LEASE MICHIGAN PLAZA 205 NORTH MICHIGAN AVENUE CHICAGO, ILLINOIS TALK AMERICA INC. LEASE MICHIGAN PLAZA 205 NORTH MICHIGAN AVENUE CHICAGO, ILLINOIS TALK AMERICA Table of Contents

     11.    FIRE OR CASUALTY

(a)    Section 7 hereof notwithstanding, if the Premises or the Building (including machinery or equipment used in its operation) shall be damaged by fire or other casualty and if such damage does not cause a termination of this Lease as described in the following sentences, then Landlord shall repair and restore the damage with reasonable promptness, subject to reasonable delays for in surance adjustments and delays caused by matters beyond Landlord's reasonable control, but Landlord shall not be obligated to expend for repairing or restoring the damage an amount in excess of the proceeds of insurance recovered with respect to the damage. If in Landlord's estimate the Premises cannot be restored within three hundred sixty-five (365) days from the date of such fire or casualty, then Landlord shall give notice to Tenant of such estimate within one hundred twenty (120) days after such fire or casualty and Tenant may elect in writing within sixty (60) days following the date of such notice from Landlord to terminate this Lease effective as of the date of Tenant's notice. If any such damage: (i) renders three (3) or m ore floors of the Building untenantable; or (ii) renders general Building systems inoperable and such systems cannot be repaired in Landlord's reasonable estimate within three hundred sixty-five (365) days from the date of such damage, or (iii) occurs within the last two (2) Lease Years, Landlord shall have the right to terminate this Lease as of the date of such damage upon giving written notice to the Tenant at any time within one hundred twenty (120) days after the date of such damage. Landlord shall have no liability to Tenant, and Tenant shall not be entitled to terminate this Lease, by virtue of any delays in completion of such repairs and restoration. Rent, however, shall abate on those portions of the Premises as are, from time to time, untenantable as a result of such damage.

(b)    Notwithstanding anything to the contrary herein set forth, Landlord shall have no duty pursuant to this Section 11 to repair or restore any portion of the Work or any other alterations, additions, installations or improvements in the Premises or the decorations thereto excep t to the extent that the proceeds of the insurance carried by Tenant are timely received by Landlord. If Tenant desires any other or additional repairs or restoration, and if Landlord consents thereto, it shall be done at Tenant's sole cost and expense subject to all of the provisions of Sections 7 and 8 hereof. Tenant acknowledges that Landlord shall be entitled to the full proceeds of any insurance coverage, whether carried by Landlord or Tenant, for damage to Tenant's Work or any other alterations, additions, installations, improvements or decorations which would become Landlord's property upon the termination of this Lease.

 

12.    WAIVER OF CLAIMS - INDEMNIFICATION

To the extent not prohibited by law and subject to the waiver of subrogation contained in Section 10(a) , Landlord and its partners, affiliates, officers, agents, servants and employees shall not be liable for any damage either to person, property or business or resulting from the loss of use thereof sustained by Tenant or by other persons due to the Building or any part thereof or any appurtenances thereto becoming out of repair, or due to the happening of any accident or event in or about the Building, including th e Premises, or due to any act or neglect of any tenant or occupant of the Building or of any other person, unless caused by the negligence or willful misconduct of Landlord or its agents, employees or contractors. This provision shall apply particularly, but not exclusively, to damage caused by gas, electricity, snow, ice, frost, steam, sewage, sewer gas or odors, fire, water or by the bursting or leaking of pipes, faucets, sprinklers, plumbing fixtures and windows, and, except as provided above, shall apply without distinction as to the person whose act or neglect was responsible for the damage and shall apply whether the damage was due to any of the causes specifically enumerated above or to some other cause of an entirely different kind. Tenant further agrees that all personal property upon the Premises, or upon loading docks, receiving and holding areas, or freight elevators of the Building, shall be at the risk of Tenant only, and that Landlord shall not be liable for any loss or damage thereto or theft thereof, except to the extent caused by Landlord's gross negligence. Without limiting any other provisions hereof, but subject to the provisions of Section 10(a) hereof, except for liability caused by the negligence or willful acts of Landlord or its agents, partners, affiliates, officers, servants< /font>, employees or contractors, Tenant agrees to defend, protect, indemnify and save harmless Landlord and its partners, affiliates, officers, agents, servants and employees from and against all liability to third parties arising out of the use of the Premises or the acts or omissions of Tenant or its servants, agents, employees, contractors, suppliers, workers or invitees.

Except for liability caused by the negligence or willful acts or omissions of Tenant or Tenant's partners, affiliates, officers, agents, servants or employees and subject to Section 10(a) hereof, Landlord agrees to defend, protect, indemnify and save harmless Tenant and its partners, shareholders, directors, affiliates, officers, agents, servants, contractors and employees from and against all liability to third parties arising out of negligent acts or omissions of Landlord or its servants, agents, employees, co ntractors, suppliers, workers or invitees.

13.    NONWAIVER

No waiver of any provision of this Lease shall be implied by any failure of either Landlord or Tenant to enforce any remedy on account of the violation of such provisions, even if such violation is continued or repeated subsequently, and no express waiver shall affect any provision other than the one specified in such waiver and that one only for the time and in the manner specifically stated. No receipt of monies by Landlord from Tenant after the termination of this Lease shall in any way alter the length of the Term or of Tenant's right of possession hereunder or after the giving of any notice shall reinstate, continue or extend the Term or affect any notice given Tenant prior to the receipt of such monies, it being agreed that after the service of not ice or the commencement of a suit or after final judgment for possession of the Premises, Landlord may receive and collect any Rent due, and the payment of said Rent shall not waive or affect said notice, suit or judgment.

 

14.    CONDEMNATION

If the Land or the Building (or any portion of the Building, the loss of which would require reconfiguration or restoration of the Building or the Premises) shall be taken or condemned by any competent authority for any public or quasi-public use or purpose, Landlord shall have the right, exercisable at its sole discretion, to cancel this Lease upon not less than sixty (60) days notice prior to the date of cancellation designated in the notice. No money or other consideration shall be payable by Landlord to Tenant for the rig ht of cancellation and Tenant shall have no right to share in the condemnation award or in any judgment for damages caused by such taking or condemnation. Notwithstanding the foregoing, Tenant may pursue a separate award to recover the cost of Tenant's moving expenses and improvements to the Premises paid for by Tenant and the loss of any trade fixtures or personal property, provided that such separate award shall not reduce the award or judgment recoverable by Landlord.

15.    ASSIGNMENT AND SUBLETTING

(a)    Subject to any provisions of this Section 15 to the contrary, Tenant shall not, without the prior written consent of Landlord, which consent shall not be unreasonably withheld or delayed, (i) assign, convey or mortgage this Lease or any interest hereunder; (ii) permit to occ ur or permit to exist any assignment of this Lease, or any lien upon Tenant's interest, voluntarily or by operation of law; (iii) sublet the Premises or any part thereof; (iv) advertise as available for sublet or assignment all or any portion of the Premises; or (v) permit the use of the Premises by any parties other than Tenant and its employees. Any such action on the part of Tenant shall be void and of no effect. There shall be no partial assignment of Tenant's interest in this Lease. Notwithstanding anything contained herein to the contrary, Landlord shall not be deemed to have acted unreasonably in its election not to consent to any such action on the part of Tenant because (aa) a Default shall have occurred and be continuing under this Lease or Tenant shall otherwise be in default in the performance of the terms, covenants or conditions contained in this Lease; (bb) the proposed assignee or sublessee (the "Proposed Tenant") shall be an existing tenant or occupant of the Building or of the building located at 225 North Michigan Avenue, Chicago, Illinois (the "225 Building"); (cc) such assignment or subletting shall cause Landlord to be in breach of any "exclusive use" or similar provision contained in any other lease for space in the Building (provided that such provision shall not be in conflict with the use provision set forth in the Schedule) ; (dd) in the reasonable judgment of Landlord, the Proposed Tenant is of a character or is engaged in a business which would be deleterious to the reputation of the Building, or the Proposed Tenant is not sufficiently financially responsible to perform its obligations under any such assignment or sublease, or the Proposed Tenant or any of its partners, members, shareholders, employees or affiliates, or the business conducted by any of them, could pose a security risk for the Building and/or its occupants; (ee) the portion of the Premises which Tenant proposes to sublease, including the means of ingress and egress thereto and the proposed use thereof, and the remaining portion of the Premises will violate any city, state or federal law, ordinance or regulation; (ff) the Proposed Tenant is a government agency (or any subdivision thereof); (gg) the Proposed Tenant is a party with whom Landlord is in

 

