Document:

exv10w13

 

Exhibit 10.13

OFFICE LEASE

BETWEEN

OLD SAUK TRAILS PARK LIMITED PARTNERSHIP

LANDLORD

AND

TOMOTHERAPY INCORPORATED

TENANT

1240 Deming Way

Madison, Wisconsin

 

 

1240 Deming Way

Madison, Wisconsin 53717

					
	 	 	 	 	 
	No. 6
	 	REFERENCE DATA
	 	January 26, 2005

These terms are specific to, and incorporated in, this lease.

	 	 	 	 	 
	¶
no.	 	Item	 	Lease Provision
	1.01

	 	Tenant
	 	TomoTherapy Incorporated, a Wisconsin corporation
	 
	 	 	 	 
	1.02

	 	Premises

Area of the Premises
	 	all of the building including seven below-grade test
bunkers 

61,410 rentable square feet (“RSF”) excluding the test bunkers
	 
	 	 	 	 
	1.03

	 	Additional Permitted uses
	 	manufacture, testing and assembly of medical imaging
equipment
	 
	 	 	 	 
	1.04

	 	Term

Effective Date
	 	Through May 31,2014 

this Reference Data page #6 is
effective March 14, 2005.
	 
	 	 	 	 
	2.01

	 	Rent
	 	14.25/RSF/yr.
	 
	 	 	 	 
	2.02

	 	Rent Adjustment 

Tenant’s pro rata share

Additional Rent
	 	$0.50/RSF/yr. each June 1st 

100.00% 

$6.82/RSF/yr [subject to adjustment per §2.02]
	 
	 	 	 	 
	2.05

	 	Security deposit
	 	NONE
	 
	 	 	 	 
	4.01

	 	Build out Allowance
	 	PAID
	 
	 	 	 	 
	10.01

	 	Extension term
	 	Four terms, five years each

	 	 	 
	LANDLORD	 	TENANT
	Old Sauk Trails Park Limited Partnership

	 	TomoTherapy Incorporated
	Old Sauk Trails Park Development Company,
gen’l partner

	 	1240 Deming Way
	8020 Excelsior Drive, Ste. 300

	 	Madison WI 53717-2911
	Madison WI 53717-1998
	 	 

	 	 	 	 	 
	/s/ George Gialamas
 

George Gialamas, President

	 	/s/ Dr. Frederick A. Robertson
 

Dr. Frederick A. Robertson, C.E.O.
	 	 

 

 

1240 Deming Way 

Madison, Wisconsin 53717

					
	 
	No. 1
	 	REFERENCE DATA
	 	October 22, 2001

These terms are specific to, and incorporated in, this lease.

	 	 	 	 	 
	¶
no.	 	Item	 	Lease Provision
	1.01

	 	Tenant
	 	Tomotherapy Incorporated, a Wisconsin corporation
	 
	 	 	 	 
	1.02

	 	Premises

Area of the Premises1
	 	1st and 2nd floor, building to
be constructed at 1240 Deming Way, including test bunkers

appx. 40,000 rentable square feet (“RSF”) of office and
manufacturing space excluding the test bunkers
	 
	 	 	 	 
	1.03

	 	Additional Permitted uses
	 	manufacture, testing and assembly of medical imaging
equipment
	 
	 	 	 	 
	1.04

	 	Term
 Target Date
	 	Ten (10) years

May 1, 2002, for 1st floor & bunkers; June 1, 2002, for 2nd floor
	 
	 	 	 	 
	2.01

	 	Rent at commencement
	 	13.00/RSF/yr.
	 
	 	 	 	 
	2.02

	 	Rent Adjustment

Tenant’s pro rata share1 

Additional Rent
	 	$0.50/RSF/yr.

60.6%

$5.50/RSF/yr [est.]
	 
	 	 	 	 
	2.05

	 	Security deposit
	 	NONE
	 
	 	 	 	 
	4.01

	 	Build out Allowance
	 	$23.25/RSF
	 
	 	 	 	 
	10.01

	 	Extension term
	 	Four terms, five years each

	 	 	 
	LANDLORD	 	TENANT
	Old Sauk Trails Park Limited Partnership

	 	Tomotherapy Incorporated
	Old Sauk Trails Park Development Company,
gen’l partner

	 	2228 Evergreen Road
	8020 Excelsior Drive, Ste. 300

	 	Middleton, WI 53562-4241
	Madison WI 53717-1998        
	 	 

	 	 	 	 	 
	/s/ George Gialamas
 

George Gialamas, President

	 	/s/ John J. Barni
 

John J. Barni, C.E.O.
	 	 

 

			
	1	 	Area of the Premises and of the Building and the Tenant’s pro rata
share to be confirmed upon completion of the final building plans, and prior to
commencement, by execution of another Reference Data page.

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	PAGE	 
	ARTICLE 1	 	BASIC LEASE PROVISIONS	 	 	 	 
	 
	 	Section 1.01	 	 	 	Date and Parties	 	 	1	 
	 
	 	Section 1.02	 	 	 	Premises	 	 	1	 
	 
	 	Section 1.03	 	 	 	Use	 	 	1	 
	 
	 	Section 1.04	 	 	 	Term	 	 	1	 
	 
	 	Section 1.05	 	 	 	Improvements	 	 	3	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE 2	 	RENT AND SECURITY	 	 	 	 
	 
	 	Section 2.01	 	 	 	Rent and Rent Adjustment 	 	 	3	 
	 
	 	Section 2.02	 	 	 	Additional Rent	 	 	4	 
	 
	 	Section 2.03	 	 	 	Personal Property Tax	 	 	9	 
	 
	 	Section 2.04	 	 	 	Security Deposit	 	 	9	 
	 
	 	Section 2.05	 	 	 	Sales Tax	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE 3	 	AFFIRMATIVE OBLIGATIONS	 	 	 	 
	 
	 	Section 3.01	 	 	 	Compliance with Laws	 	 	9	 
	 
	 	Section 3.02	 	 	 	Services and Utilities	 	 	10	 
	 
	 	Section 3.03	 	 	 	Repairs and Maintenance	 	 	12	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE 4	 	NEGATIVE OBLIGATIONS	 	 	 	 
	 
	 	Section 4.01	 	 	 	Alterations	 	 	14	 
	 
	 	Section 4.02	 	 	 	Assignment and Subleasing	 	 	16	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE 5	 	INSURANCE	 	 	 	 
	 
	 	Section 5.01	 	 	 	Insurance	 	 	17	 
	 
	 	Section 5.02	 	 	 	Indemnification	 	 	20	 
	 
	 	Section 5.03	 	 	 	Limitation of Landlord’s Liability	 	 	20	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE 6	 	LOSS OF PREMISES	 	 	 	 
	 
	 	Section 6.01	 	 	 	Damages	 	 	21	 
	 
	 	Section 6.02	 	 	 	Condemnation	 	 	23	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE 7	 	DEFAULT	 	 	 	 
	 
	 	Section 7.01	 	 	 	Tenant’s Default	 	 	25	 
	 
	 	Section 7.02	 	 	 	Landlord’s Remedies	 	 	26	 
	 
	 	Section 7.03	 	 	 	Landlord’ Default	 	 	27	 
	 
	 	Section 7.04	 	 	 	Exception to Cure Periods	 	 	27	 
	 
	 	Section 7.05	 	 	 	Self-Help	 	 	27	 
	 
	 	Section 7.06	 	 	 	Survival	 	 	27	 

 

 

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	PAGE	 
	ARTICLE 8	 	NONDISTURBANCE	 	 	 	 
	 
	 	Section 8.01	 	 	 	Subordination	 	 	28	 
	 
	 	Section 8.02	 	 	 	Estoppel Certificate	 	 	28	 
	 
	 	Section 8.03	 	 	 	Quiet Possession	 	 	29	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE 9	 	LANDLORD’S RIGHTS	 	 	 	 
	 
	 	Section 9.01	 	 	 	Rules	 	 	29	 
	 
	 	Section 9.02	 	 	 	Mechanic’s Liens	 	 	29	 
	 
	 	Section 9.03	 	 	 	Right to Enter	 	 	30	 
	 
	 	Section 9.04	 	 	 	Holdover	 	 	31	 
	 
	 	Section 9.05	 	 	 	Signs	 	 	32	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE 10	 	OPTIONS	 	 	 	 
	 
	 	Section 10.01	 	 	 	Option to Extend	 	 	33	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE 11	 	DISPUTES	 	 	 	 
	 
	 	Section 11. 01	 	 	 	Arbitration	 	 	33	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE 12	 	MISCELLANEOUS	 	 	 	 
	 
	 	Section 12.01	 	 	 	Broker’s Warranty	 	 	34	 
	 
	 	Section 12.02	 	 	 	Attorney’s Fees	 	 	35	 
	 
	 	Section 12.03	 	 	 	Notices	 	 	35	 
	 
	 	Section 12.04	 	 	 	Partial Invalidity	 	 	35	 
	 
	 	Section 12.05	 	 	 	Waive	 	 	35	 
	 
	 	Section 12.06	 	 	 	Construction	 	 	35	 
	 
	 	Section 12.07	 	 	 	Binding on Successors	 	 	35	 
	 
	 	Section 12.08	 	 	 	Governing Law	 	 	35	 
	 
	 	Section 12.09	 	 	 	Insurance Increase	 	 	35	 
	 
	 	Section 12.10	 	 	 	Lease not an Offer	 	 	35	 
	 
	 	Section 12.11	 	 	 	Recording	 	 	36	 
	 
	 	Section 12.12	 	 	 	Survival of Remedies	 	 	36	 
	 
	 	Section 12.13	 	 	 	Authority of Parties	 	 	36	 
	 
	 	Section 12.14	 	 	 	Business Days	 	 	36	 
	 
	 	Section 12.15	 	 	 	Entire Agreement	 	 	36	 
	 
	 	Section 12.16	 	 	 	Definition of Lease	 	 	36	 

                                                                 EXHIBITS

	 	 	 	 	 
	 
	 	Exhibit A	 	Floor Plan
	 
	 	Exhibit B	 	Building
	 
	 	Exhibit  C	 	Land
	 
	 	Exhibit D2	 	Space Plan
	 
	 	Exhibit E	 	Specifications
	 
	 	Exhibit F	 	Janitorial Services
	 
	 	Exhibit G	 	Rules
	 
	 	Exhibit  H	 	Building Standard
	 
	 	Exhibit I	 	Tenant Build Out Agreement

 

			
	2	 	Exhibits D & E are to be agreed on by Landlord and Tenant and added hereto by 10/31/01

 

 

DEFINITIONS

	 	 	 
	Additional Rent
	 	§2.02
	Alterations
	 	§4.01(a)
	Applicable Laws
	 	§3.01
	Asking/Answering Party
	 	§8.02(a)
	Building
	 	§1.01
	Business Days
	 	§12.13
	Business Hours
	 	§3.02(b)
	Canceling/Complying Party
	 	§3.01
	Commencement Date
	 	§l.04
	Default
	 	§7.01(a)
	Defaulting Party
	 	§7.05
	Excess Consideration
	 	§4.02(f)
	Extension Term
	 	§10.01(a)
	HVAC
	 	§3.02(a)
	Holdover
	 	§9.04(a)
	Improvements
	 	§1.05
	Injured Party
	 	§5.01(d)
	Land
	 	§1.02
	Landlord
	 	§1.01
	Late Payment
	 	§2.01 (b)
	Lease
	 	§1.01
	Operating Expenses
	 	§2.02
	Premises
	 	§1.02
	Property
	 	§2.02(a)
	Pro Rata Share
	 	§2.02(a)
	Real Estate Taxes
	 	§2.02(a)
	Reference Data
	 	§1.01
	Relevant Space
	 	§6.01 (a)
	Rent
	 	§2.01
	Statement
	 	§2.02(d)
	Substantial Completion
	 	.§1.04(b)
	Successor Landlord
	 	§8.0l(b)
	Target Date
	 	§1.04(a)
	Temporary Condemnation
	 	§6.02(h)
	Tenant
	 	§1.01
	Term
	 	§1.04(a)

 

 

ARTICLE 1 — BASIC LEASE PROVISIONS

1.01. Date and parties. This lease (Lease) is entered into between Old Sauk Trails Park
Limited
Partnership, as lessor (Landlord) and the tenant identified on the Reference Data page at the front
of this
Lease, as lessee (Tenant) for space in the building to be constructed on Lots 65 and 66, Old Sauk
Trails
Park, Sixth Addition, Madison, Wisconsin (Building).

1.02.
Premises. Landlord leases to Tenant the space identified in the Reference Data (Premises) as
shown outlined on the attached floor plan (Exhibit A). The Premises contain the fixtures,
improvements,
and other property now installed therein plus any improvements required by section 1.05 and
Exhibits D
and E.

The Building (Exhibit B) will contain approximately 59,235 rentable square feet excluding the test
bunkers and the Premises will contain the rentable area which is
designated in the Reference Data. These measurements were made using the American National Standard Method of Measuring Floor Area in
Office Buildings, ANSI/BOMA Z65.1-1996, published by the Building Owners and Managers Association
International. Any change in the rentable area of the Building or Premises will be incorporated
herein by a revision of the Reference Data.

Tenant and its agents, employees, and invitees, have the nonexclusive right with others designated
by Landlord to the free use of the common areas in the Building and of the land (Land) on which the
Building is located (Exhibit C) for the common areas’ intended and normal purpose. Common areas
include elevators, sidewalks, surface-lot parking areas, driveways, hallways, stairways, public
bathrooms, common entrances, lobby, and other similar public areas and access ways. Landlord may
change the common areas if the changes do not materially and unreasonably interfere with Tenant’s
access to the Premises or use of them.

1.03. Use. Tenant shall use the Premises for business office purposes only, unless Landlord
gives its
advance written consent to another use which shall be evidenced by inclusion in the Reference Data.
Landlord warrants that applicable laws, ordinances, regulations, and restrictive covenants permit
the
Premises to be used for any use permitted by the Lease. Tenant shall not create a nuisance or use
the
Premises for any immoral or illegal purposes.

1.04.Term.

     1.04(a). Term. The Lease begins (Commencement Date) for any part of the Premises on the
earlier of:

(i) the date Tenant takes possession and occupies any part of the Premises,
but only for that portion so occupied; or

 

 

(ii) the Target Date for each portion of the Premises, if said portion
is substantially completed on that date; or

(iii) thirty (30) days after the delivery of the notice required by subsection
1.04(c), if the applicable part of the Premises is substantially completed on that
date.

If the Commencement Date would be a Saturday, Sunday, or holiday listed in paragraph
3.02(b)(ii), the Commencement Date shall be the first business day following that Saturday,
Sunday, or holiday. Within thirty days after the Commencement Date, the parties shall
confirm the Commencement Date by an amendment to the Reference Data.

The Lease shall continue in force from the Commencement Date if said date is the first day
of a calendar month, or else from the first day of the month following the Commencement
Date for the term designated in the Reference Data, unless ended earlier pursuant to the
terms of this Lease.

1.04(b). Substantial completion. Landlord shall use its best efforts to substantially
complete the Premises by the Target Dates set in the Reference Data. Substantially complete
means:

(i) the decoration, fixtures, and equipment to be installed by Landlord
(“Building Standard”, described in Exhibit H) are installed and in good
operating order;

(ii) Tenant, its employees, agents, and invitees, have ready access to the Building
and Premises through the lobby, entranceways, elevators, and hallways;

(iii) completing
Tenant’s improvements (section 1.05 and Exhibits D and E) so that (A) Tenant can use the premises for their intended purposes without material
interference to Tenant conducting its ordinary business activities, and

(B) the only incomplete items are minor or insubstantial details of
construction,
mechanical adjustments, or finishing touches like touch-up plastering or
painting;

(iv) the Premises are ready for the installation of any equipment, furniture,
fixtures, or decoration that Tenant will install;

(v) the following items are installed and in good operating order:

(A) building lobby,

(B) hallways on floor on which Premises are located (including walls,
flooring, ceiling, lighting, etc.),

(C) elevators, HVAC, utilities, and plumbing serving the Premises, and

(D) the doors and hardware; and

(vi) the Premises are broom clean.

					
	 	 	 	 	 
	1240 Deming Way
	 	LEASE
	 	page 2 of 36

 

 

1.04(c). Notice. Landlord shall give Tenant at least thirty (30) days advance
written notice of the estimated substantial completion date if different from the Target
Date. If the estimated substantial completion date changes at any time after Landlord gives
notice, then Landlord shall give thirty (30) calendar days advance notice of the new
estimated substantial completion date.

1.04(d). Inspection and Punchlist. Before the Commencement Date, the parties shall inspect
the Premises, have all systems demonstrated, and prepare a punch-list. The punch-list
shall list incomplete, minor, or insubstantial details of construction; necessary mechanical
adjustments, and needed finishing touches. Landlord will complete the punch-list items within
thirty (30) days after the Commencement Date. Landlord will promptly correct any latent
defects as they become known, if Tenant notifies Landlord within thirty (30) days after
Tenant first learns of the defect.

1.04(e). Delayed Possession. Tenant may cancel this Lease if Landlord cannot deliver actual
possession of the substantially complete Premises by one hundred and twenty (120) days after
the Target Date. To cancel Tenant must give notice to Landlord within one hundred and eighty
(180) days after the Target Date and before Landlord gives notice to Tenant that the
Premises are substantially complete. The one hundred and twenty (120) day and one hundred
and eighty (180) day periods above shall be extended by the time equal to any period of
delay caused by the Tenant. Within thirty (30) days after cancellation Landlord shall return
to Tenant prepaid consideration including Rent and deposits.

1.05. Improvements. Landlord shall make improvements to the Premises in accord with
Exhibits D and E (Improvements) and Exhibit I (Tenant Build Out Agreement). The Improvements shall
be completed in a good and workmanlike manner and comply with all applicable laws, ordinances,
rules, and regulations of governmental authorities.

ARTICLE 2 — RENT AND SECURITY

2.01. Rent. Tenant shall pay rent (Rent) to Landlord in the amounts designated in
the Reference Data.

(a) Payment. The Rent shall be paid in equal monthly installments:

(i) without advance notice, demand, offset, or deduction unless the offset or
deduction is made by Tenant as permitted under paragraph 11.01(b)(ii) or to recover
any unpaid (nonappealable) court judgment Tenant has against Landlord;

(ii) by the first day of each month during the Term; and

					
	 	 	 	 	 
	1240 Deming Way
	 	LEASE
	 	page 3 of 36

 

 

(iii) to Landlord or to Landlord’s agent as identified in the Reference
Data, or as Landlord may specify in writing to the Tenant.

If the Term does not begin on the first day or end on the last day of a month, the Rent for
that partial month shall be prorated by multiplying the monthly Rent by a fraction, the
numerator of which is the number of days of the partial month included in the Term and the
denominator of which is the total number of days in the full calendar month.

(b) Late payment. If Tenant fails to pay part or all of the Rent or Additional Rent
(section 2.02) within ten (10) days after it is due, the Tenant shall also pay:

     (i) a late charge equal to 1 percent of the unpaid Rent and Additional Rent,
plus

     (ii) interest at 18 percent per annum or the maximum then allowed by applicable
law, whichever is less, on the remaining unpaid balance, retroactive to the date originally
due until paid, but the interest accumulation shall stop after thirty (30) days unless
Landlord gives Tenant written notice of the Tenant’s failure to pay Rent or Additional Rent
within 30 days of the date payment was due.

2.02. Additional Rent. Tenant shall also pay its pro rata share of real estate taxes
and operating expenses for the Property as Additional Rent in accordance with the following
provisions.

2.02(a). Definitions.

(i) Tenant’s pro rata share, which is shown in the Reference Data, was
calculated by dividing the rentable area of the Premises by the rentable area of the
Building and expressing the fraction as a percentage.

(ii) Property means the Building and its equipment and systems, and the Land.

(iii) Real Estate Taxes means real property taxes and currently due
installments of assessments, special or otherwise, imposed upon the Property, and
reasonable legal fees, costs, and disbursements incurred for proceedings to contest,
determine, or reduce Real Estate Taxes, but only to the extent the Real Estate Taxes
are reduced.

Real Estate Taxes do not include:

(A) federal, state, or local income taxes,

(B) franchise, gift, transfer, excise, capital stock, estate,
succession, or inheritance taxes,

(C) penalties or interest for late payment of Real Estate Taxes, and

	 	 	 	 	 
	1240 Deming Way

	 	LEASE
	 	page 4 of 36

 

 

(D) the portion of Real Estate Taxes that is allocable to any
Building capital improvements made after the Building was fully assessed as
a completed and occupied unit and the Lease was signed except to the extent
the additional improvements benefit the Tenant.

(iv) Operating Expenses means Landlord’s operating expenses that are
reasonable, actual and necessary, out-of-pocket, obtained at competitive prices,
and that are directly attributable to the operation, maintenance, management, and
repair of the Property, as determined under generally accepted accounting
principles consistently applied, including:

(A) salaries, and other compensation; including payroll taxes, vacation,
holiday, and other paid absences; and welfare, retirement, and other fringe
benefits; that is paid to employees, independent contractors, or agents of
Landlord engaged in the operation, repair, management, or maintenance of the
Property;

(B) repairs and maintenance of the Property and the cost of necessary
supplies, tools, materials, and equipment for Property repairs and
maintenance, that under generally accepted accounting principles would not
be capitalized;

(C) premiums and other charges incurred by Landlord for insurance on the
Property and for employees specified in subparagraph 2.02(a)(iv)(A)(l);

(D) costs incurred for inspection and servicing, including all outside
maintenance contracts necessary or proper for the maintenance of the
Property, such as janitorial and window cleaning, rubbish removal,
exterminating, water treatment, elevator, electrical, plumbing, and
mechanical equipment, and the cost of materials, tools, supplies, and
equipment used for inspection and servicing;

(E) costs
incurred for electricity, water, gas, fuel, or other utilities;

(F) sales, use, and excise taxes on goods and services purchased by
Landlord;

(G) license, permit, and inspection fees;

(H) fees for public accounting;

(I) legal fees, costs, and disbursements but excluding those

(1) relating to disputes with tenants,

(2) based upon Landlord’s negligence or other tortious conduct,

(3) relating to enforcing any leases except for enforcing lease
provisions for the benefit of the Building tenants generally,
or

(4) relating to the defense of Landlord’s title to, or interest in,
the Property;

(J) management fees to a person or entity other than Landlord;

(K) the annual amortization over its useful life with a reasonable
salvage value on a straight-line basis of the costs of any capital improvements made
by

	 	 	 	 	 
	1240 Deming Way

	 	LEASE
	 	page 5 of 36 

 

 

Landlord and (i) required by any changes in applicable laws, rules,
or regulations of any governmental authorities enacted after the Building
was assessed as a completed and occupied unit and the Lease was signed, or
(ii) which are for the benefit of the Building tenants generally;

(L) the annual amortization over its useful life with a reasonable
salvage value on a straight-line basis of the costs of any capital
improvements made by Landlord as a labor-saving measure or to accomplish
other savings in operating, repairing, managing, or maintaining the
Property, after the Building was assessed as a completed and occupied unit
and the Lease was signed, but only to the extent of the savings; and

(M) other costs reasonably necessary to operate, repair, manage,
and maintain the Property in a first class manner and condition.

