended from time to time.
(h) Expense Stop: The amount (per square foot of Tenant's Rentable Square Feet) Landlord herewith agrees to expend as its share of Standard Operating Costs and Variable Operating Expenses (which shall be a credit for Tenant to apply to offset Standard Operating Costs and Variable Operating Expenses charged to Tenant) shall be _______________ Dollars ($_____).
(i) Initial Security Deposit: ______________________ Dollars ($________) to be held as required under Section 4.10 of the Lease.
(j) Laws: All applicable statutes, regulations, requirements, ordinances and orders promulgated by any federal, state, local or regional governmental authority whether prior to or following the Commencement Date of this Lease.
(k) Landlord's Address: ______________________. ________________________________.
(l) Landlord's Broker: None.
(m) Lease Interest Rate: The lesser of (i) two percentage points (2%) over that fluctuating rate of interest announced from time to time by the Bank of America National Trust and Savings Association as its prime or reference commercial lending rate of interest (Prime Rate) (or in the event such bank is no longer announcing such rate, by such other federally regulated banking institution of comparable stature as Landlord shall reasonably determine), or (ii) the maximum interest rate permitted by law.
(n) Lease Term: five (5) years and six (6) months beginning on the Commencement Date and continuing until sixty-six (66) months after the first day of the first full month following the Commencement Date, unless extended pursuant to Rider No. 2 - Option to Renew Lease attached to this Lease and incorporated herein by this reference.
(o) Leased Premises Address: ___________________ .
(p) Mortgagee: Shall mean the mortgagee or beneficiary under a deed of trust holding a lien encumbering the Building or any holder of a ground leasehold interest in the Building or any part thereof.
(q) Standard Operating Costs: All costs of any kind paid or incurred by Landlord during the Lease Term because of or in connection with the ownership, management, maintenance, repair, replacement, restoration or operation of the Building (including all Common Building Areas that do not decrease or increase as a result of Tenant's use of the Premises), including by way of illustration but not limitation, all of the following: (i) all amounts charged to the Building pursuant to the Declaration; (ii) Real Property Taxes; (iii) all costs and charges for sewage; (iv) insurance costs for which Landlord is responsible or otherwise may procure under Section 4.05(a) of the Lease or which any Mortgagee deems necessary or prudent; (v) any costs levied, assessed or imposed pursuant to any applicable Laws; (vi) the cost (amortized over such period as Landlord reasonably determines together with interest at the Lease Interest Rate in effect at the time the cost is incurred on the unamortized balance) of any capital improvements to the Building or equipment replacements made by Landlord after the Commencement Date that Landlord, in its commercially reasonable business judgment determines should reduce other Standard Operating Costs or are required by any Laws or are necessary in order to operate the Building at the same quality level as prior to such replacement; (vii) costs and expenses of operation, repair and maintenance of all structural and mechanical portions and components of the Building; (viii) utilities surcharges or any other costs levied, assessed or imposed by, or at the direction of, or resulting from statutes or regulations or interpretations thereof, promulgated by any federal, state, regional, municipal or local government authority in connection with the use or occupancy of the Building (including, without limitation, energy conservation charges or surcharges); (ix) all costs incurred in the management and operation of the Building including, without limitation, gardening and landscaping, maintenance of all parking areas, maintenance of signs, resurfacing and repaving, painting, lighting, cleaning, and provision of Building security; (x) all personal property taxes levied on or attributable to personal property owned or leased by Landlord or its management agent, if any, used in connection with the Building; (xi) depreciation on personal property owned by Landlord which is consumed in the operation or maintenance of the Building to the extent not amortized pursuant to 1.01(q)(vi); (xii) rental or lease payments paid by Landlord for rented or leased personal property used in the operation or maintenance of the Building; (xiii) management fees (not to exceed three percent (3%) of total income for the Building), wages, salaries and other labor costs incurred in the management and operation of the Building; (xiv) fees for required licenses and permits; (xv) reasonable legal, accounting and other professional fees; (xvi) reasonable and appropriate reserves for repair and replacement; and (xvii) any other expenses that do not decrease or increase as a result of Tenant's use of the Premises, which would reasonably or customarily be included in the cost of managing, operating, maintaining and repairing buildings similar to the Building. If the Building is not fully occupied during any portion of the Lease Term, Landlord shall make an appropriate adjustment to Standard Operating Costs and Variable Operating Expenses for such period employing sound accounting and management principles, to determine the amount of Standard Operating Costs and Variable Operating Expenses that would have been incurred had the Building been fully occupied during such period. Notwithstanding anything to the contrary contained in the definition of Standard Operating Costs, Standard Operating Costs shall not include:
1. Any ground lease rental;