 

            active negotiations or in lease for space in the Building or with whom Landlord has a proposal outstanding in the Building or with whom the landlord of the 225 Building is in active negotiations or in lease for space in such building or with whom such landlord has a proposal outstanding in the 225 Building, provided, however, that the foregoing are merely examples of the reasons for which Landlord may reasonably not consent to any such actions by Tenant and shall not be deemed exclusive of any reason for reasonably making such election, whether similar or dissimilar to the foregoing examples. The term "sublease" and all words derived therefrom, as used in this Section 15 shall include any subsequent sublease or assignment of such sublease and any other interest arising under such sublease. Landlord's consent to any assignment, subletting or transfer or Landlord's election to accept any assignee, subtenant or transferee as the Tenant hereunder and to collect rent from such assignee, subtenant or transferee shall not release Tenant or any subsequent Tenant from any covenant or obligation under this Lease, and Tenant further expressly acknowledges and agrees that any renewal rights, expansion rights, reduction rights, rights of first offer, termination rights or limitations on Taxes or Operating Expenses shall be deemed personal to the original Tenant and shall not inure to the benefit of any assignee other than a Permitted Assignee), subtenant or transferee taking from the original Tenant. Landlord's consent to any assignment, subletting or transfer shall not constitute a waiver of Landlord's right to withhold its consent to any future assignment, subletting, or transfer. Landlord may condition its consent upon execution by the subtenant or assignee of an instrument confirming such restrictions on further subleasing or assi gnment and joining in the waivers and indemnities made by Tenant hereunder insofar as such waivers and indemnities relate to the affected space. Without limiting the foregoing, Tenant agrees to indemnify, defend and hold Landlord and its employees, agents, their officers and partners harmless from and against any claims made by any broker or finder for a commission or fee in connection with any subleasing or assignment by Tenant or any subtenant or assignee of Tenant.

(b)    If Tenant desires the consent of Landlord to an assignment or subletting or in the event Tenant desires to assign or sublet the Premises to Permitted Assignees (as hereinafter defined) where Landlord's consent is not required pursuant to Section 15(f) below, Tenant shall submit to Landlord a written notice which includes:

(i)    Copies of the final executed documentation related to the proposed sublease or assignment; and

(ii)    Sufficient information to permit Landlord to determine the identity and character of the proposed subtenant or assignee and the financial condition of the proposed assignee or subtenant.

Landlord agrees to notify Tenant as to whether Landlord consents to such assignment or sublease within thirty (30) business days after receipt by Landlord of all documents required pursuant to (i) and (ii) above.

 

 

(c)    In addition to withholding its consent Landlord shall have the right to terminate this Lease in the event of a proposed assignment of this Lease or a proposed sublease of the entire Premises or to terminate this Lease as to that portion of the Premises which Tenant seeks to sublet, if Tenant seeks to sublease less than the entire Premises. Landlord may exercise such right to terminate by giving written notice to Tenant at any time on or before the date by which Landlord is required to consent or object to such assignment or sublease. If Landlord exercises its right to terminate, the Lease or portion thereof shall be deemed terminated effective as of, and Landlord shall be entitled to recover possession of and Tenant shall surrender such portion of the Premises, on the later of: (i) the proposed date for possession by such assignee or subtenant, or (ii) ninety (90) days after the date of Landlord's notice of termination to Tenant.

(d)    If Landlord consents to any assignment of this Lease or a sublease of the Premises, as a condition of Landlord's consent, Tenant shall pay to Landlord any reasonable attorneys’ fees and expenses incurred by Landlord in connection with such assignment or sublease plus fifty percent (50%) of all Sublease Profits (as defined below) derived by Tenant from such assignment or sublease. "Sublease Profits" shall mean the entire excess (after deducting all reasonable costs of subletting) of revenues generated by the assignment of this Lease or the subleasing of the Premises over the Rent applicable thereto. All such revenues shall be applied first to reimbursement of such costs of subletting or assigning until they are paid in full. Tenant shall furnish Landlord with a sworn statement, certified by an officer of Tenant, setting forth in detail the computation of Sublease Profits, and Landlord, or its representatives, shall have access to the books, records and papers of Tenant in relation thereto, and to make copies thereof. If a part of the consideration for such assignment shall be payable other than in cash, the payment to Landlord shall be payable in accordance with the foregoing percentage of the cash and other non-cash considerations in such form as is reasonably satisfactory to Landlord. Such percentage of Sublease Profits shall be paid to Landlord promptly by Tenant upon Tenant's receipt from time to time of periodic payments from such assignee or subtenant or at such other time as Tenant shall realize Sublease Profits from such assignment or sublease. If such sublease or assignment is part of a larger transaction in which other assets of Tenant are being transferred, the consideration for the assignment or sublease shall be a reasonable allocation of the total value received minus a reasonable allocation of the total expenses incurred in connection with such transaction.

(e)    If Tenant is a partnership, a withdrawal or change, whether voluntary, involuntary or by operation of law or in one or more transactions, of partners owning directly or indirectly a controlling interest in Tenant shall be deemed an assignment of this Lease and subject to the provisions of this Section 15 . If Tenant is a corporation, any dissolution, merger, consolidation or other reorganization of Tenant, or the sale, transfer or redemption of a direct or indirect controlling interest in the capital stock of Tenant, in one or more transactions, shall be deemed a voluntary assignment of this Lease and subject to the provisions of this Section 15 . Neither this Lease nor any interest therein nor any estate created thereby shall pass by operation of law or otherwise to any trustee, custodian or receiver in bankruptcy of Tenant or any assignee for the assignment of the benefit of creditors of Tenant.

 

(f)    Notwithstanding anything contained in this Section 15 to the contrary, Tenant shall have the right, upon prior written notice to Landlord but without Landlord's consent, to assign or sublet all of the Premises to Permitted Assignees (as hereinafter defined), provided that su ch assignment or subletting shall not relieve Tenant of its primary responsibility for the performance of all obligations of Tenant hereunder, and in the event of an assignment to a Permitted Assignee, such Permitted Assignee assumes, pursuant to an agreement in form and substance reasonably satisfactory to Landlord, the obligations of Tenant hereunder and in the event of a sublet, such sublet is governed by a form of sublease reasonably approved in advance by Landlord. As used herein, a "Permitted Assignee" shall mean (i) any entity owned or controlled by Tenant, (ii) any entity of which Tenant is a subsidiary (on any level), (iii) any entity which is under common ownership or control with Tenant, (iv) any entity into which Tenant is merged or consolidated or which consolidates into Tenant, or (v) any entity which acquires all or substantially all of the asset or stock of Tenant, provided in each case that Landlord is reasonably satisfied with the business reputation and financial condition of such entity, it being understood that if such entity has a net worth at least equal to that of Tenant on the date hereof, the financial condition of such entity shall be deemed satisfactory to Landlord. At least ten (10) business days prior to the effective date of such assignment or sub lease, Tenant agrees to deliver to Landlord documentation evidencing that Landlord does not have the right to consent to such transaction pursuant to this Section 15(f) . Further, Tenant agrees to deliver to Landlord, within ten (10) business days prior to the effective date of such assignment or sublease, fully executed copies of the documents effectuating such assignment or sublease.

16.    SURRENDER OF POSSESSION

Upon the expiration of the Term or upon the termination of Tenant's right of possession, whether by lapse of time or at the option of Landlord as herein provided, Tenant shall forthwith surrender the Premises to Landlord in good order, repair and condition, ordinary wear and damage resulting from fire or other casualty excepted. Any interest of Tenant in the alterations, improvements, installations and additions to the Premises made or paid for by Landlord or Tenant shall, without compensation to Tenant, become Landlord's property at the termination of this Lease by lapse of time or otherwise and such alterations, improvements, installations and additions shall be relinquished to Landlord in good condition, ordinary wear excepted. Prior to the terminatio n of the Term or of Tenant's right of possession Tenant shall remove its office furniture, trade fixtures, office equipment and all other items of Tenant's movable property on the Premises. Unless requested to do so by Landlord, Tenant shall not have any right to remove, any alterations, improvements, installations or additions, which shall include built-in furniture or shelves and all other attached items, excluding trade fixtures and computer equipment racks. Tenant shall pay to Landlord upon demand the cost of repairing any damage to the Premises and to the Building caused by any such removal. If Tenant fails or refuses to remove any such property from the Premises , Tenant shall be conclusively presumed to have abandoned the same, and title thereto shall thereupon pass to

Landlord without any cost either by set-off, credit, allowance or otherwise, and at its option Landlord may: (i) accept the title to the property; (ii) or at Tenant's expense remove the property or any part in any manner that Landlord shall choose, repairing any damage to the Premises caused by such removal; and store, destroy or otherwise dispose of the property without incurring liability to Tenant or any other person. Landlord expressly acknowledges and agrees that nothing contained in this Lease to the contrary shall require Tenant to remove any improvements or additions installed by or on behalf of Tenant pursuant to the Tenant Work Letter or any alterations performed by Tenant pursuant to Section 8 above (unless at the time Landlord shall approve the installation of such alterations, Landlord shall have notified Tenant in writing that such removal would be required at the expiration of the Term) or otherwise require Tenant to bring the Premises back to "raw space".