Operating Expenses exclude:

(A) Real Estate Taxes as defined in paragraph 2.02(a)(iii);

(B) leasing commissions, costs, disbursements, and other expenses incurred
for leasing, renovating, or improving space for tenants;

(C) costs incurred by Landlord in discharging its obligations under section
1.05 and Exhibit C;

(D) costs (including permit, license, and inspection fees) incurred in
renovating, improving, decorating, painting, or redecorating vacant
space or space for tenants;

(E) Landlord’s cost of electricity or other service sold to tenants for
which Landlord is to be reimbursed as a charge over the Rent and Additional
Rent payable under the lease with that tenant;

(F) depreciation and amortization on the Building except as expressly
permitted elsewhere in the Lease;

(G) costs of a capital nature including capital improvements, capital
repairs, capital equipment, and capital tools, as determined under generally
accepted accounting principles consistently applied, except that the annual
amortization of these costs shall be included to the extent expressly
permitted in subparagraph 2.02(a)(iv)(K) and (L);

(H) costs incurred because the Landlord or another tenant violated the
terms of any lease;

(I) interest on debt or amortization payments on mortgages or deeds
of trust or any other debt for borrowed money;

(J) items and services for which Landlord is reimbursed by Tenant or
others or which Landlord provides selectively to one or more tenants of the
Building other than Tenant without reimbursement;

(K) advertising and promotional expenditures;

	 	 	 	 	 
	1240 Deming Way

	 	LEASE
	 	page 6 of 36

 

 

\

(L) repairs or other work needed because of fire, windstorm, or
other casualty or cause insured against by Landlord or to the extent
Landlord’s insurance required under Article 5 would have provided insurance,
whichever is the greater coverage;

(M) nonrecurring costs incurred to remedy structural defects in
original construction materials or installations;

(N) any costs, fines, or penalties incurred because Landlord violated
any governmental rule or authority;

(O) costs incurred to test, survey, cleanup, contain, abate, remove,
or otherwise remedy hazardous wastes or asbestos-containing materials from the
Property unless the wastes or asbestos-containing materials were in or on
the Property because of Tenant’s negligence or intentional acts;

(P) other expenses that under generally accepted accounting principles
consistently applied would not be considered normal maintenance, repair,
management, or operation expenses.

2.02(b). Adjustments. Operating Expenses as defined in paragraph 2.02(a)(iv) shall be
adjusted as follows:

(i) Vacancy Adjustment. If, during the term of this Lease, any area of the
Building reserved for occupancy by tenants is vacant, Landlord shall pay the Pro
Rata Share of the Operating Expenses and Real Estate Taxes allocated to that area.
The amount paid by Landlord under this paragraph shall be reduced by the full amount
of any reduction in Operating Expenses directly attributable to the vacancy.

(ii) Credits/Reimbursements. Operating Expenses shall be reduced by
reimbursements, credits, discounts, reductions, refunds or other allowances received
or receivable by Landlord for items of cost included in Operating Expenses, except
reimbursements to the Landlord by tenants under the Additional Rent (Operating
Expenses/Taxes) provision.

(iii) Increased Building Rentable Square Feet. If Landlord increases the
Building’s rentable square feet after the Building was fully assessed as a completed
and occupied unit and the Lease was signed, then the Operating Expenses and Real
Estate Taxes attributable to the additional rentable square feet shall be included
in the Operating Expenses and Real Estate Taxes and Tenant’s pro rata share shall be
reduced using the same formula in paragraph 2.02(a)(i).

2.02(c). Payment by Landlord. Subject to reimbursement under subsection 2.02(d), Landlord
shall pay the Property’s Operating Expenses and Real Estate Taxes before delinquency.

	 	 	 	 	 
	1240 Deming Way

	 	LEASE
	 	page 7 of 36

 

 

2.02(d). Payment by Tenant.

(i) From and after the commencement date of this Lease, the Tenant shall pay
monthly, together with the Rent, Additional Rent in the amount designated in the
Reference Data. Landlord reserves the right to adjust the amount of Additional Rent
due from Tenant in accordance with the following paragraph (ii).

(ii) On or before January 21st of each year during the term of this Lease, or
as soon thereafter as reasonably practical, Landlord shall deliver to Tenant:

(A) an itemized statement (Statement) showing the amount of Additional Rent
received from Tenant together with the Real Estate Taxes and actual
Operating Expenses for the prior year broken down by component expenses,
such as repairs, management fees, utility charges and janitorial costs; and

(B) a budget showing the estimated cost for Real Estate Taxes and Operating
Expenses for the next twelve calendar months and a calculation of the
Tenant’s Pro Rata Share of Additional Rent for the next twelve months.
Landlord shall supply, upon Tenant’s request, reasonable additional
information to explain or support the Statement. Any adjustment of the
amount of Additional Rent due from Tenant shall be effective, and paid by
the Tenant, with the Monthly Rent payment which is due at least ten (10)
days after Tenant’s receipt of a revised Reference Data page for this Lease
showing the adjusted amount of Additional Rent due from Tenant.

(iii) If the Statement shows that the amount of Tenant’s pro rata share for the
prior year is less than the amount of Additional Rent paid by Tenant during that
year, Landlord shall credit the difference to the installment(s) of Rent and
Additional Rent next due from Tenant (or, after expiration of the Lease, mail a
refund with the statement). If the Statement shows that the amount of Tenant’s pro
rata share for the prior year is greater than the amount of Additional Rent paid by
Tenant during that year, the difference shall be assessed to Tenant as Additional
Rent and shall be due with the installment of Rent which is due thirty (30) days
following Landlord’s delivery of an invoice for said assessment to Tenant. Any
overpayment or underpayment of Additional Rent, including interest and penalty,
shall survive the ending of the Lease.

(iv) For any year in which this Lease is not in effect for the complete
calendar year, unless it was ended because of Tenant’s default, Tenant’s obligation
for Additional Rent for that year shall be prorated by multiplying Tenant’s pro rata
share by a fraction expressed as a percentage, the numerator of which is the number
of days of the year included in the Term and the denominator of which is 365.

	 	 	 	 	 
	1240 Deming Way

	 	LEASE
	 	page 8 of 36

 

 

2.03. Personal Property Tax. Tenant shall pay, before they become delinquent, taxes
assessed during the Term against trade fixtures or personal property placed by Tenant in the
Premises. If these taxes are assessed against the Building, Tenant shall pay its share of the taxes
to the Landlord within ten (10) days after receiving Landlord’s written statement setting forth the
amount of taxes applicable to Tenant’s property and the basis for the charge to Tenant. Tenant’s
failure to pay within the ten-day period shall entitle the Landlord to the same remedies it has
upon Tenant’s failure to pay Rent.

2.04. Security Deposit. The Tenant has deposited the amount designated in the Reference Data
(Security Deposit) with the Landlord to secure Tenant’s performance of its Lease obligations. If
Tenant defaults Landlord may, after giving five (5) days advance notice to Tenant, without
prejudice to Landlord’s other remedies, apply part or all of the Security Deposit to cure Tenant’s
default. If Landlord so uses part or all of the Security Deposit, then Tenant shall within ten (10)
days after written demand, pay Landlord the amount used to restore the Security Deposit to its
original amount.

     Any part of the Security Deposit not used by the Landlord as permitted by this section shall
be returned to Tenant, without interest, within thirty (30) days after the Lease ends. If Landlord
sells the Building then the Landlord shall be relieved of any liability for the Security Deposit
and accumulated interest if the requirements of subsection 5.03(a) are met.

2.05.
Sales Tax. Tenant shall pay sales, excise or any similar taxes which may be
levied against the Rent, Additional Rent, or any other payments due to Landlord under this Lease.

ARTICLE 3 — AFFIRMATIVE OBLIGATIONS

3.01. Compliance with Laws.

3.01(a). Compliance at Commencement. Landlord and Tenant warrant, each to the other, that on
the Commencement Date, the Premises and the Tenant’s use of the same, will comply with all
applicable laws, ordinances, rules, and regulations of governmental authorities (Applicable
Laws). Any failure to comply with the Applicable Laws following notice from the other party
and a reasonable period of cure shall constitute a default under this Lease.

3.01(b). Notice of Noncompliance. If there should be a change in the Applicable Laws which
would cause either party to be found out of compliance therewith, that party shall
immediately notify the other party and undertake all actions necessary to achieve compliance
with the changed Laws, subject to the limits in the following subsection 3.01(c).

3.01(c). Compliance Limits. Either party, instead of complying with Applicable Laws as
required by subsection 3.01(b), may cancel the Lease by giving prompt notice to the other
if:

	 	 	 	 	 
	1240 Deming Way

	 	LEASE
	 	page 9 of 36

 

 

(i) the estimated cost to comply exceeds an amount equal to six
months’ current rent

(A) due from Tenant to Landlord if Tenant is not in compliance; or

(B) due from all tenants in the Building then paying rent to
Landlord if Landlord is not in compliance;

	 	(ii)	 	less than twelve (12) months remain in the Term
and Tenant does not have an option to extend the Term.

If either party (Canceling Party) cancels the Lease under (i) above, the other
(Complying Party) may, within ten (10) days of receiving the Canceling Party’s notice,
agree to achieve compliance with the Applicable Laws at its expense by giving notice to
the Canceling Party and this Lease shall continue in effect. If the Complying Party
incurs any expense in its exercise of this right, then the Canceling Party shall
promptly reimburse the Complying Party the amount of the limit identified for the
Canceling Party in (i) above, or the Complying Party’s actual cost of compliance,
whichever is less.

3.02. Services and Utilities.

3.02(a). Services. Landlord shall provide at its expense, subject to reimbursement
under subsection 2.02(d):

(i) Heating, ventilation, and air conditioning (HVAC) for the Premises
during business hours to maintain temperatures for comfortable use and occupancy
in light of Tenant’s space plan (Exhibit D);

(ii) Automatic passenger elevators providing adequate service leading to the
floor on which the Premises are located;

(iii) Janitorial services to the Premises as specified in Exhibit F;

(iv) Hot and cold water sufficient for drinking, lavatory, toilet, and
ordinary cleaning purposes to be drawn from approved fixtures in the Premises if
shown on Exhibit D or on the floor on which the Premises are located;

(v) Electricity to the Premises during business hours that provides
electric current in reasonable amounts necessary for normal office use, lighting,
and HVAC;

(vi) Replacement of lighting tubes, lamp ballasts, and bulbs;

	 	 	 	 	 
	1240 Deming Way

	 	LEASE
	 	page 10 of 36

 

 

(vii) Extermination and pest control when necessary; and

(viii) Maintenance of common areas in a first class manner comparable to other
first class office buildings in the area. The maintenance shall include cleaning,
HVAC, illumination, snow shoveling, deicing, repairs, replacements, lawn care, and
landscaping.

3.02(b). Business Hours. In section 3.02 business hours means:

(i) Monday through Friday, 7:00 a.m. to 7:00 p.m., and

(ii) Saturday, 8:00 a.m. to 1:00 p.m., but excludes the following holidays or
the days on which the holidays are designated for observance: New Year’s Day,
Memorial Day, July Fourth, Labor Day, Thanksgiving Day, and Christmas Day.

3.02(c). 24 Hour Access. Tenant, its employees, agents, and invitees shall have access to
the Premises twenty-four (24) hours a day, seven (7) days a week. During nonbusiness hours

Landlord may restrict access by requiring an entry or identification card issued by the
Landlord. Landlord shall not be liable for denying entry to any person who does not have
the required card.

     Landlord may temporarily close the Building if required because of a
life-threatening or Building-threatening situation. Landlord shall use its best efforts to
close the Building during nonbusiness hours only. If, however, the Building must be closed
during business hours, then the Rent and Additional Rent shall abate during any closing
that lasts more than eight (8) consecutive business hours.

3.02(d). Extra Services. Whenever Landlord knows that any tenant (including Tenant) is
using extra services because of either nonbusiness-hours use or high electricity
consumption installations, the Landlord will directly charge that tenant for the extra use
and exclude those charges form Operating Expenses. Extra services include:

(i) NonBusiness-Hours Use. HVAC and electricity required by Tenant during
nonbusiness hours shall be supplied upon reasonable advance verbal notice. If more
than one tenant directly benefits from these services then the cost shall be
allocated proportionately between or among the benefitting tenants based upon the
amount of time each tenant benefits and the square footage each leases.

(ii) Excess Utility Use. Tenant shall not place or operate in the Premises any
electrically operated equipment or other machinery, other than typewriters, personal
computers, adding machines, reproduction machines, and other machinery and equipment
normally used in offices, unless Tenant receives Landlord’s advance written consent.
Landlord shall not unreasonably withhold or delay its consent. But Landlord

	 	 	 	 	 
	1240 Deming Way

	 	LEASE
	 	page 11 of 36

 

 

may require payment for the extra use of electricity caused by operating
this equipment or machinery.

     Landlord may require that special, high electricity consumption installations
of Tenant such as computer or reproduction facilities (except personal computers or
normal office photocopy machines) be separately ventilated or sub-metered for
electrical consumption at Tenant’s cost.

(iii) Payment. Tenant’s charges for the utilities provided under (i) and (ii)
above shall be the lesser of:

(A) one hundred and ten percent (110%) of Landlord’s actual cost of labor
and utilities; or

(B) the lowest rate charged to any other tenant in the Building for
extra services during the calendar year.

Tenant’s failure to pay the charges in (i) and (ii) above within thirty (30) days of
receiving a proper and correct invoice shall entitle Landlord to the same remedies
it has upon Tenant’s failure to pay Rent.

3.02(e). Interruption of Services.

(i) Interruptions. Landlord does not warrant that any services Landlord
supplies will not be interrupted. Services may be interrupted because of accidents,
repairs, alterations, improvements, or any reason beyond the reasonable control of
the Landlord. Except as noted in (ii) below, any interruption shall not:

(A) be considered an eviction or disturbance of Tenant’s use and possession
of the Premises;

(B) make Landlord liable to Tenant for damages;

(C) abate Rent or Additional Rent; or

(D) relieve Tenant from performing Tenant’s Lease obligations.

(ii) Remedy. If any essential services (such as HVAC, passenger elevators,
electricity, water) supplied by Landlord are interrupted, and the interruption does
not result from the negligence or willful misconduct of Tenant, its employees,
invitees, or agents, Tenant shall be entitled to an abatement of Rent and Additional
Rent. The abatement shall begin on the third consecutive business day of the
interruption or when Tenant stops using the Premises because of the interruption,
whichever is later. The abatement shall end on the second day after the services are
restored. Tenant shall have the option to cancel the Lease if the interruption
unreasonably and materially interferes with Tenant’s use of or access to the
Premises for at least thirty (30) consecutive days and Landlord is not exercising
its best efforts to restore the services. To exercise this

	 	 	 	 	 
	1240 Deming Way

	 	LEASE
	 	page 12 of 36

 

 

option Tenant must give Landlord notice of the cancellation within ten (10) days
from the end of the thirty (30) day period.

3.03. Repairs and Maintenance.

3.03(a). Tenant’s Care of Premises. Tenant shall:

(i) keep the Premises and fixtures in good order;

(ii) make repairs and replacements to the Premises or Building needed because
of Tenant’s misuse or primary negligence, except to the extent that the repairs or
replacements are covered by Landlord’s insurance or the insurance Landlord is
required to carry under Article 5, whichever is greater;

(iii) repair and replace special equipment or decorative treatments installed
by or at Tenant’s request and that serve the Premises only, except

(A) to the extent the repairs or replacements are needed because of
Landlord’s misuse or primary negligence, and are not covered by Tenant’s
insurance or the insurance Tenant is required to carry under Article 5,
whichever is greater; or

(B) if the Lease is ended under sections 6.01 (Damage) or 6.02
(Condemnation) or 7.03 (Landlord’s Default); and

(iv) not commit waste.

3.03(b). Landlord’s Repairs. Except for repairs and replacements that Tenant must make
under subsection 3.03(a), Landlord shall make all other repairs and replacements to the
Premises, common areas and Building (including Building fixtures and equipment).

     Landlord shall make the repairs and replacements to maintain the Building in a first
class condition comparable to other first class buildings in the area. This maintenance
shall include the roof, foundation, exterior walls, interior structural walls, all
structural components, and all systems such as mechanical, electrical, HVAC, and plumbing.

3.03(c). Time for Repairs. Repairs or replacements required under subsections 3.03(a) or
3.03(b) shall be made within a reasonable time (depending on the nature of the repair or
replacement needed) after receiving notice or having actual knowledge of the need for a
repair or replacement.

	 	 	 	 	 
	1240 Deming Way

	 	LEASE
	 	page 13 of 36

 

 

3.03(d). Surrendering the Premises. Upon the last day of the initial or of the last
extension term elected by Tenant (if any), Tenant shall surrender the Premises to Landlord
in the same broom clean condition that the Premises were in on the Commencement Date except
for:

(i) ordinary wear and tear;

(ii) damage by the elements, fire, and other casualty unless Tenant
would be required to repair under subsection 3.03(a);

(iii) condemnation;

(iv) damage arising from any cause not required to be repaired or replaced by
Tenant; and

(v) alterations as permitted by this Lease unless consent was conditioned on
their removal.

On surrender Tenant shall remove from the Premises its personal property, trade fixtures, and any
alterations required to be removed under section 4.01 and repair any damage to the Premises caused
by the removal. Any items not removed by Tenant as required above shall be considered abandoned.
Landlord may dispose of abandoned items as Landlord chooses and bill the Tenant for the cost of
their disposal, minus any revenues received by Landlord for their disposal.

ARTICLE 4 — NEGATIVE OBLIGATIONS

4.01. Alterations.

4.01(a). Definition. “Alterations” means alterations, additions, substitutions,
installations, changes, and improvements, but excludes minor decorations and the
Improvements Landlord is to make under section 1.05 and Exhibits D and E.

4.01(b). Consent. Tenant shall not make Alterations without the Landlord’s advance written
consent. Landlord’s consent shall not be unreasonably withheld or unduly delayed for
non-structural interior Alterations to the Premises that do not adversely affect the
Building’s appearance, value, or structural strength.

4.01(c). Conditions of consent. Landlord may condition its consent under subsection 4.01(b)
on all or any part of the following:

	 	 	 	 	 
	1240 Deming Way
	 	LEASE
	 	page 14 of 36

 

 

(i) Tenant shall furnish Landlord with reasonably detailed plans and
specifications of the Alterations;

(ii) The Alterations shall be performed and completed:

(A) in accord with the submitted plans and specifications,

(B) in a workmanlike manner,

(C) in compliance with all Applicable Laws,

(D) using new materials and installations at least equal in quality to
the original Building materials and installations,

(E) by not disturbing the quiet possession of the other tenants,

(F) by not interfering with the construction, operation, or maintenance of
the Building, and

(G) with due diligence;

(iii) Tenant shall use workers and contractors whom Landlord
employs or approves in writing, which approval shall not be unreasonably
withheld or unduly delayed;

(iv) Tenant shall modify plans and specifications because of reasonable
conditions set by Landlord after reviewing the plans and specifications;

(v) Tenant’s contractors shall carry builder’s risk insurance in an amount
then customarily carried by prudent contractors and workers’ compensation insurance
for its employees in statutory limits;

(vi) Tenant’s workers or contractors shall work in harmony and not unreasonably
interfere with Landlord’s workers or contractors or other tenants and their
workers or contractors;

(vii) If the Alteration’s estimated cost exceeds $10,000.00, Tenant shall, at
Landlord’s request, supply a lien and completion bond, bank letter of credit, or
other security satisfactory to Landlord, in an amount equal to the estimated cost to
insure Landlord against materials and mechanics liens and against completion of the
Alterations;

(viii) Upon demand Tenant shall give Landlord evidence that it complied with
any condition set by Landlord;

(ix) Tenant shall give Landlord complete as-built drawings of the Alterations
after they are finished; and

	 	 	 	 	 
	1240 Deming Way
	 	LEASE
	 	page 15 of 36

 

 

(x) Tenant shall remove the Alterations and repair any damage from
their removal by the last day of the Term, or the date the last extension Term
elected by Tenant ends, if any, whichever is later.

4.01(d). Payment and Ownership of the Alterations. Alterations made under this subsection
shall be at Tenant’s expense. The Alterations shall belong to Landlord when this Lease and
the last extension Term, if any, ends except for those Alterations required to be removed
by Tenant, if any, under subsection 4.01(c). Nevertheless, Tenant may remove its trade
fixtures, furniture, equipment, and other personal property if Tenant promptly repairs any
damage caused by their removal.

4.02. Assignment and Subleasing.

4.02(a). Consent Required. Tenant shall not transfer, mortgage, encumber, assign, or
sublease all or part of the Premises without Landlord’s advance written consent. Landlord’s
consent to any assignment or sublease shall not be unreasonably withheld or unduly delayed.

4.02(b). Reasonableness. The Landlord’s consent shall not be considered unreasonably
withheld if:

(i) the proposed subtenant’s or assignee’s financial responsibility does not
meet the same criteria Landlord uses to select comparable Building tenants;

(ii) the proposed subtenant’s or assignee’s business is not suitable for the
Building considering the business of the other tenants and the Building’s prestige;
or

(iii) the proposed use is inconsistent with the use permitted by
section 1.03.

4.02(c). Procedure.

(i) Tenant must provide Landlord in writing:

(A) the name and address of the proposed subtenant or assignee;

(B) the nature of the proposed subtenant’s or assignee’s business it
will operate in the Premises;

(C) the terms of the proposed sublease or assignment; and

(D) reasonable financial information so that Landlord can evaluate the
proposed subtenant or assignee under paragraph 4.02(b)(i), if requested
by Landlord.

	 	 	 	 	 
	1240 Deming Way
	 	LEASE
	 	page 16 of 36

 

 

(ii) Landlord shall, within ten (10) business days after receiving the
information under paragraph 4.02(c)(i), give notice to the Tenant to permit or deny
the proposed sublease or assignment. If Landlord denies consent, it must explain
the reasons for the denial. If Landlord does not give notice within the ten (10)
business-day period, then Tenant may sublease or assign part or all of the Premises
upon the terms Tenant gave in the information under paragraph 4.02(c)(i).

4.02(d). Affiliates. Notwithstanding subsections 4.02(a), (b), and (c), Tenant may assign
or sublease part or all of the Premises without Landlord’s consent to:

	 	(i)	 	any corporation or partnership that controls, is
controlled by, or is under common control with, Tenant; or
	 
	 	(ii)	 	any corporation resulting from the merger or
consolidation with Tenant or to any entity that acquires all of Tenant’s
assets as a going concern of the business that is being conducted on the
Premises, as long as the assignee or sublessee is a bona fide entity and
assumes the obligations of Tenant.

4.02(e). Conditions. Subleases and Assignments by Tenant are also subject to the terms of
this Lease and Tenant shall remain liable for all Lease obligations unless released, in
writing, by Landlord. Consent to one sublease or assignment does not waive the consent
requirement for future assignments or subleases.

