Exhibit 10.5
LEASE AGREEMENT
THIS LEASE AGREEMENT, made this 8th day of June, 2005 by and between
Optium, Inc., a Delaware Corporation, (hereinafter referred to as Tenant) and
Xxx Palau, 000 Xxxxxxxx Xxxxx, Xxxxx Xxxx, XX 00000, (hereinafter referred to as
Landlord).
WITNESSETH:
The Landlord, for and in consideration of the prompt payment of the rent
as specified in this Agreement as well as the performance of all of the
covenants, promises and agreements contained in this Agreement upon the part of
the Tenant does hereby demise and Lease to the Tenant and Tenant does hereby
Lease from the Landlord the premises situate at 000 Xxxxxxx Xxxxx, Xxxxxxxx,
Xxxxx Xxxxxx, XX, comprising of approximately 36,403+/- square feet.
I. TERM
A. TERM
The term of this Lease shall be four (4) years commencing on November 1,
2005 (the Commencement Date) and terminating on the day prior to the anniversary
of the Lease Commencement Date. In the event that Landlord is unable to give
possession of the demised premises, as herein provided, by reason of any cause
beyond the control of Landlord, the Landlord shall not be liable in damages to
the Tenant therefore and during the period that Landlord is unable to give
possession, all rights and remedies of both parties hereunder shall be
suspended.
B. TERMINATION
This Lease shall expire at the end of the term as defined in paragraph
I.A., provided that in the event that the Tenant shall for any reason, fail to
vacate the Leased Premises at the expiration of the term of this Lease, the
Tenant shall be deemed to be a "hold-over" Tenant and liable for additional
rents provided in Paragraph II, Section E.
II. RENT
A. BASE RENT
The monthly rental payments shall be as follows:
Year 1 $ 47,020.54 per month
Year 2 $ 48,446.33 per month
Year 3 $ 49,872.11 per month
Year 4 $ 51,388.90 per month
Rental payments shall be payable at the offices of the Agent as set forth
below.
B. UTILITIES
Tenant shall be responsible for payment of all utility services including
heat, water, sewer, electricity, air conditioning and gas (if applicable). If
requested by Landlord, Tenant shall produce paid receipts for said utilities
upon the demand of Landlord.
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JUNE 6, 2005
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C. TAXES AND CONDOMINIUM ASSOCIATION FEE
Landlord shall be responsible for and pay all real estate taxes and
Condominium Association fees, as shall be in effect as of the Commencement Date.
As additional rent under this lease, Tenant shall pay all increases in the
amount of real estate taxes levied by the taxing authorities over the taxes
levied at the Commencement Date, assuming the property has been assessed as
completed. The 2005 County and Township Real Estate Taxes are $13,353.00. The
2005 Real Estate School Taxes will be attached on Exhibit "A" when the Real
Estate Tax xxxx is received from the taxing authority. Landlord shall notify
Tenant of such increased amounts and the said additional rental shall be due and
payable in a single payment with the rental payment due in the month following
the notification of the increase in taxes. In addition, Tenant shall pay any and
all increases in condominium fees as assessed by the Condominium Association and
Landlord shall notify Tenant of such increases and such additional rent shall
likewise be due and payable, in full for the period included in such increase,
with the next installment of rent following such notification. The Condominium
Association fees for 000 Xxxxxxx Xxxxx is $31,200.00 annually or $2,600.00 per
month.
D. RENTAL PAYMENTS
All rental payments shall be due and payable on or before the first day
of each calendar month during the term of this Lease. In the event that Tenant
shall not pay any payment of rent within five (5) days after the due date, a
late charge of ten percent (10%) of the base rental payment and additional
rental payment due shall be charged and payable with the next rental payment.
E. RENT WHILE HOLDING OVER
In the event that Tenant is classified as a hold-over Tenant pursuant to
paragraph I.B. above, then in addition to the rents provided for above, Tenant
shall pay an additional monthly rental of fifty percent (50%) of the total
aforementioned rents.
