LEASE AGREEMENT
BETWEEN
VITAMIN REALTY ASSOCIATES, L.L.C.,
LESSOR,
-AND-
ALL COMMUNICATION CORPORATION,
LESSEE.
-------------------------------------
DATED: March 20, 1997
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Prepared by:
Xxxxxx X. Xxxxxxxx, Esquire
Xxxxxxx & Xxxxxx, P.C.
000 Xxxxxxx Xxxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
TABLE OF CONTENTS
Page
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PRELIMINARY STATEMENT .................................................. 1
1. DEFINITIONS ........................................................ 1
2. DEMISE; TERM ....................................................... 6
3. BASIC RENT; ADDITIONAL RENT; NET LEASE ............................. 8
4. OPERATING EXPENSES ................................................. 9
5. LAYOUT AND FINISH OF DEMISED PREMISES .............................. 11
6. MAINTENANCE, ALTERATIONS AND
ADDITIONS; REMOVAL OF TRADE FIXTURES ............................... 15
7. USE OF DEMISED PREMISES ............................................ 16
8. LESSOR'S SERVICES .................................................. 17
9. INDEMNIFICATION; LIABILITY OF LESSOR ............................... 19
10. COMPLIANCE WITH REQUIREMENTS ....................................... 19
11. DISCHARGE OF LIENS ................................................. 23
12. PERMITTED CONTESTS ................................................. 23
13. INSURANCE .......................................................... 24
14. ESTOPPEL CERTIFICATES .............................................. 25
15. ASSIGNMENT AND SUBLETTING .......................................... 27
16. CASUALTY ........................................................... 32
17. CONDEMNATION ....................................................... 33
18. EVENTS OF DEFAULT .................................................. 34
19. CONDITIONAL LIMITATIONS; REMEDIES .................................. 36
20. RIGHT OF ENTRY; RESERVATION OF EASEMENTS ........................... 39
21. ACCORD AND SATISFACTION ............................................ 40
22. SUBORDINATION ...................................................... 40
23. LESSEE'S REMOVAL ................................................... 42
24. BROKERS ............................................................ 43
25. NOTICES ............................................................ 43
26. NATURE OF LESSOR'S OBLIGATIONS ..................................... 43
27. SECURITY DEPOSIT ................................................... 44
28. RULES AND REGULATIONS .............................................. 45
29. MISCELLANEOUS ...................................................... 45
30. RENEWAL OPTION ..................................................... 48
SCHEDULE A FLOOR PLAN
SCHEDULE B BASIC RENT
i
LEASE AGREEMENT
LEASE AGREEMENT (this "Lease"), made as of March 20, 1997, between
VITAMIN REALTY ASSOCIATES, L.L.C. (the "LESSOR"), a New Jersey limited liability
company, having an address at 000 Xxxx Xxxxxx, Xxxxxxxx, Xxx Xxxxxx 00000, and
ALL COMMUNICATIONS CORPORATION (the "LESSEE"), a New Jersey corporation, having
an address at 000 Xxxxx 00, Xxxxxxxxxxxx, Xxx Xxxxxx 00000.
PRELIMINARY STATEMENT
LESSOR is the owner in fee simple of a certain tract of land situated
in the Township of Hillside, County of Union and State of New Jersey, which is
designated on the official tax map for the Township of Hillside as Block 1110,
Lot 1 (the "Land"). On the Land, there is an office and warehouse building the
"Building") and other related improvements; the Land and the Building, including
all other improvements now or hereafter constructed on the Land and all fixtures
and appurtenances to the Land and the Building, are collectively referred to as
the "Premises". The Premises are commonly known as 000 Xxxx Xxxxxx, Xxxxxxxx,
Xxx Xxxxxx.
The roadways, the drainage areas, the landscape areas and the other
common portions of the Premises will be maintained for the benefit, use and
enjoyment of all tenants leasing space within the Premises.
LESSEE desires to lease from LESSOR approximately 1,560 rentable square
feet of warehouse space on the first floor of the Building and approximately
7,180 rentable square feet of office space on the second floor of the Building
(collectively, the "Demised Premises") in accordance with, and subject to, the
provisions of this Lease. The location of the Demised Premises is cross-hatched
on the floor plan annexed hereto as Schedule A.
NOW, THEREFORE, LESSOR and LESSEE agree as follows:
ARTICLE 1
DEFINITIONS
1.1. As used in this Lease, the following terms have the following
respective meanings:
(a) Additional Rent: defined in Section 3.2.
(b) Alterations: defined in Section 6.5.
(c) Basic Rent: defined in Section 3.1 and specified in Schedule B
annexed hereto.
(d) Basic Rent Payment Dates: the first day of each consecutive
calendar month during the Term.
(e) Building: defined in the Preliminary Statement.
(f) Building Holidays: Saturday, Sunday, New Year's Day, President's
Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas
Day.
(g) Business Hours: 8:00 AM to 6:00 PM, Monday through Friday, except
for Building Holidays.
(h) Change Orders: defined in Section 5.3.
(i) Commencement Date: defined in Section 2.2.
(j) Costs: defined in Section 5.2(a).
(k) Demised Premises: defined in the Preliminary Statement.
(l) Environmental Laws: all statutes, regulations, codes and ordinances
of any governmental entity, authority, agency and/or department relating to (i)
air emissions, (ii) water discharges, (iii) noise emissions, (iv) air, water or
ground pollution or (v) any other environmental or health matter, including,
without limitation, ISRA, the New Jersey Spill Compensation and Control Act,
N.J.S.A. 58:10-23.11 et seq. and the regulations promulgated thereunder, and the
Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C.
'SS' 9601 et seq. and the regulations promulgated thereunder.
(m) Events of Default: defined in Article 18.
(n) Excusable Delay: any delay caused by governmental action, or lack
thereof; shortages or unavailability of materials and/or supplies; labor
disputes (including, but not limited to, strikes, slow downs, job actions,
picketing and/or secondary boycotts); fire or other casualty; delays in
transportation; acts of God; directives or requests by any governmental entity,
authority, agency or department; any court or administrative orders or
regulations; adjustments of insurance; acts of declared or undeclared war,
public disorder, riot or civil commotion; or by anything else beyond the
reasonable control of LESSOR, including delays caused directly or indirectly by
an act or a failure to act by LESSEE or LESSEE'S Visitors.
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(o) Finish Work: defined in Section 5.3.
(p) Insurance Requirements: all terms of any insurance policy
maintained by LESSOR with respect to the Premises and all requirements of the
National Board of Fire Underwriters (or any other body exercising similar
function) applicable to or affecting all or any part of the Premises.
(q) ISRA: The New Jersey Industrial Site Recovery Act, N.J.S.A. 13:1K-6
et seq. and the regulations promulgated thereunder.
(r) Land: defined in the Preliminary Statement.
(s) Legal Requirements: all statutes, regulations, codes and ordinances
of any governmental entity, authority, agency and/or department, which now or at
any time hereafter may be applicable to the Premises or any part thereof,
including, but not limited to, all Environmental Laws.
(t) LESSEE: the party defined as such in the first paragraph of this
Lease.
(u) LESSEE Finish Work: defined in Section 5.3.
(v) LESSEE'S Finish Work Costs(s): defined in Section 5.2(a).
(w) LESSEE'S Notice: defined in Section 15.2.
(x) LESSEE'S Proportionate Share: for all purposes of this Lease shall
be deemed to be 6.0%.
(y) LESSEE'S Visitors: LESSEE'S agents, servants, employees,
subtenants, contractors, invitees, licensees and all other persons invited by
LESSEE into the Demised Premises as guests or doing lawful business with LESSEE.
(z) LESSOR: the party defined as such in the first paragraph of this
Lease, including at any time after the date hereof, the then owner of LESSOR'S
interest in the Premises.
(aa) LESSOR'S Estimated Operating Expenses: defined in Section 4.2.
(ab) LESSOR'S Expense Statement: defined in Section 4.2.