4.02(f). Review Fee. In consideration of Landlord’s review of the Tenant’s proposed
sublease or assignment, the Tenant shall pay a review fee to Landlord which is intended to
defray any expenses which Landlord may incur in the review of the proposed sublease or
assignment. The fee shall be equal to ten percent (10%) of the Rent due from Tenant for the
month in which the proposed sublease or assignment is to begin and shall be paid to
Landlord at the time the information required by paragraph 4.02(c)(i) is delivered to
Landlord.

ARTICLE
5 — INSURANCE

5.01. Insurance.

5.01(a). Building Insurance. Landlord shall keep the Building, including the
Improvements (section 1.05 and Exhibits D and E), insured against damage and destruction by
fire, earthquake, vandalism, and other perils in the amount of the full replacement value of
the Building, as the value may exist from time to time. The insurance shall include an
extended coverage endorsement of the kind required by an institutional lender to repair and
restore the Building.

	 	 	 	 	 
	1240 Deming Way
	 	LEASE
	 	page 17 of 36

 

 

5.01(b). Property Insurance. Each party shall keep its personal property and trade
fixtures in the Premises and Building insured with “all risks” insurance in an amount to
cover one hundred (100) percent of the replacement cost of the property and fixtures.
Tenant shall also keep any non-Building-standard improvements made to the Building at
Tenant’s request insured to the same degree as Tenant’s personal property.

5.01(c). Liability Insurance. Each party shall maintain contractual and comprehensive
general liability insurance, including public liability and property damage, with a minimum
combined single limit of liability of two million dollars ($2,000,000.00) for personal
injuries or deaths of persons occurring in or about the Building and Premises.

5.01(d). Waiver of Subrogation. Each party waives claims arising in any manner in its
(Injured Party’s) favor and against the other party for loss or damage to its property
located within or constituting a part or all of the Building. This waiver applies to the
extent the loss or damage is covered by:

(i) the Injured Party’s insurance; or

(ii) the insurance the Injured Party is required to carry under Article 5,
whichever is greater. The waiver also applies to each party’s directors, officers,
employees, shareholders, and agents. The waiver does not apply to claims caused by
a party’s willful misconduct

If despite a party’s best efforts it cannot find an insurance company meeting the criteria
in subsection 5.01(f) that will give the waiver at reasonable commercial rates, then it
shall give notice to the other party within thirty (30) days after the Lease’s Commencement
Date. The other party shall then have thirty (30) days to find an insurance company that
will issue the waiver. If the other party also cannot find such an insurance company, then
both parties shall be released from their obligation to obtain the waiver.

     If an insurance company is found but it will give the waiver only at rates greater than
reasonable commercial rates, then the parties can agree to pay for the waiver under any
agreement they can negotiate. If the parties cannot in good faith negotiate an agreement,
then both parties shall be released from their obligation to obtain the waiver.

5.01(e). Increase in Insurance. The amounts of coverage required by this Lease are subject
to review at the end of the initial term and of each renewal term, if any. At each review,
if necessary to maintain the same level of coverage that existed on the Commencement Date,
the amounts of coverage shall be increased to the lesser of

	 	 	 	 	 
	1240 Deming Way
	 	LEASE
	 	page 18 of 36

 

 

(i) the amounts of coverage carried by prudent Landlords
and Tenants of comparable first class office buildings in the area; or

(ii) twenty-five (25) percent higher than the previous insurance amounts.

     Either party may make the review and request appropriate increases based upon this
review within sixty (60) days after the preceding lease term ends. If the parties do not
agree to the amount of the increase, then the party requesting the increase may submit the
dispute to arbitration under section 11.01 within thirty (30) days of the request for the
increase. Landlord shall not request increased insurance unless it makes, at appropriate
times, similar requests of all other tenants whose insurance coverage is below the amount
carried by prudent tenants of similar buildings.

5.01(f). Insurance Criteria. Insurance policies required by this Lease shall:

(i) be issued by insurance companies licensed to do business in the state of
Wisconsin with general policyholder’s ratings of at least A and a financial rating
of at least XI in the most current Best’s Insurance Reports available on the
date in section 1.01. If the Best’s ratings are changed or discontinued, the
parties shall agree to an equivalent method of rating insurance companies. If the
parties cannot agree they shall submit the dispute to arbitration under section
11.01;

(ii) name the nonprocuring party as an additional insured as its interest may
appear; other landlords or tenants may also be added as additional insureds in a
blanket policy;

(iii) provide that the insurance may not be canceled or materially changed in
the scope or amount of coverage unless ten (10) days’ advance notice is given to the
non-procuring party;

(iv) be primary policies-not as contributing with, or in excess of, the
coverage that the other party may carry;

(v) be permitted to be carried through a “blanket policy” or “umbrella”
coverage;

(vi) have deductibles not greater than $5,000.00 (or such other amounts
as the Landlord and Tenant may agree) per occurrence; and

(vii) be maintained during the entire Term and any extension Term.

	 	 	 	 	 
	1240 Deming Way
	 	LEASE
	 	page 19 of 36

 

 

5.01(g). Evidence of Insurance. By the Commencement Date and upon each renewal of
its insurance policies, each party shall give certificates of insurance to the other party.
The certificate shall specify amounts, types of coverage, the waiver of subrogation, and
the insurance criteria listed in subsection 5.01(f). The policies shall be renewed or
replaced and maintained by the party responsible for that policy. If either party fails to
give the required certificate within thirty (30) days after notice of demand for it, the
other party may obtain and pay for that insurance and receive reimbursement from the party
required to have the insurance.

5.02. Indemnification.

5.02(a). Tenant’s Indemnity. Tenant indemnifies, defends, and holds Landlord
harmless from claims:

(i) for personal injury, death, or property damage;

(ii) for incidents arising in or about the Premises or Building; and

(iii) caused by the negligence or willful misconduct of Tenant, its agents,
employees, or invitees. When the claim is caused by the joint negligence or willful
misconduct of Tenant and Landlord or Tenant and a third party unrelated to Tenant,
except its agents, employees, or invitees, Tenant’s duty to defend, indemnify, and
hold Landlord harmless shall be in proportion to Tenant’s allocable share of the
joint negligence or willful misconduct.

5.02(b). Landlord’s Indemnity. Landlord indemnifies defends, and holds Tenant harmless from
claims:

(i) for personal injury, death, or property damage;

(ii) for incidents occurring in or about the Premises or Building; and

(iii) caused by the negligence or willful misconduct of Landlord, its
agents, employees, or invitees.

When the claim is caused by the joint negligence or willful misconduct of Landlord and
Tenant or Landlord and a third party unrelated to Landlord, except its agents, employees, or
invitees, Landlord’s duty to defend, indemnify, and hold Tenant harmless shall be in
proportion to Landlord’s allocable share of the joint negligence or willful misconduct.

5.02(c). Release of Claims. Notwithstanding subsections 5.02(a) and (b), the parties release
each other from any claims either party (Injured Party) has against the other. This release
is

	 	 	 	 	 
	1240 Deming Way
	 	LEASE
	 	page 20 of 36

 

 

limited to the extent the claim is covered by the Injured Party’s insurance or the
insurance the Injured Party is required to carry under Article 5, whichever is greater.

5.03. Limitation of Landlord’s liability.

5.03(a). Transfer of Premises. If the Building is sold or transferred, voluntarily or
involuntarily, the Landlord’s Lease obligations and liabilities accruing after the transfer
shall be the sole responsibility of the new owner if:

(i) the new owner expressly agrees in writing to assume these obligations;
and

(ii) the Tenant’s funds that the Landlord is holding, such as the Security
Deposit, are given to the new owner.

5.03(b).
Liability for Money Judgment. If Landlord, its employees, officers, or partners are
ordered to pay Tenant a money judgment because of Landlord’s default, then except in those
instances listed in subsection 5.03(c), Tenant’s sole remedy to satisfy the judgment shall
be:

(i) Landlord’s interest in the Building and Land including the rental income
and proceeds from sale; and

(ii) any insurance or condemnation proceeds received because of damage or
condemnation to, or of, the Building or Land that are available for use by Landlord.

5.03(c). Exceptions. Subsection 5.03(b) does not apply when:

(i) Landlord failed to apply insurance or condemnation proceeds as required by
the Lease;

(ii) Landlord misappropriated escrow funds; or

(iii) Landlord violated the warranties contained in section 12.12.

Nothing in subsections 5.03(a), (b), or (c) shall be interpreted to mean that Tenant cannot
be awarded specific performance or an injunction.

[Article 6 begins on the following page]

	 	 	 	 	 
	1240 Deming Way
	 	LEASE
	 	page 21 of 36

 

 

ARTICLE 6 — LOSS OF PREMISES

6.01. Damage.

6.01(a). Definition. “Relevant Space” means:

(i) the Premises as defined in section 1.02, excluding Tenant’s
non-Building-Standard fixtures;

(ii) access to the Premises; and

(iii) any part of the Building that provides essential services to the
Premises.

6.01(b). Repair of Damage. If the Relevant Space is damaged in part or whole from any cause
and the Relevant Space can be substantially repaired and restored within one hundred and
twenty (120) days from the date of the damage using standard working methods and
procedures, Landlord shall at its expense promptly and diligently repair and restore the
Relevant Space to substantially the same condition as existed before the damage. This
repair and restoration shall be made within one hundred and twenty days from the date of
the damage unless the delay is due to causes beyond Landlord’s reasonable control.

If the Relevant Space cannot be repaired and restored within one hundred and twenty
(120) day period, then either party may, within ten (10) days after determining that the
repairs and restoration cannot be made within one hundred and twenty (120) days (as
prescribed in subsection 6.01(c)), cancel the Lease by giving notice to the other party.
Nevertheless, if the Relevant Space is not repaired and restored within one hundred and
twenty (120) days from the date of the damage, then the Tenant may cancel the Lease at any
time after the one hundred and twentieth (120th) day and before the one hundred and fiftieth
(150th) day following the date of damage. Tenant shall not be able to cancel this Lease if
its willful misconduct caused the damage unless the Landlord is not promptly and diligently
repairing and restoring the Relevant Space.

6.01(c). Determining the Extent of Damage. If the parties cannot agree within fifteen (15)
days after the date of the damage whether the repairs and restoration described in
subsection 6.01(b) will take more than one hundred and twenty (120) days to make, then the
determination will be submitted to arbitration under section 11.01.

6.01(d). Abatement. Unless the damage is caused by Tenant’s willful misconduct, the Rent and
Additional Rent shall abate in proportion to that part of the Premises that is unfit for use
in Tenant’s business. The abatement shall consider the nature and extent of interference to
Tenant’s ability to conduct business in the Premises and the need for access and essential
services. The abatement shall continue from the date the damage occurred until the later of:

	 	 	 	 	 
	1240 Deming Way
	 	LEASE
	 	page 22 of 36

 

 

(i) the date on which the repairs to the Premises are completed if the
Landlord has given Tenant at least ten (10) days’ notice of said completion date;
or

(ii) five (5) business days after Landlord completes the repairs and
restoration to the Relevant Space or the part rendered unusable.

6.01(e). Tenant’s Property. Notwithstanding anything else in Article 6, Landlord is not
obligated to repair or restore damage to Tenant’s trade fixtures, furniture, equipment, or
other personal property, or any Tenant improvements other than those listed on Exhibit E.

6.01(f). Damage to Building. If:

(i) more than forty (40) percent of the Building is damaged and the
Landlord decides not to repair and restore the Building;

(ii) any mortgagee of the Building shall not allow adequate insurance proceeds
for repair and restoration;

(iii) the damage is not covered by Landlord’s insurance required by
subsections 5.01(a) and (b); or

(iv) the Lease is in the last twelve (12) months of its Term,

then Landlord may cancel this Lease. To cancel Landlord must give notice to Tenant within
thirty (30) days after the damage. The notice must specify the cancellation date, which date
shall be at least sixty (60) but not more than one hundred twenty (120) days after the date
notice is given.

6.01(g). Cancellation. If either party cancels this Lease as permitted by section 6.01, then
this Lease shall end on the day specified in the cancellation notice. The Rent and
Additional Rent and other charges shall be payable up to the cancellation date and shall
account for any abatement. Landlord shall promptly refund to Tenant any prepaid or unaccrued
Rent, accounting for any abatement, plus Security Deposit, if any, less any sum then owing
by Tenant to Landlord. If Landlord cancels this Lease as permitted by section 6.01, then
Landlord must also cancel all other similarly affected tenant leases in the Building.

 6.02. Condemnation. 

	 	 	 	 	 
	1240 Deming Way
	 	LEASE
	 	page 23 of 36

 

 

6.02(a). Definitions. The terms “eminent domain,” “condemnation,” “taken,” and the
like in section 6.02 include takings for public or quasi-public use and private purchases
in place of condemnation by any authority authorized to exercise the power of eminent
domain.

6.02(b). Entire Taking. If the entire Premises or the portions of the Building required for
reasonable access to, or the reasonable use of, the Premises are taken by eminent domain,
this Lease shall automatically end on the earlier of:

(i) the date title vests; or

(ii) the date Tenant is dispossessed by the condemning authority.

6.02(c). Partial Taking. If the taking of a part of the Premises materially interferes with
Tenant’s ability to continue its business operations in substantially the same manner and
space then Tenant may end this Lease on the earlier of:

(i) the date when title vests; or

(ii) the date Tenant is dispossessed by the condemning authority.

If there is a partial taking and this Lease continues, then the Lease shall end as to the
part taken and the Rent and Additional Rent shall abate in proportion to the part of the
Premises taken and Tenant’s pro rata share shall be equitably reduced.

6.02(d). Termination by Landlord. If title to a part of the Building other than the
Premises is condemned, and in the Landlord’s reasonable opinion, the Building should be
restored in a manner that materially alters the Premises, Landlord may cancel this Lease by
giving notice to Tenant. Cancellation notice shall be given within sixty (60) days
following the date title vested. This Lease shall end on the date specified in the
cancellation notice, which date shall be at least sixty (60) but not more than one hundred
twenty (120) days after the date notice is given.

6.02(e). Rent Adjustment. If the Lease is canceled as provided in subsections 6.02(b), (c),
or (d), then the Rent, Additional Rent, and other charges shall be payable up to the
cancellation date, and shall account for any abatement. Landlord, considering any abatement,
shall promptly refund to Tenant any prepaid or unaccrued Rent plus Security Deposit, if any,
less any sum then owing by Tenant to Landlord.

6.02(f). Repair. If the Lease is not canceled as provided for in subsections 6.02(b), (c),
or (d), then Landlord at its expense shall promptly repair and restore the Premises to the
condition that

	 	 	 	 	 
	1240 Deming Way
	 	LEASE
	 	page 24 of 36

 

 

existed immediately before the taking, except for the part taken, to render
the Premises a complete architectural unit, but only to the extent of the:

(i) condemnation award received for the
damage; and

(ii) Building Standard Work.

6.02(g). Awards and Damages. Landlord reserves all rights to damages paid because of any
partial or entire taking of the Premises. Tenant assigns to Landlord any right Tenant may
have to the damages or award. Further, Tenant shall not make claims against Landlord or the
condemning authority for damages.

Notwithstanding anything else in subsection 6.02(g), Tenant may claim and recover from the
condemning authority a separate award for Tenant’s moving expenses, business dislocation
damages, Tenant’s personal property and fixtures, the unamortized costs of leasehold
improvements paid for by Tenant, excluding the Landlord’s Buildout described in section 1.05
and Exhibits D and E, and any other award that would not substantially reduce the award
payable to Landlord. Each party shall seek its own award, as limited above, at its own
expense, and neither shall have any right to the award made to the other.

6.02(h). Temporary Condemnation. If part or all of the Premises are condemned for a limited
period of time (Temporary Condemnation), this Lease shall remain in effect. The Rent and
Additional Rent and Tenant’s obligations for the part of the Premises taken shall abate
during the Temporary Condemnation in proportion to the part of the Premises that Tenant is
unable to use in its business operations as a result of the Temporary Condemnation. Landlord
shall receive the entire award for any Temporary Condemnation.

ARTICLE 7 — DEFAULT 

7.01. Tenant’s Default.

7.01(a). Defaults. Each of the following constitutes a default (Default):

(i) Tenant’s failure to pay Rent or Additional Rent within seven (7) days
after Tenant receives notice from Landlord of Tenant’s failure to pay Rent or
Additional Rent;

(ii) Tenant’s failure to pay Rent or Additional Rent by the due date, at any
time during a twelve month period in which Tenant has already received two notices
of its failure to pay Rent or Additional Rent by the due date;

	 	 	 	 	 
	1240 Deming Way
	 	LEASE
	 	page 25 of 36

 

 

(iii) Tenant’s failure to perform or observe any other Tenant
obligation after a period of thirty (30) business days or the additional time, if
any, that is reasonably necessary to promptly and diligently cure the failure,
after it receives notice from Landlord setting forth in reasonable detail the
nature and extent of the failure and identifying the applicable Lease provision(s);

(iv) Tenant’s abandoning or vacating the Premises if Tenant fails to timely
pay the Rent and Additional Rent by the due date;

(v) Tenant’s failure to vacate or stay any of the following within ninety
(90) days after they occur:

(A) a petition in bankruptcy is filed by or against Tenant;

(B) Tenant is adjudicated as bankrupt or insolvent;

(C) a receiver, trustee, or liquidator is appointed for all or a substantial
part of Tenant’s property; or

(D) Tenant makes an assignment for the benefit of creditors.

7.02. Landlord’s Remedies.

7.02(a). Remedies. Landlord in addition to the remedies given in this Lease or
under the law, may do any one or more of the following if Tenant commits a Default under
section 7.01:

(i) end this Lease, and Tenant shall then surrender the Premises to Landlord;
and

(ii) enter and take possession of the Premises as provided by law and
remove Tenant, with or without having ended the Lease.

Tenant waives claims for damages by reason of Landlord’s reentry or repossession and
for damages by reason of any legal process.

7.02(b). No Surrender. Landlord’s exercise of any of its remedies or its receipt of Tenant’s
keys shall not be considered an acceptance of surrender of the Premises by Tenant. A
surrender must be agreed to in a writing signed by both parties.

7.02(c). Rent. If Landlord ends this Lease or ends Tenant’s right to possess the
Premises because of a Default, Landlord may hold Tenant liable for Rent, Additional
Rent, and other indebtedness accrued to the date the Lease Ends. Tenant shall also be
liable for the Rent, Additional Rent and other indebtedness that otherwise would have
been payable by Tenant during the remainder of the Term had there been no Default,
reduced by any sums Landlord receives by reletting the Premises during the Term.

	 	 	 	 	 
	1240 Deming Way
	 	LEASE
	 	page 26 of 36

 

 

7.02(d). Other Expenses. Tenant shall also be liable for that part of the following
sums paid by Landlord and attributable to that part of the Term ended due to Tenant’s
Default:

(i) reasonable broker’s fees incurred by Landlord for reletting part or all
of the Premises prorated for that part of the reletting Term ending concurrently
with the then current Term of this Lease;

(ii) the cost of removing and storing Tenant’s property;

(iii) the cost of minor repairs, alterations, and remodeling, necessary
to put the Premises in a condition reasonably acceptable to a new Tenant; and

(iv) other necessary and reasonable expenses incurred by Landlord in enforcing
its remedies.

7.02(e). Payment. Tenant shall pay the sums due in subsections 7.02(c) and (d) within
thirty (30) days of receiving Landlord’s proper and correct invoice for the amounts.

7.02(f). Mitigation. Landlord shall mitigate its damage by making reasonable efforts to
relet the Premises on reasonable terms. Landlord may relet for a shorter or longer period
of time than the Lease Term and make any necessary repairs or alterations. Landlord may
relet on any reasonable terms including a reasonable amount of free rent. If Landlord
relets for a period of time longer than the current Lease Term, then any special
concessions given to the new Tenant shall be allocated throughout the entire reletting Term
so as not to unduly reduce the amount of consideration received by Landlord during the
remaining period of Tenant’s term.

7.03.
Landlord’s Default. Landlord’s failure to perform or observe any of its Lease
obligations after a period of thirty (30) business days or the additional time, if any, that is
reasonably necessary to promptly and diligently cure the failure after receiving notice from Tenant
is a Default. The notice shall give reasonable detail the nature and extent of the failure and
identify the Lease provision(s) containing the obligation(s). After Tenant receives notice of a
Mortgagee’s name and address and request for notice upon Landlord’s Default, Tenant shall also
provide the notice required by this section to the Mortgagee at the same time Tenant gives notice to
Landlord. If Landlord commits a Default, Tenant may pursue any remedies given in this Lease or under
the law.

7.04.
 Exception to Cure Periods. The cure periods in paragraphs 7.01(a)(iii) and 7.03 do not
apply to:

     (a) emergencies;

     (b) failure to maintain the insurance required by section 5.01.

	 				
	1240 Deming Way
	 	LEASE
	 	page 27 of 36

 

 

7.05.
Self-Help. If either party defaults (Defaulting Party), the other party
(Nondefaulting Party) may, without being obligated and without waiving the Default, cure the
Default. The Nondefaulting Party may enter the Premises or Building to cure the Default. The
Defaulting Party shall pay the Nondefaulting Party, upon demand, all costs, expenses, and
disbursements incurred by the Nondefaulting Party to cure the Default.

7.06.
Survival. The remedies permitted by Article 7 and the parties’ indemnities in section
5.02 shall survive the ending of this Lease.

ARTICLE 8 — NONDISTURBANCE

8.01. Subordination.

8.01(a).
Mortgages. Subject to subsection 8.01(b), this Lease is subordinate to prior
or subsequent mortgages covering the Building.

8.01(b).
Foreclosures. If any mortgage is foreclosed, then:

(i) This Lease shall
continue;

(ii) Tenant’s quiet possession shall not be disturbed if Tenant
is not in Default;

(iii) Tenant will attorn to and recognize the mortgagee or purchaser at
foreclosure sale (Successor Landlord) as Tenant’s landlord for the remaining Term;
and

(iv) The Successor Landlord shall not be bound by:

(A) any payment of Rent or Additional Rent for more than one month
in advance, except the Security Deposit and free rent, if any, specified in
the Lease,

(B) any amendment, modification, or termination of this Lease
without Successor Landlord’s consent after the Successor Landlord’s name is
given to Tenant unless the amendment, modification, or ending is specifically
authorized by the original Lease and does not require Landlord’s prior
agreement or consent, and

(C) any liability for any act or omission of a prior Landlord.

8.01(c).
Self-Operating. Section 8.01 is self-operating. However, Tenant shall promptly
execute and deliver any documents needed to confirm this arrangement.

	 				
	1240 Deming Way
	 	LEASE
	 	page 28 of 36

 

 

8.02. Estoppel Certificate.

8.02(a).
Obligation. Either party (Answering Party) shall from time to time, within ten
(10) business days after receiving written request by the other party (Asking Party),
execute and deliver to the Asking Party a written statement. This written statement, which
may be relied upon by the Asking Party and any third party with whom the Asking Party is
dealing shall certify:

(i) the accuracy of the Lease document;

(ii) the Commencement and Termination Dates of the Lease;

(iii) that the Lease is unmodified and in full effect or in full effect
as modified, stating the date and nature of the modification;

(iv) whether to the Answering Party’s knowledge the Asking Party is in default
or whether the Answering Party has any claims or demands against the Asking Party
and, if so, specifying the Default, claim, or demand; and

(v) to other correct and reasonably ascertainable facts that are covered by
the Lease terms.

