EXHIBIT (10)(R)
LEASE AGREEMENT
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THIS AGREEMENT OF LEASE (hereinafter "Lease") made as of
this 1st day of January, A.D., 1995, between Harleysville, Ltd.,
a Pennsylvania limited partnership, (hereinafter "Lessor"),
AND
Harleysville Mutual Insurance Company, a Pennsylvania
insurance corporation doing business at 000 Xxxxx Xxxxxx,
Xxxxxxxxxxxx, XX 00000, (hereinafter "Lessee").
W I T N E S S E T H:
In consideration of the mutual covenants and agreements set
forth in this Lease, and other good and valuable considerations,
Lessor leases to Lessee and Lessee leases from Lessor all that
certain parcel of land, together with the buildings and
improvements erected thereon, situate at 000 Xxxxx Xxxxxx,
Xxxxxxxxxxxx, Xxxxxxxxxx Xxxxxx, Xxxxxxxxxxxx, and more fully
described in Exhibit "A," which is attached hereto and made a
part hereof, (hereinafter, collectively, "Premises").
NOW, THEREFORE, the undersigned, intending to be legally
bound hereby, agree as follows:
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1. PRIOR LEASE. This Lease supersedes and replaces in
its entirety the Lease dated as of January 1, 1990.
2. TERM. The term of this Lease shall be for a period of
five (5) years commencing on January 1, 1995 and ending on
December 31, 1999.
3. RENT.
a. Base Rent. The base rent is Twelve Dollars and
Fifty Cents ($12.50) per square foot of office space per
year. This base rental charge is to be applied to each
square foot of office space located on the Premises. The
base rent is payable monthly in advance.
b. Additional Rent. Lessee agrees to pay additional
rent, the amount of which shall be equal to the cost of any
additions, improvements, or renovations, fully amortized
over the life of same, at an annual interest rate of twelve
per cent (12%). Such additions, renovations or
improvements, if any, shall be the property of Lessor.
Lessee agrees to pay all of said charges, if any, on or
before December 31st of each year of the term of the Lease.
4. TAXES, CHARGES, AND INSURANCE. Lessee agrees to pay
taxes, charges, and insurance as follows:
a. The full amount of all real estate taxes, water
and sewer charges, special assessments of any kind or nature
whatsoever, and any other public charge levied upon or
assigned against the Premises or any portion thereof, or on
any buildings or improvements now or hereafter located
thereon, or arising by reason of
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occupancy, use or possession thereof any other similar
charges now or hereafter in effect, whether or not such
charges or any of them are or may become a lien on the
Premises.
b. All premiums on the insurance policies referred to in
Paragraph 13.
5. REPAIRS AND MAINTENANCE. Lessee agrees at its own
expense and risk, to maintain and keep the Premises, during any
term of this Lease, in good order and condition, including, but
not limited to, making all repairs and replacements, renewals and
additions, interior and exterior, structural and non-structural,
ordinary and extraordinary, foreseen and unforeseen, necessary to
keep and maintain the Premises and all systems, equipment and
apparatus appurtenant thereto, or used in connection therewith,
in good order and condition.
6. UTILITIES. Lessee shall pay all utility charges for
water, sewer, electricity, heat, telephone or other services or
utilities used in or about the Premises during the term of the
Lease. Lessee shall also be responsible for and shall pay for
the removal of all garbage and rubbish from the Premises during
the term of the Lease. Under no circumstances shall Lessor be
required to furnish any utilities or any other services of any
kind to the Premises or any part thereof.
7. COVENANT TO SURRENDER. Lessee covenants to surrender
the Premises in good order and condition, reasonable wear and
tear, casualty, and fire excepted.
8. COVENANT TO COMPLY WITH GOVERNMENTAL AUTHORITIES.
Lessee agrees to perform and to fully obey and comply with all of
the ordinances, rules, regulations and statutes of all public
authorities and/or regulatory bodies and officers enforcing said
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ordinances, rules, regulations, and statutes relating to the
Premises or to the use being made of the Premises by the Lessee.
9. MECHANIC'S LIENS. Lessee shall not do or suffer
anything to be done or any work to be performed upon the Premises
which would be encumbered by any mechanic's lien. In the event
any such lien is filed against the Premises which purports to be
for labor or material, furnished or to be furnished by Lessee,
the Lessee shall discharge the same of record within ten (10)
days after notice of the date of filing of the said lien. In the
event the Lessee fails to discharge the same of record, then
Lessor may, at its option, pay the lien or any portion thereof,
and the cost to pay the mechanic's lien and any legal expenses
shall be assessed against the Lessee the same as rent can be
assessed against the Lessee under this Lease and shall be
collected in accordance with the provisions of this Lease in the
same manner as rental. Lessor shall not be liable for any labor
and materials furnished or to be furnished to the Lessee upon
credit and no mechanic's or other liens for any such labor and
materials shall attach to or affect the reversionary interest of
the Lessor in and to the Premises.