(ac) LESSOR'S Operating Expenses: those costs or expenses paid or
incurred by LESSOR in connection with the ownership,
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operation, management, maintenance, repair and replacement of the Premises,
including, but not limited to, the cost of common area electricity; sewer meter
charges; water; window cleaning; exterminating; insurance of all kinds carried
in good faith by LESSOR and applicable to the Premises (including, without
limitation, rent insurance); snow and ice removal; maintenance and cleaning of
the parking lots and driveways (including resurfacing and restripping);
regulation of traffic; landscape and grounds maintenance; service, maintenance,
repair and replacement of all mechanical, electrical, plumbing and other systems
and/or equipment (other than any system or equipment installed by LESSEE in the
Demised Premises); general maintenance and repairs of any kind for which LESSOR
is not reimbursed; painting and/or sealing of the exterior of the Building and
the common areas; management fees; maintenance and service agreements;
compliance with any Legal or Insurance Requirements; Taxes; contesting the Taxes
and/or the assessed valuation of the Premises (including reasonable attorneys'
fees, accounting fees and appraisal fees); any expenses allocable to the
Premises and/or to LESSOR which relate to the common areas of the Premises; the
cost of obtaining and maintaining access and/or utility licenses and easements
across any contiguous property which serve the Premises; security services
and/or alarm and fire protection systems and equipment; wages, salaries, fringe
benefits and other labor costs of all persons engaged by LESSOR for the
operation, maintenance, repair and replacement of the Premises; payroll taxes
and workers' compensation for such persons; legal and accounting expenses
(except legal expenses incurred in preparing leases or enforcing the terms of
leases); licenses, permits and other governmental charges; depreciation on and
rentals of machinery and equipment used in the operation and maintenance of the
Premises; and any other expense or cost, which, in accordance with generally
accepted accounting principles and the standard management practices for
buildings comparable to the Building, would be considered as an expense of
operating, managing, maintaining, repairing or replacing the Premises, plus a
sum equal to fifteen percent (15%) of the aggregate of the foregoing for general
overhead. Excluded from LESSOR'S Operating Expenses are costs reimbursed by
insurance; the cost of any work or service performed by LESSOR for any tenant of
the Building pursuant to the terms of said tenant's lease to the extent such
work or service is in excess of the work or service which LESSOR is obligated to
perform under this Lease; costs in connection with preparing space for a new
tenant; advertising expenses; real estate brokers' commissions; franchise,
transfer, inheritance or capital stock taxes or other taxes imposed upon or
measured by the income or profits of LESSOR; and administrative wages and
salaries or any other general and administrative overhead of LESSOR. All
accounting for LESSOR'S Operating Expenses shall be on the accrual basis. In the
event that, at any time during the Term, the Building is not fully leased
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and occupied by tenants, LESSOR'S Operating Expenses shall be projected as if
the Building were fully occupied at all times.
(ad) Lien: any mortgage, pledge, lien, charge, encumbrance or security
interest of any kind, including any inchoate mechanic's or materialmen's lien.
(ae) Net Award: any insurance proceeds or condemnation award payable in
connection with any damage, destruction or Taking, less any expenses incurred by
LESSOR in recovering such amount.
(af) Net Rental Proceeds: in the case of a sublease, the amount by
which the aggregate of all rents, additional charges or other consideration
payable under a sublease to LESSEE by the subtenant (including sums paid for the
sale or rental of LESSEE'S fixtures, leasehold improvements, equipment,
furniture or other personal property) exceeds the sum of (i) the Basic Rent plus
all amounts payable by LESSEE pursuant to the provisions hereof during the term
of the sublease in respect of the subleased space, (ii) brokerage commissions at
prevailing rates due and owing to a real estate brokerage firm, and (iii) the
then net unamortized or undepreciated cost of the fixtures, leasehold
improvements, equipment, furniture or other personal property included in the
subletting; and in the case of an assignment, the amount by which all sums and
other considerations paid to LESSEE by the assignee of this Lease for or by
reason of such assignment (including sums paid for the sale of LESSEE'S
fixtures, leasehold improvements, equipment, furniture or other personal
property) exceeds the sum of (i) brokerage commissions at prevailing rates due
and owing to a real estate brokerage firm, and (ii) the then net unamortized or
undepreciated cost of the fixtures, leasehold improvements, equipment, furniture
or other personal property sold to the assignee.
(ag) New Space: defined in Section 29.5.
(ah) Premises: defined in the Preliminary Statement.
(ai) Prime Rate: the prime commercial lending rate published from time
to time in The Wall Street Journal.
(aj) Punchlist Items: defined in Section 5.4.
(ak) Recapture Notice: defined in Section 15.5.
(al) Recapture Space: defined in Section 15.5.
(am) Restoration: the restoration, replacement or rebuilding of the
Building or any portion thereof as nearly as
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practicable to its value, condition and character immediately prior to any
damage, destruction or Taking.
(an) Rules and Regulations: defined in Article 28.
(ao) Taking: a taking of all or any part of the Premises, or any
interest therein or right accruing thereto, as the result of, or in lieu of, or
in anticipation of, the exercise of the right of condemnation or eminent domain
pursuant to any law, general or special, or by reason of the temporary
requisition of the use or occupancy of the Premises or any part thereof, by any
governmental authority, civil or military.
(ap) Taxes: all real estate taxes and assessments or substitutes
therefor or supplements thereto, upon, applicable, attributable or assessed
against the Premises or any part thereof, or any improvement thereon owned by
LESSOR and used in connection with the operation of the Building. If and to the
extent that due to a change in the method of taxation or assessment any
franchise, capital stock, capital, rent, income, profit or other tax or charge
shall be substituted by the applicable taxing authority for or added to the
Taxes now or hereafter imposed upon the Premises, such franchise, capital stock,
capital, rent, income, profit or other tax or charge shall be deemed included in
the term "Taxes", provided, however, that the amount of such tax, assessment,
levy, imposition, charge or fee deemed to be included in the term "Taxes" shall
be determined as if the Premises were the only asset of LESSOR and as if the
rent received therefrom were the only income of LESSOR. In the event the
Building is not fully leased and occupied by tenants, the Taxes shall be
projected as if the Building was fully occupied at all times.
(aq) Term: defined in Section 2.2.
(ar) Termination Date: the day preceding the fifth (5th) anniversary of
the Commencement Date, or such earlier date upon which the Term may expire or be
terminated pursuant to any of the conditions of this Lease or pursuant to law.
(as) Underlying Encumbrances: defined in Section 22.1.
(at) Working Drawings: defined in Section 5.3.
ARTICLE 2
DEMISE; TERM
2.1. LESSOR, for and in consideration of the covenants hereinafter
contained and made on the part of the LESSEE, does hereby demise and lease to
LESSEE, and LESSEE does hereby hire from
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LESSOR, the Demised Premises, together with the non-exclusive right to use 40
automobile parking spaces in the general parking area on the Land and the
non-exclusive right to use such other portions of the Premises as are intended
for common use, subject, however, to the terms and conditions of this Lease.
Tenant has inspected the Demised Premises and accepts the same "as is" in its
present condition, subject to the construction of the Finish Work.
2.2. The term (the "Term") of this Lease shall commence on (i) that
date when LESSOR shall have completed the Demised Premises (as provided in
Section 2.3) or (ii) the date on which LESSEE takes occupancy of the Demised
Premises, whichever is earlier (the "Commencement Date"), and shall end on the
Termination Date.
2.3. The Demised Premises shall be deemed completed on the day
following LESSOR'S notice to LESSEE that:
(a) all of the Finish Work shall have been completed other than (i)
details of construction, decoration and mechanical adjustments which are minor
in character and the non-completion of which do not unreasonably interfere with
LESSEE'S use of the Demised Premises; (ii) Change Orders; and (iii) any part of
the Finish Work which is not completed due solely to any act or omission of
LESSEE or of LESSEE'S Visitors, including, without limitation, delays due to
changes in or additions to such work, delays in submission of information or
estimates or giving authorizations or approvals, or delays due to the
postponement of any Finish Work at the request of LESSEE or because of any
Change Orders reasonably required to be done in advance of Finish Work so
postponed; and
(b) all of the sanitary, electrical, heating, air conditioning and
other systems servicing the Demised Premises shall be completed and in good
order and operating condition except for (i) details of construction and
mechanical adjustments which are minor in character and the noncompletion of
which do not unreasonably interfere with LESSEE'S use of the Demised Premises;
and (ii) any part thereof the noncompletion of which shall be due to any delay
of the character referred to in clause 2.3(a)(ii) or (iii); and
(c) LESSOR shall have (x) obtained a valid temporary or permanent
certificate of occupancy for the Demised Premises, if required, or (y) completed
all Finish Work and all work necessary to entitle LESSOR to the issuance of such
a certificate of occupancy, if required, other than any Finish Work or Change
Orders the noncompletion of which shall be due to any delay of the character
referred to in clause 2.3(a)(ii).
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If the occurrence of any condition listed above shall be delayed due to
any act or omission of any nature by LESSEE or LESSEE'S Visitors, the
Commencement Date shall be accelerated by a time period equal to the number of
days of delay so caused by LESSEE or LESSEE'S Visitors.