8.02(b). Remedy. The Answering Party’s failure to comply with its obligation in subsection
2(a) shall be a Default. Notwithstanding paragraphs 7.01(a)(iii) and 7.03, the cure period
for this Default shall be five (5) business days after the Answering Party receives notice
of the Default.

8.03. Quiet Possession. If Tenant is not in default, and subject to the Lease
terms and the above encumbrances, Tenant’s peaceable and quiet enjoyment of the Premises shall not
be disturbed by anyone.

ARTICLE 9 — LANDLORD’S RIGHTS

9.01.
Rules.

9.01(a).
Rules. Tenant, its employees and invitees, shall comply with:

(i) the Rules attached as Exhibit G; and

(ii) reasonable modifications and additions to Rules adopted by Landlord:

(A) of which Tenant is given thirty (30) days advance notice;

(B) that are for the safety, care, order, and cleanliness of the common
areas;

(C) that do not unreasonably and materially interfere with Tenant’s conducti
of its business or Tenant’s use and enjoyment of the Premises; and

	 				
	1240 Deming Way
	 	LEASE
	 	page 29 of 36

 

 

(D) that do not require payment of additional moneys.

9.01(b).
Conflict with Lease. If a Rule issued under subsection 9.01 (a) conflicts with or
is inconsistent with any Lease provision, the Lease provision controls.

9.02. Mechanics Liens.

9.02(a).
Discharge Lien. Tenant shall, within twenty (20) days after receiving notice of any
mechanic’s lien for material or work claimed to have been furnished to the Premises on
Tenant’s behalf and at Tenant’s request, except for work contracted by Landlord including
the Buildout described in section 1.05 and Exhibits D and E:

(i) discharge the lien; or

(ii) post a bond equal to the amount of the disputed claim with
companies reasonably satisfactory to Landlord.

If Tenant posts a bond, it shall contest the validity of the lien. Tenant shall indemnify,
defend, and hold Landlord harmless from losses incurred from these liens.

9.02(b).
Landlord’s Discharge. If Tenant does not discharge the lien or post the bond within
the twenty (20) day period, Landlord may pay any amounts, including interest and legal
fees, to discharge the lien. Tenant shall then be liable to Landlord for the amounts paid
by Landlord.

9.02(c). Consent not Implied. Section 9.02 is not a consent to subject Landlord’s property
to these liens.

9.03. Right to Enter.

9.03(a). Permitted Entries. Landlord and its agents, servants, and employees may
enter the Premises at reasonable times, and at any time if an emergency, without charge,
liability, or abatement of Rent, to:

(i) examine the Premises;

(ii) make repairs, alterations, improvements, and additions either required by
the Lease or advisable to preserve the integrity, safety, and good order of part
or all of the Premises or Building;

(iii) provide janitorial and other services required by the Lease;

					 
	1240 Deming Way
	 	LEASE
	 	page 30 of 36

 

 

(iv) comply with Applicable Laws under section 3.01;

(v) show the Premises to prospective lenders or purchasers
and during the ninety (90) days immediately before this Lease ends to
prospective tenants, accompanied, if requested by Tenant, by a Tenant
representative;

(vi) post notices of nonresponsibility;

(vii) remove
any Alterations made by Tenant in violation of section 4.01; and

(viii) post “For Sale” signs and, during the one hundred and twenty (120)
days immediately before this Lease ends, post “For Lease” signs.

9.03(b). Entry Conditions. Notwithstanding subsection 9.03(a), entry is conditioned upon
Landlord:

(i) giving Tenant at least twenty-four (24) hours advance notice,
except in an emergency;

(ii) promptly finishing any work for which it entered; and

(iii) causing the least practicable interference to
Tenant’s business.

9.03(c). Interference with Tenant. Notwithstanding subsections 9.03(a) and (b):

(i) if Landlord’s entry materially and substantially interferes with the
conduct of Tenant’s business (and the entry is not needed because of Tenant’s
negligence or willful misconduct), the Rent and Additional Rent shall abate in
proportion to the extent of the interference; and

(ii) if Landlord causes damage to Tenant’s property, Landlord shall be liable
for any damage to the extent the damage is not covered by Tenant’s insurance or the
insurance Tenant is required to carry under Article 5, whichever is greater.

9.04. Holdover.

9.04(a). Holdover Status. If Tenant continues occupying the Premises after the Term ends
(Holdover) then:

				 	
	1240 Deming Way
	 	LEASE
	 	page 31 of 36

 

 

(i) if the Holdover is with Landlord’s written consent, it shall be a
month-to-month tenancy, terminable on thirty (30) days advance written notice by
either party. Tenant shall pay at the beginning of each month Rent and Additional
Rent that is five (5) percent higher than the amount due in the last full month
immediately preceding the Holdover period unless the Landlord specifies a lower or
higher Rent and Additional Rent in the written consent;

(ii) if the Holdover is without Landlord’s written consent, then Tenant
shall be a tenant-at-sufferance. Tenant shall pay by the first day of each month
twice the amount of Rent and Additional Rent due in the last full month immediately
preceding the Holdover period and shall be liable for any damages suffered by
Landlord because of Tenant’s Holdover. Landlord shall retain its remedies against
the Tenant who holds over without written consent.

9.04(b). Holdover terms. The Holdovers in subsection 9.04(a) shall be on the same terms and
conditions of the Lease except:

(i) the Term (section 1.04);

(ii) Rent and Additional Rent (sections 2.01 and 2.02);

(iii) the extension Term is deleted (section 10.01);

(iv) the Quiet Possession provision is deleted (section 8.03);

(v) Landlord’s obligation for services and repairs for a paragraph
9.04(a)(ii) Holdover (sections 3.02 and 3.03) is deleted;

(vi) consent to an assignment or sublease may be unreasonably withheld and
delayed (section 4.02);

(vii) the provision on Landlord’s Default is deleted (section 7.03);

(viii) the Defaulting Party may be the Tenant only; (sections 7.03 and 7.05);

(ix) the Buildout is deleted (Exhibits D and E
and section 1.05)

9.05. Signs.

9.05(a). Permitted Signs. Landlord shall provide Tenant, at Landlord’s expense a listing on
the Building ground sign and appropriate floor directories. Tenant may, at its expense and
subject to

				 	
	1240 Deming Way
	 	LEASE
	 	page 32 of 36

 

 

Landlord’s approval, which shall not be unreasonably withheld, install a sign on the
exterior wall or door of the Premises inside the Building.

9.05(b). Nonpermitted signs. Other than the signs and listings permitted in subsection
9.05(a), Tenant shall not place or have placed any other signs, listings, advertisements,
or any other notices anywhere else in the Building.

ARTICLE 10 — OPTIONS

10.01. Option to Extend.

10.01(a). Option. Tenant may extend this Lease for the period of years designated in the
Reference Data (Extension Term) beginning immediately after the Term, upon the same terms
and conditions of the Lease, except that:

(i) the Term shall be modified as stated above;

(ii) there will be no Option to extend beyond the final Extension Term
described on the Reference Data sheet.

(iii) the build out shall be deleted.

10.01(b). Conditions. To exercise this Option to extend, Tenant must:

(i) not be in default at the time it exercises the option;
and

(ii) give notice to Landlord that Tenant is exercising its Option to Extend
at least one hundred and twenty (120) days but not more than two hundred and forty
(240) days before the Term ends.

ARTICLE 11 — DISPUTES

11.01. Arbitration.

11.01(a). Procedure. For disputes subject to arbitration under subsection 11.01(c) that
are not resolved by the parties within ten (10) days after either party gives notice to
the other of its desire to arbitrate the dispute, the dispute shall be settled by binding
arbitration by the American Arbitration Association in accord with its then-prevailing
rules. Judgment upon the arbitration award may be entered in any court having jurisdiction.
The arbitrators shall have no power to change the Lease provisions. The arbitration panel
shall consist of three arbitrators, one of

			 		
	1240 Deming Way
	 	LEASE
	 	page 33 of 36

 

 

whom must be a real estate attorney actively engaged in the practice of law for at
least the last five (5) years. Both parties shall continue performing their Lease
obligations pending the award in the arbitration proceeding. The arbitrators shall award
the prevailing party reasonable expenses and costs including reasonable attorneys’ fees
pursuant to section 12.02 plus interest on the amount due at eighteen (18) percent per
annum or the maximum then allowed by applicable law, whichever is less.

11.01(b). Payment. The losing party shall pay to the prevailing party the amount of the
final arbitration award. If payment is not made within ten (10) business days after the
date the arbitration award is no longer appealable, then in addition to any other remedies
under the law:

(i) if the Landlord is the prevailing party, it shall have the same remedies
for failure to pay the arbitration award as it has for Tenant’s failure to pay the
Rent; and

(ii) if the Tenant is the prevailing party, it may deduct any remaining unpaid
award from its monthly payment of Rent, Additional Rent, or other charges.

11.01(c). Arbitration. The following disputes are subject to
arbitration:

(i) any disputes that the parties agree to submit to arbitration;

(ii) the date when the Premises are substantially completed;

(iii) the amount of any abatement of Rent and Additional Rent because of damage
or condemnation;

(iv) the amount billed as Additional Rent or any component part of the
calculation of Additional Rent;

(v) which party must comply with Applicable Laws under section 3.01;

(vi) whether the utilities are being provided in the quality and quantity
required by section 3.02;

(vii) whether Tenant may abate Rent and Additional Rent or cancel the Lease
under paragraph 3.02(e)(ii);

(viii) whether Landlord’s withholding of consent is unreasonable or unduly
delayed under subsections 4.02(a) and (b);

(ix) the amount of any insurance increase under subsection 5.0l(e);

	 				
	1240 Deming Way
	 	LEASE
	 	page 34 of 36

 

 

(x) whether either party can cancel the Lease under Articles 6 or 7; and

(xi) any allocations required under subparagraphs 2.02(a)(v)(B)(4).

ARTICLE 12 — MISCELLANEOUS

12.01. Broker’s Warranty. The parties warrant that the Broker identified in the Reference
Data (if any) is the only broker they dealt with on this Lease. The party who breaches this
warranty shall defend, hold harmless, and indemnify the nonbreaching party from any claims or
liability arising from the breach. The Landlord is solely responsible for paying the commission of
said Broker.

12.02. Attorneys’ Fees. In any litigation between the parties regarding this Lease, the
losing party shall pay to the prevailing party all reasonable expenses and court costs including
attorneys’ fees incurred by the prevailing party. A party shall be considered the prevailing party
if:

(a) it initiated the litigation and substantially obtains the relief it sought, either
through a judgment or the losing party’s voluntary action before arbitration (after it is
scheduled), trial, or judgment;

(b) the other party withdraws its action without substantially obtaining the relief it
sought; or

(c) it did not initiate the litigation and judgment is entered for either
party, but without substantially granting the relief sought.

12.03.
Notices. Unless a Lease provision expressly authorizes another form of
notice, all notices under this Lease shall be in writing and sent by registered or certified mail,
postage prepaid, to the address of Landlord and Tenant shown in the Reference Data.

12.04.

Partial Invalidity. If any Lease provision is invalid or unenforceable to
any extent, then that provision and the remainder of this Lease shall continue in effect and be
enforceable to the fullest extent permitted by law.

12.05.
Waiver. The failure of either party to exercise any of its rights is not a
waiver of those rights. A party waives only those rights specified in writing and signed by the
party waiving its rights.

12.06.
Binding on Successors. This Lease shall bind the parties’ heirs,
successors, representatives, and permitted assigns.

12.07.
Governing Law. This Lease shall be governed by the laws of the state of Wisconsin.

					 
	1240 Deming Way
	 	LEASE
	 	page 35 of 36

 

 

12.08. Insurance Increase. If due to Tenant’s particular use of the Premises the
Landlord’s insurance rates are increased, Tenant shall pay the increase.

12.09. Lease not an Offer. Landlord gave this Lease to Tenant for review. It is not
an offer to lease. This Lease shall not be binding unless signed by both parties and an originally
signed counterpart is delivered to Tenant by Landlord.

12.10. Recording. Recording of this Lease is prohibited except as allowed in this section.
At the request of either party, the parties shall promptly execute and record, at the cost of the
requesting party, a short form memorandum describing the Premises and stating this Lease’s Term, its
Commencement and Termination Dates, and other information the parties agree to include.

12.11.
Survival of Remedies. The parties’ remedies shall survive the ending of this
Lease when the ending is caused by the Default of the other party.

12.12.
Authority of Parties. Landlord warrants that it owns the property free and
clear of all mortgages, liens, and encumbrances except for those listed in the Reference Data. Each
party warrants that it is authorized to enter into the Lease, that the person signing on its behalf
is duly authorized to execute the Lease, and that no other signatures are necessary.

12.13.
Business Days. Business days means Monday through Friday inclusive,
excluding holidays identified at subsection 3.02(b). Throughout this Lease, wherever “days” are used
the term shall refer to calendar days. Wherever the term “business days” is used the term shall
refer to business days.

12.14.
Entire Agreement. This Lease contains the entire agreement between the
parties about the Premises and Building. Except for the Rules for which subsection 9.0l(a)
controls, this Lease shall be modified only by a writing signed by both parties.

[This
Lease is not valid unless there is a
Reference Data page and a two-page Addendum signed
by Landlord and Tenant attached to the front of it]

					 
	1240 Deming Way
	 	LEASE
	 	page 36 of 36

 

 

     

					
	1240 Deming Way
	 	Exhibit A
	 	page 1 of 2

 

 

     

					
	1240 Deming Way
	 	Exhibit A	 	page 2 of 2

 

 

     

					
	1240 Deming Way
	 	Exhibit B	 	page
1 of
1

 

 

     

					
	1240 Deming Way
	 	Exhibit C 
	 	page 1 of 1

 

 

JANITORIAL SPECIFICATIONS

Premises

Daily

Thoroughly clean entrance door glass.

Empty all wastebaskets, replacing liners as needed.

Remove all recycling, placing in proper receptacles.

Remove any trash or recycling sitting near wastebaskets which is labeled as “trash”. (Note it must
be labeled as trash or it will not be picked up to ensure only trash is disposed of.)

Light dust of furniture, fixtures, and equipment.

Spot wipe
any cleared off surface on desktops, credenzas or counter tops. (Note; Wooden desktops will be dusted only.)

Remove all
hand marks from the walls near the light switches, doors, and door
frames.

Vacuum all traffic lanes with backpack vacuum.

Weekly

Full vacuum of carpeted areas (edge to edge).

Dust picture frames, window sills.

High level and low level dusting.

Spot clean vertical surfaces.

Detailed dusting of furniture, fixtures.

Wipe off phone receivers.

Quarterly

Dust blinds three times a year.

Dust ceiling air vents and grills.

As needed

Spot vacuum upholstered furniture.

Semi-annually

Clean inner suite glass panels three times a year.

Lavatories

Daily

Empty all baskets, replacing liners as needed.

Clean and sanitize all the lavatory fixtures, counter tops, mirrors, and metal.

Wet mop lavatory floors.

Remove all hand marks from the walls near the light switches, doors, and door frames.

Spot clean lavatory partitions.

Replenish soap and paper supplies.

Weekly

Acid clean urinals and commode interiors.

Delime sinks and faucets.

Clean shower facilities.

Monthly

Full flood mop of tile floor.

Dust the ceiling air vents.

Quarterly

Clean lavatory partitions.

			 		
	1240
Deming Way Lease
	 	Exhibit F 
	 	page 1 of 2

 

 

Entryway

Daily

Thoroughly clean entrance door glass, including exterior of main lobby and sidelights.

Dust and wet mop granite floors.

Vacuum carpeted areas.

Empty and clean cigarette ashtrays and urns.

Police the exterior around the entrance

Weekly

Clean and polish building directory.

Wipe window sills

Monthly

Full wash of glass side panels.

Quarterly

Clean lobby glass panels three times/year

Hallways, Staircases, and Elevator Bank

Daily

Dust and wet mop granite floors and staircases.

Vacuum carpeted areas.

Spot polish elevators.

Weekly

Full vacuum of carpeted areas and staircases.

Coffee Islands, Kitchens

Daily

Clean and wipe down all counters.

Clean sinks if empty.

Wipe down outside of microwaves.

Dust vending machines tops, wipe down handles, and faces.

Wipe down all table tops.

Dust mop and wet mop tiled floors.

Wipe off chairs.

Empty waste baskets, replace liners as needed.

Vacuum carpeted areas.

Remove recyclables.

Weekly

Delime sinks.

Dust window sills.

As Needed

Spot clean chairs.

Contracted Special Work (Extras)

Semi-Annually

Wash interior of all exterior windows.

Shampoo Carpets — Common Areas

Shampoo Carpets — Tenants space — Tenant responsibility

Wash outside exterior windows.

Wash interior of entrance area windows.

					 
	1240
Deming
Way Lease
	 	Exhibit F
	 	page 2 of 2

 

 

1240 DEMING WAY

RULES AND REGULATIONS

     (1) HOURS OF OPERATION. The Building shall be open daily from at least 7:00
a.m. to 7:00 p.m. Monday through Friday and from 8:00 a.m. to noon on Saturday (“normal
business hours”). In case of invasion, mob, riot, demonstration, public insurrection or other
commotion, Landlord reserves the right to prevent access to the Building during the continuance of
any such occurrence for the safety of tenants and protection of the Building and the property
therein. Landlord shall in no event be liable for damages for any error with regard to the admission
of any person to or for the exclusion of any person from the Building.

     (2) ELEVATOR
SERVICE. The automatic self-service elevators in the Building will be
in operation at all times. Elevator service may be interrupted because of maintenance, repairs
or improvements or for any cause reasonably beyond Landlord’s control.

     (3) DOORS. All entrance doors to tenant premises shall be locked when
such premises are not in use. Tenant assumes full responsibility for protecting the Premises from
theft, robbery and pilferage. Landlord assumes no responsibility for loss or theft unless such
occurrence is reasonably attributable to the negligence or willful act of Landlord or persons
reasonably within Landlord’s control.

     (4) COMMON
AREAS. No portion of the sidewalks, doorways, entrances, passages,
vestibules, halls, lobbies, corridors, elevators or stairways in or
adjacent to the Building shall
be obstructed or used from any purpose other than for ingress and egress to and from
tenant premises. No doormats, overshoes, umbrellas, or other items of any nature shall be placed
or permitted to remain in such areas. No floor, skylight, partition, transom or opening that
reflects or admits light into any place in the Building and no means of access to any Building fire
escape, shall be covered or obstructed by any tenant.

     (5) NUISANCES.
Tenants and its employees and invitees shall at all times refrain from
(a) making any loud, improper noises, sounds or vibrations in their premises or elsewhere in the
Building or in any other manner annoying, disturbing, or interfering with other tenants or
their employees and invitees.

     Tenants shall not keep or permit on their premises any foul or noxious gas or substance or
combustible fluid or material. No animals (except dogs for the blind), birds or other pets shall
be permitted in or about the Building temporarily or otherwise. Aquaria may be permitted with the
prior written consent of Landlord. Bicycles shall be parked only at such place or places as
Landlord, in its sole discretion, may designate. Tenant premises shall not be used for cooking or
lodging purposes nor for a storeroom for merchandise or other materials. Tenants shall not,
without the prior written consent of Landlord, bring into, use or keep in the Building any
inflammable explosive or hazardous article of any nature.

					
	1240 Deming Way Lease
	 	Exhibit G
	 	page 1 of 2

 

 

     (6) HEAVY EQUIPMENT AND FREIGHT. Safes and other objects of unusual size
or weight shall not be allowed to be brought into or removed from the Building without the prior
written consent of Landlord. All damage done to the Building or the Premises by the delivery,
installation, use or removal thereof shall be paid for by Tenant.

Freight, business equipment, furniture, merchandise, and other large or bulky articles (excluding
packages of reasonable weight and size which can be carried by one person) shall be delivered to
and removed from the Building through such entrance, in such manner and at such times as may be
designated by Landlord. All damage to the elevator or other portions of the Building caused by the
moving or carrying of articles therein or thereon shall be paid for by Tenant. Landlord shall not
be responsible for damage to any property of tenants delivered or left in any receiving area or
elsewhere in the Building or to any property moved or handled anywhere in the Building by any
representative of Landlord as an accommodation to any tenant. Landlord shall be under no
obligation to accept delivery of, or to move or handle, any property of any tenant.

     (7) SOLICITORS. Subject to the provisions of applicable laws or ordinances,
solicitors, canvassers, and peddlers shall not be permitted in the Building. Tenants shall use their best
efforts to discourage solicitors, canvassers and peddlers from frequenting the Building. Landlord
reserves the right to exclude or eject from the Building all solicitors, canvassers and peddlers, or
any person who, in the judgment of Landlord’s security officer or employee in charge, is under the
influence of liquor or drugs, or any person who shall in any manner do or threaten to do any illegal act or
any act in violation of any of the Rules and Regulations of the Building.

     (8) LOCKS AND KEYS. Tenants shall not (a) attach or permit to be attached additional
locks or similar devices to any door or transom of their premises; (b) change existing locks
or the mechanism thereof; or (c) make or permit to be made any keys for any door thereof other than
those provided by Landlord. If more than two (2) keys for one lock are desired, Landlord shall
provide them upon payment therefore by the requesting tenant. Tenants, upon the termination of its
tenancy, shall deliver to Landlord all keys which have been furnished to the tenant or made by any
tenant.Tenants shall pay Landlord for all lost or missing keys.

     (9) EXTRA SERVICES. Requests for any extra janitorial or other special service
requirements of any tenant must be directed to Landlord. Employees of Landlord shall not
perform any work or do anything outside of their regular duties unless directed to do so by Landlord.

     (10) PARKING. Public parking for any tenant’s customers, clients, patrons and
invitees shall be available on a regulated basis solely in those areas designated by Landlord for such
parking.Tenants shall abide by all vehicular parking regulations issued by Landlord.

					
	 	 	 	 	 
	1240 Deming Way Lease
	 	Exhibit G
	 	page 2 of 2

 

 

BUILDING STANDARD

The building owner will provide the following level of finishes to the structure. All of the
construction occurring after this point is a part of the “Tenant Improvements” and will be handled
under a separate construction contract with payment made by Landlord and/or Tenant.

	 	 	 
	Grounds

	 	All site improvements are the responsibility of the owner. Parking lots, walks, drives,
landscaping and exterior signs and lighting will be installed before occupancy by any tenant,
except that the landscaping and the second course of paving is dependent on weather and may
have to be delayed until the following spring.
	 
	 	 
	Building 

shell

	 	The building will be fully enclosed and weather tight; all mechanical systems,
elevators, security and alarm systems, sprinkler loops and heads and emergency lights and
generators will be installed; the building entrance and lobby will be finished and the common
areas on the floor [e.g., lobby, halls and bathrooms] will be finished before occupancy by any
tenant.
	 
