Standard Space Lease Template with ALL Optional clauses.docx

STANDARD SPACE LEASE

Between

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

FEDERAL AVIATION ADMINISTRATION

And

[INSERT LESSOR(S) NAME]

Lease No. [69XXXX-19-L-XXXXX] [insert (ATID) facility type] [insert City, State]

SECTION 1 - OPENING

6.1.1 Preamble (JAN 2017)

This Lease is hereby entered into by and between [Insert Lessor's Legal Name], hereinafter referred to as the Lessor and the United States of America, acting by and through the Federal Aviation Administration, hereinafter referred to as the Government. The terms and provisions of this Lease, and the conditions herein, bind the Lessor and the Lessor's heirs, executors, administrators, successors, and assigns.

For purposes of this Lease, the terms Contractor and Lessor are interchangeable with each other.

6.1.2 Succeeding Lease (JAN 2015)

This Lease succeeds [Lease No. DTFAXX-XX-L-XXXXX] and all other previous agreements between the parties for the leased property described in this document.

6.1.3 Witnesseth (JAN 2015)

Witnesseth: The parties hereto, for the consideration hereinafter mentioned covenant and agree as follows:

6.1.4 Description (JAN 2017)

The Lessor hereby leases to the Government the following described premises;

[Fill in Description] The Lessor shall provide [Fill in Quantity of Parking Spaces] reserved off-street parking spaces at no additional cost to the Government. With respect to compliant accessible parking spaces, see the "Accessibility" clause.

SECTION 2 - TERMS

6.2.5 Term (AUG 2002)

To have and to hold, for the term commencing on [Start Date] and continuing through [End Date] inclusive, provided that adequate appropriations are available from year to year for the consideration herein.

6.2.5-1 Option(s) to Extend Term (JAN 2019) The Agreement may, at the option of the Government, be extended beyond [Fill in Date] at the rental rate established in the "Consideration" clause herein. The extension shall be upon the terms and conditions herein specified and no extension shall extend beyond [Fill in Date]. The Government shall notify the Airport in writing by certified mail, no later than ninety (90) days before the expiration of the Agreeement term, of its intent to exercise the option(s) or of its intent to vacate the premises at the end of said term. Any extension exercised by the Government pursuant to this clause shall be subject to the availability of adequate appropriations from year to year for the payment of rentals.

6.2.6 Consideration (JUL 2017)

The Government shall pay the Lessor rent for the premises in the amount of $ <Insert Dollar Amount> per annum, payable as follows: <Insert narrative, e.g. “$600.00 payable annually to John Smith and $600.00 payable annually to Jane Smith” or “$1200.00 payable to John Smith at the monthly rate of $100.00”>. Payment shall be made in arrears, without the submission of invoices or vouchers. Payments are due on the first business day following the end of the payment period and are subject to available appropriations. The payments shall be directly deposited in accordance with the "Payment by Electronic Funds Transfer" clause in this Lease. Payments shall be considered paid on the day an electronic funds transfer is made.

6.2.7 Cancellation (JUL 2017)

The Government may terminate this Lease at any time, in whole or in part, if the Real Estate Contracting Officer (RECO) determines that a termination is in the best interest of the Government. The RECO shall terminate by delivering to the Lessor a written notice specifying the effective date of the termination. The termination notice shall be delivered by certified mail return receipt requested and mailed at least [insert number of days; 30, 60, or 90] days before the effective termination date.

6.2.10 Interest for Late Payment (JAN 2019)

If requested by the Lessor in writing, the Government will pay an interest penalty when payment is not made within 90 days of the due date.

Payment shall be considered as being made on the day a check is dated or an electronic funds transfer is made. All days referred to in this clause are calendar days, unless otherwise specified. Rent shall be paid monthly in arrears and will be due on the first workday of each month and only as provided for by the lease.

The interest penalty shall be at the rate established by the Secretary of the Treasury under Section 12 of the Contract Disputes Act of 1978 (41 U.S.C. 611) that is in effect on the day after the due date. This rate is referred to as the "Renegotiation Board Interest Rate," and it is published in the Federal Register semiannually on or about January 1 and July 1. Interest penalties of less than $1.00 need not be paid.

Interest penalties will not be paid on delays due to disagreement between the Government and Lessor over the payment amount, requests for additional information, or for other issues involving contract compliance, or on amounts temporally withheld or retained in accordance with the terms of the contract.

For payments other than rent, the Lessor shall prepare and submit an invoice to the RECO or the RECO's designated representative for approval not later than 60 days after completion and acceptance of the work. An invoice shall include the following items:

1. Name and address of the Lessor

2. Invoice date

3. Lease Number

4. Government's order number or other authorization.

5. Description, price, and quantity of work or services delivered.

6. Name and address of Lessor official to whom payment is to be sent

6.2.11 Operating Cost Escalator (JAN 2019)

A. The base for the operating costs adjustment will be $[insert base amount for operating costs] per square foot.

B. Calculating Annual Adjustment: Beginning with the second year of the lease and each year after, the Government shall pay adjusted rent for changes in costs for cleaning services, supplies, materials, maintenance, trash removal, landscaping, water, sewer charges, heating, electricity, and certain administrative expenses attributable to occupancy (Operating Costs).