10. WAIVER OF LIENS. Lessee agrees that in the event that
the Lessor gives written approval and permits any alterations or
repairs to be made to the Premises, before any work is started or
performed, a Waiver of Liens shall be prepared by the Lessor at
the Lessee's expense and signed by the contractor and/or
materialmen and the Lessor. Said Waiver of Liens shall be filed
of record at the Lessee's expense in accordance with the
Mechanic's Lien Laws of the Commonwealth of Pennsylvania. The
parties hereto agree that a Waiver of Liens will only be required
where the improvements are in excess of FIVE HUNDRED DOLLARS
($500.00).
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11. ALTERATIONS, ADDITIONS, AND IMPROVEMENTS. Lessee
agrees that it will not demolish any building on the Premises or
make any alterations, additions, or improvements to the Premises
without first obtaining the prior written consent and approval of
the Lessor. Lessee agrees that in the event of any changes or
alterations or additions as approved by the Lessor, it must
comply with the Waiver of Liens provision as set forth in this
Lease, and that all such improvements, additions and repairs made
to the Premises during the term of Lease, with the approval of
the Lessor, shall, upon the expiration of the same, be and
become, the sole and exclusive property of the Lessor, its
successors and assigns, without any cost to Lessor. It is agreed,
however, that all trade fixtures installed by the Lessee and/or
its successors and assigns, in the Premises shall remain the
property of the Lessee subject to the provisions herein on
removal.
12. OWNERSHIP. Lessor herewith covenants that it has good
title to the Premises and that the Lessee, upon paying the
rentals and upon keeping and observing the covenants, agreements
and conditions herein specified to be kept and performed by the
Lessee, shall and may lawfully, peacefully and quietly have,
hold, use, occupy, possess, and enjoy the Premises for and during
the term hereof without any hindrance, eviction, molestation, or
interruption of or by the Lessor or any person or persons.
13. INSURANCE AND INDEMNIFICATION.
a. Lessee agrees to indemnify and save harmless
Lessor against and from any and all claims by or on behalf
of any person or persons, firm or firms, corporation or
corporations, (i) arising from any condition of the interior
or exterior of the premises; (ii) arising from any breach or
default on the part of Lessee in the
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performance of any covenant, agreement, or condition on the
part of Lessee to be performed, pursuant to the terms of
this Lease; or (iii) arising from any act or negligence of
Lessee, or any of its agents, servants or employees. In
case any action or proceeding is brought against Lessor by
reason of such claim, Lessee, upon notice from Lessor,
covenants to resist or defend such action or proceeding by
counsel satisfactory to Lessor.
b. Lessee agrees to maintain, at its own expense,
during the term of this Lease a policy of general liability
insurance with a reputable company authorized to do business
in the Commonwealth of Pennsylvania, in which policy Lessor
and Lessee shall be named as insureds, and Lessee shall
furnish current certificates evidencing the existence of
such insurance. Such policy shall provide coverage in an
amount not less than ONE MILLION DOLLARS ($1,000,000.00)
(single limit combined bodily injury and property damage
each occurrence) to cover all situations involving claims
for Bodily Injury, death or property damage arising upon the
Premises. Such insurance may be carried under a blanket
policy covering other locations of the Lessee, provided the
protection and coverage afforded the Lessor is not reduced
thereby.
c. Lessee agrees, at its own expense, during the term of this
Lease, to keep the Premises insured against loss or damage by
fire or theft, and such other hazards, casualties and
contingencies as are usually covered by the special cause of loss
form in the area and boiler insurance, from time to time. The
property coverage insurance shall be in the amount of the full
insurable value of the
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Premises, without deduction for depreciation, and the other
insurance, if any, shall be in such amounts as Lessor may
reasonably require. Said policy shall be written by a
reputable company authorized to do business in the
Commonwealth of Pennsylvania. Said policy or policies of
insurance shall name both Lessor and Lessee as insureds.