2.4. LESSEE, by entering into occupancy of any part of the Demised
Premises, shall be conclusively deemed to have agreed that LESSOR up to the time
of such occupancy had performed all of its obligations hereunder with respect to
such part and that such part, except for (a) latent defects, and (b) minor
details of construction, decoration and mechanical adjustment referred to above,
was in satisfactory condition as of the date of such occupancy, unless within
fifteen (15) days after such date LESSEE shall give notice to LESSOR specifying
the respects in which the same was not in such condition.
2.5. When the Commencement Date occurs, LESSOR and LESSEE shall enter
into an agreement memorializing the Commencement and Termination Dates of this
Lease.
ARTICLE 3
BASIC RENT; ADDITIONAL RENT; NET LEASE
3.1. LESSEE shall pay rent ("Basic Rent") to LESSOR during the Term in
the amounts and at the times provided in Schedule B in lawful money of the
United States of America; provided, however, LESSEE shall pay the first
installment of Basic Rent upon the execution of this Lease. In the event the
Commencement Date shall be other than a Basic Rent Payment Date, the Basic Rent
and Additional Rent payable hereunder shall be prorated for the initial and
terminal fractional months of the Term.
3.2. In addition to the Basic Rent, LESSEE shall pay to LESSOR during
the Term all other amounts, liabilities and obligations which LESSEE herein
agrees to pay to LESSOR as and when the same become due (hereinafter
collectively referred to as "Additional Rent"); and LESSEE agrees that each such
amount, liability and obligation, together with any interest, penalty and/or
cost thereon, shall be deemed Additional Rent regardless of whether it is
specifically referred to as Additional Rent in this Lease. LESSOR shall have all
the rights, powers and remedies provided for in this Lease or at law or in
equity or otherwise for failure to pay Additional Rent as are available for
nonpayment of Basic Rent.
3.3. If any installment of Basic Rent or Additional Rent is not paid
when due, LESSEE shall pay to LESSOR on demand, as Additional Rent, a late
charge equal to four percent (4%) of the amount unpaid. In addition, any
installment or installments of
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Basic Rent or Additional Rent accruing hereunder which are not paid within ten
(10) days after the date when due, shall bear interest at the Prime Rate plus
four percent (4%) per annum from the due date thereof until the date of payment,
which interest shall be deemed Additional Rent hereunder and shall be payable
upon demand by LESSOR.
3.4. LESSEE will contract for and pay all charges for communications
services at any time rendered or used on or about the Demised Premises to the
company providing the same.
3.5. Except as herein provided, LESSEE hereby covenants and agrees to
pay to LESSOR during the Term, at LESSOR'S address for notices hereunder, or
such other place as LESSOR may from time to time designate, without any offset,
set-off, counterclaim, deduction, defense, abatement, suspension, deferment or
diminution of any kind (i) the Basic Rent, without notice or demand, (ii)
Additional Rent and (iii) all other sums payable by LESSEE hereunder. Except as
otherwise expressly provided herein, this Lease shall not terminate, nor shall
LESSEE have any right to terminate or avoid this Lease or be entitled to the
abatement of any Basic Rent, Additional Rent or other sums payable hereunder or
any reduction thereof, nor shall the obligations and liabilities of LESSEE
hereunder be in any way affected for any reason. The obligations of LESSEE
hereunder shall be separate and independent covenants and agreements.
ARTICLE 4
OPERATING EXPENSES
4.1. LESSEE shall pay to LESSOR, as Additional Rent, LESSEE'S
Proportionate Share of LESSOR'S Operating Expenses for any calendar year during
the Term. LESSEE'S Proportionate Share of LESSOR'S Operating Expenses for less
than a year shall be prorated and apportioned.
4.2. On or about the Commencement Date, and thereafter within ninety
(90) days following the first day of each succeeding calendar year within the
Term, LESSOR shall determine or estimate LESSEE'S Proportionate Share of
LESSOR'S Operating Expenses for such calendar year ("LESSOR'S Estimated
Operating Expenses") and shall submit such information to LESSEE in a written
statement ("LESSOR'S Expense Statement").
4.3. Commencing on the first Basic Rent Payment Date following the
submission of any LESSOR'S Expense Statement and continuing thereafter until
LESSOR renders the next LESSOR'S Expense Statement, LESSEE shall pay to LESSOR
on account of its obligation under Section 4.1 of this Lease, a sum (the
"Monthly
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Expense Payment") equal to one-twelfth (1/12) of LESSEE'S Proportionate Share of
LESSOR'S Estimated Operating Expenses for such calendar year. LESSEE'S first
Monthly Expense Payment after receipt of LESSOR'S Expense Statement shall be
accompanied by the payment of an amount equal to the product of the number of
full months, if any, within the calendar year which shall have elapsed prior to
such first Monthly Expense Payment, times the Monthly Expense Payment; minus any
Additional Rent already paid by LESSEE on account of its obligation under
Section 4.1 of this Lease for such calendar year.
4.4. LESSOR shall use reasonable efforts to deliver to LESSEE within
120 days after each calendar year a statement of the final Operating Expenses
for the immediately preceding calendar year which shall reconcile the payments
made by LESSEE for such calendar year. Any balance due to LESSOR shall be paid
by LESSEE within thirty (30) days after LESSEE'S receipt of the final LESSOR'S
Expense Statement; any surplus due to LESSEE shall be applied by LESSOR against
the next accruing monthly installment(s) of Additional Rent due under this
Article. If the Term has expired or has been terminated, LESSEE shall pay the
balance due to LESSOR or, alternatively, LESSOR shall refund the surplus to
LESSEE, whichever the case may be, within thirty (30) days after LESSEE'S
receipt of the final LESSOR'S Expense Statement; provided, however, if the Term
shall have been terminated as a result of a default by LESSEE, then LESSOR shall
have the right to retain such surplus to the extent LESSEE owes LESSOR any Basic
Rent or Additional Rent.
4.5. LESSEE or its representative shall have the right to examine
LESSOR'S books and records with respect to the reconciliation of LESSOR'S
Operating Expenses for the prior calendar year set forth in the final LESSOR'S
Expense Statement during normal business hours at any time within thirty (30)
days following the delivery by LESSOR to LESSEE of such final LESSOR'S Expense
Statement. Unless LESSEE shall give LESSOR a notice objecting to said
reconciliation and specifying the respects in which said reconciliation is
claimed to be incorrect within ten (10) days after the date of said examination,
said reconciliation shall be considered as final and accepted by LESSEE.
Notwithstanding anything to the contrary contained in this Article, LESSEE shall
not be permitted to examine LESSOR'S books and records or to dispute said
reconciliation unless LESSEE has paid to LESSOR the amount due as shown thereon;
said payment is a condition precedent to said examination and/or dispute.
4.6. (a) If LESSOR shall receive any refund of Taxes in respect of a
calendar year and if LESSEE shall have paid Additional Rent pursuant to this
Article 4 for said calendar year, LESSOR shall credit to LESSEE LESSEE'S
Proportionate Share of such refund (based upon the portion of said Taxes paid by
LESSEE)
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against the next accruing monthly installment(s) of Additional Rent due under
this Article, or if the Term shall have expired, LESSEE'S Proportionate Share of
such refund shall be refunded to LESSEE within thirty (30) days after receipt
thereof by LESSOR; provided, however, if the Term shall have expired as a result
of a default by LESSEE, then LESSOR shall have the right to retain LESSEE'S
Proportionate Share of the refund to the extent LESSEE owes LESSOR any Basic
Rent or Additional Rent.
(b) While proceedings for the reduction in assessed valuation for
any year are pending, the computation of the Taxes shall be based upon the
original assessments for such year.
(c) Notwithstanding anything to the contrary contained in this
Lease, LESSEE shall not have the right to contest or appeal the validity of any
Taxes or the amount of the assessed valuation of the Premises without the prior
written consent of LESSOR.
4.7. In no event shall any adjustment in LESSEE'S obligation to pay
Additional Rent under this Article 4 result in a decrease in the Basic Rent
payable hereunder. LESSEE'S obligation to pay Additional Rent, and LESSOR'S
obligation to credit and/or refund to LESSEE any amount, pursuant to the
provisions of this Article 4, shall survive the Termination Date.
4.8. LESSEE shall also pay to LESSOR, as Additional Rent, upon demand,
the amount of any increase in LESSOR'S Operating Expenses which is attributable
to LESSEE'S use or manner of use of the Demised Premises, to activities
conducted on or about the Demised Premises by LESSEE or on behalf of LESSEE or
to any additions, improvements or alterations to the Demised Premises made by or
on behalf of LESSEE.