The amount of adjustment will be determined by multiplying the base amount above, as negotiated and established prior to the lease award, by the percentage change in the Cost of Living Index for that year. The percentage change for a particular year shall be computed by comparing the index figure published for the month prior to that month which begins each successive l2-month period. (For example, a lease which commences in June of 2015 would use the index published for May of 2015, and that figure would be compared with the index published for May of 2016, May of 2017, and so on.) The Cost of Living Index is found in the U.S. Department of Labor Revised Consumer Price Index for Urban Wage Earners and Clerical Workers, U.S. City Average, All Items figure, (1982 to 1984=100) published by the Bureau of Labor Statistics. The total CPI adjustment amount will be incorporated into the fixed rental amount and paid in accordance with the terms of the lease.

C. Annual Maximum Adjustment: Notwithstanding the immediately preceding paragraph, the maximum adjustment for any 12-month period payable by the Government shall not exceed [insert percent of maximum annual adjustment] percent above the base amount for the operating costs.

D. Rental adjustments shall be effective on the anniversary date of the lease; however, payment of the adjusted rental rate shall become due on the first workday of the second month following the publication of the Cost of Living Index for the month prior to the 12-month period.

E. If Government exercises an option to extend the lease term at the same base rental rate as that of the original term, the total monthly rent to be paid during the option period shall be based on the CPI adjustments made during the original term. Annual adjustments for operating costs will continue in the same manner as during the original term of the lease.

F. In the event the Cost of Living Index decreases at any time during the term of the lease, the rental amount will be reduced accordingly. The amount of any such reductions will be determined in the same manner as the increases in rent provided under this clause.

6.2.12 Tax Adjustment (JAN 2019)

A. The Government shall pay additional rent for its share of increases in real estate taxes over taxes paid for the calendar year in which its lease commences. Payment will be in a lump sum and become due on the first workday of the month following the month in which paid tax receipts for the base year and the current year are presented, or the anniversary date of the lease, whichever is later. The Government will be responsible for payment only if the receipts are submitted within sixty (60) calendar days of the date the tax payment is due. If no full tax assessment is made during the calendar year in which the Government lease commences, the base year will be the year of a full assessment.

B. The Government's share of the tax increase will be based on the ratio of the square feet occupied by the Government to the total rentable square feet in the building. If the Government's lease terminates before the end of a calendar year, payment will be based on the percentage of the year in which the Government occupied space. The payment will not include penalties for non-payment or delay in payment. If there is any variance between the assessed value of the Government's space and other space in the building, the Government may adjust the basis for determining its share of the tax increase.

C. The Government may contest the tax assessment by initiating legal proceedings on behalf of the Government and the Lessor or the Government alone. If the Government is precluded from taking legal action, the Lessor shall contest the assessment upon reasonable notice by the Government. The Government shall reimburse the Lessor for all costs and shall execute all documents required for the legal proceedings. The Lessor shall agree with the accuracy of the documents. The Government shall receive its share of any tax refund. If the Government elects to contest the tax assessment, payment of the rent shall become due on the first workday of the month following conclusion of the appeal proceedings.

D. In the event of any decreases in real estate taxes occurring during the term of occupancy under the lease, the rental amount will be reduced accordingly. The amount of any such reductions will be determined in the same manner as increases in rent provided under this clause.

6.2.13 Rent Commencement (JAN 2019)

The rent commencement date (for each increment) shall be the date that the leased premises are accepted in writing by the Government. Any rental paid by the Government prior to actual occupancy shall not include the cost for services and utilities. In any event, the Government shall not be required to commence rent prior to acceptance of space by the Government.

6.2.13-1 Lease Commencement (JUL 2010) The Government shall issue a Supplemental Lease Agreement, to establish the lease commencement date after the acceptance of all space, if different from the date previously established in the lease. In any case, the rental commencement date shall not be prior to the commencement date of the lease.

6.2.14 Holdover (JUL 2017)

If after the expiration of the Lease, the Government shall retain possession of the premises, the Lease shall continue in full force and effect on a month-to-month basis. Payment shall be made in accordance with the Consideration clause of the Lease, in arrears on a prorated basis, at the rate paid during the Lease term. This period shall continue until the Government shall have signed a new lease with the Lessor, acquired the property in fee, or vacated the premises.

6.2.16 Lessor's Successors (JUL 2017)

The terms and provisions of this Lease and the conditions herein bind the Lessor and the Lessor's heirs, executors, administrators, successors, and assigns.

6.2.17 Adjustment for Vacant Premises (JAN 2017)

If the Government fails to occupy any portion of the leased premises or vacates the premises in whole or in part prior to expiration of the term of the lease, including any option periods exercised, the total rental rate shall be reduced by that portion of the costs per square foot of operating expenses not required to maintain the space. Said reduction shall occur after the Government gives 30 days’ prior written notice to the Lessor, and shall continue in effect until the Government occupies the premises or the lease expires or is terminated.