	 	 
	Premises

	 	Each tenant suite will have a finished and level concrete floor; outside walls will be
finished and taped and sanded above/below windows as required; the demising walls separating
the Premises from adjoining suites or common areas will be finished on each side facing a
common area and unfinished on each side facing a tenant suite to accommodate tenant’s wiring;
HVAC will be provided to each floor with ducting to and within the Premises as part of the
tenant improvements; both 277/480 volt and 120/208 volt electrical service will be provided
to each floor in amounts sufficient for standard office usage, extraordinary demand and all
distribution to and within the Premises is part of the tenant improvements; ceilings are
unfinished with sprinkler heads turned up upon start of tenant improvements.

					
	 	 	 	 	 
	1240 Deming Way
	 	Exhibit H
	 	page 1 of 1

 

 

Tomotherapy, Inc.

1240 Deming Way

Madison, Wisconsin 53717

TENANT BUILD OUT AGREEMENT

THIS AGREEMENT, is entered into by and between Old Sauk Trails Park Limited Partnership, a
Wisconsin limited partnership (“Landlord”) and Tomotherapy, Inc. (“Tenant”).

WHEREAS, Landlord and Tenant will enter into a lease (“Lease”) for the first and second floors of
the building to be constructed at 1240 Deming Way, Madison, Wisconsin; and

WHEREAS, the execution of the Lease is conditioned, in part, on Landlord’s delivery of the leased
premises in a condition suitable for Tenant’s occupancy and the installation of its furnishings,
fixtures and equipment used in the conduct of its business therein; and

WHEREAS, the Lease provides that the Landlord will pay $23.25/rentabIe square foot of the Premises,
excluding Tenant’s test bunkers (“Build out Allowance”) toward the cost of the Tenant Improvements
including the test bunkers (as defined in the Lease and specifically excluding the work described
in Exhibit H of the Lease which work will be done at Landlord’s expense); and

WHEREAS, Landlord will enter into a contract with Planning Associates, Inc. for the installation of
the Tenant Improvements (“Contract”) at a cost which is expected to exceed the Build out Allowance;
and

WHEREAS, Landlord has required that Tenant, as a condition precedent to Landlord’s execution of the
Contract, approve the terms of the Contract and agree to reimburse Landlord for all costs which
Landlord incurs in excess of the Build out Allowance;

NOW, THEREFORE, in consideration of the premises and of the mutual promises made hereby, Landlord
and Tenant agree as follows:

	1.	 	Tenant has reviewed and hereby approves the terms of the Contract, a copy of which is
attached hereto as Exhibit #1.
	 
	2.	 	Tenant acknowledges that the Contract Price identified therein is subject to change due
to, among other reasons, receipt of final bids, costs over or under allowances and change
orders executed subsequent hereto. Whenever Owner’s consent is required under the
Contract, Owner shall be deemed to include both Landlord and Tenant.
	 
	3.	 	Landlord shall proceed diligently and in good faith to supervise the completion of the
Tenant Improvements in a timely fashion, shall pay all sums due therefor and shall secure

					
	 	 	 	 	 
	1240 Deming Way
	 	Exhibit I
	 	page 1 of 2

 

 

all required lien waivers for the labor and material provided under the contract.

	4.	 	Tenant shall be deemed a third-party beneficiary of the Contract and shall be entitled to
enforce and rely on all terms, covenants and conditions, warranties, indemnifications and
other rights of Owner under the contract as if Tenant was a signatory thereto.
	 
	5.	 	Notwithstanding any change in the Contract Price that Tenant has approved as provided
herein, Tenant agrees that it shall promptly reimburse Landlord for all sums paid under
the Contract in excess of the Build out Allowance. Tenant’s failure to pay such sums
within thirty (30) days of its receipt of an invoice therefor shall be a Default under
Section 7.01 of the Lease. Furthermore, Landlord may it its discretion, require that
Tenant deposit funds for some or all of the cost of the Improvements in excess of the
Build out Allowance.

In witness whereof Landlord and Tenant have executed this Agreement at Madison, Wisconsin, on the
date set forth above.

	 	 	 
	          LANDLORD

	 	TENANT
	Old Sauk Trails Park Limited Partnership

	 	Tomotherapy, Inc.
	The Gialamas Company, Inc., agent
	 	 
	 
	 	 
	/s/ George
Gialamas
	 	/s/ John J. Barni
	 
	 	 
	George Gialamas, President

	 	John J. Barni, C.E.O.

The undersigned contractor hereby joins in this Agreement for the purpose of acknowledging,
consenting and agreeing to the terms contained herein, including, without limitation, providing
that Tenant is a third-party beneficiary under the Contract.

	 	 	 
	 

	 	Design/build Contractor
	 

	 	PLANNING ASSOCIATES, INC.
	 
	 	/s/ James M. Pientka
	 

	 	 
	 

	 	James M. Pientka, Executive Vice President

THIS LEASE IS NOT VALID UNTIL THIS TENANT BUILD OUT AGREEMENT, WITH EXHIBIT 1 ATTACHED, HAS BEEN
EXECUTED BY LANDLORD, TENANT AND DESIGN/BUILD CONTRACTOR.

					
	 	 	 	 	 
	1240 Deming Way
	 	Exhibit I
	 	page 2 of 2exv10w14

 

Exhibit 10.14

Tomotherapy

1209 Deming Way

Madison WI 53717

					
	 	 	 	 	 
	No. 3
	 	REFERENCE DATA
	 	June 13, 2006

These terms are specific to, and incorporated in, this lease.

	 	 	 	 	 
	¶
no.	 	Item	 	Lease Provision
	1.02

	 	Premises
	 	All of the building excluding eight below grade
bunkers
	 

	 	Parking 
Area of the
Premises
	 	All surface parking 
56,052 BOMA rentable square
feet (“RSF”)
	 
	 	 	 	 
	1.03

	 	Additional Permitted uses
	 	Manufacture, office, testing and assembly of
medical imaging equipment
	 
	 	 	 	 
	1.04

	 	Term 
Target Date
	 	Twelve years ending May 30,
2018 
July 1, 2006
	 
	 	 	 	 
	2.01

	 	Rent at commencement
	 	$12.50/RSF/yr.
	 
	 	 	 	 
	2.02

	 	Rent Adjustment 
Tenant’s pro
rata share
 Additional Rent
	 	$0.50 /RSF/yr. beginning
July 1, 2007
 100%

$5.00/RSF (subject to adjustment per S2.02)
	 
	 	 	 	 
	2.04

	 	Security deposit
	 	None
	 
	 	 	 	 
	4.01

	 	Build out Allowance
	 	None
	 
	 	 	 	 
	10.01

	 	Extension term
	 	Four (4) extension terms of five (5) years each
	 
	 	 	 	 
	12.01

	 	Broker
	 	The Gialamas Company, Inc.
	 
	 	 	 	 
	12.13

	 	Encumbrances
	 	Mortgage to US Bank, N.A.

	 	 	 	 	 
	LANDLORD	 	 	 	TENANT
	Adelphia, LLC

	 	 	 	Tomotherapy Incorporated
	8020 Excelsior Drive, Ste 300

	 	 	 	1240 Deming Way
	Madison
WI 53717-1998

	 	 	 	Madison, WI 53717-2911
	 
	 	 	 	 
	/s/ George Gialamas

	 	 	 	/s/ Dr. Frederick A. Robertson
	 

	 	 	 	 
	George Gialamas, Manager

	 	 	 	Dr. Frederick A. Robertson, C.E.O.

 

 

Addendum to Lease

Tomotherapy, Incorporated

1209 Deming Way

Madison, Wisconsin

The Lease for approximately 56,052 square feet to be constructed at 1209 Deming Way,
Madison, Wisconsin, between Adelphia, LLC as Landlord and Tomotherapy, Incorporated, a
Wisconsin corporation as Tenant dated October 28, 2005, is modified as follows:

Option to Purchase

Landlord hereby grants to Tenant an option to purchase the land and building described herein
(“the Property”) on the following terms:

1. Tenant may close the purchase the Property at anytime during the initial or any
renewal or extended term of the Lease; except the closing may not occur prior to the
expiration of the fifth (5th) lease year.

2. Tenant must deliver a written notice of its election to purchase the Property
(“Notice”) to Landlord at least one year prior to the proposed date of its purchase. Once
the Notice is received by Landlord, Tenant’s election may not be rescinded without
Landlord’s consent.

3. Tenant shall cure all material defaults under the Lease prior to or at the time of the
closing of the purchase of the Property.

4. The
Property purchase price shall be its appraised value, determined by a commercial appraised selected jointly by Landlord and Tenant. The full appraisal report
must be delivered to Landlord and Tenant within three months of Landlord’s receipt of
the Notice. Any delay in delivery of the appraisal shall extend the closing date by the
number of days in excess of three months from the Landord’s receipt of the Notice.

	 	 	 	 	 
	Adelphia, LLC

	 	 	 	Tomotherapy Incorporated
	8020
Excelsior Drive, Suite 300

	 	 	 	1240 Deming Way
	Madison,
WI 53717-1998

	 	 	 	Madison, WI 53717-2911
	 
	 	 	 	 
	/s/ George Gialamas

	 	 	 	/s/ Dr. Frederick A. Robertson
	 

	 	 	 	 
	George Gialamas, Manager

	 	 	 	Dr. Frederick A. Robertson, C.E.O.

 

 

OFFICE LEASE

BETWEEN

Adelphia, LLC

LANDLORD

AND

Tomotherapy Incorporated

TENANT

Tomotherapy

1209 Deming Way

Madison, Wisconsin

 

 

Tomotherapy

1209 Deming Way

Madison WI 53717

	 	 	 	 	 	 	 
	No. 1

	 	 
	 	REFERENCE DATA
	 	[October 28, 2005]

These terms are specific to, and incorporated in, this lease.

	 	 	 	 	 
	¶
no.	 	Item	 	Lease Provision
	1.02

	 	Premises
	 	All of the building excluding eight below grade bunkers
	 

	 	Parking
	 	All surface parking
	 

	 	Area of the Premises
	 	56,052 BOMA rentable square feet (“RSF”)
	 
	 	 	 	 
	1.03

	 	Additional Permitted uses
	 	Manufacture, office, testing and assembly of medical imaging equipment
	 
	 	 	 	 
	1.04

	 	Term
	 	Twelve years ending April 30, 2018
	 

	 	Target Date
	 	May 1, 2006
	 
	 	 	 	 
	2.01

	 	Rent at commencement
	 	$12.50/RSF/yr. 
	 
	 	 	 	 
	2.02

	 	Rent Adjustment
	 	$0.50 /RSF/yr. beginning May 1, 2007
	 

	 	Tenant’s pro rata share
	 	100%
	 

	 	Additional Rent
	 	$5.00/RSF/mo (subject to adjustment per S2.02)
	 
	 	 	 	 
	2.04

	 	Security deposit
	 	None
	 
	 	 	 	 
	4.01

	 	Build out Allowance
	 	None
	 
	 	 	 	 
	10.01

	 	Extension term
	 	Four (4) extension terms of five (5) years each
	 
	 	 	 	 
	12.01

	 	Broker
	 	The Gialamas Company, Inc.
	 
	 	 	 	 
	12.13

	 	Encumbrances
	 	Mortgage to Bank [Mortgagee to be determined]

	 	 	 	 	 	 	 
	LANDLORD	 	 	 	TENANT	 	 
	Adelphia, LLC

	 	 	 	Tomotherapy Incorporated	 	 
	8020 Excelsior Drive, Ste 300

	 	 	 	1240 Deming Way	 	 
	Madison WI 53717-1998

	 	 	 	Madison, WI 53717-2911	 	 
	 
	 	 	 	 	 	 
	/s/ George Gialamas

	 	 	 	/s/ Dr. Frederick A. Robertson	 	 
	 

George Gialamas, Manager

	 	 	 	 

Dr. Frederick A. Robertson, C.E.O.
	 	 

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	 	 	 	 	 	 	PAGE
	ARTICLE 1     BASIC LEASE PROVISIONS	 	1
	 
	 	Section 1.01	 	Date and Parties	 	 
	 
	 	Section 1.02	 	Premises	 	 
	 
	 	Section 1.03	 	Use	 	 
	 
	 	Section 1.04	 	Term	 	 
	 
	 	Section 1.05	 	Improvements	 	 
	 
	 	 	 	 	 	 
	ARTICLE 2     RENT AND SECURITY	 	3
	 
	 	Section 2.01	 	Rent and Rent Adjustment	 	 
	 
	 	Section 2.02	 	Additional Rent	 	 
	 
	 	Section 2.03	 	Personal Property Tax	 	 
	 
	 	Section 2.04	 	Security Deposit	 	 
	 
	 	Section 2.05	 	Sales Tax	 	 
	 
	 	 	 	 	 	 
	ARTICLE 3     AFFIRMATIVE OBLIGATIONS	 	8
	 
	 	Section 3.01	 	Compliance with Laws	 	 
	 
	 	Section 3.02	 	Services and Utilities	 	 
	 
	 	Section 3.03	 	Repairs and Maintenance	 	 
	 
	 	 	 	 	 	 
	ARTICLE 4     NEGATIVE OBLIGATIONS	 	12
	 
	 	Section 4.01	 	Alterations	 	 
	 
	 	Section 4.02	 	Assignment and Subleasing	 	 
	 
	 	 	 	 	 	 
	ARTICLE 5     INSURANCE	 	15
	 
	 	Section 5.01	 	Insurance	 	 
	 
	 	Section 5.02	 	Indemnification	 	 
	 
	 	Section 5.03	 	Limitation of Landlord’s Liability	 	 
	 
	 	 	 	 	 	 
	ARTICLE 6     LOSS OF PREMISES	 	18
	 
	 	Section 6.01	 	Damages	 	 
	 
	 	Section 6.02	 	Condemnation	 	 
	 
	 	 	 	 	 	 
	ARTICLE 7     DEFAULT	 	22
	 
	 	Section 7.01	 	Tenant’s Default	 	 
	 
	 	Section 7.02	 	Landlord’s Remedies	 	 
	 
	 	Section 7.03	 	Landlord’s Default	 	 
	 
	 	Section 7.04	 	Exception to Cure Periods	 	 
	 
	 	Section 7.05	 	Self-Help	 	 
	 
	 	Section 7.06	 	Survival	 	 

 

 

	 	 	 	 	 	 	 
	 	 	 	 	 	 	PAGE
	ARTICLE 8      NONDISTURBANCE	 	24
	 
	 	Section 8.01	 	Subordination and Attornment	 	 
	 
	 	Section 8.02	 	Estoppel Certificate	 	 
	 
	 	Section 8.03	 	Quiet Possession	 	 
	 
	 	 	 	 	 	 
	ARTICLE 9      LANDLORD’S RIGHTS	 	26
	 
	 	Section 9.01	 	Rules	 	 
	 
	 	Section 9.02	 	Mechanic’s Liens	 	 
	 
	 	Section 9.03	 	Right to Enter	 	 
	 
	 	Section 9.04	 	Holdover	 	 
	 
	 	Section 9.05	 	Signs	 	 
	 
	 	 	 	 	 	 
	ARTICLE 10      OPTIONS	 	29
	 
	 	Section 10.01	 	Option to Extend	 	 
	 
	 	 	 	 	 	 
	ARTICLE 11      DISPUTES	 	29
	 
	 	Section 11. 01	 	Arbitration	 	 
	 
	 	 	 	 	 	 
	ARTICLE 12      MISCELLANEOUS	 	31
	 
	 	Section 12.01	 	Broker’s Warranty	 	 
	 
	 	Section 12.02	 	Attorney’s Fees	 	 
	 
	 	Section 12.03	 	Notices	 	 
	 
	 	Section 12.04	 	Partial Invalidity	 	 
	 
	 	Section 12.05	 	Waive	 	 
	 
	 	Section 12.06	 	Binding on Successors	 	 
	 
	 	Section 12.07	 	Governing Law	 	 
	 
	 	Section 12.08	 	Insurance Increase	 	 
	 
	 	Section 12.19	 	Lease not an Offer	 	 
	 
	 	Section 12.10	 	Recording	 	 
	 
	 	Section 12.11	 	Survival of Remedies	 	 
	 
	 	Section 12.12	 	Authority of Parties	 	 
	 
	 	Section 12.13	 	Business Days	 	 
	 
	 	Section 12.14	 	Entire Agreement	 	 

	 	 	 	 	 	 	 
	 

	 	 	 	EXHIBITS	 	 
	 
	 	 	 	 	 	 
	 

	 	Exhibit A
	 	 	 	Premises
	 

	 	Exhibit B
	 	 	 	Building
	 

	 	Exhibit C
	 	 	 	Land and Surface Parking
	 

	 	Exhibit D
	 	 	 	Building Standard
	 

	 	Exhibit E
	 	 	 	Tenant Improvements
	 

	 	Exhibit F
	 	 	 	Janitorial Services
	 

	 	Exhibit G
	 	 	 	Rules
	 

	 	Exhibit H
	 	 	 	Tomotherapy to Provide
	 

	 	 	 	 	 	Exhibit H for Landlord Review

 

 

DEFINITIONS

	 	 	 
	Additional Rent
	 	§2.02
	Alterations
	 	§4.01(a)
	Applicable Laws
	 	§3.01
	Asking/Answering Party
	 	§8.02(a)
	Building
	 	§1.01
	Business Days
	 	§12.13
	Business Hours
	 	§3.02(b)
	Canceling/Complying Party
	 	§3.01
	Commencement Date
	 	§1.04(a)
	Default
	 	§7.01(a)
	Defaulting Party
	 	§7.05
	Excess Consideration
	 	§4.02(f)
	Extension Term
	 	§10.01(a)
	HVAC
	 	§3.02(a)
	Holdover
	 	§9.04(a)
	Improvements
	 	§1.05
	Injured Party
	 	§5.01(d)
	Land
	 	§1.02
	Landlord
	 	§1.01
	Late Payment
	 	§2.01(b)
	Lease
	 	§1.01
	Operating Expenses
	 	§2.02
	Premises
	 	§1.02
	Property
	 	§2.02(a)
	Pro rata share
	 	§2.02(a)
	Real Estate Taxes
	 	§2.02(a)
	Reference Data
	 	§1.01
	Relevant Space
	 	§6.01(a)
	Rent
	 	§2.01
	Statement
	 	§2.02(d)
	Substantial Completion
	 	§1.04(b)
	Successor Landlord
	 	§8.01(b)
	Target Date
	 	§1.04(a)
	Temporary Condemnation
	 	§6.02(h)
	Tenant
	 	§1.01
	Term
	 	§1.04(a)

 

 

ARTICLE 1 — BASIC LEASE PROVISIONS

1.1. Date and parties. This lease (Lease) is entered into between
Adelphia, LLC, as lessor (Landlord) and the tenant identified on the Reference Data page at the
front of this Lease, as lessee (Tenant) for office and manufacturing space at 1209 Deming Way,
Madison, Wisconsin (Building).

1.2. Premises. Landlord leases to Tenant the Property, including the land,
improvements, office, storage and parking space identified in the Reference Data (Premises) as
shown outlined on the attached floor plan(s) (Exhibit A). The Premises contain the fixtures,
improvements, and other property now installed therein plus any improvements required by section
1.05 and Exhibit E and as otherwise agreed to by the parties from time to tune.

The Building (Exhibit B) contains 56,052 rentable square feet, all of which is included in the
Premises. These measurements were made using the American National Standard Method of Measuring
Floor Area in Office Buildings, ANSI/BOMA Z.65.1 -1996, published by the Building Owners and
Managers Association International. Any change in the rentable area of the Building or Premises
will be incorporated herein by a revision of the Reference Data.

Tenant and its agents, employees, and invitees, have the exclusive right to the free use of the
common areas in the Building and of the land (Land) on which the Building is located (Exhibit C)
for the common areas’ intended and normal purpose. Common areas include elevators, sidewalks,
surface-lot parking areas, driveways, hallways, stairways, public bathrooms, common entrances,
lobby, and other similar public areas and access ways.

1.03. Use. Tenant shall use the Premises for business office purposes only,
unless additional or alternate uses are designated in the Reference Data. Landlord warrants
that applicable laws, ordinances, regulations, and restrictive covenants permit the Premises to
be used as described in the Reference Data. Tenant shall not create a nuisance or use the
Premises for any immoral or illegal purposes.

1.04. Term.

1.04(a). Term. The Lease begins (Commencement Date) on the earlier of:

	 	(i)	 	The date Tenant takes possession and occupies the Premises; or
	 
	 	(ii)	 	The Target Date, if the Premises are substantially completed on that
date; or
	 
	 	(iii)	 	Thirty (30) days after the delivery of the notice
required by subsection 1.04(c), if the Premises are substantially completed on
that date.

If the Commencement Date would be a Saturday, Sunday, or holiday listed in paragraph
3.02(b)(ii), the Commencement Date shall be the first business day following that Saturday,
Sunday, or holiday. Within thirty days after the Commencement Date, the parties shall confirm
the Commencement Date by an amendment to the Reference Data. The Lease shall continue in force
from the Commencement Date if said date is the first day of a calendar month, or else from the
first day of the month following the

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 1 of 32

 

 

Commencement Date for the term designated in the Reference Data, unless ended
earlier pursuant to the terms of this Lease.

1.04(b). Substantial completion. Landlord shall use its best efforts to substantially
complete the Premises by the Target Date set in the Reference Data. Substantially complete
means:

	 	(i)	 	Completing Tenant’s improvements (section 1.05 and Exhibit E) so that

	 	(A)	 	Tenant can use the premises for their intended
purposes without material interference to Tenant conducting its
ordinary business activities,;
	 
	 	(B)	 	The only incomplete items are minor or
insubstantial details of construction, mechanical adjustments, or
finishing touches like touch-up plastering or painting; and
	 
	 	(C)	 	All necessary permits required to occupy the
building have been received, but any special permits as may be required
for the Tenant’s business operation are excluded.

	 	(ii)	 	Tenant, its employees, agents, and invitees, have ready access
to the Building and Premises through the lobby, entranceways, elevators, and
hallways;
	 
	 	(iii)	 	The decoration, fixtures, and equipment to be installed by
Landlord (“Building Standard”, Exhibit D) are installed and in good operating
order;
	 
	 	(iv)	 	The Premises are ready for the installation of any
equipment, furniture, fixtures, or decoration that Tenant will install;
	 
	 	(v)	 	The following items are installed and in good operating order:

	 	(A)	 	Building lobby,
	 
	 	(B)	 	Hallways on floor on which Premises are located
(including walls, flooring, ceiling, lighting, etc.),
	 
	 	(C)	 	Elevators, HVAC, utilities, and plumbing serving the Premises, and
	 
	 	(D)	 	The doors and hardware; and

	 	(vi)	 	The Premises are broom clean.

1.04(c). Notice. Landlord shall give Tenant at least thirty (30) days advance written notice
of the estimated substantial completion date if different from the Target Date. If the
estimated substantial completion date changes at any time after Landlord gives notice, then
Landlord shall give thirty (30) calendar days advance notice of the new estimated
substantial completion date.