17.    HOLDING OVER

During each month or portion thereof for which Tenant shall retain possession of the Premises or any portion thereof after the expiration or termination of the Term or of Tenant's right of possession, whether by lapse of time or otherwise, Tenant shall pay to Landlord an amount as Rent per month at the rate equal to 200% of the Base Rent and 200% of the Additional Rent payable by Tenant per month for the last month of the Term for all of the Premises (regardless of whether Tenant retains possession of all or only a portion of the Premises) for each mon th or portion thereof Tenant so retains possession of all or any portion of the Premises; provided, however, that during the first month, rather than paying 200% as stated aforesaid, Tenant shall pay an amount as Rent per month at the rate equal to 150% of the Base Rent and 150% of the Additional Rent payable by Tenant per month based upon the last month of the Term for all of the Premises (regardless of whether Tenant retains possession of all or only a portion of the Premises) for each month or portion thereof Tenant retains possession of all or a portion of the Premises. In addition to the foregoing, Tenant shall also pay Landlord for all damages sustained by Landlord on account any such holding over the provisions of this Section 17 shall not be deemed to limit or constitute a waiver of any other rights or remedies of Landlord provided herein or at law.

18.    ESTOPPEL CERTIFICATE

Tenant agrees, that, from time to time upon not less than ten (10) days prior request by Landlord, Tenant, or Tenant's duly authorized representative having knowledge of the following facts, will deliver to Landlord a statement in writing certifying: (i) that this Lease is unmodified and in full force and effect (or if there have been modifications, a description of such modifications and that the Lease as modified is in full force and effect); (ii) the dates to which Rent and other charges have been paid; (iii) that the Landlord is not in default under any provision of this Lease, or, if in default, the nature thereof in detail; and (iv) such further matters as are set forth on the form of estoppel certificate attached hereto as Exhibit D and made a part hereof, or as may be reasonably requested by Landlord, it being intended that any such statement may be relied upon by any mortgagees or prospective mortgagees, or any prospective assignee of any Mortgagee, or any prospective and/or subsequent purchaser or transferee of all or a part of Landlord's interest in the Land and/or Building. Tenant shall execute and deliver whatever instruments may be required for such purposes within ten (10) days following Landlord's request therefor.

 

19.    OBLIGATIONS TO MORTGAGEES

(a)    Subordination . This Lease is subject and subordinate to all present and future ground or underlying leases of the Land and/or improvement leases of the Building and to the lien of any mortgages or trust deeds now and hereafter in force against the Land or Building and to all renewals, extensions, modifications, consolidation and replacements thereof. At Landlord's request (and after consent from any prior mortgagee or lessor if Tenant has agreed not to so subordinate without such consent), Tenant shall execute such further instruments or assurances as Landlord may reasonably deem necessary to evidence, confirm or effectuate such subordination of this Lease thereto or, if requested, to make Tenant's interest in this Lease superior thereto. If any mortgage shall be foreclosed or property encumbered thereby is transferred in lieu of foreclosure, or if any such future ground or improvements lease or underlying lease is terminated: (i) the liability of the mortgagee, trustee, transferee, purchaser at such foreclosure sale or ground lessor or improvements lessor and the liability of a subsequent owner (all of the foregoing parties are collectively referred to as "Mortgagee") shall exist only with respect to the period during which the Mortgagee is the owner of the Land or Building and the Mortgagee shall be released from any further liability upon its transfer of ownership; and (ii) the Mortgagee shall not have any liability whatsoever for the acts of the Landlord prior to any such transfer nor any liability for any deposits made by Tenant hereunder unless Mortgagee has received such deposits; and (iii) Tenant hereby agrees to attorn to and recognize as Landlord, Mortgagee and, upon request of the Mortgagee, will execute such instruments as may be required by said Mortgagee.

(b)    Notice to Landlord and Mortgagee . If any act or omission by Landlord would give Tenant the right to damages from Landlord or any rights with respect to this Lease, Tenant will not sue for such damages or exercise any such rights until ( i) it shall have given written notice of the act or omission to Landlord and to the holder(s) of the indebtedness or other obligations secured by any mortgage or deed of trust affecting the Premises or of any ground or underlying lease, if the name and address of such holder(s) have been furnished to Tenant; and (ii) a reasonable period of time (in light both of the time required to cure the act or omission and the effect of the act or omission on Tenant's business operations in the Premises) to cure the act or omission has elapsed following the giving of the notice, during which time Landlord and such holder(s), or either of them, their agents or employees, will be entitled to enter upon the Premises and do therein whatever may be necessary to cure the act or omission.

20.    CERTAIN RIGHTS RESERVED BY LANDLORD

Landlord shall have the following rights, each of which Landlord may exercise without notice to Tenant (but subject to maintaining access to the Premises as described in subparagraph (iii) below), and without liability to Tenant for damage or injury to property, person or business on account of the exercise thereof, and the exercise of any such rights shall not be deemed to constitute an eviction or disturbance of Tenant's use or possession of the Premises and shall not give rise to any claim for set-off or abatement of rent or any other claim:

 

 

(i)    To change the name or street address of the Building.

(ii)    To install, affix and maintain any and all signs on the exterior or interior of the Building so long as the same do not materially affect Tenant's access to light or views.

(iii)    To decorate or to make repairs, alterations, additions, installations or improvements, whether structural or otherwise, in and about the Building, or any part thereof, and for such purposes to enter upon the Premises with reasonable notice to Tenant (other than in an emergency), and during the continuance of any of said work, to temporarily close doors, entryways, public space and corridors in the Building and to interrupt or temporarily suspend services or use of facilities, all without affecting any of Tenant's obligations hereunder, so long as the Premises are reasonably accessible and usable by Tenant.

(iv)    To furnish door keys, magnetic cards or electronic access systems for the entry door(s) in the Premises at the commencement of the Lease and to retain at all times, and to use in appropriate instances, keys or access cards to all doors within and into the Premises. Tenant agrees to purchase only from Landlord additional keys and access cards as required, to change no locks, and not to affix locks on doors without the prior written consent of Landlord. Notwithstanding the provisions for Landlord's access to the Premises, Tenant relieves and releases Landlord of all responsibility arising out of theft, robbery, pilferage and personal assault, excluding gross negligence or willful misconduct of Landlord or its agents. Upon the expiration of the Term or Tenant's right to possession, Tenant shall return all keys and access cards to Landlord and shall disclose to Landlord the combination of any safes, cabinets or vaults left in the Premises.

(v)    To designate and approve all window coverings used in the Building, including, without limitation, solar window coverings.

(vi)    To approve the weight, size and location of safes, vaults, vertical files and other heavy equipment and articles in and about the Premises and the Building so as not to exceed the legal live load per square foot designated by the structural engineers for the Building, and to require all such items and furniture and similar items to be moved into or out of the Building and Premises only at such times and in such manner as Landlord shall reasonably direct in writing. Tenant shall not install or operate machinery or any mechanical devices of any nature not directly related to Tenant's ordinary use of the Premises without the prior written consent of Landlord. Movements of Tenant's property into or out of the Building or Premises and within the Building are entirely at the risk and responsibility of Tenant, and Landlord reserves the right to require permits before allowing any property to be moved into or out of the Building or Premises.

 

(vii)    To establish reasonable controls for the purpose of regulating all property and packages, both personal and otherwise, to be moved into or out of the Building and Premises and all persons using the Building after normal office hours.

(viii)    To regulate in a reasonable manner delivery and service of supplies and the usage of the loading docks, receiving areas and freight elevators.

(ix)    To show the Premises to prospective tenants, lien holders and purchasers at reasonable times upon twenty-four hours notice.

(x)    To enter the Premises at any reasonable time to inspect the Premises upon twenty-four hours notice (except in the event of an emergency).

(xi)    To grant to any person or to reserve unto itself the exclusive right to conduct any business or render any service in the Building. If Landlord elects to make available to tenants in the Building any services or supplies, or arranges a master contract therefor, Tenant agrees to obtain its requirements, if a ny, therefor from Landlord or under any such contract, provided that the charges therefor are reasonable, and that the services contracted for are similar to those provided in other buildings in downtown Chicago.