III. RIGHTS AND OBLIGATIONS OF TENANT
A. USE OF PREMISES
Tenant shall use the leased premises for office, engineering and light
manufacturing purposes and no other purpose. Tenant shall be responsible for the
acquisition of any and all permits for such use from any municipal or
governmental authority or agency at its own cost and expense.
B. FIXTURES AND EQUIPMENT
All trade fixtures, equipment, appliances, decorations, etc., installed
by Tenant in the Leased Premises shall remain the sole property of the Tenant,
provided, however, that Tenant shall repair any damages caused by the removal of
such fixtures, equipment, appliances, decorations, etc., from the Leased
Premises at the termination of this Lease as provided herein.
C. WASTE AND NUISANCE
Tenant shall not commit or suffer to be committed any waste or any
nuisance or other act or thing which may disturb the Landlord or any other
person to whom the Landlord has any duty.
D. GOVERNMENTAL REGULATIONS
Tenant shall at Tenant's sole cost and expense, without notice or demand
from Landlord, comply with and faithfully observe all requirements of all
municipal, county, state, federal and other governmental authorities having
jurisdiction, now in force or which may hereafter be enforced, pertaining to the
use of the Leased Premises.
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E. IMPROVEMENTS
Tenant shall not make any alterations, additions or improvements to the
Leased Premises without the prior written consent of Landlord. Consent for
non-structural alterations, additions, or improvements shall not be unreasonably
withheld by Landlord. Tenant shall comply with all governmental rules and
regulations in connection with such work, and shall prevent any lien or
obligation from being created against or imposed upon the Leased Premises and
will discharge all liens and charges for services rendered or materials
furnished immediately after such liens occur or said charges become due and
payable. Such alterations, additions or improvements shall become part of the
real property and remain the property of Landlord on termination of the Lease.
At all times when any change or alteration is in progress, there shall be
maintained, at Tenant's expense, Workmen's Compensation Insurance in accordance
with the law, covering all persons employed in connection with the change or
alteration, and general liability insurance of the mutual benefit of Tenant and
Landlord, expressly covering the additional hazards due to the change or
alteration.
F. SIGNS
Tenant may not install any signs or posters on the exterior of the
building in which the Leased Premises are located or at any other location
adjacent to the said building or install, display or use any signs except as
shall be permitted by the Landlord. Tenant shall comply with all other rules and
regulations imposed by the Landlord or any municipal or other authority
exercising jurisdiction over such matters. Tenant and Landlord hereby agree that
Tenant will erect two (2) small directional signs within the vicinity of 000
Xxxxxxx Xxxxx. Tenant shall submit signs and location plans for Landlord's
review and approval.
IV. MAINTENANCE BY TENANT
Landlord shall be responsible for and maintain in good operating
condition any and all heating, ventilation, and air-conditioning equipment
servicing the Premises. Landlord shall pay for a preventive maintenance contract
upon the air conditioning and heating unit servicing the demised premises.
Tenant shall have the sole liability and responsibility for any
maintenance of the interior of the Leased Premises and the repair and
maintenance of any fixtures or equipment contained therein, excluding heating,
ventilation and air conditioning equipment.
Tenant shall provide complete janitorial services to the premises at
least on a weekly basis and shall be responsible for the cost of such services.
Landlord reserves the right to visit the premises at reasonable times and
with reasonable notice.
Tenant shall not be responsible for any damage by fire elements or
unavoidable casualty or other catastrophe cause to premises which shall not be
due to the negligence of the Tenant, Tenant's employees, agents or servants.