1.04(d). Inspection and Punch List. Before the Commencement Date, the parties shall
inspect the Premises, have all systems demonstrated, and prepare a punch-list. The
punch-list shall list incomplete, minor, or insubstantial details of construction;
necessary mechanical adjustments, and needed finishing  touches. Landlord will
complete the punch-list items within thirty (30) days after the Commencement

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 2 of 32

 

 

Date. Landlord will promptly correct any latent defects as they become known, if
Tenant notifies Landlord within thirty (30) days after Tenant first learns of the
defect.

1.05. Improvements. Landlord shall complete the improvements (“Improvements”) to the
Premises which are described in Exhibit E (Tenant Improvements), subject to the requirement
that Tenant pay for (or, with Landlord’s consent, reimburse Landlord for) the cost of the
Tenant Improvements). The Improvements shall be completed in a good and workmanlike manner and
comply with all applicable laws, ordinances,. rules, and regulations of governmental
authorities.

ARTICLE 2 — RENT AND SECURITY

2.01.
Rent. Tenant shall pay rent (Rent) to Landlord in the amounts designated
in the Reference Data.

(a) Payment. The Rent shall be paid in equal monthly
installments:

	 	(i)	 	Without advance notice, demand, offset, or deduction
unless the offset or deduction is made by Tenant (1) as permitted under
paragraphs 3.02(c), 3.02(e)(ii) or 11.01(b)(ii) or (2) to recover any unpaid
court judgment Tenant has against Landlord;
	 
	 	(ii)	 	By the first day of each month during the Term; and
	 
	 	(iii)	 	To Landlord or to Landlord’s agent as identified in the
Reference Data, or as Landlord may specify in writing to the Tenant.

If the Term does not begin on the first day or end on the last day of a month, the Rent
for that partial month shall be prorated by multiplying the monthly Rent by the number
of days of the partial month included in the Term over thirty.

(b) Late payment. If Tenant fails to pay part or all of the Rent or Additional Rent
(section 2.02) within ten (10) days after it is due and if Landlord gives Tenant written
notice of the Tenant’s failure to pay Rent or Additional Rent and Tenant fails to pay the
amount due within ten (10) days of the receipt of said notice, the Tenant shall also pay:

	 	(i)	 	A late charge equal to 1 percent of the unpaid Rent and Additional Rent,
plus
	 
	 	(ii)	 	Interest at 18 percent per annum or the maximum then allowed
by applicable law, whichever is less, on the remaining unpaid balance,
retroactive to the date originally due until paid.

2.02.
Additional Rent. Tenant shall also pay its pro rata share of real estate taxes and
operating expenses for the Property as Additional Rent in accordance with the following provisions.

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 3 of 32

 

 

2.02(a). Definitions.

	 	(i)	 	Tenant’s pro rata share, which is shown in the Reference Data, was calculated
by dividing the rentable area of the Premises by the rentable area of the Building
(excluding the storage area, if any) and expressing the fraction as a percentage.
	 
	 	(ii)	 	Property means the Building and its equipment and systems, and the Land.
	 
	 	(iii)	 	Real Estate Taxes means real property taxes and annual installments of
assessments, special or otherwise, imposed upon the Property, and reasonable legal
fees, costs, and disbursements incurred for proceedings to contest, determine, or
reduce Real Estate Taxes, but only to the extent the Real Estate Taxes are reduced.

Real Estate Taxes do not include:

	 	(A)	 	Federal, state, or local income taxes,
	 
	 	(B)	 	Franchise, gift, transfer, excise, capital stock,
estate, succession, or inheritance taxes,
	 
	 	(C)	 	Penalties or interest for late payment of Real Estate Taxes, and
	 
	 	(D)	 	The portion of Real Estate Taxes that is allocable
to any Building capital improvements made after the Building was fully
assessed as a completed and occupied unit and the Lease was signed,
except to the extent the additional improvements benefit the Tenant.

	 	(iv)	 	Operating Expenses means Landlord’s operating expenses that are reasonable,
actual and necessary, out-of-pocket, obtained at competitive prices, and that are
directly attributable to the operation, maintenance, management, and repair of the
Property, as determined under generally accepted accounting principles consistently
applied, including:

	 	(A)	 	Salaries, and other compensation; including payroll
taxes, vacation, holiday, and other paid absences; and welfare, retirement,
and other fringe benefits; that is paid to employees, independent
contractors, or agents of Landlord engaged in the operation, repair,
management, or maintenance of the Property;
	 
	 	(B)	 	Repairs and maintenance of the Property and the cost of
necessary supplies and materials and for Property repairs and maintenance;
	 
	 	(C)	 	Premiums and other charges incurred by Landlord for
insurance on the Property;
	 
	 	(D)	 	Costs incurred for inspection and servicing, including
all outside maintenance contracts necessary or proper for the maintenance
of the Property, such as janitorial and window cleaning, rubbish removal,
exterminating, water treatment, elevator, electrical, plumbing, and
mechanical equipment, and the cost of materials, tools, supplies, and
equipment used for inspection and servicing;
	 
	 	(E)	 	Costs incurred for water, or other utilities;
	 
	 	(F)	 	Sales, use, and excise taxes on goods and
services purchased by Landlord for the sole use upon and benefit
of the Property;

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 4 of 32

 

 

	 	(G)	 	License, permit, and inspection fees;
	 
	 	(H)	 	Legal fees, costs, and disbursements relating to the property;
	 
	 	(I)	 	Management fees, not exceeding 4% of gross revenue from the
Building, to a person or entity other than Landlord;
	 
	 	(J)	 	The annual amortization over its useful life with a reasonable salvage
value on a straight-line basis of the costs of any capital improvements made by Landlord
and (i) required by any changes in applicable laws, rules, or regulations of any
governmental authorities enacted after the Building was assessed as a completed and
occupied unit and the Lease was signed, or (ii) which are for solely for the benefit of
Tenant;
	 
	 	(K)	 	The annual amortization over its useful life with a reasonable salvage
value on a straight-line basis of the costs of any capital improvements made by Landlord
as a labor-saving measure or to accomplish other savings in operating, repairing,
managing, or maintaining the Property, after the Building was assessed as a completed and
occupied unit and the Lease was signed, but only to the extent of the savings; and
	 
	 	(L)	 	Other costs reasonably necessary to operate, repair, manage, and maintain the Property in
a first class manner and condition.

Operating Expenses exclude:

	 	(A)	 	Real Estate Taxes as defined in paragraph 2.02(a)(iii);
	 
	 	(B)	 	Leasing commissions, costs, disbursements, and other expenses incurred for
leasing, renovating, or improving space for tenants;
	 
	 	(C)	 	Costs incurred by Landlord in discharging its obligations under section 1.05
and Exhibits D and E;
	 
	 	(D)	 	Costs (including permit, license, and inspection fees) incurred in renovating,
improving, decorating, painting, or redecorating vacant space or space for tenants;
	 
	 	(E)	 	The cost of electricity or other service sold to tenants for which Landlord is
to be reimbursed or which are paid directly by another tenant;
	 
	 	(F)	 	Depreciation and amortization on the Building except as expressly permitted
elsewhere in the Lease;
	 
	 	(G)	 	Costs of a capital nature including capital improvements, capital repairs,
capital
equipment, and capital tools, as determined under generally accepted accounting
principles consistently applied, except that the annual amortization of these
costs shall be included to the extent expressly permitted in subparagraphs
2.02(a)(iv)(K) and (L);
	 
	 	(H)	 	Costs incurred because the Landlord or another tenant violated the terms of
any lease;
	 
	 	(I)	 	Interest on debt or amortization payments on mortgages or deeds of trust or
any other debt for borrowed money;

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 5 of 32

 

 

	 	(J)	 	Items and services for which Landlord is reimbursed by
Tenant or others or which Landlord provides selectively to one or more
tenants of the Building other than Tenant without reimbursement;
	 
	 	(K)	 	Advertising and promotional expenditures;
	 
	 	(L)	 	Repairs or other work needed because
of fire, windstorm, or other casualty or cause insured against by
Landlord or to the extent Landlord’s insurance required under
Article 5 would have provided insurance, whichever is the greater
coverage;
	 
	 	(M)	 	Nonrecurring costs incurred to remedy structural defects in
original construction
materials or installations;
	 
	 	(N)	 	Any costs, fines, or
penalties incurred because Landlord violated any
governmental rule or authority;
	 
	 	(O)	 	Costs incurred to test, survey,
cleanup, contain, abate, remove, or otherwise
remedy hazardous wastes or asbestos-containing materials from the
Property unless the wastes or asbestos-containing materials were in or
on the Property because of Tenant’s negligence or intentional acts;
	 
	 	(P)	 	Other expenses that under generally accepted accounting principles
consistently applied would not be considered normal maintenance,
repair, management, or operation expenses.

2.02(b). Adjustments. Rent shall increase annually by the amount shown in the Reference Data
and Operating Expenses as defined in paragraph 2.02(a)(iv) shall be adjusted as follows:

	 	(i)	 	Vacancy Adjustment. If, during the term of this Lease, any area of
the Building reserved for occupancy by tenants is vacant, Landlord shall pay the
pro rata share of the Operating Expenses and Real Estate Taxes allocated to that
area. The amount paid by Landlord under this paragraph shall be reduced by the
full amount of any reduction in Operating Expenses directly attributable to the
vacancy.
	 
	 	(ii)	 	Credits/Reimbursements. Operating Expenses shall be reduced by
reimbursements, credits, discounts, reductions, refunds or other allowances
received or receivable by Landlord for items of cost included in Operating
Expenses, except reimbursements to the Landlord by tenants under the Additional
Rent (Operating Expenses/Taxes) provision.
	 
	 	(iii)	 	Increased Building Rentable Square Feet. If Landlord increases the
Building’s rentable square feet after the Building was fully assessed as a
completed and occupied unit and the Lease was signed, then the Operating Expenses
and Real Estate Taxes attributable to the additional rentable square feet shall
be included in the Operating Expenses and Real Estate Taxes and Tenant’s pro rata
share shall be reduced using the
formula in paragraph 2.02(a)(i).

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 6 of 32

 

 

2.02(c). Payment by Landlord. Subject to reimbursement under subsection 2.02(d), Landlord
shall pay the Property’s Operating Expenses and Real Estate Taxes before delinquency.

2.02(d). Payment by Tenant

	 	(i)	 	From and after the commencement date of this Lease, the Tenant shall pay
monthly, together with the Monthly Rent, Additional Rent in the amount designated in
the Reference Data. Landlord reserves the right to adjust the amount of Additional
Rent due from Tenant in accordance with actual or anticipated changes in the amount of
Real Estate Taxes, Operating Expenses or Tenant’s pro rata share. Any adjustment of
the amount of Additional Rent shall be effective as of January 1st of the
year in which the adjustment is made, and paid by the Tenant with the Monthly Rent
payment which is due at least ten (10) days after Tenant’s receipt of the Statement
described in the following paragraph (ii) showing the adjusted amount of Additional
Rent due from Tenant.
	 
	 	(ii)	 	On or before January 31st following each year during the term of
this Lease, or as soon thereafter as reasonably practical, Landlord shall deliver to
Tenant:

	 	(A)	 	An itemized statement (Statement) showing the amount of Additional Rent
received together with the Real Estate Taxes and actual Operating Expenses for
the prior year broken down by component expenses, such as repairs,
management fees, utility charges and janitorial costs; and
	 
	 	(B)	 	A budget showing the estimated cost for Real Estate Taxes and
Operating Expenses and a calculation of the Tenant’s Pro Rata Share of Additional
Rent for the current year. Landlord shall supply, upon Tenant’s request,
reasonable additional information to explain or support the Statement.

	 	(iii)	 	If the Statement shows that the amount of Tenant’s pro rata share for the prior
year is less than the amount of Additional Rent paid by Tenant during that year,
Landlord shall credit the difference to the installment(s) of Rent and Additional Rent
next due from Tenant (or, after expiration of the Lease, mail a refund with the
statement). If the Statement shows that the amount of Tenant’s pro rata share for the
prior year is greater than the amount of Additional Rent paid by Tenant during that
year, the difference shall be assessed to Tenant as Additional Rent and shall be due
with the installment of Rent which is due at least thirty (30) days following
Landlord’s delivery of an invoice for said assessment to Tenant. Any overpayment or
underpayment of Additional Rent, including interest and penalty, shall survive the
ending of the Lease.
	 
	 	(iv)	 	For any year in which this Lease is not in effect for the complete calendar year,
unless it was ended because of Tenant’s default, Tenant’s obligation for Additional Rent
for that year shall be prorated by multiplying Tenant’s pro rata share by a fraction
expressed as a percentage, the numerator of which is the number of days of the year
included in the
Term and the denominator of which is 365.

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 7 of 32

 

 

	 	(v)	 	If Tenant disputes the accuracy of Landlord’s Statement, Tenant and its
agents or employees shall have ninety (90) days after receiving the
Statement to examine Landlord’s books and records concerning the Statement
at a mutually convenient time at Landlord’s offices. The books and records
shall be kept in accord with generally accepted accounting principles
consistently applied. Upon the expiration of ninety days following Tenant’s
receipt of the Statement, Tenant shall be conclusively presumed to have
accepted the Statement as complete and accurate unless Tenant has delivered
a written notice of its objection(s) to the Statement to Landlord by that
date.

2.03. Personal Property Tax. Tenant shall pay, before they become delinquent, taxes
assessed during the Term against trade fixtures or personal property placed by Tenant in the
Premises. If these taxes are assessed against the Building, Tenant shall pay its share of the
taxes to the Landlord within ten (10) days after receiving Landlord’s written statement setting
forth the amount of taxes applicable to Tenant’s property and the basis for the charge to Tenant.
Tenant’s failure to pay within the ten-day period shall entitle the Landlord to the same remedies
it has upon Tenant’s failure to pay Rent.

2.04. Security Deposit. The Tenant has deposited the amount designated in the Reference
Data (Security Deposit) with the Landlord to secure Tenant’s performance of its Lease
obligations. If Tenant defaults Landlord may, after giving five (5) days advance notice to
Tenant, without prejudice to Landlord’s other remedies, apply part or all of the Security Deposit
to cure Tenant’s default. If Landlord so uses part or all of the Security Deposit, then Tenant
shall within ten (10) days after written demand, pay Landlord the amount used to restore the
Security Deposit to its original amount.

     Any part of the Security Deposit not used by the Landlord as permitted by this section shall
be returned to Tenant, without interest within thirty (30) days after the Lease ends. If Landlord
sells the Building then the Landlord shall be relieved of any liability for the Security Deposit
and accumulated interest if the requirements of subsection 5.03(a) are met.

2.05. Sales Tax. Tenant shall pay sales, excise or any similar taxes which may be
levied against the Rent, Additional Rent, or any other payments due to Landlord under this Lease.

ARTICLE 3 — AFFIRMATIVE OBLIGATIONS

3.01. Compliance with Laws.

3.01(a). Compliance at Commencement. Landlord warrants to Tenant that on the Commencement
Date, the Land, Building and the Premises will comply with all applicable laws, ordinances,
rules, and regulations of governmental authorities (Applicable Laws). Tenant warrants to
Landlord that on the Commencement Date the Tenant’s intended use of the Premises will
comply with all Applicable Laws.

3.01(b). Notice of Noncompliance. If there should be a change in the Applicable Laws which would
cause either party to be found out of compliance therewith, that party shall immediately
notify the other party and undertake all actions necessary to achieve compliance with the changed
Laws, subject to the limits in the following subsection 3.01(c).

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 8 of 32

 

 

3.01(c). Compliance Limits. Either party, instead of complying with Applicable Laws
as required by subsection 3.01(b), may cancel the Lease by giving prompt notice to the
other if:

	 	(i)	 	The estimated cost to comply exceeds an amount equal to six
months’ current Rent

	 	(A)	 	Due from Tenant to Landlord if Tenant is not in compliance; or
	 
	 	(B)	 	Due from all tenants in the Building then paying
Rent to Landlord if Landlord is not in compliance; or

	 	(ii)	 	Less than twelve (12) months remain in the Term and Tenant
does not have an option to extend the Term.

If either party (Canceling Party) cancels the Lease under (i) above, the other (Complying
Party) may, within ten (10) days of receiving the Canceling Party’s notice, agree to
achieve compliance with the Applicable Laws at its expense by giving notice to the
Canceling Party and this Lease shall continue in effect. If the Complying Party incurs any
expense in its exercise of this right, then the Canceling Party shall promptly reimburse
the Complying Party the amount of the limit identified for the Canceling Party in (i)
above, or the Complying Party’s actual cost of compliance, whichever is less.

3.02. Services and Utilities.

3.02(a). Services. Landlord shall provide at its expense, subject to reimbursement
under subsection 2.02(d):

	 	(i)	 	Heating, ventilation, and air conditioning (HVAC) for the
Premises and for the common areas of the Building during business hours to
maintain temperatures for comfortable use and occupancy in light of the Tenant
Improvements (Exhibit E);
	 
	 	(ii)	 	Automatic passenger elevators providing adequate service leading
to the floor on which the Premises are located;
	 
	 	(iii)	 	Janitorial services to the Premises as specified in Exhibit F;
	 
	 	(iv)	 	Hot and cold water sufficient for drinking, lavatory, toilet, and
ordinary cleaning purposes to be drawn from approved fixtures in the Premises if
shown on Exhibit E or on the floor on which the Premises are located;
	 
	 	(v)	 	Replacement of lighting tubes, lamp ballasts, and
bulbs;
	 
	 	(vi)	 	Extermination and pest control when necessary; and
	 
	 	(vii)	 	Maintenance of common areas in a first class manner comparable to other first class
office buildings in the area. The maintenance shall include cleaning, HVAC,

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 9 of 32

 

 

illumination, snow shoveling, de-icing, repairs,
replacements, lawn care, and landscaping.

3.02(b). Business Hours. In section 3.02 business hours means:

	 	(i)	 	Monday through Friday, 7:00 a.m. to 7:00 p.m., and
	 
	 	(ii)	 	Saturday, 8:00 a.m. to 1:00 p.m., but excludes the
following holidays or the days on which the holidays are designated for
observance: New Year’s Day, Memorial Day, July Fourth, Labor Day,
Thanksgiving Day, and Christmas Day.

3.02(c). 24 Hour Access. Tenant, its employees, agents, and invitees shall have access to
the Premises twenty-four (24) hours a day, seven (7) days a week. During non-business
hours Landlord may restrict access by requiring an entry or identification card issued by
the Landlord. Landlord shall not be liable for denying entry to any person who does not
have the required card.

     Landlord may temporarily close the Building if required because of a
life-threatening or Building-threatening situation. Landlord shall use its best efforts
to close the Building during non-business hours only. If, however, the Building must be
closed during business hours, then the Rent and Additional Rent shall abate during any
closing that lasts more than eight (8) consecutive business hours and Tenant may reduce
amounts next coming due under this Lease by such abated amount.

3.02(d). Separate Meter. Electric service to the Premises is separately metered and
billed directly to the Tenant.

3.02(e). Interruption of Services.

	 	(i)	 	Interruptions. Landlord does not warrant that any services
Landlord supplies will not be interrupted. Services may be interrupted
because of accidents, repairs, alterations, improvements, or any reason
beyond the reasonable control of the Landlord. Except as noted in (ii) below,
any interruption shall not:

	 	(A)	 	Be considered an eviction or disturbance of
Tenant’s use and possession of the Premises;
	 
	 	(B)	 	Make Landlord liable to Tenant for damages;
	 
	 	(C)	 	Abate Rent or Additional Rent; or
	 
	 	(D)	 	Relieve Tenant from performing Tenant’s Lease obligations.

	 	(ii)	 	Remedy. If any essential services (such as HVAC, passenger elevators, electricity, water)
supplied by Landlord are interrupted, and the interruption does not result from the negligence
or willful misconduct of Tenant, its employees, invitees, or agents, Tenant shall be entitled
to an abatement of Rent and Additional Rent. The abatement shall begin on the third consecutive
business day of the interruption or when Tenant stops using the  Premises because of the
interruption, whichever is later. The abatement shall end on the

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 10 of 32

 

 

	 	 	 	second day after the services are restored and Tenant may reduce amounts next
coming due under this Lease by such abated amount.
	 
	 	 	 	Tenant shall have the option to cancel the Lease if the interruption
unreasonably and materially interferes with Tenant’s use of or access to the
Premises for at least thirty (30) consecutive days (or for at least
forty-five (45) non-consecutive days in any twelve month period) and Landlord
is not exercising its best efforts to restore the services. To exercise this
option Tenant must give Landlord notice of the cancellation within thirty
(30) days following the thirtieth (30th) or forty-fifth
(45th)
day, respectively.

3.03. Repairs and Maintenance.

3.03(a). Tenant’s Care of Premises. Tenant shall:

	 	(i)	 	Keep the Premises and trade fixtures in good order;
	 
	 	(ii)	 	Make repairs and replacements to the Premises or Building needed
because of Tenant’s misuse or primary negligence, except to the extent that the
repairs or replacements are covered by Landlord’s insurance or the insurance
Landlord is required to carry under Article 5, whichever is greater;
	 
	 	(iii)	 	Repair and replace special equipment or decorative treatments
installed by or at Tenant’s request and that serve the Premises only, except

	 	(A)	 	To the extent the repairs or replacements are needed
because of Landlord’s misuse or primary negligence, and are not covered by
Tenant’s insurance or the insurance Tenant is required to carry under
Article 5, whichever is greater; or
	 
	 	(B)	 	If the Lease is ended under sections 6.01 (Damage) or
6.02 (Condemnation) or 7.03 (Landlord’s Default); and

	 	(iv)	 	Not commit waste.

3.03(b). Landlord’s Repairs. Except for repairs and replacements that Tenant must make under
subsection 3.03(a), Landlord shall make all other repairs and replacements to the Premises,
common areas and Building (including Building fixtures and equipment).

     Landlord shall make the repairs and replacements to maintain the Building in a first
class condition comparable to other first class buildings in the area. This maintenance shall
include the roof, foundation, exterior walls, interior structural walls, all structural
components, and all systems such as mechanical, electrical, HVAC, and plumbing.

3.03(c). Time for Repairs. Repairs or replacements required under subsections 3.03(a) or 3.03(b)
shall be made within a reasonable time (depending on the nature of the repair or replacement
needed) after receiving notice or having actual knowledge of the need for a repair or replacement.

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 11 of 32

 

 

3.03(d). Surrendering the Premises. Upon the last day of the initial or of the last
extension term elected by Tenant (if any), Tenant shall surrender the Premises to Landlord
in the same broom clean condition that the Premises were in on the Commencement Date
except for:

	 	(i)	 	Ordinary wear and tear;
	 
	 	(ii)	 	Damage by the elements, fire, and other casualty unless
Tenant would be required to repair under subsection 3.03(a);
	 
	 	(iii)	 	Condemnation;
	 
	 	(iv)	 	Damage arising from any cause not required to be repaired or replaced by
Tenant; and
	 
	 	(v)	 	Alterations as permitted by this Lease unless consent was conditioned on
their removal.