4.9. The provisions of Section 29.3 shall apply to LESSOR'S Expense
Statement.
ARTICLE 5
LAYOUT AND FINISH OF DEMISED PREMISES
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5.1. (a) LESSOR shall construct improvements to the Demised Premises in
preparation for LESSEE's occupancy in accordance with the architectural and
engineering working drawings and specifications (the "Working Drawings") for the
layout and finish of the Demised Premises, titled "Construction Plan" prepared
by T.L. dated February 24, 1997 (Drawing No. A1-A5).
(b) LESSOR, as promptly as is practicable after receiving the
necessary governmental approvals required for the
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commencement of construction, shall, through a contractor or contractors to be
engaged by it for such purpose, proceed with due dispatch, subject to any
Excusable Delay, to do all the work shown on the Working Drawings (such work
being herein called the "Finish Work").
5.2. (a) LESSOR shall pay all Costs (as hereinafter defined) in
connection with constructing the Finish Work as shown on the Working Drawings.
LESSEE shall reimburse LESSOR for the amount by which the Costs of the Finish
Work exceeds $75,000.00 ("LESSEE'S Finish Work Costs") within ten (10) days
after LESSEE receives written invoices evidencing the Costs incurred by LESSOR
in performing the Finish Work. The term "Costs" shall mean all actual costs
incurred by LESSOR for work performed or caused to be performed by LESSOR, its
architects, engineers, contractors and subcontractors, including, but not
limited to, the cost of materials, labor, permits, approvals and insurance. The
failure of LESSEE to pay such amount to LESSOR within such ten (10) day period
shall be a default by LESSEE of its obligations hereunder, and, as a result of
such default, LESSOR shall have all rights and remedies provided in Article 18
hereof.
(b) LESSEE shall be solely responsible for the cost of preparing
the Working Drawings.
(c) LESSOR shall use reasonable efforts, including the
solicitation of competitive bids where appropriate from reputable contractors,
to obtain the construction of the Finish Work at a reasonable cost. LESSOR shall
deliver to LESSEE, for informational purposes only, all bids from contractors
and subcontractor to perform any aspect of the Finish Work promptly after
receipt of such bids.
5.3. If LESSEE decides to amend, change or modify the Working Drawings,
LESSEE shall submit to LESSOR for its approval (which approval shall not be
unreasonably withheld) a reasonably detailed description of a proposed
amendment, change or modification (hereinafter referred to as a "Change Order").
Within ten (10) business days after receipt of the Change Order, LESSOR shall
notify LESSEE whether it approves or disapproves the Change Order, the estimated
construction costs for the Change Order and the effect, if any, of the Change
Order on the Commencement Date. If LESSOR approves the Change Order, LESSOR
shall notify LESSEE of such approval and LESSEE shall notify LESSOR whether it
approves the estimated cost and the effect, if any, on the Commencement Date
within five (5) business days after LESSEE's receipt of LESSOR's notice. If
LESSEE fails to notify LESSOR of LESSEE's approval of the estimated cost and the
effect on the Commencement Date within said five (5) business day period, then
LESSEE shall be deemed to have disapproved the estimated cost and effect on the
Commencement
12
Date. Notwithstanding anything to the contrary contained herein, LESSOR shall
not proceed with the work shown on any approved Change Order unless LESSEE has
approved LESSOR's determination of the cost and effect of the Change Order. If
LESSEE has notified LESSOR of its approval, then LESSEE shall pay 100% of the
Costs of the Change Order in accordance with the provisions of Sections 6.1(b)
and (f) hereof.
5.4. Upon notification by LESSOR to LESSEE that the Finish Work has
been substantially completed as set forth herein, LESSOR and LESSEE will inspect
the Demises Premises and develop a list of all defects or incomplete items in or
of the Finish Work which would not materially interfere with LESSEE's use of the
Demised Premises and which would reasonably be determined in a walk-through
inspection (the "Punchlist Items"). LESSOR agrees to correct, at its sole cost
and expense, all Punchlist Items with due diligence.
5.5. LESSEE shall pay Costs of any Change Orders as Additional Rent
hereunder at the time of the payment of LESSEE'S Finish Work Costs.
5.6. Notwithstanding anything contained in this Lease to the contrary,
and as an essential inducement to LESSOR, LESSEE agrees that, while LESSOR is
performing Finish Work and Change Orders (if applicable):
(a) LESSEE shall not perform or cause to be performed any
alteration, construction, fixturing, decoration or other work in the Demised
Premises by LESSEE'S Visitors without LESSOR'S prior written consent in each
instance. LESSEE acknowledges that LESSOR shall have the right to withhold its
consent to the performance of any such alteration, construction or other work in
the exercise of its sole discretion.
(b) In the event that LESSOR shall grant its consent to LESSEE to
perform such alteration, construction, fixturing, decoration or other work in
the Demised Premises, then LESSEE agrees promptly to notify LESSOR in writing of
the names of LESSEE'S Visitors who are to work in said Demised Premises, and to
furnish LESSOR with such other information as LESSOR may require. All work done
by LESSEE and LESSEE'S Visitors shall be scheduled and performed so as not to
conflict, interfere with, or delay LESSOR'S completion of the Demised Premises.
In the event that LESSEE or LESSEE'S Visitors do not work in harmony with, or
interfere with, labor employed by LESSOR, its agents, contractors,
subcontractors or employees, or in the event any work stoppage, jurisdictional
labor dispute or other interference with LESSOR, its agents, contractors,
subcontractors or employees occurs, of which facts LESSOR shall be sole and
absolute judge, LESSOR shall have
13
the right to require LESSEE, upon written demand, to remove or cause the removal
forthwith of all LESSEE'S Visitors from the Demised Premises and LESSEE agrees
to comply with such demand immediately. In the event LESSEE fails to comply with
such demand immediately, and thereby causes a delay in the completion of the
Finish Work and/or the Change Orders, the same shall be deemed a delay of the
character referred to in clause 2.3(a)(iii). If such delay does not cease within
a reasonable period of time (not to exceed twenty (20) days), then such delay
shall constitute a material breach of this Lease entitling LESSOR to all of its
rights hereunder and at law to terminate this Lease and to hold LESSEE fully
liable for all damages resulting therefrom.
(c) LESSOR shall in no event be liable in any way for any injury,
loss or damage which may occur to any of LESSEE'S fixtures, equipment,
decorations, installations or other property of any nature whatsoever which
LESSEE elects to install or place in or about the Demised Premises prior to the
Commencement Date pursuant to this Article, except in the event such injury,
loss or damage is caused by the gross negligence of LESSOR. Such items shall be
installed and/or placed in or about the Demised Premises solely at LESSEE'S
risk. LESSEE shall be liable to LESSOR in the event LESSEE or LESSEE'S Visitors
damage LESSOR'S installations, or mechanical equipment, or other property.
(d) Except for the obligation to pay Basic Rent and Additional
Rent, the terms and conditions of this Lease shall apply during any period that
LESSEE or LESSEE'S Visitors are performing work within the Demised Premises, and
LESSEE shall submit proof to LESSOR'S reasonable satisfaction, prior to entering
upon the Demised Premises pursuant to this Article, that LESSEE has in full
force and effect comprehensive general public liability insurance complying with
the requirements of Article 13.
5.7. LESSOR shall obtain, at LESSOR'S expense, only those building
permits required in connection with the portion of the Finish Work within the
scope of the Working Drawings and the Outline Specifications, and LESSEE shall
obtain, at its expense, all permits, licenses or authorizations of any nature
required in connection with the operation of LESSEE'S business at the Demised
Premises or any work performed by LESSEE or LESSEE'S Visitors.
14
ARTICLE 6
MAINTENANCE, ALTERATIONS AND ADDITIONS;
REMOVAL OF TRADE FIXTURES
6.1. LESSEE agrees to keep the Demised Premises (including, but not
limited to, all systems located within the Demised Premises and servicing only
the Demised Premises) in good order and condition (except for ordinary wear and
tear) and will make all non-structural repairs, alterations, renewals and
replacements, ordinary and extraordinary, foreseen or unforeseen, and shall take
such other action as may be necessary or appropriate to keep and maintain the
Demised Premises in good order and condition. Except as expressly provided in
this Lease, LESSOR shall not be obligated in any way to maintain, alter or
repair the Demised Premises. Notice is hereby given that, except with respect to
repairs or restoration undertaken by LESSOR, LESSOR will not be liable for any
labor, services or materials furnished or to be furnished to LESSEE, or to
anyone holding the Demised Premises or any part thereof through or under LESSEE,
and that no mechanics' or other liens for any such labor or materials shall
attach to or affect the interest of LESSOR in and to the Demised Premises.