SECTION 3 - GENERAL CLAUSES

3.2.5-1-RE Officials Not to Benefit (OCT 1996) No member of or delegate to Congress, or resident commissioner, shall be admitted to any share or part of this lease, or to any benefit arising from it. However, this clause does not apply to this lease to the extent that this lease is made with a corporation for the corporation's general benefit.

3.3.1-15-RE Assignment of Claims (OCT 1996) Pursuant to the Assignment of Claims Act, as amended, 31 U.S.C. § 3727, 41 U.S.C. § 6305 the Lessor may assign his rights to be paid under this lease.

6.3.7 Accessibility

The building and the leased premises shall be accessible to persons with disabilities pursuant to the Architectural Barriers Act and Rehabilitation Act as detailed in the Architectural Barriers Act Accessibility Standards (ABAAS) 41 CFR Parts 102-71, 102-72, et al, and all applicable state and local accessibility laws and regulations. ABAAS is available at www.access-board.gov.

Subject to the exception set forth herein, separate ABAAS compliant toilet facilities for men and women shall be provided on each floor where the Government leases space. Separate ABAAS compliant toilet facilities shall not be required if due to the age of the building, design layout, or other structural requirements, it is technically infeasible to do so. In the event the Lessor determines that it is technically infeasible to provide separate ABAAS compliant toilet facilities, the Lessor shall provide the basis for the determination of technical infeasibility in writing to the RECO, together with all supporting documentation.

With respect to all restrooms, water closets, and urinals, they shall not be visible when the exterior door is open. Each toilet room shall contain toilet paper dispensers, soap dispensers, paper towel dispensers, waste receptacles, a coin operated sanitary napkin dispenser with receptacle for each toilet in the women's restroom, disposable toilet seat cover dispensers, a convenience outlet, and hot and cold water. No fewer than two drinking fountains shall be provided. One drinking fountain shall be a low unit commonly called a wheelchair unit and one drinking fountain shall comply with standing persons requirements, unless sufficient space is not available to provide both a wheelchair unit and a standing persons unit. In such instance, and subject to the approval of the RECO, a single unit able to accommodate both disabled and non-disabled persons shall be provided.

In addition, compliant accessible parking spaces shall be provided in accordance with the ABAAS requirements as detailed in 42 U.S.C. 4151 and as set forth in the ABAAS Scoping Requirements.

6.3.8 Changes (JAN 2017)

A. The RECO may at any time, by written order, make changes within the general scope of this Lease in any one or more of the following:

1. Work or services;

2. Facilities or space layout; or

3. Amount of space B. If any such change causes an increase or decrease in Lessor's cost of or the time required for performance under this lease, whether or not changed by the order, the RECO shall modify this Lease to provide for one or more of the following:

1. An equitable adjustment in the rental rate;

2. A lump sum equitable adjustment; or

3. An equitable adjustment of the annual operating costs per occupiable square foot.

C. The Lessor shall assert its right to an adjustment under this clause within 30 days from the date of receipt of the change order and shall submit a proposal for adjustment. Failure to agree to any adjustment shall be a dispute under the Contract Disputes clause. However, nothing in this clause shall excuse the Lessor from proceeding with the change as directed.

D. Absent such written change order, the Government shall not be liable to the Lessor under this clause.

6.3.16 Failure in Performance (OCT 1996)

In the event the Lessor fails to perform any service, to provide any item, or meet any requirement of this Lease, the Government may perform the service, provide the item, or meet the requirement, either directly or through a contract. The Government may deduct any costs incurred for the service or item, including administrative costs, from the rental payments. No deduction of rent pursuant to this clause will constitute default by the Government on this Lease.

6.3.17 No Waiver (OCT 1996)

No failure by the Government to insist upon strict performance of any provision of this Lease, or failure to exercise any right, or remedy consequent to a breach thereof, will constitute a waiver of any such breach in the future.

6.3.18 Non-Restoration (JUL 2017)

It is hereby agreed between the parties that, upon termination of its occupancy (due to termination or expiration of the Lease), the Government shall have no obligation to restore and/or rehabilitate, either wholly or partially, the property that is the subject of this lease, including any holdover period. It is further agreed that the Government may abandon in place any or all of the structures and equipment installed in or located upon said property by the Government during its tenure. Such abandoned equipment shall become the property of the Lessor.

6.3.26 Damage by Fire or Other Casualty (OCT 1996)

If the building or structure is partially or totally destroyed or damaged by fire or other casualty or if environmentally hazardous conditions are found to exist so that the leased premises is untenantable as determined by the Government, the Government may terminate the Lease, in whole or in part, immediately by giving written notice to the Lessor and no further rental will be due.

6.3.27 Delivery and Condition (JAN 2017)

Unless the Government elects to have the space occupied in increments, the space must be delivered ready for occupancy as a complete unit. The Government reserves the right to determine when the space is ready to occupy.