2. Costs of capital improvements and equipment; except for those (a) acquired to reduce Standard Operating Costs, amortized at an annual rate reasonably calculated to equal the amount of Standard Operating Costs actually saved in each calendar year throughout the Lease Term (as determined at the time Landlord elected to proceed with the capital improvement or acquisition of the capital equipment to reduce Standard Operating Costs), together with interest at the actual interest rate incurred by Landlord, or (b) made after the Commencement Date that are required under any governmental law or regulation that was not in effect as of the date of this Lease (which shall be amortized, including interest on the unamortized cost at the actual interest rate, if any, incurred by Landlord, over its useful life as reasonably determined by Landlord) , or (c) necessary in order to operate the Building at the same quality level as prior to such replacement;
3. Costs incurred by Landlord for the repair of damage to the Building, to the extent that Landlord is reimbursed by insurance proceeds (or any other source whatsoever);
4. Costs, including architectural, permit, license and inspection costs, incurred with respect to the installation of tenant improvements made for tenants or other occupants in the Building or incurred in renovating or otherwise improving, decorating, painting or redecorating vacant space for tenants or other occupants of the Building;
5. Depreciation, amortization and interest payments, except as otherwise provided in this Section 1.01(q) and except on materials, tools, supplies and vendor-type equipment purchased by Landlord to enable Landlord to supply services Landlord might otherwise contract for with a third party where such depreciation, amortization and interest payments would otherwise have been included in the charge for such third party's services, all as determined in accordance with generally accepted accounting principles, consistently applied, and when depreciation or amortization is permitted or required, the item shall be amortized over its reasonably anticipated useful life;
6. Marketing costs including leasing commissions, attorneys' fees in connection with the negotiation and preparation of leases, space planning costs, and other costs and expenses incurred in connection with lease, sublease and/or assignment negotiations and transactions with present or prospective tenants or other occupants of the Building;
7. Costs incurred by Landlord for alterations which are considered capital improvements and replacements under generally accepted accounting principles, consistently applied, except as permitted in Subsection (2) and (3) above;
8. Costs of a capital nature, including, without limitation, capital improvements, capital repairs, capital equipment and capital tools, all as determined in accordance with generally accepted accounting principles, consistently applied, except as permitted in Subsection (2) above;
9. Expenses in connection with services or other benefits which are not offered to Tenant or for which Tenant (or any other Tenant) is charged directly;
10. Costs incurred by Landlord due to the violation by Landlord or any tenant of the terms and conditions of any lease of space in the Building;
11. Overhead and profit increment paid to Landlord or to subsidiaries or affiliates of Landlord for goods and/or services in the Building to the extent the same exceeds the costs of such goods and/or services rendered by unaffiliated third parties on a competitive basis to projects or buildings of a comparable quality;
12. Interest, principal, points and fees on debts or amortization on any mortgage or mortgages or any other debt instrument encumbering the Building or the land on which the Building is located (except as permitted in Subsection (2) above);
13. Landlord's general corporate overhead and general administrative expenses;
14. Any compensation paid to clerks, attendants or other persons in commercial concessions operated by Landlord (other than parking attendants and a concierge for the project);
15. Except for making repairs or keeping permanent systems in operation while repairs are being made, rentals and other related expenses incurred in leasing air conditioning systems, elevators or other equipment ordinarily considered to be of a capital nature, except equipment not affixed to the Building which is used in providing janitorial or similar services;
16. Advertising and promotional expenditures, and costs of signs in or on the Building identifying the owner of the Building or other tenants' signs (but not directional signs);
17. Electric power costs for which any tenant directly contracts with the local public service company (but such space shall be treated as vacant for electrical gross-up purposes);
18. Costs incurred in connection with the operation of any retail or restaurant operations in the Building, to the extent such costs exceed the amount which would reasonably be expected to have been incurred had such space been used for general office purposes;
19. Costs incurred in connection with upgrading the Building to comply with handicap, life, fire and safety codes in effect prior to the Commencement Date;
20. Tax penalties incurred as a result of Landlord's negligence, inability or unwillingness to make payments and/or to file any income tax or informational returns when due;
21. [Intentionally Omitted];
22. Costs arising from Landlord's charitable or political contributions;
23. Costs arising from defects in the base, shell or core of the Building or in improvements installed by Landlord prior to the Commencement Date, or repair of such defects;
24. Costs for sculpture, paintings or other objects of art (but not maintenance and repair);
25. Costs (including in connection therewith all attorneys' fees and costs of settlements or judgments and payments in lieu thereof) arising from claims, disputes or potential disputes in connection with potential or actual claims or litigation or arbitrations pertaining to the Landlord and/or the Building;
26. [Intentionally Omitted];
27. Any rental costs related to the operation of a leasing office in the Building;
28. Costs arising from (and future reserves for) bad debt losses and rent losses;
29. Costs incurred in connection with gifts or parties provided by Landlord to tenants in the Building;
30. Management fees incurred in the management or operation of the Building to the extent they exceed three percent (3%) of the gross rental receipts for the Building;
31. Any other expenses which, in accordance with generally accepted accounting principles, consistently applied, would not normally be treated as an Standard Operating Expense by landlords of comparable buildings.