6.2. If LESSOR is required to make any repairs and replacements to the
Premises as a result of or arising out of the intentional acts or negligence of
LESSEE or LESSEE'S Visitors, then LESSEE shall reimburse LESSOR, upon demand,
for the reasonable cost thereof.
6.3. All maintenance and repair, and each addition, improvement or
alteration (a) must not, individually or in the aggregate, adversely affect the
usefulness of the Demised Premises for use as office space, (b) shall be
completed expeditiously in a good and workmanlike manner, and in compliance with
all applicable Legal and Insurance Requirements, (c) shall be completed free and
clear of all Liens and (d) shall be performed by contractors approved by LESSOR
to the extent such work involves any work to any electrical, mechanical,
plumbing or other system of the Building, any work to the outside of the
Building, any work to the roof of the Building or any work to any structural
element of the Building.
6.4. LESSEE shall not make any addition, improvement or alteration of
the Demised Premises (any such work being hereinafter referred to as
"Alterations"), unless LESSEE submits to LESSOR detailed plans and
specifications therefor and LESSOR approves such plans and specifications in
writing (which such approval shall be at LESSOR'S sole discretion).
6.5. (a) All additions, improvements and alterations to the Demised
Premises shall, upon installation, become the property
15
of LESSOR and shall be deemed part of, and shall be surrendered with, the
Demised Premises, unless LESSOR, by notice given to LESSEE at least thirty (30)
days prior to the Termination Date, elects to relinquish LESSOR'S right thereto.
If LESSOR elects to relinquish LESSOR'S right to any such addition, improvement
or alteration, LESSEE shall remove said addition, improvement or alteration,
shall promptly repair any damage to the Demised Premises caused by said removal
and shall restore the Demised Premises to the condition existing prior to the
installation of said addition, improvement or alteration; all such work shall be
done prior to the Termination Date.
(b) LESSEE may install or place or reinstall or replace and
remove from the Demised Premises any trade equipment, machinery and personal
property belonging to LESSEE, provided, that (i) LESSEE shall repair all damage
caused by such removal and (ii) LESSEE shall not install any equipment,
machinery or other items upon the roof of the Building or make any openings on
or about such roof. Such trade equipment, machinery and personal property shall
not become the property of LESSOR.
ARTICLE 7
USE OF DEMISED PREMISES
7.1. LESSEE shall not, except with the prior consent of LESSOR, use or
suffer or permit the use of the Demised Premises or any part thereof for any
purposes other than general, administrative and sales offices and warehousing of
inventory in connection therewith; provided, however, anything in this Lease to
the contrary notwithstanding, that (a) the portions of the Demised Premises
which are identified as toilets or utility areas shall be used by LESSEE only
for the purposes for which they are designed, (b) LESSEE complies with the
requirements of Section 7.2 hereof, and (c) in no event shall LESSEE use the
Demised Premises for retail purposes to the general public.
7.2. LESSEE shall not use, or suffer or permit the use of, the Demised
Premises or any part thereof in any manner or for any purpose or do, bring or
keep anything, or suffer or permit anything to be done, brought or kept, therein
(including, but not limited to, the installation or operation of any electrical,
electronic or other equipment) (a) which would violate any covenant, agreement,
term, provision or condition of this Lease or is unlawful or in contravention
of the certificate of occupancy for the Building or the Demised Premises, or is
in contravention of any Legal or Insurance Requirement to which the Building or
the Demised Premises is subject, or (b) which would overload or could cause an
overload of the electrical or mechanical systems of the Building or the Demised
Premises or which would exceed the floor load per
16
square foot which the floor was designed to carry and which is allowed by law,
or (c) which in the reasonable judgment of the LESSOR may in any way impair or
interfere with the proper and economic heating, air conditioning of the Building
or (d) suffer or permit the Building or any component thereof to be used in any
manner or anything to be done therein or anything to be brought into or kept
thereon which, in the reasonable judgment of LESSOR, would in any way impair or
tend to impair or exceed the design criteria, the structural integrity,
character or appearance of the Building, or result in the use of the Building or
any component thereof in a manner or for a purpose not intended; nor shall the
LESSEE use, or suffer or permit the use of, the Demised Premises or any part
thereof in any manner, or do, or suffer or permit the doing of, anything therein
or in connection with the LESSEE'S business or advertising which, in the
reasonable judgment of the LESSOR, may be prejudicial to the business of
LESSOR.
7.3. LESSEE shall obtain, at its sole cost and expense, all permits,
licenses or authorizations of any nature required in connection with the
operation of LESSEE'S business at the Demised Premises.
ARTICLE 8
LESSOR'S SERVICES
8.1. LESSOR shall furnish to LESSEE only the services set forth in this
Lease.
8.2. Throughout the Term, LESSOR shall supply the following items,
which shall be included in LESSOR'S Operating Expenses (a) janitorial services
for the Demised Premises at times reasonably determined by LESSOR (other than
during Building Holidays); and (b) snow and ice removal from the parking areas,
driveways and sidewalks each day (other than Building Holidays) within a
reasonable time after accumulation thereof.
8.3. (a) LESSOR shall provide to the Demised Premises HVAC,
electricity, hot and cold water and sewer services. The Demised Premises are not
separately metered, and LESSEE shall pay to LESSOR as Additional Rent, LESSEE'S
Proportionate Share of the cost of such services, which payment shall be due
within ten (10) days after receipt of a statement therefor from LESSOR.
Notwithstanding anything to the contrary contained in this Lease, LESSEE hereby
expressly agrees and acknowledges that (i) LESSOR shall not be liable in any way
to LESSEE (A) for any loss, damage, failure, defect or change in the quantity or
character of any utility furnished to the Demised Premises, (B) or if such
quantity or character of any utility furnished to the Demised Premises is no
17
longer available or suitable for LESSEE'S requirements, or (C) for any
cessation, diminution or interruption of the supply thereof.
(b) LESSEE shall be responsible for replacing all light bulbs,
fluorescent lamps, non-Building standard lamps and bulbs, and all ballasts used
by LESSEE in the Demised Premises. At the option of LESSOR, LESSEE shall
purchase from LESSOR all fluorescent lamps, light bulbs and ballasts used in the
Demised Premises and pay LESSOR for the cost of same.
(c) LESSEE shall make no alteration to the existing electrical
equipment or connect any fixtures, appliances or equipment thereto (other than
electric typewriters, personal computers, calculators, desk lights, photocopy
machines and other small, ordinary office equipment) without the prior written
consent of LESSOR in each instance. Should LESSOR grant such consent, all
additional risers or other equipment required therefor shall be provided by
LESSOR and the cost thereof shall be paid by LESSEE as Additional Rent upon
LESSOR'S demand.
8.4. LESSOR shall not be liable to LESSEE for any costs, expenses or
damages incurred by LESSEE as a result of any failure to furnish any service
hereunder, or any interruption of any utility service to the Demised Premises,
and such failure or interruption (i) shall not be construed as a constructive
eviction or eviction of LESSEE, (ii) shall not excuse LESSEE from failing to
perform any of its obligations hereunder and (iii) shall not entitle LESSEE to
any abatement or offset against Basic Rent or Additional Rent. LESSEE agrees
that any service to be provided by LESSOR may be stopped and/or interrupted in
connection with any inspection, repair, replacement or emergency.
8.5. The parties hereto shall comply with all mandatory and voluntary
energy conservation controls and requirements imposed or instituted by the
Federal, State or local governments and applicable to office and warehouse
buildings, including, without limitation, controls on the permitted range of
temperature settings, and requirements necessitating curtailment of the volume
of energy consumption or the hours of operation of the Building. Any terms or
conditions of this Lease that conflict or interfere with such controls or
requirements shall be suspended for the duration of such controls or
requirements. Compliance with such controls or requirements shall not be
considered an eviction, actual or constructive, of LESSEE from the Demised
Premises and shall not entitle LESSEE to terminate this Lease or to an abatement
of any Basic Rent or Additional Rent.