6.3.27-1 Occupancy Permit (JAN 2017) The premises offered will have a valid Occupancy Permit, issued by the local jurisdiction, for the intended use of the Government, or the Lessor will complete and provide a certified copy of the "FAA Safety & Environmental Checklist" form, in lieu of an occupancy permit, at the RECO's discretion.

6.3.29 Alterations (FEB 2019)

The Government shall have the right during the term of this Lease, including any extensions thereof, to make alterations, attach fixtures, and erect structures or signs in or upon the premises hereby leased. All alterations and additions are and will remain the property of the Government and may be removed or otherwise disposed of by the Government. The parties hereto mutually agree and understand, that no restoration rights shall accrue to the Lessor for any alterations or removal of alterations to the leased premises under this Lease, and that the Government shall have the option of abandoning alterations in place, when terminating the Lease, at no additional cost.

6.3.30 Hold Harmless (OCT 1996)

In accordance with and subject to the conditions, limitations and exceptions set forth in the Federal Tort Claims Act of 1948, as amended (28 USC 2671 et. seq.), hereafter termed "the Act" the Government will be liable to persons damaged by any personal injury, death or injury to or loss of property, which is caused by a negligent or wrongful act or omission of an employee of the Government while acting within the scope of his office or employment under circumstances where a private person would be liable in accordance with the law of the place where the act or omission occurred. The foregoing shall not be deemed to extend the Government's liability beyond that existing under the Act at the time of such act or omission or to preclude the Government from using any defense available in law or equity.

6.3.31 Default by Lessor (OCT 1996)

Each of the following shall constitute a default by Lessor under this Lease:

A. If the Lessor fails to perform the work required to deliver the leased premises ready for occupancy by the Government with such diligence as will ensure delivery of the leased premises within the time required by the lease agreement, or any extension of the specified time.

B. Failure to maintain, repair, operate or service the premises as and when specified in this Lease, or failure to perform any other requirement of this Lease as and when required, provided such failure which shall remain uncured for a period of time as specified by the RECO, following Lessor's receipt of written notice thereof from the RECO.

C. Repeated failure by the Lessor to comply with one or more requirements of this Lease shall constitute a default notwithstanding that one or all failures shall have been timely cured pursuant to this clause.

If default occurs, the Government may, by written notice to the Lessor, terminate the lease in whole or in part.

6.3.32 Compliance with Applicable Laws (OCT 1996)

The Lessor shall comply with all federal, state and local laws applicable to the Lessor as owner or Lessor, or both, of building or premises, including, without limitation, laws applicable to the construction, ownership, alteration or operation of both or either thereof, and will obtain all necessary permits, licenses and similar items at Lessor's expense. This Lease shall be governed by federal law.

6.3.33 Covenant Against Contingent Fees (AUG 2002)

The Lessor warrants that no person or agency has been employed or retained to solicit or obtain this contract upon an agreement or understanding for a contingent fee, except a bona fide employee or agency. For breach or violation of this warranty, the Government shall have the right to annul this contract without liability or, in its discretion, to deduct from the contract price or consideration, or otherwise recover the full amount of the contingent fee.

6.3.34 Anti-Kickback (JAN 2017)

The Anti-Kickback Act of 1986 (41 U.S.C. 51-58) (the Act), prohibits any person from (1) Providing or attempting to provide or offering to provide any kickback; (2) Soliciting, accepting, or attempting to accept any kickback; or (3) Including, directly or indirectly, the amount of any kickback in the contract price charged by a prime Contractor to the United States or in the contract price charged by a subcontractor to a prime Contractor or higher tier subcontractor.

6.3.35 Examination of Records (AUG 2002)

The Comptroller General of the United States, the Administrator of FAA or a duly authorized representative from either shall, until three (3) years after final payment under this contract have access to and the right to examine any of the Lessor's directly pertinent books, documents, paper, or other records involving transactions related to this contract.

6.3.36 Subordination, Nondisturbance and Attornment (JAN 2017) A. The Government agrees, in consideration of the warranties and conditions set forth in this clause, that this Lease is subject and subordinate to any and all recorded mortgages, deeds of trust and other liens now or hereafter existing or imposed upon the premises, and to any renewal, modification or extension thereof. It is the intention of the parties that this provision shall be self-operative and that no further instrument shall be required to effect the present or subsequent subordination of this Lease. Based on a written demand received by the RECO, the Government will review and, if acceptable, execute such instruments as Lessor may reasonably request to evidence further the subordination of this Lease to any existing or future mortgage, deed of trust or other security interest pertaining to the premises, and to any water, sewer or access easement necessary or desirable to serve the premises or adjoining property owned in whole or in part by Lessor if such easement does not interfere with the full enjoyment of any right granted the Government under this Lease.

B. No such subordination, to either existing or future mortgages, deeds of trust or other lien or security instrument shall operate to affect adversely any right of the Government under this Lease so long as the Government is not in default under this Lease. Lessor will include in any future mortgage, deed of trust or other security instrument to which this Lease becomes subordinate, or in a separate non-disturbance agreement, a provision to the foregoing effect. Lessor warrants that the holders of all notes or other obligations secured by existing mortgages, deeds of trust or other security instruments have consented to the provisions of this clause, and agrees to provide true copies of all such consents to the RECO promptly upon demand.