V. INSURANCE AND INDEMNITY
A. LIABILITY INSURANCE REQUIRED OF THE TENANT
Tenant, at its own expense, shall provide and maintain in force during
the term of this Lease, liability and property damage insurance in the amount of
One Million Dollars ($1,000,000.00) on a combined single-limit basis, covering
Landlord as well as Tenant, with one or more responsible insurance companies
duly authorized to transact business in
Pennsylvania, listing Landlord as an
additional insured and loss payee. Tenant shall furnish Landlord with
certificates of all insurance required by this section. If Tenant does not
maintain such insurance in full force and effect, Landlord may notify Tenant of
such failure and if Tenant does not deliver to Landlord within ten (10) days
after such notice, certification showing all such insurance to be in full force
and effect, Landlord may at its option,
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JUNE 6, 2005
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take out the necessary insurance to comply with the provisions hereof and pay
the premiums on the items specified in such notice and Tenant covenants thereon
on demand to reimburse and pay Landlord any amounts paid or expended in the
amount of the insurance premiums required hereby and specified in the notice,
with interest thereon at the rate of eight (8%) percent per annum from the date
of such payment by Landlord until repaid by Tenant.
B. FIRE INSURANCE
Landlord shall maintain and keep in force and effect or cause to be
maintained and kept in force and effect a policy of fire insurance covering the
exterior of the premises of which the Leased Premises is a part and Tenant shall
be responsible for fire insurance covering the Leased Premises and contents,
with Landlord listed as loss payee as its interest appear.
C. INDEMNIFICATION OF LANDLORD
Except for claims arising out of acts caused by the negligence of the
Landlord or its representatives, Tenant will indemnify Landlord to the extent
that the loss is not covered by insurance and save Landlord harmless from and
against any and all claims, actions, damages, liability and expense in
conjunction with the loss of life, an occurrence in, upon or at the Leased
Premises or the occupancy or use by Tenant of the Leased Premises or any part
thereof, or occasioned wholly or in part by any act or omission of Tenant, his
agents, contractors, employees, or servants. In case Landlord shall have been
made a party to any litigation commenced by or against Tenant, then Tenant shall
protect and hold Landlord, harmless and shall pay all costs, expenses and
reasonable attorney's fees incurred or paid by Landlord in connection with such
litigation. This indemnification shall exclude claims made by Tenant against
Landlord. Tenant shall also pay all costs, expenses and reasonable attorney's
fees that may be incurred or paid by the Landlord in enforcing the covenants and
agreements of this Lease.
D. WAIVER OF SUBROGATION
Landlord and Tenant hereby release each other from any and all liability
or responsibility to the other or any one claiming through or under them by way
of subrogation or otherwise for any loss, damage or injury to property or
persons, including death, covered by any insurance then in force, even if such
loss or damage shall have been caused by the fault or the negligence of the
other party, or anyone for whom such party may be responsible. All policies of
insurance referred to herein shall contain a clause(s) or endorsement(s)
acknowledging such waiver of subrogation and also to the effect that this mutual
release shall not adversely affect or impair said insurance or prejudice the
right of any insured to recover thereunder.
VI. DESTRUCTION OF LEASED PREMISES
A. MINOR DAMAGE
If the Leased Premises shall be damaged by fire, the elements or
unavoidable casualty, but are not rendered materially unusable in whole or in
part, Landlord shall at its own expense and costs, promptly cause such damage to
be repaired and the rent shall not be abated.
B. PARTIAL DESTRUCTION
If by reason of such occurrence, the Leased Premises are rendered
materially unusable in part, the Landlord shall at its own expense, promptly
cause the damage to be repaired and the rent shall meanwhile be abated on a
prorata basis.
C. TOTAL DESTRUCTION
If the Leased Premises shall be rendered wholly unusable by reason of
total destruction, this Lease shall terminate upon the option of either the
Landlord or the Tenant and if so terminated, both parties shall be released from
any further liability under it.
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VII. EMINENT DOMAIN
A. TOTAL CONDEMNATION OF LEASED PREMISES
If the whole of the Leased Premises shall be acquired or condemned by
eminent domain for any public or quasi-public purpose, Tenant shall have the
right to terminate this Lease at any time after the date of title vesting in
such proceedings. All rental shall be prorated as of the date of such
termination.