21.    RULES AND REGULATIONS

Tenant agrees to observe the rules and regulations for the Building attached hereto as Exhibit C and made a part hereof. Landlord shall have the right from time to time to prescribe additional rules and regulations for general application to all office tenants which, in its reasonable judgment, may be desirable for the use, entry, operation and management of the Premises and Building, each of which rules and regulations and any amendments thereto shall become a part of this Lease. Tenant shall comply with all of the rules and regulations; provided, however, that the rules and regulations shall not contradict or abrogate any right or privilege herein expressly granted to Tenant . Landlord agrees to use reasonable efforts to enforce the rules and regulations in a non-discriminatory manner. To the extent of any inconsistency between the rules and regulations and this Lease, this Lease shall control.

22.    DEFAULT AND LANDLORD’S REMEDIES

(a)    Default . Any one or more of the following events shall be a default ("Default") under this Lease: (i) If Tenant does not pay the Rent or any installment thereof or does not pay any other sum (other than replacement of the Letter of Cred it which is governed by clause (x) below) required to be paid by Tenant under this Lease or under the terms of any other agreement between Landlord (or Landlord's predecessors in title) and Tenant and such default shall continue for five (5) days after written notice to Tenant; or (ii) if Tenant fails to observe

 

 

           or perform any of the other covenants or conditions in this Lease which Tenant is required to observe and perform and such default shall continue for fifteen (15) days after written notice to Tenant, provided, however, if such default does not involve a hazardous condition and is susceptible to cure but cannot, by the use of reasonable efforts, be cured within fifteen (15) days, Landlord shall not exercise any of its remedies hereunder if and so long as (a) Tenant shall have commenced to cure such default within fifteen (15) days and (b) Tenant shall thereafter continuously and diligently proceed to cure such default in a manner reasonably satisfactory to Landlord, and (c) such default shall be cured within sixty (60) days of such notice to Tenant; or (iii) if a default is made in the performance by Tenant of any covenant of this Lease which involves a hazardous condition and is not cured by Tenant immediately upon written notice to Tenant; or (iv) if the interest of Tenant in this Lease shall be levied on under execution or other legal process; or (v) if any voluntary petition in bankruptcy or for corporate reorganization or any similar relief shall be filed by Tenant; or (vi) if any invol untary petition in bankruptcy shall be filed against Tenant under any federal or state bankruptcy or insolvency act and shall not have been dismissed within ninety (90) days from the filing thereof; or (vii) if a receiver shall be appointed for Tenant or any of the property of Tenant by any court and such receiver shall not have been dismissed within ninety (90) days from the date of his appointment; or (viii) if Tenant shall make an assignment for the benefit of creditors; or (ix) if Tenant shall admit in writing Tenant's inability to meet Tenant's debts as they mature; or (x) if Tenant fails to replace the Letter of Credit as provided in Section 29 hereof.

(b)    Landlord's Remedies . If a Default occurs, Landlord may, at its sole option, with or without further notice or demand of any kind to Tenant or any other person, have any one or more of the following described remedies in addition to all other rights and remedies provided at law or in equity or elsewhere herein (provided that Landlord shall use such efforts as are required by law to mitigate any damages resulting from such Default):

(i)    Terminate this Lease and the Term created hereby and immediately, repossess the Premises. If Landlord does terminate this Lease and repossess the Premises, Landlord shall be entitled to immediately recover, in addition to any other sums or damages for which Te nant may be liable to Landlord, as damages a sum of money equal to the greater of: (1) the excess of the present value of the Rent provided to be paid by Tenant for the balance of the Term (disregarding any unexpired period of initial Rent abatement) over the present value of the anticipated fair market rent for the Premises (computed based upon the yield on U.S. Treasury obligations having a maturity closest to the Termination Date) that could be achieved for said period, after deduction of all anticipated expenses of reletting, including, without limitation, all allowances, abatements, construction costs, brokerage commissions and tenant concessions likely to be required under then-existing market conditions; or (2) the unamortized portion of any rent abatements, allowances,

 

 

           construction costs, brokerage commissions and other costs incurred by Landlord in connection with this Lease, as amortized on a straight-line basis with interest on the unamortized amount at twelve percent (12%) per annum over the initial Term during which Base Rent is payable. Should the present value of the anticipated fair market rent for the Premises, after deduction of all anticipated expenses of reletting, that could be achieved for the balance of the Term exceed the present value of the Rent provided to be paid by Tenant for the balance of the Term, Landlord shall have no obligation to pay to Tenant the excess or any part thereof or to credit such excess or any part thereof against any other sums or damag es for which Tenant may be liable to Landlord.

(ii)    Landlord may terminate Tenant's right of possession and may repossess the Premises by forcible entry and detainer suit, by taking peaceful possession or otherwise, without terminating this Lease. If Landlord terminates Tenant's right of possession without terminating this Lease, Landlord shall take reasonable measures to the extent required by law, to relet the same for the account of Tenant, for such rent and upon such terms as shall be reasonably satisfactory to Landlord. Reasonable measures shall not obligate Landlord to show the Premises before showing other space in the Building to a prospective tenant. For the purpose of such reletting, Landlord is authorized to decorate, repair, remodel or alter the Premises and to relet the Premises at such rental rate (which may be higher than the rental rate then applicable under this Lease), as Landlord reasonably determines to be necessary to maximize the effective rent on reletting. If Landlord shall fail to relet the Premises, Tenant shall pay to Landlord as damages the amount of the Rent reserved in this Lease for the balance of the Term as due hereunder. If the Premises are relet and a sufficient sum shall not be realized from such reletting after paying all of the costs and expenses of all decoration, repairs, r emodeling, alterations, installations and additions and the expenses of such reletting (including all allowances, abatements and other tenant concessions required under then-existing market conditions), to satisfy the Rent provided for in this Lease, Tenant shall satisfy and pay the same upon demand therefor from time to time. Tenant shall not be entitled to any rents received by Landlord in excess of the Rent provided for in this Lease. Tenant agrees that Landlord may file suit to recover any sums falling due under the terms of this Section 22 from time to time and that no suit or recovery of any portion due Landlord hereunder shall be any defense to any subsequent action brought for any amount not theretofore reduced to judgment in favor of Landlord.

(c)    Jury Trial Waiver . Tenant hereby waives its rights to a trial by jury in any action or proceeding based upon o r related to the subject matter of this Lease and the business relationship that is being established. This waiver is knowingly, intentionally and voluntarily made by Tenant and Tenant acknowledges neither Landlord nor any person acting on behalf of Landlord has made any representations of fact to include this waiver of trial by jury or has taken any actions which in any way modify or

 

 

            nullify its effect. Tenant acknowledges that this waiver is a material inducement to enter into this Lease and that Landlord has already relied on this waiver in entering into this Lease and that Landlord will continue to rely on this waiver in its future dealings with Tenant. Tenant further acknowledges that it has been represented (or has had the opportunity to be represented) in the signing of this Lease and in the making of this waiver by independent legal counsel.

23.    EXPENSES OF ENFORCEMENT

The prevailing party shall be entitled to receive from the other party hereto upon demand all reasonable costs, charges and expenses including the reasonable fees and out-of-pocket expenses of counsel (including in-house attorneys), agents and others retained by the prevailing party incurred in enforcing the obligations hereunder against the other party hereto.

24.    COVENANT OF QUIET ENJOYMENT

Landlord covenants that Tenant, on paying the Rent, charges for services and other payments herein reserved and on keeping, observing and performing all the other terms, covenants, conditions, provisions and agreements herein contained on the part of Tenant to be kept, observed and performed, shall, during the Term, peaceably and quietly have, hold and enjoy the Premises subject to the terms, covenants, conditions, provisions and agreements hereof.

 

25.    REAL ESTATE BROKER

Each party represents that it has dealt with (and only with) the Broker(s) specified in Item 10 of the Schedule as broker in connection with this Lease, and that insof ar as such party knows, no other brokers negotiated this Lease or are entitled to any commissions in connection therewith. Each party agrees to indemnify, defend and hold the other and its employees, agents, their officers and partners, harmless from and against any claims resulting from a breach of the foregoing representation.

26.    MISCELLANEOUS

(a)    Rights Cumulative . All rights and remedies of Landlord under this Lease shall be cumulative and none shall exclude any other rights and remedies allowed by law.

(b)    Interest . All payments becoming due under this Lease and remaining unpaid when due shall bear interest until paid at the greater of (i) twelve percent (12%) per annum or (ii) four percent (4%) per annum above the Prime Rate (as such ter m is defined in Section 3(a)(ii)D hereof).

 

(c)    Terms . The necessary grammatical changes required to make the provisions hereof apply either to corporations or partnerships or individuals, men or women, as the case may require, shall in all cases be assumed as though in each case ful ly expressed. Tenant acknowledges that "Rentable Area" as used in this Lease includes a portion of the common and service areas of the Building. Landlord makes no representation or warranty as to the rentable or usable square footage of the Premises, and Tenant agrees that Landlord's determination of the Rentable Area of the Premises and Tenant's Proportionate Share shall be conclusive and binding upon Tenant absent manifest error.