C. In the event of any sale of the premises or any portion thereof by foreclosure of the lien of any such mortgage, deed of trust or other security instrument, or the giving of a deed in lieu of foreclosure, the Government will be deemed to have attorned to any purchaser, purchasers, transferee or transferees of the premises or any portion thereof and its or their successors and assigns, and any such purchasers and transferees will be deemed to have assumed all obligations of the Lessor under this Lease, so as to establish direct privity of estate and contract between Government and such purchasers or transferees, with the same force, effect and relative priority in time and right as if the lease had initially been entered into between such purchasers or transferees and the Government; provided, further, that the RECO and such purchasers or transferees shall, with reasonable promptness following any such sale or deed delivery in lieu of foreclosure, execute all such revisions to this Lease, or other writings, as shall be necessary to document the foregoing relationship.

D. None of the foregoing provisions may be deemed or construed to imply a waiver of the Government's rights as a sovereign.

6.3.38 Sublease (OCT 1996)

The Government reserves the right to sublease the space covered under this Lease to another agency or private party. In subleasing this space to another party the Government is not relieved from its responsibilities under the terms of this Lease, unless otherwise agreed upon with the Lessor.

6.3.39 Integrated Agreement (OCT 1996)

This Lease, upon execution, contains the entire agreement of the parties, and no prior written or oral agreement, express or implied shall be admissible to contradict the provisions of this Lease.

6.3.40 Equal Opportunity (JAN 2017)

The Lessor shall have on file affirmative action programs required by the rules and regulations of the Secretary of Labor (41 CFR 60-1 and 60-2).

6.3.41 Affirmative Action for Special Disabled and Vietnam Era Veterans (OCT 1996) The Lessor agrees to comply with the rules, regulations, and relevant orders of the Secretary of Labor (Secretary) issued under the Vietnam Era Veterans' Readjustment Assistance Act of 1972 (the Act), as amended. If the Lessor does not comply with the requirements of this clause, appropriate actions may be taken under the rules, regulations, and relevant orders of the Secretary issued pursuant to the Act.

6.3.42 Affirmative Action for Disabled Workers (JAN 2017)

The Lessor agrees to comply with the rules, regulations, and relevant orders of the Secretary of Labor (Secretary) issued under the Rehabilitation Act of 1973 (29 USC 793) (the Act), as amended. If the Lessor does not comply with the requirements of this clause, appropriate actions may be taken under the rules, regulations, and relevant orders of the Secretary issued pursuant to the Act.

6.3.43 Unauthorized Negotiating (OCT 1996)

In no event shall the Lessor enter into negotiations concerning the space leased or to be leased with anyone other than the RECO or his/her designee.

6.3.44 Inspection (OCT 1996)

The Government reserves the right, at any time after the Lease is signed and during the term of the Lease, to inspect the leased premises and all other areas of the building to which access is necessary, to ensure a safe and healthy work environment for the Government tenants and the Lessor's performance under this Lease. The Government shall have the right to perform sampling of suspected hazardous conditions.

6.3.45 Contract Disputes (JAN 2017)

All contract disputes arising under or related to this Lease will be resolved through the FAA dispute resolution system at the Office of Dispute Resolution for Acquisition (ODRA) and will be governed by the procedures set forth in 14 C.F.R. Parts 14 and 17, which are hereby incorporated by reference. Judicial review, where available, will be in accordance with 49 U.S.C. 46110 and will apply only to final agency decisions. A Lessor may seek review of a final Government decision only after its administrative remedies have been exhausted.

All contract disputes will be in writing and will be filed at the following address:

Office of Dispute Resolution for Acquisition, AGC-70 Federal Aviation Administration 800 Independence Avenue, S.W., Room 323 Washington, DC 20591 Telephone: (202) 267-3290 A contract dispute against the FAA will be filed with the ODRA within two (2) years of the accrual of the lease claim involved. A contract dispute is considered to be filed on the date it is received by the ODRA.

The full text of the Contract Disputes clause is incorporated by reference. Upon request the full text will be provided by the RECO.

3.10.1-22 Contracting Officer's Representative (APR 2012)

(a) The Contracting Officer may designate other Government personnel (known as the Contracting Officer's Representative) to act as his or her authorized representative for contract administration functions which do not involve changes to the scope, price, schedule, or terms and conditions of the contract. The designation will be in writing, signed by the Contracting Officer, and will set forth the authorities and limitations of the representative(s) under the contract. Such designation will not contain authority to sign contractual documents, order contract changes, modify contract terms, or create any commitment or liability on the part of the Government different from that set forth in the contract.

(b) The Contractor shall immediately contact the Contracting Officer if there is any question regarding the authority of an individual to act on behalf of the Contracting Officer under this contract.