B. LANDLORD'S DAMAGES
In the event of any condemnation or taking as aforesaid, whether whole or
partial, the Tenant shall not be entitled to any part of the award paid for such
condemnation, and the Landlord is to receive the full amount of such award;
Tenant hereby expressly waiving any rights or claim to any part thereof.
C. TENANT'S DAMAGES
Tenant shall have the right to claim and recover from any condemning
authority such compensation as may be separately awarded or recoverable by
Tenant in Tenant's own right on account of any and all damages to Tenant's
business by reason of the acquisition or condemnation, and for or on account of
any loss, losses or expenses to which Tenant may be put in removing Tenant's
merchandise, furniture, fixtures, equipment and leasehold improvements.
VIII. LANDLORD'S WARRANTIES AND COVENANTS
A. AUTHORITY AND TITLE
Landlord represents and warrants that Landlord is the owner of the Leased
Premises and has the right to make this lease.
B. QUIET ENJOYMENT
Landlord covenants that upon the payment by the Tenant of the rents
herein provided and upon performance of all the covenants, terms and conditions
oh Tenant's part to be observed and performed, Tenant shall peaceably and
quietly hold and enjoy the Leased Premises or the tenancy created hereby without
hindrance or interruption by the Landlord or any other person or persons
lawfully or equitably claiming by, through or under the Landlord, subject
nevertheless to the terms and conditions of this Lease.
IX. ASSIGNMENT AND SUBLEASE
A. ASSIGNMENT AND SUBLETTING BY TENANT
Tenant shall not have the right, except with the prior written consent of
Landlord, to assign this Lease or any interest therein and provided that the
assignee selected by Tenant shall be subject to the approval of Landlord and
that the assignee shall assume in writing all of the Tenant's obligations under
this Lease and Tenant shall remain liable for each and every obligation
hereunder.
The approval of Landlord shall be based upon the proposed assignee's
financial condition, proposed use and stability.
Tenant shall not have the right except with the prior written consent of
Landlord, to sublet the premises provided that the Landlord shall have the right
to approve such subTenant and that the subTenant shall assume in writing all of
the Tenant's obligation under this Lease, and Tenant shall remain liable for
each and every obligation under this Lease. The approval of such subTenant shall
be based upon the same conditions as set forth in the previous paragraph.
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X. CONFESSION OF JUDGMENT AND EJECTMENT
A. If the rent and/or any charges hereby reserved as rent, shall
remain unpaid on any day when the same shall be due, Tenant hereby empowers any
Prothonotary, Clerk of Court or attorney of record to appear for Tenant in any
and all actions which may be brought for rent and/or the charges, payments,
costs and expenses reserved as rent, or agreed to be paid by the Tenant and/or
to sign for Tenant an agreement for entering in any competent court for the
recovery of rent or other charges, payments, costs and expenses, and in said
suits or in said actions, to confess judgment against Tenant for all or any part
of the rent specified in this Lease, and then unpaid, including, at Landlord's
option, the rent for the entire unexpired balance of the term of this Lease,
and/or other charges, payments, costs and expenses reserved as rent or agreed to
be paid by the Tenant and for interest and costs together with an attorney's
commission not to exceed fifteen percent (15%).
B. When this Lease shall be determined by condition broken during the
original term of this Lease, it shall be lawful for any attorney for Tenant, to
file an agreement for entering in any competent court, of an amicable action in
judgment in ejectment against Tenant and all persons claiming under Tenant, for
the recovery by Landlord of possession of the herein Leased Premises, for which
this Lease or a copy thereof shall be its sufficient warrant, whereupon, if
Landlord so desires, a Writ of Execution or possession may issue forthwith,
without any prior writ or proceeding whatsoever, and provided that if for any
reason after such action shall have been commenced, the same shall be determined
and possession of the Premises hereby demised remain in or to be restored to
Tenant, Landlord shall have the right upon any subsequent default or defaults,
or upon the termination of this lease as herein before set forth, to bring one
or more actions as herein before set forth to recover possession of the said
premises.