32. Any Variable Operating Expenses (as defined in Section 1.01(bb).
It is understood that Standard Operating Costs shall be reduced by all cash discounts, trade discounts, or quantity discounts actually received by Landlord or Landlord's managing agent in the purchase of any goods, utilities, or services in connection with the operation of the Building. In the calculation of any expenses hereunder, it is understood that no expense shall be charged more than once. Landlord shall use commercial reasonable efforts to effect an equitable proration of bills for services rendered to the Building and to any other property owned by Landlord.
(r) Permitted Uses: General office use, including, but not limited to, a call center facility operated on a twenty-four (24) hour per day basis, three hundred sixty-five (365) days per year.
(s) Premises: The office space in the approximate location within the Building as indicated on Exhibit A attached hereto and incorporated herein by this reference.
(t) Real Property Taxes: Any form of tax, assessment, license fee, license tax, business license fee, commercial rental tax, levy, charge, penalty, tax or similar imposition, imposed by any authority having the direct power to tax (including any city, county, state or federal government, or any school, agricultural, lighting, drainage, transportation, air pollution, environmental or other improvement or special assessment district) as against any legal or equitable interest of Landlord in the Building and/or the Premises, including, but not limited to, the following:
(i) any tax on a landlord's right to rent or right to other income from the Premises or against Landlord's business of leasing the Premises;
(ii) any assessment, tax, fee, levy or charge in substitution, partially or totally, of any assessment, tax, fee, levy or charge previously included within the definition of Real Property Taxes (it is the intention of Tenant and Landlord that all such new and increased assessments, taxes, fees, levies and charges be included within the definition of Real Property Taxes for the purposes of this Lease);
(iii) any assessment, tax, fee, levy or charge allocable to or measured by the area of the Premises or the rent payable hereunder, including, without limitation, any gross income tax or excise tax levied by the state, county, city or federal government, or any political subdivision thereof, with respect to the receipt of such rent, or upon or with respect to the possession, leasing, operating, management and maintenance, alteration, repair, use or occupancy of the Building, or any portion thereof;
(iv) any assessment, tax, fee, levy or charge upon this transaction creating or transferring an interest or an estate in the Premises;
(v) any assessment, tax, fee, levy or charge based upon the number of people employed, working at, or using the Premises or the Building, or utilizing public or private transportation to commute to the Premises or the Building; and
(vi) reasonable legal and other professional fees, costs and disbursements incurred in connection with proceedings to contest, determine or reduce Real Property Taxes. Real Property Taxes shall not include successor transfer taxes (except as provided in Section 1.01 (t) (iv) above, federal or state income, franchise, inheritance or estate taxes of Landlord or any of the parties which comprise Landlord.
(u) Rentable Square Feet in the Building: Seventy-four thousand five hundred sixty-six (74,566) rentable square feet. The Building is stipulated for all purposes to contain said Rentable Square Feet in the Building.
(v) Tenant's Address: _____________________.
(w) Tenant's Broker: ________________.
(x) Tenant's Guarantor: None.
(y) Tenant's Rentable Square Feet: _______________________________ (________) rentable square feet. The Premises are stipulated for all purposes to contain said Tenant's Rentable Square Feet.
(z) Tenant's Usable Square Feet: ___________________ (_______) usable square feet. The Premises are stipulated for all purposes to contain said Tenant's Usable Square Feet.