18
ARTICLE 9
INDEMNIFICATION; LIABILITY OF LESSOR
9.1. LESSEE hereby indemnifies, and shall pay, protect and hold LESSOR
harmless from and against all liabilities, losses, claims, demands, costs,
expenses (including attorneys' fees and expenses) and judgments of any nature,
(except to the extent LESSOR is compensated by insurance maintained by LESSEE
hereunder and except for such of the foregoing as arise from the recklessness or
willful misconduct of LESSOR, its agents, servants or employees), arising, or
alleged to arise, from or in connection with, (a) any injury to, or the death
of, any person or loss or damage to property on or about the Demised Premises,
(b) any violation of this Lease or of any Legal or Insurance Requirement, or (c)
performance of any labor or services or the furnishing of any materials or other
property in respect of the Demised Premises or any part thereof. LESSEE will
resist and defend any action, suit or proceeding brought against LESSOR by
reason of any such occurrence by independent counsel selected by LESSEE, which
is reasonably acceptable to LESSOR. The obligations of LESSEE under this Section
9.1 shall survive any termination of this Lease.
9.2. LESSEE agrees to make no claim against LESSOR for any injury or
damage to LESSEE or to any other person or for any damage to, or loss (by theft
or otherwise) of, or loss of use of, any property of LESSEE or of any other
person, unless caused by the recklessness or willful misconduct of LESSOR, its
agents, servants and employees, it being understood that LESSEE assumes all risk
in connection therewith.
ARTICLE 10
COMPLIANCE WITH REQUIREMENTS
10.1. At its sole cost and expense, LESSEE will (a) comply with all
Legal and Insurance Requirements applicable to the Demised Premises and the use
thereof and (b) maintain and comply with all permits, licenses and other
authorizations required by any governmental authority for its use of the Demised
Premises and for the proper operation, maintenance and repair of the Demised
Premises or any part thereof. LESSOR will join in the application for any permit
or authorization with respect to Legal Requirements if such joinder is
necessary.
10.2. LESSEE shall not do, or permit to be done, anything in or to the
Demised Premises, or bring or keep anything therein which will, in any way,
increase the cost of fire or public liability insurance on the Premises, or
invalidate or conflict with the fire insurance or public liability insurance
policies covering
19
the Premises or any personal property kept therein by LESSOR, or obstruct or
interfere with the rights of LESSOR or of other tenants, or in any other way
injure LESSOR or other tenants, or subject LESSOR to any liability for injury to
persons or damage to property, or interfere with good order of the Building, or
conflict with the Legal Requirements. Any increase in fire insurance premiums on
the Premises or the contents within the Building, or any increase in the
premiums of any other insurance carried by LESSOR in connection with the
Building or the Demised Premises, caused by the use or occupancy of the Demised
Premises by LESSEE and any expense or cost incurred in consequence of the
negligence, carelessness or willful action of LESSEE, shall be Additional Rent
and paid by LESSEE to LESSOR within ten (10) days of demand therefor made by
LESSOR to LESSEE.
10.3. LESSEE shall deliver promptly to LESSOR a true and complete
photocopy of any correspondence, notice, report, sampling, test, finding,
declaration, submission, order, complaint, citation or any other instrument,
document, agreement and/or information submitted to, or received from, any
governmental entity, department or agency in connection with any Environmental
Law relating to or affecting LESSEE, LESSEE'S employees, LESSEE'S use and
occupancy of the Demised Premises and/or the Demised Premises.
10.4. LESSEE shall not cause or permit any "hazardous substance" or
"hazardous waste" (as such terms are defined under ISRA or any other
Environmental Law) to be brought, kept or stored on or about the Demised
Premises, and LESSEE shall not engage in, or permit any other person or entity
to engage in, any activity, operation or business on or about the Demised
Premises which involves the generation, manufacture, refining, transportation,
treatment, storage, handling or disposal of hazardous substances and/or
hazardous wastes.
10.5. (a) If a spill or discharge of a hazardous substance or a
hazardous waste occurs on the Premises, LESSEE shall give LESSOR immediate oral
and written notice of such spill and/or discharge, setting forth in reasonable
detail all relevant facts. In the event such spill or discharge arose out of or
in connection with LESSEE'S use and occupancy of the Demised Premises, or in the
event such spill or discharge was caused by the act, negligence or omission of
LESSEE or LESSEE'S Visitors, then LESSEE shall pay all costs and expenses
relating to compliance with the applicable Environmental Law (including, without
limitation, the costs and expenses of the site investigations and of the removal
and remediation of such hazardous substance or hazardous waste).
(b) Without relieving LESSEE of its obligations under this
Lease and without waiving any default by LESSEE under
20
this Lease, LESSOR shall have the right, but not the obligation, to take such
action as LESSOR deems necessary or advisable to cleanup, remove, resolve or
minimize the impact of or otherwise deal with any spill or discharge of any
hazardous substance or hazardous waste. In the event such spill or discharge
arose out of or in connection with LESSEE'S use and occupancy of the Demised
Premises, or in the event such spill or discharge was caused by the act,
negligence or omission of LESSEE or LESSEE'S Visitors, then LESSEE shall pay to
LESSOR on demand, as Additional Rent, all costs and expenses incurred by LESSOR
in connection with any action taken by LESSOR.
10.6. (a) If LESSEE'S operations at the Demised Premises now or
hereafter constitute an "Industrial Establishment" (as defined under ISRA) or
are subject to the provisions of any Environmental Law, then LESSEE agrees to
comply, at its sole cost and expense, with all requirements of ISRA or such
other applicable Environmental Law to the satisfaction of LESSOR and the
governmental entity, department or agency having jurisdiction over such matters
(including, but not limited to, performing site investigations and performing
any removal and remediation required in connection therewith), in connection
with (i) the occurrence of the Termination Date, (ii) any termination of this
Lease prior to the Termination Date, (iii) any closure, transfer or
consolidation of LESSEE'S operations at the Demised Premises, (iv) any change in
the ownership or control of LESSEE, (iv) any permitted assignment of this Lease
or permitted sublease of all or part of the Demised Premises or (v) any other
action by LESSEE which triggers such Environmental Law.
(b) In connection with subsection (a) above, if LESSEE has
failed (i) with respect to ISRA, to obtain a no further action letter, complete
an approved remediation agreement or otherwise comply with the requirements of
ISRA, or (ii) with respect to any other applicable Environmental Law to fully
comply with the applicable provisions of such Environmental Law prior to the
Termination Date, LESSEE shall be deemed to be a holdover tenant, shall pay rent
at the rate set forth in Section 23.3 and shall continue to diligently pursue
compliance with ISRA and/or such Environmental Law. Upon LESSEE'S full
compliance with ISRA and/or the provisions of such Environmental Law, LESSEE
shall deliver possession of the Demised Premises to LESSOR in accordance with
the provisions of this Lease and such holdover rent shall be adjusted as of said
date.
10.7. (a) In connection with (i) any sale or other disposition of all
or part of LESSOR'S interest in the Premises, (ii) any change in the ownership
or control of LESSOR, (iii) any condemnation, (iv) any foreclosure or (v) any
other action by LESSOR which triggers ISRA or any other applicable Environmental
21
Law, LESSOR shall comply, at its sole cost and expense, with all requirements of
ISRA or such applicable Environmental Law; provided, however, if any site
investigation is required as a result of LESSEE'S use and occupancy of the
Demised Premises or a spill or discharge of a hazardous substance or hazardous
waste caused by the act, negligence or omission of LESSEE or LESSEE'S Visitors,
then LESSEE shall pay all costs associated with said site investigation; in
addition, if any removal and remediation is required as a result of a spill or
discharge of a hazardous substance or hazardous waste caused by the act,
negligence or omission of LESSEE or LESSEE'S Visitors, then LESSEE shall pay all
costs associated with said removal and remediation.
(b) If, in connection with such compliance, LESSOR requires
any affidavits, certifications or other information from LESSEE, LESSEE agrees
to cooperate with LESSOR and to execute and deliver to LESSOR without charge all
such documents within five (5) business days after LESSEE'S receipt of said
request.
10.8. (a) LESSOR shall have the right, but not the obligation, to enter
onto the Demised Premises from time to time during the Term for the purpose of
conducting such tests and investigations as LESSOR deems reasonably necessary to
determine whether LESSEE is complying with the provisions of this Article 10 and
all applicable Environmental Laws. In the event LESSOR determines that LESSEE is
not in compliance with this Article 10 or any Environmental Law, LESSOR shall
notify LESSEE of such fact, setting forth in such notice the basis for LESSOR'S
determination. Within ten (10) business days after receipt of LESSOR'S notice of
noncompliance, LESSEE shall notify LESSOR whether it disputes LESSOR'S
determination. If LESSEE so notifies LESSOR within said ten (10) business day
period, then LESSOR and LESSEE, and their respective consultants, shall meet to
resolve the dispute; if LESSEE fails to notify LESSOR of any objection within
said ten (10) business day period, then LESSEE shall be deemed to have accepted
LESSOR'S determination and LESSEE shall promptly remedy the noncompliance.