6.3.54 Excusable Delays (JUL 2014)

A. The Lessor shall not be in default because of any failure to perform this Lease under its terms if the failure arises from causes beyond the control and without the fault or negligence of the Lessor. Examples of these causes are: (1) acts of God or of the public enemy, (2) acts of the Government in either its sovereign or contractual capacity, (3) fires, (4) floods, (5) epidemics, (6) quarantine restrictions, (7) strikes, (8) freight embargoes, and (9) unusually severe weather. In each instance, the failure to perform must be beyond the control and without the fault or negligence of the Lessor. 'Default' includes failure to make progress in the work so as to endanger performance.

B. The RECO shall ascertain the facts and extent of the failure. If the RECO determines that any failure to perform results from one or more of the causes above, the delivery schedule shall be revised, subject to the rights of the Government under the termination clause of this contract.

SECTION 4 - FINANCIAL CLAUSES

6.4.1 System for Award Management - Real Property - SAM Waiver (JAN 2017) The System for Award Management (SAM) is the Government's required method to receive vendor information. However, you have been granted an exception to SAM and therefore must provide your initial payment information and any future changes to your payment information to the RECO on a completed and signed "Vendor Miscellaneous Payment Information" form, together with any other required notice under this lease.

6.4.2 Payment by Electronic Funds Transfer (JAN 2017)

All payments by the Government under this Lease will be made by electronic funds transfer (EFT). The Government will make payment by EFT through the Automated Clearing House (ACH) network, subject to the rules of the National Automated Clearing House Association. The rules governing federal payments through the ACH are contained in 31 CFR Part 210. The Lessor is responsible for maintaining correct payment information with the Government. If the Lessor's EFT information is incorrect or outdated, the Government is not required to make payments to the Lessor until correct/current EFT information is submitted to the Government for payment distribution.

SECTION 5 - DESIGN AND CONSTRUCTION CLAUSES

6.5.1 Tenant Improvements (JAN 2017)

A. The tenant improvement allowance is $[insert dollar amount per foot] per ANSI/BOMA Office Area square foot which shall be paid entirely by the Lessor, including any instance where the Government accepts fixtures and/or other tenant improvements already in place. Tenant improvements are the components, finishes, and fixtures that typically take space from the "shell" condition to a finished, usable condition. The tenant improvement allowance shall cover all or a portion of the cost of the design and build out of the Government's demised area in accordance with the Government's approved Design Intent Drawings.

All tenant improvements required by the Government for occupancy shall be constructed and paid for by the Lessor as part of the rental consideration, and all improvements shall meet the quality standards and requirements of this Lease. At no additional cost to the Government, the Lessor agrees to pay and disburse all of the tenant improvement payments, and provide the Government with all of the costs associated with the tenant improvements including, but not limited to, construction costs and costs related to preparation of construction plans, construction management fees, city fees and permit costs or penalties, certificate of occupancy and applicable taxes and engineering fees.

B. The Government, at its sole discretion, shall make all decisions as to the usage of the tenant improvement allowance. The Government may: 1) use all or part of the tenant improvement allowance, or 2) return to the Lessor, any unused portion of the tenant improvement allowance in exchange for a decrease in rent. If the Government build out costs are in excess of the tenant improvement allowance, the Lessor may recover such costs in accordance with the "Lessor's Recovery of Tenant Improvement Costs in Excess of the Allowance" clause.

C. The tenant improvement allowance shall include all of the Lessor's administrative costs, general contractor fees, subcontractor's profit and overhead costs, Lessor's profit and overhead, design costs, and other associated project fees necessary to prepare construction documents and to complete the tenant improvements. It is the Lessor's responsibility to prepare all documentation (working/construction drawings, etc.) required to receive construction permits. No costs associated with the building shell shall be included in the tenant improvement price proposal.

D. If the Government determines that termination of the lease is in the best interest of the Government, the Government shall pay an amount based on the unamortized balance of the tenant improvement allowance as of the first day of the month the lease is cancelled and terminated, as described in the "Lessor's Recovery of Tenant Improvement Allowance in the Event of Cancellation" clause.

6.5.2 Work Performance (JUL 2010)

All work in performance of this Lease shall be done by skilled workers or mechanics and shall be acceptable to the RECO. The RECO retains the right to reject the Lessor's workers 1) if such are either unlicensed, unskilled, or otherwise incompetent, or 2) if such have demonstrated unacceptable performance in connection with work carried out in conjunction with this Lease. In the event of such rejection, the Lessor shall offer substitute/replacement workers, subject to the approval of the RECO.

6.5.3 Responsibility of the Lessor and Lessor's Architect/Engineer (JAN 2017) A. The Lessor shall be responsible for the professional quality, technical accuracy, and the coordination of all designs, drawings, specifications, and other services furnished by the Lessor under this contract. The Lessor shall, without additional compensation, correct or revise any errors or deficiencies in its designs, drawings, specifications or other services.