C. In granting the above warrant of attorney to Confess judgment for
rent and/or ejectment, Tenant hereby knowingly, intentionally, and voluntarily
waives any and all rights (granted by constitution, statue, rule regulation or
otherwise) Tenant has or may have either upon the confession of judgment for
rent due or possession of the leased premises against Tenant after default or
condition broken or upon execution of process thereon against Tenant or property
of Tenant to: (i) prior notice; (ii) a prior judicial proceeding; and (iii)
review by an authorized public official; and Tenant expressly waives such rights
as an explicit and material part of the consideration hereof.
XI. SUBORDINATION
In the event that Landlord requests or that any lender of Landlord
requests, Tenant agrees to subordinate its interest under this lease to the
interest of such lender and Tenant further agrees to promptly execute any
estoppel or other certificate reasonably requested.
XII. SECURITY INTERESTS
Tenant hereby grants to Landlord a security interest in personal property
including all furniture, fixtures and equipment owned by Tenant and as such
shall be security for the rents reserved hereunder and/or subject to any
currently existing or hereafter placed security interests or financing
statements given by Tenant in acquisition of furniture, fixtures, equipment and
inventory. Tenant shall execute such Financing Statements or other documents as
may be required by Landlord to perfect its security interest hereunder.
XIII. SECURITY DEPOSIT
Tenant has deposited with Landlord the sum of Twelve thousand three
hundred thirty-four dollars and ninety-two cents ($12,334.92) to be held as
security for the full and faithful performance by Tenant of Tenant's obligations
under this Lease and for the payment of damages to the demised premises. The
security deposit shall be returned to Tenant at the expiration of the term of
this Lease less such sums as are required for the payment of damages to the
demised premises. It is understood and agreed that no part of the security
deposit is to be considered as the last rental due under the terms of this
Lease.
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XIV. MISCELLANEOUS
A. PARTIES
All rights and liabilities herein given to, or imposed upon the
respective parties hereto, extend to and bind the respective heirs, executors,
administrators, successors and assigns of said parties.
B. SECURITY
The Tenant shall be solely responsible for security for the Leased
Premises.
C. GOVERNING LAW
This Agreement shall be deemed to have been made in
Pennsylvania and all
the terms, conditions and covenants hereunder shall be governed by the laws of
the Commonwealth of
Pennsylvania.
D. ENTIRE AGREEMENT
This Lease and any exhibits attached hereto and form a part hereof, set
forth all of the covenants, promises, agreements, conditions for understandings,
either written or oral, between them other than as herein set forth. No
subsequent alteration, amendment, change or addition to this Lease shall be
binding on Landlord or Tenant unless reduced to writing and signed by them.
E. NOTICES
All notices that may be necessary under this Agreement shall conclusively
be presumed to have been given when sent by certified mail addressed
respectively as follows:
TO LANDLORD: XXX PALAU
000 Xxxxxxxx Xxxxx
Xxxxx Xxxx, XX 00000
TO TENANT: OPTIUM, INC.
Attn: Xxxxx Xxxxxx
000 Xxxxxxx Xxxxx
Xxxxx 000
Xxxxxxxx, XX 00000
TO AGENT: XXXX'X XXXXX REALTY CORP.
0000 X. Xxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
F. PARTIAL INVALIDITY
If any term, covenant or condition of this Lease or the application
thereof to any person or circumstances shall to any extent be in valid or
unenforceable, the remainder of this Lease or the application of such term,
covenant or condition to persons or circumstances other than those as to which
it is held invalid or unenforceable, shall not be affected thereby and each
term, covenant or condition of this Lease shall be valid and be enforceable to
the fullest extent permitted by law.
