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engineering and consultant fe es assoc iated wi th the preparation of the Plans; (b) governmental agency plan review, permit, license and other fees (including, without limitation, any charges required by any governmental entity or authority hav ing jurisdiction over the Premises); (c) sales and use taxes; (d) insurance costs and expenses; (e) testing and inspecting costs; (t) costs and expenses of material and la bor, including without limitation, General Contrac tor's profit and general overhead; (g) costs and expenses associated with the compli ance with applicable Laws; (h)ccsts and expenses of alterat ions of the Pre mises and all life safety syste ms necessitated byany applicable Law; (i) costs and expenses associated with any modification or addition to thePremises or any stree t or public right of way; (j) all costs and expenses of construction workrequired to complete the Work; (k) costs and expenses of Lessee signage, if any; (I) costs andexpenses associated with the placement of any new, addit ional or supplemental mechan ical,electrical, plumbing or life safety systems on the Premises, including, without l!milation, costsassociated with any repair or replacement of any HVAC units or systems, and running pi ping andconduit to such systems (the location for such piping and conduit shall be selected by Lessor);(m) costs and expenses associated with any Lessee Changes or Lessor Changes; and (n) any outof-pocket costs and expenses incurred by Lessor or Lessor's consultants associated with thereview of the Plans, Le ssor proposed that the entire Cost of Work would be $8,500,000 for thecompletion of the Work ("Cost Esti mate"). Any changes to the scope of Work that wouldincrease the "Cost Estima te" must be approved In writing by Les see prior to commencement ofsuch extra Work ("Change Order") provided, howe ver, that Les sor and Lessee also agree to aI 0% contingency amount equal to $850,000 ("Contingency Amount"), which such Conti ngencyAmount may be incurred in con nection with any Lessor Change, and is to be paid and reimbursedto Less or by Lessee, without such prior written approval of Lessee. Concurrently upon theexecution oftl1is Lease, Lessee shall deposit with Lessor, the sum of $850,000, which suchamount shall be a "retainer" against fees and costs incu rre d by Lesoor in connect ion with Lessor'scompletion of the Work. All Work shall be completed by a general contractor chosen by Lessorbut approved by Lessee, which approval shall not be unreasonably withheld, conditioned ordelayed (the "General Contractor"). Lessor shall be req uired to obtain the required permits forthe Work, with any costs end expenses included within the Cost Estimate. Lessee herebyapproves Bentley Construction as the General Contractor, Lessee must arrange with an insu rancecompany to provide the coverage req uired under the Lease, the cost of which is not included inthe Cost Estimate. Prior to the start of Work, Lessor must receive the certificates of insurancerequired under the Lease, Such cert ificate of ins urance shall name Lessor as additional insurnd,Lessor shall cause the General Contractor to perform all Work in a good and workmanl ikemanner and in accord ance with good indu stry practice, applicable Laws and the Lessor's WorkStandards, and in material compliance with the Plans. Lessor shall deliver to Lessee a request forpayment from the General Contractor, approved by Lessor, showing the schedule, by trade, ofpercentage of completion of the Work and the cost of labor rendered and materials de livered tothe Premises for which such payment is being requested, which such request for payment may besubmitted weekly and on or before the seventh (7th) Busi ness Day after receipt of such requestfor payment, Lessee shall deliver a check to Lessor made payable to either Lessor or GeneralContractor, the amounts so requested by Lessor. During the construction of the Work, Lessor'sRepresentative and Lessee's Representative shall meet as often es deemed reasonably necessaryby Lessor and/or Lessee lo discuss construction progress. For purposes hereof, "SubstantialCompletion• (and any correlative variations thereot) of the Work shall mean completion ofconstruction of the Work in material compl iance with the Plans, with the except ion of any PunchList Items. For the purposes hereof, the term "Punch List Items" shall mean minor detai ls ofconstruction or decorat ion or mechanical adjustments that can reasonably be com pleted after thedate Lessee commences its operations within the Premises without causing substa ntialinterference with Lessee's operat ions at the Premises. Lessor shall use its good faith efforts to
<br />8 12926-14 7,1 EXHIBIT 1
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