(aa) Commencement Memorandum shall mean a document similar to Exhibit D attached hereto. The Commencement Memorandum, among other things, shall contain a reference to the Rentable Area of the Premises and Useable Area of the Premises. Tenant agrees that the Rentable Area and Useable Area of the Premises stated in the Commencement Memorandum shall be binding throughout the Lease Term.
(bb) Variable Operating Expenses: All costs of any kind paid or incurred by Landlord in connection with the management, maintenance, repair, replacement or operation of the of the Building (which does decrease or increase as a result of Tenant's use of the Premises) including by way of illustration but not limitation all of the following: (i) utilities, water, waste disposal, janitorial and refuse removal and all other utilities and services provided to the Building, (ii) repairs and supplies, and (iii) all other costs that will increase (or decrease) as a result of a tenant's use of the Premises. Tenant's share shall be Tenant's Adjusted Share (as defined below).
(cc) Tenant's Adjusted Share: Tenant's Adjusted Share shall be equal to a fraction where the numerator is Tenant's Adjusted Rentable Square Feet (as defined below) and the denominator is the Adjusted Rentable Square Feet in the Building (as defined below). The Tenant's Adjusted Share shall be determined by Landlord each quarter of each calendar year utilizing the method described herein. It is stipulated that Tenant shall use the Building systems twenty-four (24) hours per day, three hundred sixty-five (365) days per year. First, Landlord, in its reasonable discretion, shall make a determination of the number of hours (Tenant's Hours of Operation) that each of the tenants occupying the Building have utilized their respective space during the calendar year. Any space that is occupied for only a portion of a calendar quarter shall be prorated on the basis of the actual number of days in such calendar year. Second, Landlord shall assign each tenant in the Building an operations constant (Tenant's Operating Constant) that is equal to a fraction where the numerator is the Tenant's Hours of Operation and the denominator is equal to two thousand eight hundred ten (2,810) hours (Standard Operating Hours). Third, Landlord shall adjust the rentable square feet allocated to each tenant (individually referred to as Tenant's Adjusted Rentable Square Feet) in the Building by multiplying the Tenant's Operating Constant assigned to the tenant for that calendar year by the Tenant's Rentable Square Feet. Fourth, Landlord shall determine the adjusted rentable square feet in the Building (Adjusted Rentable Square Feet in the Building) for that particular calendar year by adding up the Tenant's Adjusted Rentable Square Feet for each of the tenant's occupying space in the Building. Landlord shall have the right to further adjust the Tenant's Adjusted Rentable Square Feet in the event a tenant occupying the Building operates in such a manner that causes a disproportionate use of the utilities (and other services comprising the Variable Operating Expenses) by that tenant as compared to other tenants in the Building, resulting in a higher cost for such utilities (and other services comprising the Variable Operating Expenses) on a per-hour basis for such tenant's space. By way of illustration, such disproportionate use of the utilities (and other services comprising the Variable Operating Expenses) could be caused by uses including, but not limited to, more computers than would be used by a general office, more electrical equipment than would be used by a general office, or more people than would occupy a general office.
Section 1.02 Base Rent.
The Base Rent shall be as follows:
Months Monthly Installments
The Base Rent due for the first full calendar month during the Lease Term for which Rent is owed shall be paid to Landlord by Tenant contemporaneously with Tenant's and Landlord's execution hereof.
Section 1.03 Riders.
The following Riders are attached to and made a part of this Lease: Rider No. 1 - Work Letter; Rider No. 2 - Option to Renew Lease; Rider No. 3 - Right of First Offer to Lease.
Section 1.04 Parking.
Tenant shall be entitled to use up to ____________ (____) unreserved parking spaces, of which eleven (11) shall be reserved and covered, at no charge throughout the Lease Term. Additionally, Tenant shall have the right to request that Landlord cover a portion of the parking spaces Tenant is entitled to use, at Tenant's sole cost and expense, in a manner and location to be approved by Landlord. Landlord agrees that, other than the cost of constructing the covering as stated above, Tenant shall not be charged for the use of any such covered parking spaces.
LEASE TERM AND COMMON BUILDING AREAS
Section 2.01 Lease of Property for Lease Term.
Landlord hereby leases the Premises to Tenant and Tenant leases the Premises from Landlord for the Lease Term. The Lease Term is for the period stated in Section 1.01(n) above and shall begin and end on the dates specified in Section 1.01(n) above. The Commencement Date shall be the date specified in Section 1.01(e) above for the beginning of the Lease Term.
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