On surrender, Tenant shall remove from the Premises its personal property, trade fixtures,
and any alterations as identified by Landlord in Exhibit H (to be provided by Tomotherapy)
upon the Tenant’s commencement of the Building or subsequent addition of such personal
property, trade fixtures, or alterations, and repair any damage to the Premises caused by
the removal. The preceding sentence shall not apply to the bunkers installed on the
Premises. Any items not removed by Tenant as required above shall be considered abandoned.
Landlord may dispose of abandoned items as Landlord chooses and bill the Tenant for the
cost of their disposal, minus any revenues received by Landlord for their disposal.

ARTICLE 4 — NEGATIVE OBLIGATIONS 

4.01. Alterations.

4.01(a). Definition. “Alterations” means alterations, additions, substitutions,
installations, changes, and improvements, but excludes minor decorations and the
Improvements Landlord is to make under section 1.05 and Exhibit E. “Minor decorations” as
used in this Subsection shall mean any alteration which costs less than $10,000.00,
including labor, materials and fees.

4.01(b). Consent. Tenant shall not make Alterations without the Landlord’s advance written
consent. Landlord’s consent shall not be unreasonably withheld or unduly delayed for
nonstructural interior Alterations to the Premises that do not adversely affect the
Building’s appearance, value, or structural strength.

4.01(c). Conditions of Consent. Landlord may condition its consent under subsection 4.01(b)
on any of the following:

	 	(i)	 	Tenant shall furnish Landlord with reasonably detailed plans
and specifications of the Alterations;
	 
	 	(ii)	 	The Alterations shall be performed and completed:

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 12 of 32

 

 

	 	(A)	 	In accordance with the submitted plans and specifications,

	 
	 	(B)	 	In a workmanlike manner,
	 
	 	(C)	 	In compliance with all Applicable Laws,
	 
	 	(D)	 	Using new materials and installations at least
equal in quality to the original Building materials and installations,
	 
	 	(E)	 	Without disturbing the quiet possession of the other tenants,
	 
	 	(F)	 	Without interfering with the construction,
operation, or maintenance of the Building, and
	 
	 	(G)	 	With due diligence;

	 	(iii)	 	Tenant shall use workers and contractors whom Landlord
employs or approves in writing, which approval shall not be unreasonably
withheld or unduly delayed;
	 
	 	(iv)	 	Tenant shall modify plans and specifications because of reasonable
conditions set by Landlord after reviewing the plans and specifications;
	 
	 	(v)	 	Tenant’s contractors shall carry builder’s risk insurance in an
amount then customarily carried by prudent contractors and workers’ compensation
insurance for its employees in statutory limits;
	 
	 	(vi)	 	Tenant’s workers or contractors shall work in harmony and not
unreasonably interfere with Landlord’s workers or contractors or other tenants
and their workers or contractors;
	 
	 	(vii)	 	If the Alteration’s estimated cost exceeds $25,000.00, Tenant shall, at Landlord’s
request, supply a lien and completion bond, bank letter of credit, or other security
satisfactory to Landlord, in an amount equal to the estimated cost to insure
Landlord against materials and mechanics liens and against completion of the
Alterations;
	 
	 	(viii)	 	Upon demand Tenant shall give Landlord evidence that it complied with any
condition set by Landlord; and
	 
	 	(ix)	 	Tenant shall give Landlord complete as-built drawings of the Alterations
after they are finished.
	 
	 	(x)	 	Tenant shall remove the Alternations and repair any damage from their
removal by the last day of the Term, or the date the last extension Term elected
by Tenant ends, if any, whichever is later.

4.01(d). Payment and Ownership of the Alterations. Alterations made under this subsection
shall be at Tenant’s expense. The Alterations shall belong to Landlord when this Lease and the
last extension Term, if any, ends except for those Alterations required to be removed by
Tenant, if any, under subsection 4.01(c). Nevertheless, Tenant may remove its trade fixtures,
furniture, equipment, and other personal property if Tenant promptly repairs any damage caused
by their removal.

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 13 of 32

 

 

4.02 Assignment and Subleasing.

4.02(a). Consent Required. Tenant shall not transfer, mortgage, encumber, assign, or sublease
all or part of the Premises without Landlord’s advance written consent. Landlord’s consent to any
assignment
or sublease shall not be unreasonably withheld or unduly delayed. Notwithstanding any
other provision herein, any assignment of Tenant’s interest in the Lease or any sublease
of more than fifty percent (50%) of the rentable area of the Premises (other than
assignments or subleases made to affiliates as permitted in Section 4.02(d)) may extend
only until the end of the current term and any right to renew or extend the Lease shall
be deemed waived unless Landlord specifically reinstates such right.

4.02(b). Reasonableness. The Landlord’s consent shall not be considered unreasonably
withheld if:

	 	(i)	 	The proposed subtenant’s or assignee’s financial
responsibility does not meet the same criteria Landlord uses to select
comparable Building tenants;
	 
	 	(ii)	 	The proposed subtenant’s or assignee’s business is not
suitable for the Building considering the business of the other tenants and
the Building’s prestige; or
	 
	 	(ii)	 	The proposed use is inconsistent with the use(s) permitted
by section 1.03.

4.02(c). Procedure.

	 	(i)	 	Tenant must provide Landlord in writing:

	 	(A)	 	The name and address of the proposed subtenant or assignee;
	 
	 	(B)	 	The nature of the proposed subtenant’s or
assignee’s business it will operate in the Premises;
	 
	 	(C)	 	The terms of the proposed sublease or assignment; and
	 
	 	(D)	 	Reasonable financial information so that Landlord
can evaluate the proposed subtenant or assignee under paragraph
4.02(b)(i), if requested by Landlord.

	 	(ii)	 	Landlord shall, within ten (10) business days after receiving
the information under paragraph 4.02(c)(i), give notice to the Tenant to
permit or deny the proposed sublease or assignment. If Landlord denies
consent, it must explain the reasons for the denial. If Landlord does not
give notice within the ten (10) business-day period, then Tenant may sublease
or assign part or all of the Premises upon the terms Tenant gave in the
information under paragraph 4.02(c)(i).

4.02(d). Affiliates. Notwithstanding subsections 4.02(a), (b), and (c), Tenant may assign or
sublease part or all of the Premises without Landlord’s consent to:

	 	(i)	 	Any corporation, limited liability company, limited partnership, limited liability
partnership or general partnership (collectively, “Entity”) that controls, is controlled by,
or is under common control with, Tenant; or

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 14 of 32

 

 

	 	(ii)	 	Any Entity resulting from the merger or consolidation with Tenant
or to any
Entity that acquires all of Tenant’s assets as a going concern of the
business that is being conducted on the Premises, as long as the assignee
or sublessee is a bona fide entity and assumes the obligations of Tenant.

4.02(e).
Conditions. Subleases and Assignments by Tenant are also subject to the terms
of this Lease (except as limited by subsection 4.02(a), above) and Tenant shall remain
liable for all Lease obligations unless released, in writing, by Landlord. Consent to
one sublease or assignment does not waive the consent requirement for future assignments
or subleases.

ARTICLE 5 — INSURANCE 

5.01. Insurance.

5.01(a). Building Insurance. Landlord shall keep the Building, including the Improvements
(section 1.05 and Exhibit E), insured against damage and destruction by fire, earthquake,
vandalism, and other perils in the amount of the full replacement value of the Building,
as the value may exist from time to time. The insurance shall include an extended
coverage endorsement of the kind required by an institutional lender to repair and
restore the Building.

5.01(b). Property Insurance. Each party shall keep its personal property and trade
fixtures in the Premises and Building insured with “all risks” insurance in an amount to
cover one hundred (100) percent of the replacement cost of the property and fixtures.
Tenant shall also keep any non-Building-standard improvements made to the Building at
Tenant’s request insured to the same degree as Tenant’s
personal property.

5.01(c). Liability Insurance. Each party shall maintain contractual and comprehensive
general liability insurance, including public liability and property damage, with a
minimum combined single limit of liability of two million dollars ($2,000,000.00) for
personal injuries or deaths of persons occurring in or about the Building and Premises.

5.01(d). Release of Claims and Waiver of Subrogation. Each party waives any right of
recovery against the other party and releases all claims arising in any manner in its
(Injured Party’s) favor and against the other party for any loss or damage to the Injured
Party’s property (real or personal) located within or constituting a part or all of the
Building. The parties further agree to have their respective insurers waive any rights of
subrogation that such insurers may have against the other party. This waiver and release
apply to the extent the loss or damage is covered by:

	 	(i)	 	The Injured Party’s insurance; or
	 
	 	(ii)	 	The insurance the Injured Party is required to carry under
this Article 5, whichever is greater. The waiver also applies to each
party’s directors, officers, employees, shareholders, and agents. The waiver
and release do not apply to claims caused by a party’s willful misconduct.

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 15 of 32

 

 

     If despite a party’s best efforts it cannot find an insurance company
meeting the criteria in subsection 5.01(f) that will give the waiver at reasonable
commercial rates, then it shall give notice to the other party within thirty (30) days
after the Lease’s Commencement Date. The other party shall then have thirty (30) days to
find an insurance company that will issue the waiver. If the other party also cannot find
such an insurance company, then both parties shall be released from their obligation to
obtain the waiver.

     If an insurance company is found but it will give the waiver only at rates greater
than reasonable commercial rates, then the parties can agree to pay for the waiver under
any agreement they can negotiate. If the parties cannot in good faith negotiate an
agreement, then both parties shall be released from their obligation to obtain the
waiver.

5.01(e). Increase in Insurance. The amounts of coverage required by this Lease are
subject to review at the end of the initial term and of each renewal term, if any. At
each review, if necessary to maintain the same level of coverage that existed on the
Commencement Date, the amounts of coverage shall be increased to the lesser of

	 	(i)	 	The amounts of coverage carried by prudent Landlords
and Tenants of comparable first class office buildings in the area; or
	 
	 	(ii)	 	Twenty-five (25) percent higher than the previous insurance amounts.

     Either party may make the review and request appropriate increases based upon this
review within sixty (60) days after the preceding lease term ends. If the parties do not
agree to the amount of the increase, then the party requesting the increase may submit the
dispute to arbitration under section 11.01 within thirty (30) days of the request for the
increase. Landlord shall not request increased insurance unless it makes, at appropriate
times, similar requests of all other tenants whose insurance coverage is below the amount
carried by prudent tenants of similar buildings.

5.01(f). Insurance Criteria. Insurance policies required by this Lease shall:

	 	(i)	 	Be issued by insurance companies licensed to do business in
the state of Wisconsin with general policyholder’s ratings of at least B++
and a financial rating of at least VII in the most current Best’s
Insurance Reports available on the date in section 1.01. If the
Best’s ratings are changed or discontinued, the parties shall agree
to an equivalent method of rating insurance companies. If the parties cannot
agree they shall submit the dispute to arbitration under section 11.01;
	 
	 	(ii)	 	Name the nonprocuring party as an additional insured as
its interest may appear; other landlords or tenants may also be added as
additional insureds in a blanket policy;
	 
	 	(iii)	 	Provide that the insurance may not be canceled or materially changed in the scope or
amount of coverage unless ten (10) days’ advance notice is given to the nonprocuring
party;

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 16 of 32

 

 

	 	(iv)	 	Be primary policies—not as contributing with, or in
excess of, the coverage that the other party may carry;
	 
	 	(v)	 	Be permitted to be carried through a “blanket policy” or “umbrella”
coverage;
	 
	 	(vi)	 	Have deductibles not greater than a commercially reasonable amount per occurrence; and
	 
	 	(vii)	 	Be maintained during the entire Term and any extension Term.

5.01(g). Evidence of Insurance. By the Commencement Date and upon each renewal of its
insurance policies, each party shall give certificates of insurance to the other party.
The certificate shall specify amounts, types of coverage, the waiver of subrogation, and
the insurance criteria listed in subsection 5.0 l(f). The policies shall be renewed or
replaced and maintained by the party responsible for that policy. If either party fails
to give the required certificate within thirty (30) days after receipt of a written
demand for it from the other party, the other party may obtain and pay for that insurance
and receive reimbursement from the party required to have the insurance.

5.02. Indemnification.

5.02(a). Tenant’s Indemnity. Tenant indemnifies, defends, and holds Landlord harmless
from third party claims:

	 	(i)	 	For personal injury, bodily injury, death, or
property damage;
	 
	 	(ii)	 	For incidents arising in or about
the Premises or Building; and
	 
	 	(iii)	 	Caused by the negligence or willful misconduct of Tenant,
its agents, employees, or invitees.

When the claim is caused by the joint negligence or willful misconduct of Tenant and
Landlord or Tenant and a third party unrelated to Tenant, except its agents, employees, or
invitees, Tenant’s duty to defend, indemnify and hold Landlord harmless shall be in
proportion to Tenant’s allocable share of the joint negligence or willful misconduct.

5.02(b). Landlord’s Indemnity. Landlord indemnifies, defends and holds Tenant harmless from
third party claims:

	 	(i)	 	For personal injury, bodily injury, death, or property damage;
	 
	 	(ii)	 	For incidents occurring in or about the Premises or Building; and
	 
	 	(iii)	 	Caused by the negligence or willful misconduct of Landlord,
its agents, employees, or invitees.

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 17 of 32

 

 

When the claim is caused by the joint negligence or willful misconduct of
Landlord and Tenant or Landlord and a third party unrelated to Landlord, except its
agents, employees, or invitees, Landlord’s duty to defend, indemnify, and hold Tenant
harmless shall be in proportion to Landlord’s allocable share of the joint negligence or
willful misconduct.

5.03. Limitation of Landlord’s Liability.

5.03(a). Transfer of Premises. If the Building is sold or transferred, voluntarily or
involuntarily, the Landlord’s Lease obligations and liabilities accruing after the
transfer shall be the sole responsibility of the new owner if:

	 	(i)	 	The new owner expressly agrees in writing to assume these obligations;
and
	 
	 	(ii)	 	The Tenant’s funds that the Landlord is holding, such as
the Security Deposit, are given to the new owner.

5.03(b). Liability for Money Judgment. If Landlord, its employees, officers, or partners
are ordered to pay Tenant a money judgment because of Landlord’s default, then except in
those instances listed in subsection 5.03(c), Tenant’s sole remedy to satisfy the
judgment shall be:

	 	(i)	 	Landlord’s interest in the Building and Land including
the rental income and proceeds from sale; and
	 
	 	(ii)	 	Any insurance or condemnation proceeds received because
of damage or condemnation to, or of, the Building or Land that are available
for use by Landlord.

5.03(c). Exceptions. Subsection 5.03(b) does not apply when:

	 	(i)	 	Landlord failed to apply insurance or condemnation proceeds as required
by the Lease;
	 
	 	(ii)	 	Landlord misappropriated escrow funds; or
	 
	 	(iii)	 	Landlord violated the warranties contained in section 12.01.

Nothing in subsections 5.03(a), (b), or (c) shall be interpreted to mean that Tenant cannot
be awarded specific performance or an injunction.

ARTICLE 6 — LOSS OF PREMISES

6.01. Damage.

6.01(a). Definition. “Relevant Space” means:

	 	(i)	 	The Premises as defined in section 1.02;

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 18 of 32

 

 

	 	(ii)	 	Access to the Premises; and
	 
	 	(iii)	 	Any part of the Building that provides essential services to the
Premises.

6.01(b). Repair of Damage. If the Relevant Space is damaged in part or whole from any
cause and the Relevant Space can be substantially repaired and restored within one
hundred and twenty (120) days from the date of the damage using standard working methods
and procedures, Landlord shall at its expense promptly and diligently repair and restore
the Relevant Space to substantially the same condition as existed before the damage. This
repair and restoration shall be made within one hundred and twenty days from the date of
the damage unless the delay is due to causes beyond Landlord’s reasonable control.

If the Relevant Space cannot be repaired and restored within one hundred and twenty (120)
day period, then either party may, within ten (10) days after determining that the
repairs and restoration cannot be made within one hundred and twenty (120) days (as
prescribed in subsection 6.01 (c)), cancel the Lease by giving notice to the other
party. Nevertheless, if the Relevant Space is not repaired and restored within one
hundred and twenty (120) days from the date of the damage, then the Tenant may cancel the
Lease at any time after the one hundred and twentieth (120th) day and before the one
hundred and fiftieth (150th) day following the date of damage. Tenant shall not be able
to cancel this Lease if its willful misconduct caused the damage unless the Landlord is
not promptly and diligently repairing and restoring the Relevant Space.

6.01(c). Determining the Extent of Damage. If the parties cannot agree within fifteen (15)
days after the date of the damage whether the repairs and restoration described in
subsection 6.0l(b) will take more than one hundred and twenty (120) days to make, then
the determination will be submitted to arbitration under section 11.01.

6.01(d). Abatement. Unless the damage is caused by Tenant’s willful misconduct, the Rent
and Additional Rent shall abate in proportion to that part of the Premises that is unfit
for use in Tenant’s business. The abatement shall consider the nature and extent of
interference to Tenant’s ability to conduct business in the Premises and the need for
access and essential services. The abatement shall continue from the date the damage
occurred until:

	 	(i)	 	Five (5) business days after Landlord completes the repairs
and restoration to the Relevant Space or the part rendered unusable; or
	 
	 	(ii)	 	The date on which Tenant again uses the Premises or the
part rendered unusable for its business, whichever is first.

6.01(e). Tenant’s Property. Notwithstanding anything else in Article 6, Landlord is not
obligated to repair or restore damage to Tenant’s trade fixtures, furniture, equipment, or
other personal property.

6.01(f). Damage to Building. If more than forty (40) percent of the Building is
damaged and:

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 19 of 32

 

 

	 	(i)	 	Any mortgagee of the Building shall not allow adequate
insurance proceeds for repair and restoration and the Landlord decides not
to repair and restore the Building;
	 
	 	(ii)	 	The damage is not covered by Landlord’s insurance
required by subsections 5.01(a) and (b)and the Landlord decides not to repair
and restore the Building; or
	 
	 	(iii)	 	The Lease is in the last twelve (12) months of its Term,

then Landlord may cancel this Lease. To cancel Landlord must give notice to Tenant
within thirty (30) days after the damage. The notice must specify the cancellation date,
which date shall be at least sixty (60) but not more than one hundred twenty (120) days
after the date notice is given.

6.01(g) Cancellation. If either party cancels this Lease as permitted by section 6.01,
then this Lease shall end on the day specified in the cancellation notice. The Rent and
Additional Rent and other charges shall be payable up to the cancellation date and shall
account for any abatement. Landlord shall promptly refund to Tenant any prepaid or
unaccrued Rent, accounting for any abatement, plus Security Deposit, if any, less any sum
then owing by Tenant to Landlord. If Landlord cancels this Lease as permitted by section
6.01, then Landlord must also cancel all other similarly affected tenant leases in the
Building.

6.02. Condemnation.

6.02(a). Definitions. The terms “eminent domain,” “condemnation,” “taken,” and the like in
section 6.02 include takings for public or quasi-public use and private purchases in
place of condemnation by any authority authorized to exercise the power of eminent
domain.

6.02(b). Entire Taking. If the entire Premises or the portions of the Building required
for reasonable access to, or the reasonable use of, the Premises are taken by eminent
domain, this Lease shall automatically end on the earlier of:

	 	(i)	 	The date title vests; or
	 
	 	(ii)	 	The date Tenant is dispossessed by the condemning authority.

6.02(c). Partial Taking. If the taking of a part of the Premises materially interferes
with Tenant’s ability to continue its business operations in substantially the same
manner and space then Tenant may end this Lease on the earlier of:

	 	(i)	 	The date when title vests; or
	 
	 	(ii)	 	The date Tenant is dispossessed by the condemning authority.

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 20 of 32

 

 

If there is a partial taking and this Lease continues, then the Lease
shall end as to the part taken and the Rent and Additional Rent shall abate in
proportion to the part of the Premises taken and Tenant’s pro rata share shall be
equitably reduced.

6.02(d). Termination by Landlord. If title to a part of the Building other than the
Premises is condemned, and in the Landlord’s reasonable opinion, the Building should be
restored in a manner that materially alters the Premises, Landlord may cancel this Lease
by giving notice to Tenant. Cancellation notice shall be given within sixty (60) days
following the date title vested. This Lease shall end on the date specified in the
cancellation notice, which date shall be at least sixty (60) but not more than one
hundred twenty (120) days after the date notice is given.

6.02(e). Rent Adjustment. If the Lease is canceled as provided in subsections 6.02(b),
(c), or (d), then the Rent, Additional Rent, and other charges shall be payable up to
the cancellation date, and shall account for any abatement. Landlord, considering any
abatement, shall promptly refund to Tenant any prepaid or unaccrued Rent plus Security
Deposit, if any, less any sum then owing by Tenant to Landlord.

6.02(f). Repair. If the Lease is not canceled as provided for in subsections 6.02(b),
(c), or (d), then Landlord at its expense shall promptly repair and restore the Premises
to the condition that existed immediately before the taking, except for the part taken,
to render the Premises a complete architectural unit, but only to the extent of the:

	 	(i)	 	Condemnation award received for the
damage; and
	 
	 	(ii)	 	Building Standard Work.

6.02(g). Awards and Damages. Landlord reserves all rights to damages paid because of any
partial or entire taking of the Premises. Tenant assigns to Landlord any right Tenant may
have to the damages or award. Further, Tenant shall not make claims against Landlord or
the condemning authority for damages.

Notwithstanding anything else in subsection 6.02(g), Tenant may claim and recover from
the condemning authority a separate award for Tenant’s moving expenses, business
dislocation damages, Tenant’s personal property and fixtures, the unamortized costs of
leasehold improvements paid for by Tenant and any other award that would not
substantially reduce the award payable to Landlord. Each party shall seek its own award,
as limited above, at its own expense, and neither shall have any right to the award made
to the other.

6.02(h) Temporary Condemnation. If part or all of the Premises are condemned for a limited
period of not more than four months (Temporary Condemnation), this Lease shall remain in
effect. The Rent and Additional Rent and Tenant’s obligations for the part of the Premises
taken shall abate during the Temporary Condemnation in proportion to the part of the
Premises that Tenant is unable to use in its business operations as a result of the Temporary Condemnation. Landlord shall receive
the entire award for any Temporary Condemnation.

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 21 of 32

 

 

ARTICLE 7 — DEFAULT

7.01. Tenant’s Default.

7.01(a). Defaults. Each of the following constitutes a default (Default):

	 	(i)	 	Tenant’s failure to pay Rent or Additional Rent within
seven (7) days after Tenant receives notice from Landlord of Tenant’s failure
to pay Rent or Additional Rent;
	 
	 	(ii)	 	Tenant’s failure to pay Rent or Additional Rent by the due
date, at any time during a twelve month period in which Tenant has already
received two notices of its failure to pay Rent or Additional Rent by the
due date;
	 
	 	(iii)	 	Tenant’s failure to perform or observe any other Tenant
obligation after a period of thirty (30) business days or the additional
time, if any, that is reasonably necessary to promptly and diligently cure
the failure, after it receives notice from Landlord setting forth in
reasonable detail the nature and extent of the failure and identifying the
applicable Lease provision(s);
	 
	 	(iv)	 	Tenant’s abandoning or vacating the Premises if Tenant fails
to timely pay the Rent and Additional Rent by the due date;
	 
	 	(v)	 	Tenant’s failure to vacate or stay any of the following
within ninety (90) days after they occur:

	 	(A)	 	A petition in bankruptcy is filed by or against Tenant;

	 
	 	(B)	 	Tenant is adjudicated as bankrupt or insolvent;
	 
	 	(C)	 	A receiver, trustee, or liquidator is appointed
for all or a substantial part of
Tenant’s property; or
	 
	 	(D)	 	Tenant makes an assignment for the benefit of creditors.