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G. AGENCY
It is hereby expressly agreed and understood that Xxxx'x Xxxxx Realty
Corporation is acting as "Agent" only and shall not in any event be held liable
to the Landlord or Tenant for the fulfillment or nonfulfillment of any of the
terms and conditions of this Lease, or for any action or proceedings that may be
taken by Landlord against Tenant, or by Tenant against Landlord. It is hereby
expressly agreed that Xxxx'x Xxxxx Realty Corp. shall receive a commission of
six (6%) percent of the monthly rental as collected by agent, including any
renewals, extensions or expansions.
H. FINANCIAL STATEMENTS
Tenant will provide Landlord with Tenant's statement of financial
credibility.
I. TENANT IMPROVEMENTS
Tenant intends and Landlord agrees to a significant building renovation
which is subject to Section III Paragraph E "Improvements." Additionally,
Landlord has reviewed and approved preliminary plans. Tenant will contract
directly with Xxx Xxxx, the architect, to design and prepare all final plans for
the entire building known as 000 Xxxxxxx Xxxxx. All payments to the architect
will be paid by Tenant. Furthermore, Tenant will submit to Landlord for
Landlord's review all building plans and copies of all building permits and
final Certificate of Occupancy if issued and required by New Britain Township.
Tenant will be responsible for procuring including all the payments of all
necessary plans and permits required by the appropriate governmental
authorities. Tenant will contract directly with the construction firm of its
choosing including the payments of all work to be done, which shall include
managing the construction contract.
Tenant will contract directly with the construction firm of its choosing
including the payments of all work to be done, which shall include managing the
construction contract. Landlord agrees to pay for the renovation of the
bathrooms in the Demised Premises as long as the existing plumbing lines are not
moved. Landlord reserves the right to review and approve the plans, the finishes
chosen, and cost to renovate the bathrooms prior to the commencement of
construction.
Subsequent Tenant Improvements will be solely subject to Section III
Paragraph E "Improvements."
Tenant will be responsible for payment of all utilities and interior
maintenance of Suite 503, consisting of approximately 6,648+/- square feet,
including when interior renovations are started by Tenant. The base rent for
Suite 503 shall commence on November 1, 2005 as per Section II, Paragraph A,
"Base Rent".
J. HEATING, VENTILATION and AIR CONDITIONING
Tenant, at its sole cost and expense will do an evaluation of the
heating, ventilation and cooling unit servicing the individual office suite
known as Suite 503 to determine if the unit in place is adequate to service
Suite 503.
K. RIGHT OF EARLY LEASE TERMINATION
Tenant may at its sole option, terminate the lease provided Tenant gives
six (6) months written notice to Landlord. The early termination fee in the
amount of three (3) months rent shall be paid prior to the termination of the
lease and would be due and payable in full prior to Tenant vacating the premises
and not later than ninety (90) days after the notice to terminate was given.
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X. XXXXXXXXXX XX XXXXX 000
When the
Lease Agreement has been fully executed by Tenant and landlord,
Tenant can take possession of Suite 503, provided an insurance
certificate is given to Landlord showing proof of insurance as required
by the
Lease Agreement, Section V, paragraph A, "Liability Insurance
Required Of The Tenant". Furthermore, Tenant will be responsible for
interior maintenance and utilities of Suite 503, per Section XIV,
paragraph I, "Tenant Improvements".
IN WITNESS WHEREOF, and intending to be legally bound, the Landlord and
Tenant have executed this Lease on the day and year first above written.
TENANT: OPTIUM, INC.
Attest: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxxx Xxxxxx
---------------------- -----------------------------
Xxxxx X. Xxxxxx Xxxxx Xxxxxx,
Assistant Secretary CEO & President
LANDLORD: XXX PALAU
Witness: /s/ [ILLEGIBLE] By: /s/ Xxx Palau
--------------------- -----------------------------
Xxx Palau
Date: 6/8/05
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EXHIBIT "A"
Amount of Real Estate School Tax to be attached
$____________