(d)    Binding Effect . Each of the provisions of this Lease shall extend to and shall, as the case may require, bind or inure to the benefit not only of Landlord and of Tenant, but also of their respective successors or assigns, provided this clause shall not permit any assignment by Tenant contrary to the provisions of Section 15 hereof.

(e)    Lease Contains All Terms . All of the representations and obligations of Landlord and Tenant are contained herein and in the Work Letter and other Exhibits attached hereto, and no modification, waiver or amendment of this Lease or of any of its conditions or provisions shall be binding upon the Landlord or Tenant unless in writing signed by such party or by a duly authorized agent of such party empowered by a written authority signed by such party.

(f)    Delivery for Examination . Submission of the Lease for examination shall not bind Landlord in any manner, and no Lease or obligations of the Landlord shall arise until this instrument is signed by both Landlord and Tenant and delivery is made to each.

(g)    No Air Rights . No rights to any view or to light or air over any property, whether belonging to Landlord or any other person, are granted to Tenant by this Lease.

(h)    Modification of Lease . If (i) any lender requires, as a condition to its lending funds the repayment of which is to be secured by a mortgage or trust deed on the Land and Building or either, or (ii) the fee owner of the Land requires, a s a condition to entering into a ground lease with Landlord or a lease of the entire Building with Landlord, that certain modifications be made to this Lease, which modifications will not require Tenant to pay any additional amounts or otherwise change materially the rights or obligations of Tenant hereunder, Tenant shall, upon Landlord's request, execute appropriate instruments effecting such modifications.

(i)    Transfer of Landlord's Interest . Tenant agrees that Landlord has the right to transfer its interest in the Land and Building and in this Lease. If such a transfer occurs, Landlord shall automatically be released from all liability under this Lease arising after the date of such transfer and Tenant agrees to look solely to such transferee for the performance of Landlord's obligations hereunder arising after the date of such transfer. Tenant further acknowledges that the Landlord may assign its interest in this Lease to a mortgage lender as additional security and agrees that such an assignment shall not release Landlord from its obligations hereunder and that Tenant shall continue to look to Landlord for the performance of its obligations hereunder.

 

(j)    Landlord's Title . Nothing herein contained shall empower Tenant to commit or engage in any act which can, shall or may encumber the estate or title of Landlord.

(k)    Prohibition Against Recording . Neither this Lease, nor the Subordination, Non-Disturbance and Attornment Agreement, nor any memorandum, affidavit or other writing with respect thereto, shall be recorded by Tenant or by anyone acting thr ough, under or on behalf of Tenant, and the recording thereof in violation of this provision shall make this Lease null and void at Landlord's election.

(l)    Captions . The captions of Sections, Subsections, Paragraphs and Subparagraphs are for convenience only and shall not be deemed to limit, construe, affect or alter the meaning of such Sections, Subsections, Paragraphs or Subparagraphs.

(m)    Covenants and Conditions . All of the covenants of Tenant hereunder shall be deemed and construed to be "conditions," if Landlord so elects, as well as "covenants" as though the words specifically expressing or importing covenants and co nditions were used in each separate instance.

(n)    Only Landlord/Tenant Relationship . Nothing contained in this Lease shall be deemed or construed by the parties hereto or by any third party to create the relationship of principal and agent, partnership, joint venturer or any associatio n between Landlord and Tenant, it being expressly understood and agreed that neither the method of computation of Rent nor any act of the parties hereto shall be deemed to create any relationship between Landlord and Tenant other than the relationship of landlord and tenant.

(o)    Application of Payments . Landlord shall have the right to apply payments received from Tenant pursuant to this Lease (regardless of Tenant's designation of such payments) to satisfy any obligations of Tenant hereunder, in such order and amounts, as Landlord in its sole discretion, may elect.

(p)    Definition of Landlord . All indemnities of Tenant contained herein which inure to the benefit of Landlord shall be construed to also inure to the benefit of (i) Landlord's beneficiaries if Landlord is a trust, (ii) Landlord's partn ers if Landlord is a partnership, (iii) Landlord's shareholders, members, officers and directors if Landlord is a corporation or limited liability company, (iv) any current or future mortgagees of the Land and/or Building, (v) the successors and assigns of any of the foregoing, and (vi) the respective beneficiaries, shareholders, members, directors, officers, partners, agents, employees, managers and affiliates of any persons mentioned in clauses (i) through (v) above.

 

(q)    Time of Essence . Time is of the essence of this Lease and each of its provisions.

(r)    Governing Law . Interpretation of this Lease shall be governed by the laws of the State of Illinois.

(s)    Partial Invalidity . If any term, provision or condition contained in this Lease shall, to any extent, be invalid or unenforceable, the remainder of this Lease (or the application of such term, provision or condition to persons or circum stances other than those in respect to which it is invalid or unenforceable) shall not be affected thereby, and each and every other term, provision and condition of this Lease shall be valid and enforceable to the fullest extent possible permitted by law.

(t)    Substitution of Other Premises . Landlord may substitute for the Premises other premises in the Building (herein referred to as the "New Premises") provided that: (i) the New Premises shall have approximately the same Rentable Area as the Premises; and (ii) the New Premises shall be usable for Tenant's purpose. Landlord shall improve the New Premises, at its expense, to substantially the same condition as the Premises and pay all reasonable costs incurred by Tenant in relocating to the New Premises . The Base Rent per square foot for the New Premises shall be at the same per square foot rates set forth in Schedule 1, but in no ev ent shall the Monthly Base Rent exceed the Monthly Base Rent set forth in Schedule 1 and Tenant's Proportionate Share shall be adjusted to reflect the square footage of the New Premises, but in no event shall it exceed Tenant's Proportionate Share for the Premises.

27.    NOTICES

(a)    All notices to be given under this Lease shall be in writing and delivered either (i) personally upon an officer of Landlord or Tenant, as the case may be, or (ii) by depositing such notice in the United States mail, certified or registered mail with return receipt requested, postage prepaid, or (iii) via reputable overnight air courier service (such as Federal Express or Airborne) and in every case addressed as set forth in the Schedule or if no address for Tenant is inserted in the Schedule , addressed to Tenant at Tenant's present address.

(b)    Notice via personal service shall be deemed to have been given when actually delivered. Notice given by certified or registered mail shall be deemed to have been given on the second business day after the date that the notice is deposited into the mail postage prepaid. Notice given via air courier shall be deemed given one (1) business day after it is accepted by said courier for next day delivery.

(c)    Either Landlord or Tenant may change the location at which it receives notices to another location within the United States of America upon not less than ten (10) days notice to the other pursuant to this Section 27 .

 

28.    LIMITATION OF LIABILITY

Tenant, and any person claiming an interest in the Premises through or under Tenant, each agree to look solely to the interests of Landlord from time to time in the Land and Building, and no judgments against such persons may be satisfied out of any other assets. In no event shall Landlord (or any of their respective officers, directors, agents, advisors, managers, shareholders, members, partners, beneficiaries, affiliates or successors and assigns) ever have any personal liability for any covenant, agreement, obligation, warranty, representation, indemnity or undertaking under this Lease or otherwise or be answerable or liable in any equitable, judicial or administrative proceeding or order.

29.    LETTER OF CREDIT

(a)    Landlord's obligations and Tenant's rights hereunder are expressly conditioned upon Tenant depositing, concurrently with Tenant's execution hereof, as security for the prompt, full and faithful performance by Tenant of each and every < /font>provision of this Lease and of all obligations of Tenant hereunder, the Letter of Credit (as defined in subparagraph (b) below).

(b)    The term "Letter of Credit" as used herein shall mean an irrevocable, unconditional letter of credit, in form and substance acceptable to Landlord in Landlord's sole judgment, initially expiring no earlier than July 31, 2004 in the amount of $7,030.48 issued by a national bank acceptable to Landlord, in Landlord's sole judgment, which Letter of Credit (i) shall be payable to Landlord upon demand made pursuant to presentation of an unconditional sight draft without accompanying certificate and (ii) shall be renewed as hereafter provided in subparagraph (d) below.

(c)    If Tenant fails to perform any of its obligations hereunder, Landlord may use, apply or retain the whole or any part of the Letter of Credit for the payment of: (i) any Rent or other sums of money which Tenant may not have paid when due; (ii) any sum expended by Landlord on behalf of Tenant in accordance with the provisions of this Lease; or (iii) any sum which Landlord may expend or be required to expend by reason of a Default by Tenant, including, without limitation, any damage or deficiency in or from the rel etting of the Premises as provided in Section 22 hereof. The use, application or retention of the Letter of Credit by Landlord shall not prevent Landlord from exercising any other right or remedy provided by this Lease or by law (it being intended that Landlord shall not first be required to proceed against the Letter of Credit) and shall not operate as a limitation on any recovery to which Landlord may otherwise be entitled. If any portion of the Letter of Credit is used, applied or retained by Landlord for the purposes set forth above, Tenant agrees, within ten (10) days after the written demand therefor is made by Landlord, to reinstate the Letter of Credit in an amount equal to $7,030.48.