B. The Lessor remains solely responsible for designing, constructing, operating, and maintaining the leased premises in full accordance with the requirements of the lease. The Government retains the right to review and approve many aspects of the Lessor's design, including without limitation, review of the Lessor's design and construction drawings, shop drawings, product data, finish samples, and completed base building and tenant improvement construction. The Government shall work closely with the Lessor, in an integrated manner, to identify potential design flaws, to minimize costly misdirection of effort, and to assist the Lessor in its effort to monitor whether such design and construction comply with applicable laws and satisfy all lease requirements.

C. Neither the Government's review, approval or acceptance of, nor payment through rent of the services required under this lease, shall be construed to operate as a waiver of any rights under this Lease or of any cause of action arising out of the performance of this Lease, and the Lessor shall be and remain liable to the Government in accordance with applicable law for all damages to the Government caused by the Lessor's negligent performance of any of the services required under this Lease.

D. Design and construction and performance information is contained throughout several of the solicitation documents which shall comprise a resulting lease. The Lessor shall provide to space planners, architects, engineers, construction contractors, etc., all design and performance information required whether it is found in the submitted solicitation, the lease, price lists, or Design Intent Drawings. Reliance upon one of these documents to the exclusion of any other may result in an incomplete understanding of the scope of the work to be performed and/or services to be provided.

6.5.4 Lessor's Recovery of Tenant Improvement Costs in Excess of the Allowance (OCT 2012) A. If the Government's build out costs are in excess of $[insert dollar amount] per square foot or $[insert dollar amount] the Government reserves the right to either: 1) reduce the tenant improvement requirements, 2) pay a lump sum for the overage amount upon completion and acceptance of the improvements, or 3) increase the rent to cover the amount in excess of the allowance according to the negotiated amortization rate over the term of the lease. Reimbursement shall occur only after acceptance of the space, and shall be based on a detailed invoice provided by the Lessor and the determination by the RECO that the work completed is satisfactory; such determination to take place only after an inspection of the work and building materials by the RECO.

B. Notwithstanding the foregoing, at the Government's option, the Lessor shall fund an additional amount for the Government's cost of installing security systems, computer wiring, and telephone wiring up to a maximum additional amount not to exceed $[insert dollar amount]; and the Government shall reimburse the Lessor within [insert number of business days ]business days of acceptance of such systems and wiring in writing and executed by the RECO, based upon a detailed invoice provided by the Lessor. If the Government installs its own security systems, computer wiring, or telephone wiring, the Government covenants that the Lessor shall have no liability regarding these installations.

6.5.5 Lessor’s Recovery of Tenant Improvement Allowance in the Event of Cancellation (OCT 2012) The Lessor shall recover the unamortized balance of the tenant improvement allowance (or a lesser amount as described in the following sentence), effective on the date of cancellation. The Lessor shall amortize the actual cost of the tenant improvements or the tenant improvement allowance, whichever amount is less, over the term of the lease. The Lessor shall make a disclosure of all tenant improvement costs to the Government after all tenant improvement costs have been accounted for, such disclosure shall include a monthly payment schedule of said tenant improvement costs and balance remaining each month. In the event that the Government cancels this Lease, or any portion thereof:, the Government agrees that it shall make a one-time, lump sum payment to the Lessor for the remaining balance of tenant improvement costs in their entirety if the entire lease is terminated, or prorate, if any portion thereof is cancelled. Lessor agrees that such payment shall release the Government from all present and future liability under this clause.

6.5.6 Liquidated Damages (JAN 2017)

In case of failure on the part of the Lessor to complete the work within the time fixed in the lease contract, the Lessor shall pay the Government as fixed and agreed liquidated damages, pursuant to this paragraph, the sum of $[insert dollar amount] for each and every calendar day that the delivery is delayed beyond the date specified for delivery of all the space ready for occupancy by the Government. This remedy is not exclusive and is in addition to any other remedies which may be available under this lease or at law. This liquidated sum is not meant as a penalty, but as an approximation of actual damages that would be suffered by the Government as a result of the Lessor's delay.

6.5.7 Amortization Schedule (JAN 2017)

An Amortization Payment Schedule is required for the following: 1) in the event the Government build-out is in excess of the tenant improvement allowance or 2) in the event the lease is terminated prior to the date set in the "Term" clause. The amortization is based on a [insert interest rate]% (interest agreed on the tenant improvement) rate of return, with payments of $[insert dollar amount] per month in arrears as per Attachment [insert attachment name], attached hereto and made a part hereof.

6.5.8 Lessor's Unit Prices/Costs and Construction Schedule (OCT 2012) Within [insert # of business days] business days after award of the lease, the Lessor shall submit to the RECO:

A. A detailed description of unit prices/costs and B. A tentative construction schedule giving the dates on which the various phases of construction shall be completed to coincide with the Government's required occupancy date. The finalized schedule shall be submitted no later than [insert number of business days] business days after award. The schedule shall include timing for completion of design and construction milestones including, but not limited to:

1) Submittal of preliminary plans and specifications;

2) Submittal of other working drawings;

3) RECO's approval of completed construction documents and the tenant improvements price proposal;

4) Issuance of any and all required building permits;

5) Start of construction;

6) Completion of principal categories of work;

7) Phased completion and availability for occupancy of each portion of the Government-demised area (by floor, block, or other appropriate category);

8) Final construction completion; and

9) Inspection and acceptance of the leased premises by the Government.