14. DESTRUCTION OF PREMISES.
a. In the event that the Premises is totally
destroyed or so damaged by fire or other casualty not
occurring through the fault or negligence of the Lessee, or
those employed by or acting for it, that the same cannot be
repaired or restored within a reasonable time, this Lease
shall absolutely cease and terminate, and the rent shall
xxxxx for the balance of the term. The determination of what
is a reasonable time shall be the sole conclusion of the
Lessor under the circumstances.
b. In the event the damage to the Premises, be only
partial and such that it can be restored to its condition
existing at the time of the damage within a reasonable time,
the Lessor may at its option, restore the same with
reasonable promptness, reserving the right to enter upon the
Premises for that purpose. In that event the rent may be
apportioned and suspended during the time the Lessor is in
possession, taking into account the proportion of the
Premises rendered untenantable and the duration of the
Lessor's possession. If dispute arises as to the amount of
rent due under this clause, Lessee agrees to pay the full
amount claimed to the Lessor, but Lessee, however, shall
have the right to proceed by law to recover the excess
payment, if any. The Lessor shall have such election to
repair
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the Premises or terminate this Lease by giving written
thereof to the Lessee at the Premises within sixty (60) days
from the day the Lessor receives notice that the Premises
have been damaged by fire or other casualty.
15. SIGNS. Lessee shall have the right to erect signs at
its sole cost, on any portion of the Premises, subject to and in
accordance with all applicable laws, ordinances, rules, and
regulations.
16. PARKING. Lessor shall provide an area for the
employees, customers, and vendors of the Lessee to park.
17. DEFAULT. An event of default shall include Lessor's
failure to pay the base rent, additional rent, or any other sum
payable under this Lease, or either party's failure to perform or
comply with any other terms, covenants, agreements, or conditions
of this Lease. However, it is agreed that no default on the part
of Lessee or Lessor shall be deemed to have occurred unless the
non-defaulting party shall have given the defaulting party
written notice of the alleged default, and the defaulting party
shall not have within thirty (30) days after receipt of such
notice commenced action to remedy such default.
18. CONSTRUCTION OF LEASE. Words of gender used in this
lease shall be held to include any other gender and words in the
singular number shall be held to include the plural when the
sense requires. The headings as to the contents of particular
paragraphs herein are inserted only for convenience and are in no
way to be construed as part of the Lease or as a limitation of
the scope of the particular paragraphs to which they refer.
19. NOTICES. All notices required or permitted to be
served hereunder or by law between Lessor and Lessee shall be in
writing and delivered by hand or by Certified
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Mail, Return Receipt Requested, postage prepaid, addressed to
Xxxxx X. Xxxxx, Senior Vice President, Chief Financial Officer &
Assistant Secretary on behalf of Lessor and Xxxxx X. Xxxx, Vice
President-Facilities Services on behalf of Lessee, at 000 Xxxxx
Xxxxxx, Xxxxxxxxxxxx, XX 00000, or to such other address as a
party shall specify by written notice to the other.
20. ASSIGNMENT AND SUBLETTING. Lessee may not assign this
Lease, or sublease the whole or any party of the Premises,
without the prior written consent of Lessor, provided, however,
that no such assignment or subletting shall relieve Lessee from
its duty to perform fully all of the agreements, covenants, and
conditions set forth in this Lease.
21. LEASE ALL INCLUSIVE. This Lease contains the entire
agreement between the parties hereto and no representation or
statement not herein contained shall vary or modify this Lease,
and this Lease shall not be effective between the parties until
the execution thereof and the required delivery of any and all
resolutions to the Lessor by the Lessee.
22. GOVERNING LAW. This Lease shall be governed by and
construed under the laws of the Commonwealth of Pennsylvania.
23. AMENDMENT. No amendment, modification or alteration
of the terms of this Lease shall be binding unless it is in
writing, dated subsequent to the date of this Lease, and duly
executed by the Lessor and Lessee.
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IN WITNESS WHEREOF, the parties hereunto have set their
hands and seals the day and year first above written.
Lessor:
HARLEYSVILLE LTD.