(d)    No later than thirty (30) days prior to the expiration of any Letter of Credit then deposited hereunder, Tenant shall deliver to

 

 

            Landlord a new Letter of Credit expiring not earlier than one (1) year from the expiration of the prior Letter of Credit and meeting all of the other requirements set forth herein or an amendment to the existing Letter of Credit extending the maturity date thereof for one (1) year. In the event Tenant fails to timely provide such substitute Letter of Credit or amendment to the existing Letter of Credit, Landlord shall be entitled to draw the full amount of the existing Letter of Credit.

(e)    If Tenant shall fully and faithfully comply with all of the provisions of this Lease, the Letter of Credit, or any balance thereof, shall be returned to Tenant after the expiration of the Term or upon any later date after which Tenant has vacated the Premises, and following the payment by Tenant of any deficiency owed by Tenant with respect to the Expense Adjustment Amount or the Tax Adjustment Amount for the final Lease Year hereof following the reconciliation thereof in accordance with Sections 3(b) and 3(d) hereof. Upon the return of the Letter of Credit, or the remaining balance thereof to the original Tenant, Landlord shall be completely relieved of liability under this Section 29 or otherwise with respect to the Letter of Credit.

(f)    Tenant acknowledges that Landlord has the right to transfer or mortgage its interest in the Land and the Building and in this Lease and Tenant agrees that if such a transfer or mortgage occurs, Landlord shall have the right to transfer or assign the Letter of Credit to the transferee or mortgagee. The Letter of Credit must provide that it is assignable by Landlord to such transferee or mortgagee at no cost to Landlord or such transferee or mortgagee. Upon such transfer or assignment, Landlord shall thereby be re leased by Tenant from all liability or obligation for the return of such Letter of Credit and Tenant shall look solely to such transferee or mortgagee for the return of the Letter of Credit.

30.    TENANT’S OPTION TO RENEW

The Tenant is hereby granted one (1) three (3) year option to renew the Lease ("Renewal Option"). If the Tenant desires to exercise the Renewal Option, it shall so notify the Landlord, in writing, not later than the first day of the ninth (9) month prior to the then current expiration date of the Term. Such notice shall only be effective if delivered at a time when the Tenant is not in Default hereunder or otherwise in default in the performance of any of its obligations under the terms and provisions of this Lease. Within thirty (30) days following its receipt of Tenant's notice of its desire to exercise the Renewal Option, given at the time and in the manner provided above, Landlord shall prepare and transmit to Tenant an appropriate amendment to this Lease extending the Term for three (3) years ("Extended Term") and specifying (i) the Base Rent for such extension, which shall be the base rental rate then being offered and accepted by Landlord to other tenants of comparable size and location renewing leases in the Building, including concessions for rent abatement and tenant improvement allowances, all as reasonably determined by Landlord and evidenced by recent transactions which shall be disclosed to Tenant ("Market Rent") and (ii) that all other terms and conditions during the Extended Term are the same as those during the Term, except for any expansion rights, reduction rights or limitations on taxes an d operating expenses. In the event the Tenant shall fail for any reason to execute and deliver the lease amendment within twenty (20) business days of Tenant's receipt of the same, or if Tenant shall be in Default hereunder or otherwise in default in the performance of any of its obligations under the terms and provisions of this Lease at the commencement date of any Extended Term, then in either such event, at Landlord's option, Tenant's purported exercise of its Renewal Option shall be of no force or effect and the Renewal Option shall become null and void.

 

IN WITNESS WHEREOF , the parties have executed this Lease as of the day and year first above written.

LANDLORD:

BTS OWNERS LLC, a Delaware limited liability company

By:    BTS Managers LLC, its Member

 

By:   LB BTS I Inc., its Managing Member

 

                                                                                                  By:  __/s/_____________            

                                                                                                  Name: _______________               

                                                                                                  Its:  _________________

TENANT:

 

TALK AMERICA INC.,

a Pennsylvania corporation

 

By:   /s/ Aloysius T. Lawn IV            

Its:   EVP - General Counsel        

EXHIBIT A

 

FLOOR PLAN OF PREMISES

EXHIBIT B

 

TENANT WORK LETTER

This is the Tenant Work Letter referred to in the Lease of even date herewith (the "Lease") wherein TALK AMERICA INC., a Pennsylvania corporation ("Tenant"), has agreed to lease certain space from BTS OWNERS LLC, a Delaware limited liability company ("Landlord"), at 205 North Michigan Avenue, Chicago, Illinois. Unless otherwise defined herein, all capitalized terms used herein shall have the respective meanings assigned to them in the Lease.

 

1.    Tenant's Work

 

(a)    Tenant shall provide the construction material, hardware and equipment and the labor to construct and install the improvements to the Premises described in the Plans (as that term is hereinafter described). The material, hardware and equipment as incorporated into the Premises pursuant to the Plans are herein collectively referred to as the "Tenant's Work". Subject to the provisions of this Work Letter, Tenant shall proceed diligently to cause the Tenant's Work approved by Landlord to be completed in accordance with the terms and conditions of the Lease and this Work Letter. Notwithstanding anything contained herein to the contrary, Tenant's Work in all events shall include the material, hardware and equipment described on, and Tenant shall otherwise comply with, the Landlord's Construction Guidelines, Rules and Regulations.

 

(b)    Tenant agrees to cause its interior space planner (the "Interior Space Planner") to deliver to Landlord preliminary space plans for the Premises, which preliminary space plans shall include the following information: (1) partition layout; (2) door layout; (3) identification of ceiling types; (4) identification of flooring types; (5) identification of proposed room types and uses; (6) identification of all special floor loading areas and above standard furniture and equipment (files, safes, etc.), along with applicable struct ural loading information to determine if any structural reinforcing is required; and (7) general information in the form of outline specifications for all proposed millwork, electrical, mechanical, fire protection, communication technology systems and plumbing requirements. Such preliminary space plans are herein referred to as the "Preliminary Space Plans". The Preliminary Space Plans are subject to Landlord's review and approval. Upon receipt of a complete set of the Preliminary Space Plans Landlord will review the same and shall submit written comments to Tenant within ten (10) business days. Tenant shall cause the Preliminary Space Plans to be revised to incorporate Landlord's comments.

 

(c)    Tenant shall deliver to Landlord architectural design development plans and specifications (the "Architectural Design Plans") and mechanical/ electrical/ fire protection/ plumbing and communications technology design plans and specifications (herein referred to as the

 

 

           "MEP/CT Engineering Plans") for the Work to be performed in the Premises. Such plans and specifications shall include the following: (1) all of Landlord's comments to the Preliminary Space Plans; (2) demolition plans; (3) partition plans; (4) reflected ceiling plans; (5) flooring plans; (6) electrical and telephone outlet plans; (7) furniture plans; (8) floor loading plans indicating any special floor loading areas, specific weights for concentrated loads in sufficient detail to allow for structural engineering; (9) computer equipment and support area plans; (10) special area plans (i.e., kitchens, A/V, washrooms, etc.); (11) door, frame and hardware schedules; (12) wall finish plans; (13) elevations, details and sections as required; and (14) specific critical information required to sufficiently engineer the aforesaid Premises. The Architectural Design Plans and MEP/CT Engineering Plans shall be subject to Landlord's prior written approval. Landlord shall either approve or disapprove the Architectural Design Plans and MEP/CT Engineering Plans in writing within ten (10) business days of receipt by Landlord of a complete set thereof. If Landlord does not approve the same, Landlord shall advise Tenant in writing generally of the changes required in such Architectural Design Plans and MEP/CT Engineering Plans so that they will meet with Landlord's approval. Tenant shall cause the Interior Space Planner to revise the Architectural Design Plans and MEP/CT Engineering Plans pursuant to Landlord's comments and to deliver to Landlord, within ten (10) days after receipt by Tenant of such comments, revised Architectural Design Plans and MEP/CT Engineering Plans noting the changes for Landlord's approval. Landlord shall conti nue to comment on such Architectural Design Plans and MEP/CT Engineering Plans and Tenant shall continue to revise said Architectural Design Plans and MEP/CT Engineering Plans within ten (10) days of receipt of comments from Landlord until such Architectural Design Plans and MEP/CT Engineering Plans are approved by Landlord. Notwithstanding anything herein to the contrary, if Tenant elects to use the services of an architect other than Fujikawa Johnson, or structural engineer other than Alfred Benesch or a mechanical/electrical engineer other than Cosentini Associates, Landlord requires that Tenant submit drawings to Landlord for review and approval by such architects/engineers. The cost of such review, along with the cost of updating Landlord's infrastructure documents, shall be borne by Tenant.