7.02. Landlord’s Remedies.

7.02(a). Remedies. Landlord in addition to the remedies given in this Lease or under the
law, may do any one or more of the following if Tenant commits a Default under section
7.01:

	 	(i)	 	End this Lease, and Tenant shall then surrender the Premises to Landlord;
and
	 
	 	(ii)	 	Enter and take possession of the Premises as provided by
law and remove Tenant, with or without having ended the Lease.

Tenant waives claims for damages by reason of Landlord’s reentry or repossession and for
damages by reason of any legal process.

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 22 of 32

 

 

7.02(b). No Surrender. Landlord’s exercise of any of its remedies or its
receipt of Tenant’s keys shall not be considered an acceptance of surrender of the
Premises by Tenant. A surrender must be agreed to in a writing signed by both parties.

7.02(c). Rent. If Landlord ends this Lease or ends Tenant’s right to possess the
Premises because of a Default, Landlord may hold Tenant liable for Rent, Additional
Rent, and other indebtedness accrued to the date the Lease Ends. Tenant shall also be
liable for the Rent, Additional Rent and other indebtedness that otherwise would have
been payable by Tenant during the remainder of the Term had there been no Default,
reduced by any sums Landlord receives by re-letting the Premises during the Term.

7.02(d). Other Expenses. Tenant shall also be liable for that part of the following
sums paid by Landlord and attributable to that part of the Term ended due to Tenant’s
Default:

	 	(i)	 	Reasonable broker’s fees incurred by Landlord for re-letting
part or all of the Premises prorated for that part of the re-letting Term
ending concurrently with the then current Term of this Lease;
	 
	 	(ii)	 	The cost of removing and storing Tenant’s property
and repairing any damage to the Premises caused by Tenant’s negligence;
	 
	 	(iii)	 	The cost of repairs, alterations, and remodeling,
necessary to put the Premises in the condition required by the new Tenant,
prorated for that part of the re-letting Term ending concurrently with the
then current Term of this Lease; and
	 
	 	(iv)	 	Other necessary and reasonable expenses incurred by Landlord in enforcing
its remedies.

7.02(e). Payment. Tenant shall pay the sums due in subsections 7.02(c) and (d) within
thirty (30) days of receiving Landlord’s proper and correct invoice for the amounts.

7.02(f). Mitigation. Landlord shall mitigate its damage by making reasonable efforts to
re-let the Premises on reasonable terms. Landlord may re-let for a shorter or longer
period of time than the Lease Term and make any necessary repairs or alterations. Landlord
may re-let on any reasonable terms including a reasonable amount of free rent. If Landlord
re-lets for a period of time longer than the current Lease Term, then any special
concessions given to the new Tenant shall be allocated throughout the entire re-letting
Term so as not to unduly reduce the amount of consideration received by Landlord during
the remaining period of Tenant’s Term.

7.03. Landlord’s Default. Landlord’s failure to perform or observe any of its Lease
obligations after a period of thirty (30) business days or the additional time, if any, that is
reasonably necessary to promptly and diligently cure the failure after receiving notice from
Tenant is a Default. The notice shall give reasonable detail of the nature and extent of the
failure and identify the Lease provision(s) containing the obligation(s). After Tenant receives
notice of a Mortgagee’s name and address and request for notice upon Landlord’s Default, Tenant
shall also provide the notice required by this section to the Mortgagee at the same time Tenant
gives notice to Landlord. If Landlord commits a Default, Tenant may pursue any remedies given in
this Lease or under the law.

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 23 of 32

 

 

7.04. Exception to Cure Periods. The cure periods in paragraphs
7.01(a)(iii) and 7.03 do not apply to:

	 	(i)	 	Emergencies;
	 
	 	(ii)	 	Failure to maintain the insurance required by section 5.01.

7.05. Self-Help. If either party defaults (Defaulting Party), the other party
(Nondefaulting Party) may, without
being obligated and without waiving the Default, cure the Default. The Nondefaulting Party may
enter the
Premises or Building to cure the Default. The Defaulting Party shall pay the Nondefaulting
Party, upon demand,
all costs, expenses, and disbursements incurred by the Nondefaulting Party to cure the Default.

7.06. Survival. The remedies permitted by Article 7 and the parties’ indemnities
in section 5.02 shall survive the
ending of this Lease.

ARTICLE 8 — NONDISTURBANCE

8.01. Subordination and Attornment. Subject to subsection 8.01(a) and (b), this Lease is
subordinate to prior or subsequent mortgages covering the Building.

8.01(a). Subordination. The provisions of this Section 8.04(a) are subject to Landlord’s
performance of its obligations under section 8.04(b) below. Subject to the last sentence of
this Section, this Lease and Tenant’s tenancy hereunder shall be subject and subordinate at
all times to the lien of any mortgage or deed of trust now or hereafter placed upon the
interest of the Landlord in the Premises; provided that any such subordination is contingent
upon the lender agreeing not to disturb Tenant’s possession of the Premises or Tenant’s other
rights under this Lease, except in the event of a default by Tenant which is not cured within
any applicable cure period. Landlord shall provide Tenant with signed, recordable
non-disturbance agreements from all existing and future lenders and ground lessors in form
reasonably satisfactory to Tenant, and Tenant shall not be required to subordinate to future
lenders or ground lessors unless Tenant receives such signed, recordable non-disturbance
agreements reasonably acceptable to Tenant.

8.01(b). Attornment If and so long as this Lease is in full force and effect, then at the
option of the mortgagee:

	 	(i)	 	This Lease shall remain in full force notwithstanding:

	 	(A)	 	A default under the mortgage by Landlord,
	 
	 	(B)	 	A defense to which Tenant might
be entitled against Landlord under this
Lease, or
	 
	 	(C)	 	Any bankruptcy or similar proceedings with respect to landlord;

	 	(ii)	 	If any such mortgagee shall become possessed of the Premises, Tenant shall
be obligated to such mortgagee to pay to it the rentals and other charges due hereunder and to
thereafter comply with all terms of this Lease; and

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 24 of 32

 

 

	 	(iii)	 	If any mortgagee or purchaser at a private or public sale shall become
possessed of the Premises, Tenant shall, without charge, attorn to such
mortgagee or purchaser as its landlord under the Lease; provided, such
successor-in-interest expressly agrees to recognize Tenant’s rights under
this Lease and expressly agrees to assume Landlord’s obligations under the
Lease accruing after the date such mortgagee acquires title to the Premises
through a written instrument, a copy of which is delivered to Tenant.

8.01(c). Recording. Tenant shall promptly execute and deliver any documents needed to
confirm this arrangement within ten (10) days of receipt from Landlord.

8.02. Estoppel Certificate.

8.02(a). Obligation. Either party (Answering Party) shall from time to time, within ten
(10) business days after receiving written request from the other party (“Asking Party”),
execute and deliver to the Asking Party a written statement confirming the status of this
Lease. This written statement, which may be relied upon by the Asking Party and any third
party with whom the Asking Party is dealing, shall certify:

	 	(i)	 	The accuracy of the Lease document;
	 
	 	(ii)	 	The Commencement and Termination Dates of the Lease;
	 
	 	(iii)	 	That the Lease is unmodified and in full force and effect
or in full force and effect as modified, stating the date and nature of the
modification;
	 
	 	(iv)	 	Whether to the Answering Party’s knowledge the Asking Party
is in default or whether the Answering Party has any claims or demands
against the Asking Party and, if so, specifying the Default, claim, or
demand; and
	 
	 	(v)	 	Other correct and reasonably ascertainable facts that are covered by the
Lease terms.

8.02(b). Remedy. The Answering Party’s failure to comply with its obligation in subsection
2(a) shall constitute a Default hereunder. Notwithstanding paragraphs 7.01(a)(iii) and
7.03, the cure period for this Default shall be five (5) business days after the Answering
Party receives notice of the Default.

8.03. Quiet Possession. If Tenant is not in Default hereunder, and subject to the Lease
terms and the above encumbrances, Tenant’s peaceable and quiet enjoyment of the Premises shall not
be disturbed by anyone, including other tenant and occupants of the Building and the Land. In the
event that Tenant is disturbed by any third party in the Building or the Land, Tenant shall give
notice of such disturbance to Landlord and Landlord shall thereafter, but within ten(10) days of
the date of Tenant’s notice, cause the disturbance to cease.

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 25 of 32

 

 

ARTICLE 9 — LANDLORD’S RIGHTS

9.01. Rules.

9.01(a). Rules. Tenant, its employees and invitees, shall
comply with:

	 	(i)	 	The Rules attached as Exhibit G; and
	 
	 	(ii)	 	Reasonable modifications and additions to Rules adopted by Landlord:

	 	(A)	 	Of which Tenant is given thirty (30) days advance notice;

	 
	 	(B)	 	That are for the safety, care, order, and cleanliness of the common
areas;
	 
	 	(C)	 	That do not unreasonably and materially
interfere with Tenant’s conduct of its
business or Tenant’s use and enjoyment of the Premises; and
	 
	 	(D)	 	That do not require payment of additional moneys.

9.01(b). Conflict with Lease. If a Rule issued under subsection 9.01 (a) conflicts with
or is inconsistent with any Lease provision, the Lease provision controls.

9.01(c). Enforcement. Although Landlord is not responsible for another tenant’s failure
to observe the Rules, the Landlord shall not unreasonably enforce the Rules against the
Tenant.

9.02. Mechanics Liens.

9.02(a). Discharge Lien. Tenant shall, within twenty (20) days after receiving notice of
any mechanic’s lien for material or work claimed to have been furnished to the Premises
on Tenant’s behalf and at Tenant’s request:

	 	(i)	 	Discharge the lien; or
	 
	 	(ii)	 	Post a bond or other security equal to the amount of the
disputed claim with companies reasonably satisfactory to Landlord.

If Tenant posts a bond, it shall contest the validity of the lien. Tenant shall indemnify,
defend, and hold Landlord harmless from losses incurred from these liens.

9.02(b). Landlord’s Discharge. If Tenant does not discharge the lien or post the bond
within the twenty (20) day period, Landlord may pay any amounts, including interest and
legal fees, to discharge the lien. Tenant shall then be liable to Landlord for the amounts
paid by Landlord.

9.02(c). Consent not Implied. Section 9.02 is not a consent to subject Landlord’s property
to these liens.

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 26 of 32

 

 

9.03. Right to Enter.

9.03(a). Permitted Entries. Landlord and its agents, servants, and
employees may enter the Premises at reasonable times, and at any time if an emergency,
without charge, liability, or abatement of Rent, to:

	 	(i)	 	Examine the Premises;
	 
	 	(ii)	 	Make repairs, alterations, improvements, and additions either
required by the Lease or advisable to preserve the integrity, safety, and good order of part or
all of the Premises or Building;
	 
	 	(iii)	 	Provide janitorial and other services
required by the Lease;
	 
	 	(iv)	 	Comply with Applicable
Laws under section 3.01;
	 
	 	(v)	 	Show the Premises to prospective lenders or purchasers and during
the ninety (90) days immediately before this Lease ends to prospective tenants, accompanied,
if requested by Tenant, by a Tenant representative;
	 
	 	(vi)	 	Post notices of non-responsibility; and
	 
	 	(vii)	 	Remove any Alterations made by Tenant in violation of section 4.01.

9.03(b). Entry Conditions. Notwithstanding subsection 9.03(a), entry is
conditioned upon Landlord:

	 	(i)	 	Giving Tenant at least twenty-four (24) hours advance notice, except in
an emergency;
	 
	 	(ii)	 	Promptly finishing any work for which it entered; and
	 
	 	(iii)	 	Causing the least practicable interference to Tenant’s
business.

9.03(c). Interference with Tenant. Notwithstanding subsections
9.03(a) and (b):

	 	(i)	 	If Landlord’s entry materially and substantially interferes
with the conduct of Tenant’s business (and the entry is not needed because of
Tenant’s negligence or willful misconduct), the Rent and Additional Rent
shall abate in proportion to the extent of the interference; and
	 
	 	(ii)	 	If Landlord causes damage to Tenant’s property, Landlord shall
be liable for any damage to the extent the damage is not covered by Tenant’s
insurance or the insurance Tenant is required to carry under Article 5,
whichever is greater.

9.04. Holdover.

9.04(a). Holdover Status. If Tenant continues occupying the Premises after the
Term ends (Holdover) then:

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 27 of 32

 

 

	 	(i)	 	If the Holdover is with Landlord’s written consent, it shall be
a month-to-month tenancy, terminable on thirty (30) days advance written
notice by either party. Tenant shall pay at the beginning of each month Rent
and Additional Rent that is five (5) percent higher than the amount due in
the last full month immediately preceding the Holdover period unless the
Landlord specifies a lower or higher Rent and Additional Rent in the written
consent;
	 
	 	(ii)	 	If the Holdover is without Landlord’s written consent,
then Tenant shall be a tenant-at-sufferance. Tenant shall pay by the first
day of each month twice the amount of Rent and Additional Rent due in the
last full month immediately preceding the Holdover period and shall be
liable for any damages suffered by Landlord because of Tenant’s Holdover.
Landlord shall retain its remedies against the Tenant who holds over without
written consent.

9.04(b). Holdover terms. The Holdovers in subsection 9.04(a) shall be on the same
terms and conditions of the Lease except:

	 	(i)	 	The Term (section 1.04);
	 
	 	(ii)	 	Rent and Additional Rent (sections 2.01 and 2.02);
	 
	 	(iii)	 	The extension Term is deleted (section 10.01);
	 
	 	(iv)	 	The Quiet Possession provision is deleted (section 8.03);
	 
	 	(v)	 	Landlord’s obligation for services and repairs for a
paragraph 9.04(a)(ii) Holdover (sections 3.02 and 3.03) is deleted;
	 
	 	(vi)	 	Consent to an assignment or sublease may be unreasonably
withheld and delayed (section 4.02);
	 
	 	(vii)	 	The provision on Landlord’s Default is deleted (section 7.03);
	 
	 	(viii)	 	The Defaulting Party may be the Tenant only; (sections 7.03 and 7.05);
	 
	 	(ix)	 	The Buildout is deleted (Exhibits D and E and section 1.05).

The modification of the Lease for Holdovers, as described above, shall not alter the
rights or remedies of the parties for events occurring prior to the Holdover, for which
the terms of this Lease, unmodified by this section 9.04(b), shall apply.

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 28 of 32

 

 

9.05. Signs.

9.05(a). Permitted Signs. Landlord shall provide Tenant, at Landlord’s expense a
listing on Building and appropriate floor directories. Tenant may, at its expense and
subject to Landlord’s approval, which shall not be unreasonably withheld, install a sign
on any door which provides entrance to the Premises from inside the building.

9.05(b). Nonpermitted signs. Other than the signs and listings permitted in subsection
9.05(a), Tenant shall not place or have placed any other signs, listings,
advertisements, or any other notices anywhere else in the Building. No signs shall be
permitted on any exterior windows in the Building.

ARTICLE 10 — OPTIONS

10.01. Option to Extend.

10.01(a). Option. Tenant may extend this Lease for the period of years designated in the
Reference Data (Extension Term) beginning immediately after the Term, upon the same terms
and conditions of the Lease, except that:

	 	(i)	 	The Term shall be modified as stated above;
	 
	 	(ii)	 	There will be no Option to extend beyond the final
Extension Term described on the Reference Data sheet.
	 
	 	(iii)	 	The build out shall be deleted.

10.01(b). Conditions. To exercise this Option to extend,
Tenant must:

	 	(i)	 	Not be in default at the time it
exercises the option;
	 
	 	(ii)	 	Give notice to Landlord that Tenant is exercising its Option
to Extend at least one hundred and twenty (120) days but not more than two
hundred and forty (240) days before the Term ends; and
	 
	 	(iii)	 	Execute a new Reference Data page which confirms the extended
term within fifteen (15) days of Landlord’s delivery of the new Reference Data
page to Tenant.

ARTICLE 11 — DISPUTES

11.01. Arbitration.

11.01(a). Procedure. For disputes subject to arbitration under subsection 11.01(c) that are not
resolved
by the parties within ten (10) days after either party gives notice to the other of its desire to
arbitrate the
dispute, the dispute shall be settled by binding arbitration by the American Arbitration
Association in
accord with its then-prevailing rules. Judgment upon the arbitration award may be entered in any
court
having jurisdiction. The arbitrators shall have no power to change the Lease provisions. The
arbitration
panel shall consist of three arbitrators, one of whom must be a real estate attorney actively
engaged in the
practice of law for at least the last five (5) years. Both parties shall continue performing
their Lease

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 29 of 32

 

 

obligations pending the award in the arbitration proceeding. The arbitrators shall
award the prevailing party reasonable expenses and costs including reasonable attorneys’
fees pursuant to section 12.02 plus interest on the amount due at eighteen (18) percent
per annum or the maximum then allowed by applicable law, whichever is less.

11.01(b).
Payment. The losing party shall pay to the prevailing party the amount of the
final arbitration award. If payment is not made within ten (10) business days after the
date the arbitration award is no longer appealable, then in addition to any other
remedies under the law:

	 	(i)	 	If the Landlord is the prevailing party, it shall have
the same remedies for failure to pay the arbitration award as it has for
Tenant’s failure to pay the Rent; and
	 
	 	(ii)	 	If the Tenant is the prevailing party, it may deduct
any remaining unpaid award from its monthly payment of Rent, Additional Rent,
or other charges.

11.01(c). Arbitration. The following disputes are subject to
arbitration:

	 	(i)	 	Any disputes that the parties
agree to submit to arbitration;
	 
	 	(ii)	 	The date when
the Premises are substantially completed;
	 
	 	(iii)	 	The amount of any abatement of Rent and Additional Rent
because of damage or condemnation;
	 
	 	(iv)	 	The amount billed as Additional Rent or any component part of the
calculation of Additional Rent;
	 
	 	(v)	 	Which party must comply with Applicable Laws under section 3.01;
	 
	 	(v)	 	Whether the utilities are being provided in the quality and
quantity required by section 3.02;
	 
	 	(vii)	 	Whether Tenant may abate Rent and Additional Rent or cancel
the Lease under paragraph 3.02(e)(ii);
	 
	 	(viii)	 	Whether Landlord’s withholding of consent is unreasonable or unduly delayed
under subsections 4.02(a) and (b), except with respect to Alterations that are
necessary to not unreasonably interrupt Tenant’s business, for which Tenant
may seek judicial relief;
	 
	 	(ix)	 	The amount of any insurance increase under subsection 5.01(e);
	 
	 	(x)	 	Whether either party can cancel the Lease under Articles 6 or 7; and
	 
	 	(xi)	 	Any allocations required under subparagraphs 2.02(a)(v)(B)(4).

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 30 of 32

 

 

ARTICLE 12 — MISCELLANEOUS

12.01. Broker’s Warranty. The parties warrant that the Broker identified in the
Reference Data (if any) is the only broker they dealt with on this Lease. The party who breaches
this warranty shall defend, hold harmless, and indemnify the non-breaching party from any claims
or liability arising from the breach. The Landlord is solely responsible for paying the
commission of said Broker.

12.02. Attorneys’ Fees. In any litigation between the parties regarding this Lease, the
losing party shall pay to the prevailing party all reasonable expenses and court costs
including attorneys’ fees incurred by the prevailing party. A party shall be considered the
prevailing party if:

	 	(i)	 	It initiated the litigation and substantially obtains the
relief it sought, either through a judgment or the losing party’s voluntary
action before arbitration (after it is scheduled), trial, or judgment;
	 
	 	(ii)	 	The other party withdraws its action without substantially
obtaining the relief it sought; or
	 
	 	(iii)	 	It did not initiate the litigation and judgment is entered
for either party, but without substantially granting the relief sought.

 12.03. Notices. Unless a Lease provision expressly authorizes another form of notice, all notices
under this Lease shall be in writing, may be transmitted in any form (including facsimile) and
shall be effective only upon receipt at the location identified on the Reference Data page which
is in effect on the date of the notice; provided, however, that in the event of dispute, the
sending party shall bear the burden of proof with regard to receipt of the notice.

 12.04. Partial Invalidity. If any Lease provision is invalid or unenforceable to any
extent, then that provision and the remainder of this Lease shall continue in effect and be enforceable to the fullest extent
permitted by law.

12.05.
Waiver. The failure of either party to exercise any of its rights is not a
waiver of those rights. A party waives only those rights specified in writing and signed by the party waiving its rights.

12.06.
Binding on Successors. This Lease shall bind the parties’ heirs, successors, representatives, and
permitted assigns.

12.07.
Governing Law. This Lease shall be governed by the laws of the State of Wisconsin.

12.08. Insurance Increase. If due to Tenant’s particular use of the Premises the
Landlord’s insurance rates are increased, Tenant shall pay the increase.

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 31 of 32

 

 

12.09. Lease not an Offer. Landlord gave this Lease to Tenant for review.
It is not an offer to lease. This Lease shall not be binding unless signed by both parties and an originally signed counterpart is
delivered to Tenant by Landlord.

12.10. Recording. Recording of this Lease is prohibited except as allowed in this section. At the request of either party, the parties shall promptly execute and record, at the cost of the requesting party,
a short form memorandum describing the Premises and stating this Lease’s Term, its Commencement and Termination Dates, and other information the parties agree to include.

12.11. Survival of Remedies. The parties’ remedies shall survive the ending of this Lease when the ending is caused by the Default of the other party.

12.12. Authority of Parties. Landlord warrants that it owns the property free and clear of all mortgages, liens, and encumbrances except for those listed in the Reference Data. Each party warrants that it is
authorized to enter into the Lease, that the person signing on its behalf is duly authorized to execute the Lease,
and that no other signatures are necessary.

12.13. Business Days. Business days means Monday through Friday inclusive,
excluding holidays identified at
subsection 3.02(b). Throughout this Lease, wherever “days” are used the term shall refer to
calendar days.
Wherever the term “business days” is used the term shall refer to business days.

12.14. Entire Agreement. This Lease contains the entire agreement between the
parties about the Premises and
Building. Except for the Rules for which subsection 9.0 l(a) controls, this Lease shall be
modified only in writing
signed by both parties.

[This Lease is not valid unless there is a Reference Data page signed
by Landlord and Tenant attached to the front of it]

					
	 	 	 	 	 
	1209 Deming Way
	 	Tomotherapy Lease
	 	Page 32 of 32

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00117-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00117-of-00352.parquet"}]]