BY: HARLEYSVILLE GROUP INC.,
General Partner
Witness:
/s/XXXXX X. XXXXXXXX BY: /s/XXXXX X. XXXXX
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Xxxxx X. Xxxxxxxx Xxxxx X. Xxxxx
Senior Vice President,
CFO & Asst. Secretary
Lessee:
HARLEYSVILLE MUTUAL INSURANCE COMPANY
Attest:
/s/X. XXXXXXXX XXXXXXXXXXX BY:/s/XXXXX X. XXXX
-------------------------- ----------------------------
X. Xxxxxxxx Xxxxxxxxxxx Xxxxx X. Xxxx
Asst. Secretary Vice President
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EXHIBIT A
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PARCEL #1:
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ALL THAT CERTAIN lot, piece and parcel of land with the building
and improvements thereon situated in Lower Salford Township,
Xxxxxxxxxx County, Pennsylvania, bounded and described according
to survey made by Xxxxxx and Xxxxxx, Inc., Civil Engineers and
Land Surveyors, dated 2/8/79 and revised 5/6/82, bounded and
described as follows, to wit:
BEGINNING at a point, said point being a railroad spike at the
intersection of Harleysville Pike, A/K/A Maple Avenue, and Oak
Drive; thence, along the center line of Oak Drive North forty-
three degrees, four minutes and zero seconds West, a distance of
eight hundred seventy-six and six one-hundredths feet (N 43o 04'
00" W, 876.06') North forty-eight degrees, eighteen minutes,
thirty-six seconds East twenty-five and fifty-six one-hundredths
feet (25.56') to an iron pipe, being the true point of beginning
of this description; thence continuing North forty-eight degrees,
eighteen minutes thirty-six seconds East six hundred twenty-six
and nineteen one-hundredths feet (N 48o 18' 36" E, 626.19'), to a
point along the common property line of Harleysville Mutual
Insurance Company and now or late Xxxxx Xxxxxx; thence North
forty-two degrees fifty-eight minutes thirty-seven seconds West
six hundred nineteen and sixty-two one-hundredths feet (N 42o 58'
37" W, 619.62') to a railroad spike on the Southside of
Lederachville Road; thence North forty-seven degrees twenty
minutes and fifteen seconds East, three hundred eighty-one and
fifty-six one-hundredths feet (N 47o 20' 15" E, 381.56') to a
railroad spike on the Southside of Lederachville Road; thence,
North thirty-eight degrees thirteen minutes forty-eight seconds
East eighty-three and fifty-three one-hundredths feet (N 38o 13'
48" E, 83.53') to a railroad spike on the Southside of
Lederachville Road; thence South fifty degrees fifty-six minutes
twelve seconds East thirteen and sixty one-hundredths feet (S 50o
56' 12" E, 13.60') to an iron pipe; thence, continuing South
fifty degrees fifty-six minutes twelve seconds East two hundred
forty-five feet (S 50o 56' 12" E, 245') along the land now or
late of Prescol Inc. to an iron pipe; thence North thirty-three
degrees twenty-six minutes four seconds East five hundred eighty-
three and ninety one-hundredths feet (N 33o 26' 04" E, 583.90')
along the land now or late of Prescol Inc. to an iron pipe;
thence, North thirty-eight degrees fourteen minutes thirty-four
seconds East two hundred five and eighty-three one-hundredths
feet (N 38o 14' 34" E, 205.83') along the land now or late of
Prescol Inc. to an iron pipe; thence, South forty-seven degrees
sixteen minutes fifty-four seconds East three hundred seventy-
three and sixty-three one-hundredths feet (S 47o 16' 54" E,
373.63') to an iron pipe; thence North forty-two degrees forty-
three minutes six seconds East eighteen feet (N 42o 43' 06" E,
18') to an iron pipe; thence South forty-seven degrees sixteen
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minutes fifty-four seconds East sixty-six and forty-eight one--
hundredths feet (S 47o 16' 54" E, 66.48') to an iron pipe; thence
along the arc of a curve having a radius of nine hundred four and
seventy-three one-hundredths feet (904.73') a delta of six
degrees four minutes twenty-eight seconds (06o 04' 28") and an
arc of ninety-five and ninety-two one-hundredths feet (95.92') in
distance to an iron pipe; thence South forty-three degrees twenty-
seven minutes fifty-eight seconds West five hundred ninety-four
and fifty-six one-hundredths feet (S 43o 27' 58" W, 594.46') to
an iron pipe; thence South forty-seven degrees thirty-three
minutes nine seconds West along the boundary line now or late of
Xxxxxx X. Xxxxx, three hundred fifty-nine and two one-hundredths
feet (S 47o 33' 09" W, 359.02') to an iron pipe; thence South
forty-five degrees seventeen minutes forty-four seconds East
along the boundary line now or late of Xxxxxx X. Xxxxx and now or
late of Xxxxxx X. Xxxxx, nine hundred fourteen and fifty-one one-
hundredths feet (S 45o 17' 44" E, 914.51') to an iron pipe;
thence continuing the same direction South forty--five degrees
seventeen minutes forty-four seconds East twenty and twenty-two
one-hundredths feet (S 45o 17' 44" E, 20.22') to a railroad spike
near the Northside of Harleysville Pike A/K/A Maple Avenue;
thence South fifty degrees twenty-seven minutes sixteen seconds
West one thousand forty-nine and seventy-two one-hundredths feet
(S 50o 27' 16" W, 1049.72') to a railroad spike to the point and
place of beginning, containing 37.0485 acres of land, more or
less.