 

(d)    Tenant agrees to cause to be delivered to Landlord fully completed and coordinated Architectural Design Plans and MEP/CT Engineering Plans (the "Construction Documents") sufficient in detail so that Tenant can use such revised plans to obtain a building permit and contractors' bids for the Work. The Construction Documents must be in a final and complete form with all necessary design elements identified and specified to fully bid and construct the Work. The Construction Documents are subject to Landlord's review and approval. Landlord shall rev iew the Construction Documents and submit written comments to Tenant within ten (10) business days of receipt by Landlord of a complete set thereof. If Landlord does not approve the same, Landlord shall advise Tenant in writing generally of the changes required in the Construction Documents so that they meet with Landlord's approval. Tenant shall cause the Construction Documents to be revised until they will meet with Landlord's approval. The Architectural Design Plans, the MEP/CT Engineering Plans and the Construction Documents are herein collectively referred to as the "Plans".

 

 

(e)    Tenant represents to Landlord that Tenant has reviewed its needs and the above specified delivery dates with the Interior Space Planner and that Tenant has assured itself that the Plans can be delivered as hereinabove required. Tenant agrees to cooperate with the Interior Space Planner as promptly as possible and in any event in sufficient time to cause the Plans to be prepared and timely delivered as hereinabove required.

 

(f)    Neither review nor approval by Landlord of any of the Plans shall constitute a representation or warranty by Landlord that such Plans either (i) are complete or suitable for their intended purpose or (ii) comply with applicable laws, ordinances, codes and regulations, it being expressly agreed by Tenant that Landlord assumes no responsibility or liability whatsoever to Tenant or to any other person or entity for such completeness, suitability or compliance.

 

2.    Cost of Tenant's Work

 

(a)    Prior to commencement of any portion of the Tenant's Work, Tenant shall obtain a contract to perform the Tenant's Work by bidding the Tenant's Work to certain of those general contractors from Landlord's list of approved contractors or such other contractor as may be approved by Landlord. Tenant agrees to promptly give Landlord a copy of the contract. The general contractor must use only those subcontractors on Landlord's list of approved subcontractors, as the same may be amended by Landlord from time to time, or such other subcontractors as m ay be approved by Landlord.

 

(b)    Landlord shall give Tenant a total allowance ("Allowance") of $42,777.00 as a credit towards the cost of the Tenant's Work including the cost of Tenant's initial move to the Premises. Tenant shall pay all costs of the Tenant's Work in excess of the Allowance. All amounts shall be paid by Tenant within thirty (30) days after Tenant's receipt of invoices therefor.

 

(c)    Tenant shall pay a construction coordination  and overhead fee to Landlord in an amount equal to 5% of the cost of Tenant's Work to cover Landlord's coordination, supervision and overhead and related expense allocable to such work (the "Coordination Fee"). The Coordination Fee shall be deducted by Landlord from the Allowance. In addition, Tenant shall pay all of Landlord's costs, including, without limitation: (i) the cost of Landlord's (and Landlord's consultants) preliminary and ongoing review of the Preliminary Space Plans, the Plans, and all other construction documents; (ii) the cost of temporary toilets and access to phone service to the Premises during the construction period; (iii)the costs of trash removal and disposal; and (iv) freight dock services and normal Building security during Tenant's construction and move-in period.

 

(d)       Landlord shall make payments of the Allowance only one time per month upon receipt of invoices, sworn statements, mechanics lien waivers as provided herein and such other documentation as Landlord may reasonably request. Payment of the Allowance shall be made by Landlord upon Tenant's direction through a construction escrow with the title insurance company selected by Landlord pursuant to escrow instructions approved by Landlord. Landlord shall have no obligation to make any payment of the Allowance at any time that Tenant is in Default hereunder.

 

(e)    Prior to commencing Tenant's Work, Tenant shall submit to Landlord a total project budget (the "Budget") outlining the cost of the Tenant's Work plus the cost of all non-tenant improvement items, including soft costs, cabling, and telephone to be incurred by Tenant in connection with the Premises (collectively, the "Tenant's Project Costs"). Tenant shall deliver to Landlord an updated Budget with each draw request for a payment of a portion of the Allowance. If, as of the time any such draw request is made, the remaining Tenant's Project Costs pursuant to the current Budget exceed the remaining amount of the Allowance, Tenant shall deposit into the escrow the amount by which the remaining Tenant's Project Costs set forth in the current Budget exceed the remaining amount of the Allowance. All amounts so deposited by Tenant are herein collectively called "Tenant Deposits".

 

(f)    Tenant shall make draw requests on the escrow based upon the percentage of Tenant's Project Costs incurred as of the date of the draw request. Tenant shall present to Landlord and to the title company which is acting as escrow, a letter requesting a disbursement of funds, invoices (or paid receipts for each item paid by Tenant and for which Tenant is seeking reimbursement), a copy of any cancelled checks pursuant to which such invoice has been paid, and, with respect to any construction to any portion of the Premises, such lien waivers (for lie nable items) required by the title company or Landlord. The lien waiver from the general contractor and from each subcontractor and material supplier must be delivered with each draw request. Landlord shall have no obligation to make a payment until all waivers for the prior draw are submitted.

 

(g)    Draw requests shall be submitted to Landlord and the title company not later than the 23rd day of the calendar month. Not later than the 20th day of the next calendar month Landlord will review Tenant's Work and Tenant's draw request and advise Tenant in writing of any respects in which the draw request is disapproved and the reason for such disapproval. Such advice need not comply with the notice provisions of the Lease. Otherwise, the draw request will be deemed approved. Draw requests submitted by the 23rd day of a calendar month shall be pa id, subject to the foregoing approval procedure, not later than the 25th day of the following calendar month. Landlord and Tenant agree to cooperate in attempting to resolve disapproved portions of each draw request.

 

 

            (h)                          Notwithstanding anything herein to the contrary, in the event that on the date that all Tenant's Work has been completed and paid for the sum of the Allowance and any Tenant Deposits exceed the amount disbursed by the escrowee on account of Tenant's Project Costs (the amount of such excess being herein called the "Excess Funds") and provided that Tenan t is not then in Default under the Lease, Landlord shall apply such Excess Funds in the following order of priority until such Excess Funds are exhausted:

 

(i)    Landlord shall pay to Tenant, within sixty (60) days following the Rent Commencement Date out of such Excess Funds an amount not to exceed the Tenant Deposits, if any;

 

(ii)    The balance of such Excess Funds, if any, shall be refunded to Landlord.

 

3.    Access by Tenant; Work in Harmony

 

Tenant agrees for itself and its agents, representatives, employees, suppliers, contractors, subcontractors, workmen, mechanics, and suppliers, that all such parties shall work in harmony and not unreasonably interfere with Landlord and Landlord's agents, representatives, employees, suppliers, contractors, subcontractors, mechanics, and workmen in doing work for other tenants and occupants of the Building. Landlord agrees for itself and its agents, representatives, employees, suppliers, contractors, subcontractors, workmen, mechanics, and suppliers, that all such parties shall work in harmony and not unreasonably interfere with Tenant and Tenant's agents, representatives, employees, suppliers, contractors, subcontractors, mechanics, and workmen in doing the Tenant Work.