6.5.9 Construction Schedule and Acceptance of Tenant Improvements (JAN 2017) The construction schedule shall commence upon lease award, unless otherwise expressly agreed by the Lessor and Government as stated in the lease. The schedule shall be divided into seven tasks for each phase. These are:

A. The generation of the Design Intent Drawings;

B. The Government's approval of the Design Intent Drawings;

C. The Lessor's generation of the Government's construction documents;

D. The Government's review and approval of the construction documents;

E. The submittal of the Tenant Improvements Price Proposal, Government's review, approval, and Notice to Proceed (NTP) process;

F. The Lessor's construction of the leased premises; and G. The Government's acceptance of the space upon completion of construction. References to "approval" shall mean such approval granted by the RECO in writing. During the construction schedule, the Government may require regularly scheduled progress meetings and that the Lessor keep meeting minutes of discussion topics and attendance. During the design and construction tasks, the Lessor may discover instances where the Government's directives conflict. In such cases, the Lessor shall immediately notify the RECO in writing so that the Government may issue a determination as to how to proceed.

6.5.10 Design Intent Drawings - Provided by Lessor (JAN 2017) The Design Intent Drawings (also known as "Preliminary Drawings" or "Prelims") will be prepared by the Lessor as described below.

As part of the rental consideration, including the tenant improvement allowance, the Lessor shall prepare and provide to the Government, for the Government's approval, Design Intent Drawings detailing the tenant improvements to be made by the Lessor within the leased premises. The Government shall use best efforts to coordinate the provision of such information and details as required by the Lessor's architect to complete such drawings in a timely manner. For purposes of this lease, Design Intent Drawings are defined as fully-dimensioned drawings of the leased space which include enough information to prepare construction drawings and shall consist of:

A. Furniture locations, telephone and data outlet types and locations, electrical outlet locations, switch locations, ceiling grid height and light fixture locations, and cabinet/counter and shelving locations;

B. Specifications necessary for calculation of electrical and HVAC loads;

C. All finish/color/signage selections, and D. Security requirements.

Design Intent Drawings shall be due from the Lessor within [insert number of business days] business days from the date of award.

6.5.10 Design Intent Drawings - Provided by Government (JAN 2017) The Design Intent Drawings (also known as "Preliminary Drawings" or "Prelims") will be prepared by the Government, as described below.

The Government shall prepare and provide to the Lessor the Government's approved Design Intent Drawings based upon the base building drawings provided by the Lessor. These Design Intent Drawings shall detail the tenant improvements to be made by the Lessor within the leased premises. Design Intent Drawings, for the purposes of this lease, are defined as fully-dimensioned drawings of the leased space which include enough information to prepare construction drawings and shall consist of:

A. Furniture locations, telephone and data outlet types and locations;

B. Specifications necessary for calculation of electrical and HVAC loads;

C. All finish/color/signage selections; and D. Security requirements.

Design Intent Drawings shall be due to the Lessor within [insert number of business days] business days from the date of award. If the Government provided Design Intent Drawings require additional design work after submittal to Lessor, then the Lessor will immediately complete that requirement, at Lessor's cost, and submit said drawings back to the Government for review and approval. Said review and approval shall be provided within [insert number of business days] business days from the date submitted by the Lessor.

6.5.11 Review of the Design of Intent Drawings (JAN 2017)

The Government has the right to review, approve, and request modifications (if necessary) to the Lessor's Design Intent Drawings at any time prior to the Lessor's commencement of working/construction drawings. The Government's review and approval of the drawings is limited to determining whether the drawings meet the specific requirements of the submitted solicitation and this lease. The Government shall perform all reviews of Design Intent Drawings within [insert number of business days] business days of receipt from Lessor. If the Government fails to provide the review within the requisite number of business days, the lease shall be modified to reflect a new occupancy date, which modification shall be at no cost to the Government. Should the Government disapprove the Lessor's Design Intent Drawings, such disapproval, and the documented reasons, shall be provided in writing to the Lessor by the RECO. Lessor shall have [insert number of business days] business days to cure all noted deficiencies in the Design Intent Drawings, and the revised Design Intent Drawings shall be resubmitted to the RECO for review and approval. Upon approval of the Design Intent Drawings, a notice to proceed shall be transmitted to the Lessor, and the Lessor shall commence working/construction drawings for the space.

6.5.12 Budget Proposal for Design Intent Drawings (JAN 2017)

At the sole discretion of the Government, the Lessor may be required to submit a budget proposal based on the tenant improvements and associated work, as shown on the Design Intent Drawings. This budget proposal shall be completed within ten (10) business days from the date of the Government's request. Delay of receipt of such proposal shall result in a Lessor delay and delay in the rent commencement after acceptance of the leased premises.

6.5.13 Working Construction Drawings (JUL 2010)

The Lessor shall prepare, as part of the tenant improvement allowance, final working/construction drawings for the improvements illustrated on…