(b) In the event LESSEE is not in compliance with the
provisions of this Article 10 or any applicable Environmental Law, LESSEE shall
pay to LESSOR, as Additional Rent, upon demand, an amount equal to all costs and
expenses incurred by LESSOR in connection with the tests and investigations
conducted by or on behalf of LESSOR.
(c) LESSOR shall use reasonable efforts to minimize any
interference with or disruptions to LESSEE'S operations at the Demised Premises
caused by such tests and investigations, to do all such tests and investigations
in a good and workmanlike manner, to proceed with such tests and investigations
with reasonable
22
dispatch and to repair promptly all damage to the Demised Premises arising out
of or in connection with such tests and investigations.
10.9. LESSEE hereby agrees to defend, indemnify and hold LESSOR
harmless from and against any and all claims, losses, liability, damages and
expenses (including, without limitation, site investigation costs, removal and
remediation costs and attorneys' fees and disbursements) arising out of or in
connection with (i) LESSEE'S use and occupancy of the Demised Premises, (ii) any
spill or discharge of a hazardous substance or hazardous waste by LESSEE or
LESSEE'S Visitors and/or (iii) LESSEE'S failure to comply with the provisions of
this Article 10.
10.10. If LESSOR has given to LESSEE the name and address of any holder
of an Underlying Encumbrance, LESSEE agrees to send to said holder a photocopy
of those items given to LESSOR pursuant to the provisions of Section 10.3.
10.11. LESSEE'S obligations under this Article 10 shall survive the
expiration or earlier termination of this Lease.
ARTICLE 11
DISCHARGE OF LIENS
LESSEE will discharge within fifteen (15) days after receipt of notice
thereof any Lien on the Demised Premises or the Basic Rent, Additional Rent or
any other sums payable under this Lease, caused by or arising out of LESSEE'S
acts or LESSEE'S failure to perform any obligation hereunder.
ARTICLE 12
PERMITTED CONTESTS
LESSEE may contest by appropriate proceedings, the amount, validity or
application of any Legal Requirement which LESSEE is obligated to comply with or
any Lien which LESSEE is obligated to discharge, provided that (a) such
proceedings shall suspend the collection of any amounts due as a result thereof,
(b) no part of the Demised Premises or of any Basic Rent or Additional Rent or
other sum payable hereunder would be subject to loss, sale or forfeiture during
such proceedings, (c) LESSOR would not be subject to any civil or criminal
liability for failure to pay or perform, as the case may be, (d) LESSEE shall
have furnished such security as may be required in the proceedings or reasonably
requested by LESSOR, (e) such proceedings shall not affect the payment of Basic
Rent, Additional Rent or any other sum payable to LESSOR hereunder or prevent
LESSEE from using the Demised Premises for its permitted use hereunder, and (f)
LESSEE shall notify LESSOR
23
of any such proceedings not less than ten (10) days prior to the commencement
thereof, and shall describe such proceedings in reasonable detail. LESSEE will
conduct all such contests in good faith and with due diligence and will,
promptly after the determination of such contest, pay and discharge all amounts
which shall be determined to be payable therein.
ARTICLE 13
INSURANCE
13.1. LESSEE will maintain with insurers authorized to do business in
the State of New Jersey and which are rated A-Plus in Best's Key Rating
Guide:
(a) comprehensive general liability insurance (including, during any
period when LESSEE is making alterations or improvements to the Demised
Premises, coverage for any construction on or about the Demised Premises),
against claims for bodily injury, personal injury, death or property damage
occurring on, in or about the Demised Premises in a combined single limit of not
less than $2,000,000.00;
(b) workers' compensation insurance coverage for the full statutory
liability of LESSEE;
(c) such other insurance with respect to the Demised Premises in such
amounts and against such insurable exposures as may reasonably and customarily
be carried by tenants in similar quality buildings in the vicinity in which the
Building is located.
13.2. The policies of insurance required to be maintained by LESSEE
pursuant to Section 13.1 shall name as the insured parties (except for workers'
compensation insurance) LESSOR and LESSEE, as their respective interests may
appear, and shall be reasonably satisfactory to LESSOR. In addition, said
policies of insurance (except for worker's compensation insurance) shall (i)
provide that thirty (30) days' prior written notice of suspension, cancellation,
termination, modification, non-renewal or lapse or material change of coverage
shall be given and that such insurance shall not be invalidated by any act or
neglect of LESSOR or LESSEE or any owner of the Demised Premises, nor by any
change in the title or ownership of the Demised Premises, nor by occupation of
the Demised Premises for purposes more hazardous than are permitted by such
policy, and (ii) not contain a provision relieving the insurer thereunder of
liability for any loss by reason of the existence of other policies of insurance
covering the Demised Premises against the peril involved, whether collectible or
not; and the policies of insurance required to be maintained by LESSEE pursuant
to subsection 13.1(a) shall also include a contractual
24
liability endorsement evidencing coverage of LESSEE'S obligation to indemnify
LESSOR pursuant to Section 9.1 hereof.
13.3. On the Commencement Date, LESSEE shall deliver to LESSOR original
or duplicate policies or certificates of the insurers evidencing all the
insurance which is required to be maintained hereunder by LESSEE, and, within
ten (10) days prior to the expiration of any such insurance, other original or
duplicate policies or certificates evidencing the renewal of such insurance.
13.4. LESSEE shall not obtain or carry separate insurance concurrent in
form or contributing in the event of loss with that required by Section 13.1
unless LESSOR and LESSEE are named as insureds therein.
13.5. (a) LESSOR hereby waives and releases LESSEE, and LESSEE hereby
waives and releases LESSOR, from any and all liabilities, claims and losses for
which the released party is or may be held liable to the extent of any insurance
proceeds received by said injured party.
(b) Each party hereto agrees to have included in each of its
insurance policies (insuring the Building in the case of LESSOR, and insuring
LESSEE'S personal property, trade fixtures, equipment and improvements in the
case of LESSEE, against loss, damage or destruction by fire or other casualty) a
waiver of the insurer's right of subrogation against the other party to this
Lease. If there is any extra charge for such waiver, the party requesting the
waiver shall pay the extra charge therefor. If such waiver is not enforceable or
is unattainable, then such insurance policy shall contain either (i) an express
agreement that such policy shall not be invalidated if LESSOR or LESSEE,
whichever the case may be, waives the right of recovery against the other party
to this Lease or (ii) any other form for the release of LESSOR or LESSEE,
whichever the case may be. If such waiver, agreement or release shall not be, or
shall cease to be, obtainable from LESSOR'S insurance company or from LESSEE'S
insurance company, whichever the case may be, then LESSOR or LESSEE shall notify
the other party of such fact and shall use its best efforts to obtain such
waiver, agreement or release from another insurance company satisfying the
requirements of this Lease.
ARTICLE 14
ESTOPPEL CERTIFICATES
14.1. At any time and from time to time, upon not less than ten (10)
days' prior notice by LESSOR, LESSEE shall execute, acknowledge and deliver to
LESSOR a statement (or, if LESSEE is a corporation, an authorized officer of
LESSEE shall execute,
25
acknowledge and deliver to LESSOR a statement) certifying the following: (i) the
Commencement Date, (ii) the Termination Date, (iii) the date(s) of any
amendment(s) and/or modification(s) to this Lease, (iv) that this Lease was
properly executed and is in full force and effect without amendment or
modification, or, alternatively, that this Lease and all amendments and/or
modifications thereto have been properly executed and are in full force and
effect, (v) the current annual Basic Rent, the current monthly installments of
Basic Rent and the date on which LESSEE'S obligation to pay Basic Rent
commenced, (vi) the current monthly installment of Additional Rent for Taxes and
LESSOR'S Operating Expenses, (vii) the date to which Basic Rent and Additional
Rent have been paid, (viii) the amount of the security deposit, if any, (ix)
that all work to be done to the Demised Premises by LESSOR has been completed in
accordance with this Lease and have been accepted by LESSEE, except as
specifically provided in the estoppel certificate, (x) that no installment of
Basic Rent or Additional Rent has been paid more than thirty (30) days in
advance, (xi) that LESSEE is not in arrears in the payment of any Basic Rent or
Additional Rent, (xii) that, to the best of LESSEE'S knowledge, neither party to
this Lease is in default in the keeping, observance or performance of any
covenant, agreement, provision or condition contained in this Lease and no event
has occurred which, with the giving of notice or the passage of time, or both,
would result in a default by either party, except as specifically provided in
the estoppel certificate, (xiii) that LESSEE has no existing defenses, offsets,
liens, claims or credits against the Basic Rent or Additional Rent or against
enforcement of this Lease by LESSOR, (xiv) that LESSEE has not been granted any
options or rights of first refusal to extend the Term, to lease additional
space, to terminate this Lease before the Termination Date or to purchase the
Premises, except as specifically provided in this Lease, (xv) that LESSEE has
not received any notice of violation of Legal Requirements or Insurance
Requirements relating to the Demised Premises or to the Premises, (xvi) that
LESSEE has not assigned this Lease or sublet all or any portion of the Demised
Premises, (xvii) that no "hazardous substances" or "hazardous wastes" have
been generated, manufactured, refined, transported, treated, stored, handled,
disposed or spilled on or about the Demised Premises and (xviii) such other
reasonable matters as the person or entity requesting the Certificate may
request. LESSEE hereby acknowledges and agrees that such statement may be relied
upon by any mortgagee, or any prospective purchaser, lessee, sublessee,
mortgagee or assignee of any mortgage, of the Demised Premises or any part
thereof. If LESSEE is unable to certify as to any of the information provided
above, LESSEE shall set forth the reasons therefor in the statement, in
reasonable detail.