 

4.    Construction Requirements

(a)                  Tenant agrees that the entry into the Premises by Tenant and its contractors shall be deemed to be under all of the terms, covenants, conditions and provisions of the Lease except as to the covenant to pay Rent, and Tenant further agrees that in connection therewith Landlord shall not be liable in any way for any injury, loss, or damage which may occur to any of Tenant's Work and installations made in the Premises or to property placed therein prior to the Commence ment Date and thereafter, the same being at Tenant's sole risk. In addition, Tenant shall require all entities performing work on behalf of Tenant to provide protection for existing improvements to an extent that is satisfactory to Landlord and shall allow Landlord access to the Premises, for inspection purposes, at all times during the period when Tenant is undertaking construction activities therein. If any entity performing work on behalf of Tenant causes any injury to any person or any damage to the Premises, the Building, any other property of Landlord or any other person, then Tenant agrees to indemnify, defend and hold Landlord harmless from any loss, damage or injury suffered in connection with any such damage or injury. Further, Tenant shall cause such damage to be repaired at Tenant's expense and if Tenant fails to cause such damage to be repaired promptly upon Landlord's demand therefor, Landlord may in addition to any other rights or remedies available to Landlord under this Lease or at law or eq uity cause such damage to be repaired, in which event Tenant shall promptly upon Landlord's demand pay to Landlord the cost of such repairs;

 

(b)                  All contractors and subcontractors shall use only those service corridors and service entrances designated by Landlord for ingress and egress of personnel and the delivery and removal of equipment and material through or across any common areas of the Building shall only be permitted with the written approval of Landlord and during hours determined by Landlord. Landlord shall have the right to order Tenant or any contractor or subcontractor who violates the above r equirements to cease work in the Building and leave the Building and remove its equipment and its employees from the Building and, at Landlord's option, restore any portion of the Building on which it has done work to its original condition;

 

(c)                 Tenant agrees that all services and work performed on the Premises by, on behalf of, or for the account of Tenant, including installation of telephones, carpeting, materials and personal property delivered to the Premises shall be done in a first-class workmanlike manner using only good grades of material and shall be performed only by persons covered by a collective bargaining agreement with the appropriate trade union;

 

(d)                 Tenant agrees to protect, indemnify, defend and hold Landlord and its agents, partners, contractors and employees harmless from and against any and all losses, damages, liabilities, claims, liens, costs, and expenses, including reasonable attorneys' fees, of whatever nature including those to the person and property of Tenant, its employees, agents, invitees, licensees and others arising out of or in connection with the activities of Tenant or Tenant's contractors in or about the Premises or the Building, and the cost of any repairs to the Premises or the Building necessitated by activities of Tenant or Tenant's contractors;

 

(e)                  Tenant shall secure, pay for, and maintain during the continuance of its work within the Premises, policies of insurance with such coverages and such amounts as Landlord may reasonably require, which policies shall be endorsed to include Landlord and its contractor and their respective employees and agents and Landlord's mortgagees as additional insured parties and which shall provide thirty (30) days prior written notice of any alteration or termination of covera ge, in such amounts and insuring such risks as Landlord may require. Tenant shall not permit Tenant's contractors to commence any work until all required insurance has been obtained by Tenant and certificates evidencing such coverage have been delivered to Landlord; and

 

(f)                   Tenant's agents, subcontractors and vendors shall be required to conform with Landlord's Construction Guidelines, Rules and Regulations.

 

5.    Miscellaneous

 

(a)    Except as expressly set forth herein, Landlord has no other agreement with Tenant and has no other obligation to do any other work or pay any amounts with respect to the Premises. Any other work in the Premises which may be permitted by Landlord pursuant to the terms and conditions of the Lease shall be done at Tenant's sole cost and expense and in accordance with the terms and conditions of the Lease.

 

(b)                       This Work Letter shall not be deemed applicable to any additional space added to the original Premises at any time or from time to time, whether by any options under the Lease or otherwise, or to any portion of the original Premises or any additions thereto in the event of a renewal or extension of the initial term of the Lease, whether by any options under the Lease or otherwise, unless expressly so provided in the Lease or any amen dment or supplement thereto.

 

(c)                      The failure by Tenant to pay any monies due Landlord pursuant to this Work Letter within the time period herein stated shall be deemed a Default under the terms of the Lease for which Landlord shall be entitled to exercise all remedies available to Landlord for nonpayment of Rent. All late payments shall bear interest and shall be subject to a late charge pursuant to the Lease.

 

(d)                     This Work Letter is being executed in conjunction with the Lease and is subject to each and every term and condition thereof, including without limitation, the limitations of Landlord's liability set forth therein.

 

(e)                      Tenant shall be solely responsible to determine at the site all dimensions of the Premises and the Building which affect any work to be performed by or for Tenant hereunder.

 

Dated this 1st day of July, 2003.

 

                              LANDLORD:

 

                               BTS OWNERS LLC, a Delaware limited liability

                                company

 

                    By:    BTS Managers LLC, its Member

 

                      By:   LB BTS I Inc., its Managing Member

    

 

CONTRACTORS AND VENDORS

If you are planning to do any type of work in Michigan Plaza, you must notify the Office of the Building at ###-###-####. Any construction, HVAC or plumbing plans must be submitted to the Office of the Building for review before work commences. Michigan Plaza is a 100% Union Building.

 

MICHIGAN PLAZA CONTRACTOR AND VENDOR GUIDELINES

1.    All contractors and employees are required to enter through the dock. You will be required to sign in at the security desk on the dock level and provide a picture ID that will be kept in exchange for a building pass. You are required to wear the pass at all times while in the building.

2.    Please provide a list of sub-contractors to the Office of the Building prior to working in the building.

3.    After hours access to the dock requires a security guard at a 4-hour minimum charge. After hours dock access requires a 24-hour scheduling notification to the Office of the Building.

4.    The building has two freights for each tower that run on automatic and are 5'10" deep, 7'1'' wide, 9'1'' tall (front) and 12' tall (back). Although there is no operator required, we do require that you reserve the freight car 24 hours in advance for after-hours moves/deliveries. You cannot reserve the freight during normal dock hours. Any objects that may have to be hoisted on top of the elevator cabs must be scheduled with an additional cost to the contractor. Any damage to the freight elevators will be billed back to the contractor.

5.    Open boxes, 30-yards or less, can be dropped off after 5:00 p.m. and must be removed by 6:00 a.m. the following morning.

6.    Large drywall deliveries are to be unloaded after hours, at a four-hour minimum charge, to keep the loading dock clear.

7.    Contractor parking is not allowed in the dock area. Tools and equipment may be loaded into the building. Parking is available off site at System Parking on Lower East South Water Street.

8.    Contractors must provide fire protection equipment and fire watch if required. If you are torch cutting or welding you must obtain a building permit from the Michigan Plaza engineering office.

9.    Notify the building engineer 24 hours in advance for any system shutdown.

10.    The general foreman is responsible for securing the job area after each workday. Any Michigan Plaza personnel time required for clean up is charged back to the contractor.

11.    Contractors must provide and keep wet shoe pads at all construction entries to prevent tracking of dust throughout the building.

12.    Loud work (work that generates a tenant complaint) is to be done after 6:00 p.m. or before 8:00 a.m. Landlord reserves the right to remove individuals who do not operate within these regulations.

13.    Breaks are only to be taken in the construction area or off the building premises.

14.    Contractors are responsible for the final clean.

15.    All changes to building equipment or property must be submitted in the form of drawings to the Operations Manager and the Chief Engineer

           for approval. Please contact us if you have any questions or problems.

16.    Because of the potential for multiple construction projects to occur in the building at the same time, we ask for mutual courtesy among the tradesmen.

17.    The stairways are to be used by construction personnel for emergency purposes only. These doors are locked at all times except during a fire.

 

 

18.    The perimeter induction units are not to be tampered with by any contractors unless approved in advance by the Office of the Building.

19.    Contractors will not be allowed to enter the building unless accurate and updated Certificates of Insurance for all contractors are on file with the Office of the Building. The requirements are at listed at the end of this manual.

20.    All Contractors are responsible for obtaining permits and scheduling inspections with the City of Chicago Building Department, Electrical Department, Plumbing Department, and Fire Department etc. Contractors are required to submit evidence for such permits and inspections to Landlord prior to work commencing.

21.    Contractors are not allowed to disconnect or alter the elevator controls, signals, buttons, etc.

22.    Any work, which creates a toxic odor, i.e. electrostatic paint, must be completed after regular building hours, which is 6:00 p.m.

23.    Michigan Plaza is a smoke-free building. Smoking is not allowed anywhere in the building.

24.    All floors and wall coverings need to be protected in all common areas.

25.    Michigan Plaza is a union building. Please make certain all of your workers are union workers.

CONTRACTOR FINAL CLEAN PUNCHLIST

 

1.    Area should be thoroughly cleaned, vacuumed and dusted after job completion.

2.    Any convectors that are cracked or broken must be replaced.

3.    Broken window blinds must be replaced.

4.    Windows must be cleaned.

5.    Common areas are in their original condition. If any damage to walls, ceiling, etc. occurs, repairs must be made before job completion.

 

 

The loading dock is open Monday-Friday, 7:00 a.m. - 4:30 p.m. All vehicles can park on the dock first come-first serve for one hour BEFORE 3:30 PM. Any vehicle left on the dock after the one-hour time limit is required to park off-site or the vehicle will be towed. System Parking is one-half block east of the dock on Lower E. South Water Street. There is no "staging" allowed on the dock. Any deliveries requiring additional time must be scheduled after hours, between 4:30pm and 7:00 am Monday-Friday or Saturday and Sunday. Any damage to the freight elevators will be billed back to the tenant or company responsible for the delivery.

205/225 North Michigan Avenue is a union building. All persons entering the building performing work must be union and have a certificate of insurance on file with the Office of the Building. A new tenant is required to provide their certificate of insurance before moving into their space.