BEING the same premises which Harleysville Mutual Insurance
Company, by Indenture dated September 30, 1985, and duly recorded
in the office for the Recording of Deeds, in and for the County
of Xxxxxxxxxx, at Norristown, Pennsylvania, on October 25, 1985,
in Deed Book 4782, at Page 1426, granted and conveyed unto
Harleys-ville, Ltd.
UNDER AND SUBJECT to easements of record.
BEING Parcel Numbers 50-00-02419-00-6 and 50-00-00772-00-6.
PARCEL #2:
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ALL THAT CERTAIN LOT OR PIECE OF GROUND tract or piece of land
situate in Lower Salford Township, Xxxxxxxxxx County and State of
Pennsylvania, bounded and described according to a re-survey
thereof made by Xxxxxxx X. Xxxxx, C.E. on August 22nd 1952 as
follows, to wit:
BEGINNING at a pin set at the intersection of Xxxxx Xxxxxxx Xxxxx
Xx. 00000 and the center line of Xxxxxxx Shop Road both 33 feet
wide also known as the Lederachville Road; thence along the
Meeting House Road North forty-three degrees East 643.5 feet to a
spike at the line of now or late Xxxxxx X. Xxxxxx; thence along
the Anders line South forty-six degrees and fifteen minutes East
619.62 feet to an iron pin in line of the Harleysville Mutual
Casualty Co. property; thence by the same South forty-five
2
degrees West 642.69 feet to an iron pin at or near the center
line of Xxxxxxx Shop Road; thence by the same North forty-six
degrees and twenty-one minutes West 597.21 feet to the center
line of the Lederachville Road the point of beginning.
BEING the same premises which Xxxxx X. Xxxxxx by Indenture dated
November 16, 1987, and duly recorded in the Office for the
Recording of Deeds, in and for the County of Xxxxxxxxxx, at
Norristown, Pennsylvania, on November 19, 1987 in Deed Book 4857,
at Page 2029, granted and conveyed unto Harleysville, Ltd.
BEING Parcel Number 50-00-02953-00-3.
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AMENDMENT TO LEASE AGREEMENT
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THIS AMENDMENT TO AGREEMENT OF LEASE (hereinafter
"Amendment") made as of this 1st day of January AD 2000 between
Harleysville, Ltd., a Pennsylvania limited partnership
(hereinafter "Lessor"), and Harleysville Mutual Insurance
Company, a Pennsylvania insurance corporation doing business at
000 Xxxxx Xxxxxx, Xxxxxxxxxxxx, XX 00000 (hereinafter "Lessee").
WITNESSETH:
WHEREAS, Lessor and Lessee entered into a Lease Agreement
(hereinafter "Lease"), for all that certain parcel of land,
together with buildings and improvements erected thereon as set
forth in Exhibit "A" to the Lease; and
WHEREAS, Lessor and Lessee desire to amend the Lease with
regard to the amount of base rent to be paid.
NOW, THEREFORE, the parties hereto, for the mutual promises
hereinafter contained, intending to be legally bound, do hereby
agree as follows:
1. Section 2 of the Lease shall be deleted in its entirety and
the following substituted in its place:
"The term of this Lease shall be for a period of five (5)
years commencing on January 1, 2000 and ending on December
31, 2004.
2. The first sentence of Section 3(a) of the Lease shall be
deleted in its entirety and the following shall be inserted in
its place:
"The base rent is Fifteen Dollars and Fifty-three Cents
($15.53) per square foot of office space per year."
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3. All terms, conditions, and provisions of the Lease are
hereby ratified and confirmed, excepted as amended herein.
IN WITNESS WHEREOF, the Lessor and the Lessee have set their
hands and seals the day and year first above written.
Lessor:
BY: HARLEYSVILLE GROUP INC.,
General Partner
Attest:
/s/XXXXX X. XXXXX BY:/s/XXXXX X. XXXXX
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Xxxxx X. Xxxxx Xxxxx X. Xxxxx
Senior Vice President, Senior Vice President, CFO, and
Secretary & Assistant Secretary
General Counsel
BY: HURON INSURANCE COMPANY,
Limited Partner
Attest:
/s/XXXXX X. XXXXX BY: /s/XXXXX X. XXXXXXX
-------------------- -----------------------------
Xxxxx X. Xxxxx Xxxxx X. Xxxxxxx
Secretary Vice President
Lessee:
HARLEYSVILLE MUTUAL INSURANCE COMPANY
Attest:
/s/XXXXX X. XXXXX BY:/s/XXXXX X. XXXX
--------------------- ------------------------
Xxxxx X. Xxxxx Xxxxx X. Xxxx
Senior Vice President, Vice President
Secretary &
General Counsel
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