14.2. If LESSEE shall fail or otherwise refuse to execute an estoppel
certificate in accordance with Section 14.1, then
26
and upon such event, LESSEE shall be deemed to have appointed LESSOR and LESSOR
shall thereupon be regarded as the irrevocable attorney-in-fact of LESSEE duly
authorized to execute and deliver the required certificate for and on behalf of
LESSEE, but the exercise of such power shall not be deemed a waiver of LESSEE'S
default.
ARTICLE 15
ASSIGNMENT AND SUBLETTING
15.1. Except as otherwise expressly provided in this Article 15, LESSEE
shall not sell, assign, transfer, hypothecate, mortgage, encumber, grant
concessions or licenses, sublet, or otherwise dispose of any interest in this
Lease or the Demised Premises, by operation of law or otherwise, without the
prior written consent of LESSOR. Any consent granted by LESSOR in any instance
shall not be construed to constitute a consent with respect to any other
instance or request. If the Demised Premises or any part thereof should be
sublet, used, or occupied by anyone other than LESSEE, or if this Lease should
be assigned by LESSEE, LESSOR shall have the right to collect rent from the
assignee, subtenant, user or occupant, but no such assignment, subletting, use,
occupancy or collection shall be deemed a waiver of any of LESSOR'S rights under
the provisions of this Section 15.1, a waiver of any of LESSEE'S covenants
contained in this Article 15, the acceptance of the assignee, subtenant, user or
occupant as tenant, or a release of LESSEE from further performance by LESSEE of
LESSEE'S obligations under the Lease.
15.2. If LESSEE shall desire to sublet the Demised Premises or to
assign this Lease, it shall first submit to LESSOR a written notice ("LESSEE'S
Notice") setting forth in reasonable detail:
(a) the name and address of the proposed sublessee or assignee;
(b) the terms and conditions of the proposed subletting or assignment
(including the proposed commencement date of the sublease or the effective date
of the assignment, which shall be at least thirty (30) days after LESSEE'S
Notice is given);
(c) the nature and character of the business of the proposed sublessee
or assignee;
(d) banking, financial, and other credit information relating to the
proposed sublessee or assignee, in reasonably sufficient detail, to enable
LESSOR to determine the proposed sublessee's or assignee's financial
responsibility; and
27
(e) in the case of a subletting, complete plans and
specifications for any and all work to be done in the Demised Premises to be
sublet.
15.3. Within thirty (30) days after LESSOR'S receipt of
LESSEE'S Notice, LESSOR agrees that it shall notify LESSEE whether LESSOR (i)
consents to the proposed sublet or assignment, (ii) does not consent to the
proposed sublet or assignment, or (iii) elects to exercise its recapture right,
as described in Section 15.5. If LESSOR fails to so notify LESSEE within said
thirty (30) day period, LESSOR shall be deemed to have not consented to the
proposed sublet or assignment. In the event that LESSOR does not elect to
exercise its right of recapture, LESSOR agrees that it shall not unreasonably
withhold its consent to an assignment of the Lease or a sublease of all or a
part of the Demised Premises.
15.4. In addition to the foregoing requirements,
(a) no assignment or sublease shall be permitted if, at the
effective date of such assignment or sublease, LESSEE is in default under this
Lease; and
(b) no assignment or sublease shall be permitted unless LESSEE
agrees, at the time of the proposed assignment or sublease and in LESSEE'S
Notice, to pay to LESSOR, immediately upon receipt thereof, all Net Rental
Proceeds, of whatever nature, payable by the prospective assignee or sublessee
to LESSEE pursuant to such assignment or sublease.
15.5. (a) LESSOR shall have the right, to be exercised by
giving written notice (the "Recapture Notice") to LESSEE within thirty (30) days
after receipt of LESSEE'S Notice, to recapture the space described in LESSEE'S
Notice (the "Recapture Space"). The Recapture Notice shall cancel and terminate
this Lease with respect to the Recapture Space as of the date stated in LESSEE'S
Notice for the commencement of the proposed assignment or sublease as fully and
completely as if that date had been herein definitively fixed as the Termination
Date, and LESSEE shall surrender possession of the Recapture Space as of such
date. Thereafter, the Basic Rent and Additional Rent shall be equitably adjusted
based upon the square footage of the Demised Premises then remaining, after
deducting the square footage attributable to the Recapture Space.
(b) In the event LESSOR elects to exercise its recapture right
and the Recaptured Space is less than the entire Demised Premises, then LESSOR,
at its sole expense, shall have the right to make any alterations to the Demised
Premises required, in LESSOR'S reasonable judgment, to make such Recaptured
Space a self-contained rental unit. LESSOR agrees to perform all such work, if
28
any, with as little inconvenience to LESSEE'S business as is reasonably
possible; provided, however, LESSOR shall not be required to perform such work
after LESSEE'S business hours or on weekends; and provided further, LESSOR shall
not be deemed guilty of an eviction, partial eviction, constructive eviction or
disturbance of LESSEE'S use or possession of the Demised Premises, and shall not
be liable to LESSEE for same.
15.6. In addition to the foregoing requirements, any sublease
must contain the following provisions:
(a) the sublease shall be subject and subordinate to all of the
terms and conditions of this Lease;
(b) at LESSOR'S option, in the event of cancellation or
termination of this Lease for any reason or the surrender of this Lease, whether
voluntarily, involuntarily, or by operation of law, prior to the expiration of
such sublease, including extensions and renewals of such sublease, the subtenant
shall make full and complete attornment to LESSOR for the balance of the term of
the sublease. The attornment shall be evidenced by an agreement in form and
substance satisfactory to LESSOR which the subtenant shall execute and deliver
at any time within five (5) days after request by LESSOR or its successors and
assigns;
(c) the term of the sublease shall not extend beyond a date
which is one day prior to the Termination Date;
(d) no subtenant shall be permitted to further sublet all or
any portion of the subleased space or to assign its sublease without LESSOR'S
prior written consent; and
(e) the subtenant shall waive the provisions of any law now or
subsequently in effect which may give the subtenant any right of election to
terminate the sublease or to surrender possession of the space subleased in the
event that any proceeding is brought by LESSOR to terminate this Lease.
15.7. Each of the following events shall be deemed to
constitute an assignment of this Lease and each shall require the prior written
consent of LESSOR:
(a) any assignment or transfer of this Lease by operation of
law; or
(b) any hypothecation, pledge, or collateral assignment of this
Lease; or
29
(c) any involuntary assignment or transfer of this Lease in
connection with bankruptcy, insolvency, receivership, or similar proceeding; or
(d) any assignment, transfer, disposition, sale or acquisition
of a controlling interest in LESSEE to or by any person, entity, or group of
related persons or affiliated entities, whether in a single transaction or in a
series of related or unrelated transactions; or
(e) any issuance of an interest or interests in LESSEE (whether
stock, partnership interests, or otherwise) to any person, entity, or group of
related persons or affiliated entities, whether in a single transaction or in a
series of related or unrelated transactions, which results in such person,
entity, or group holding a controlling interest in LESSEE. For purposes of the
immediately foregoing, a "controlling interest" of LESSEE shall mean 50% or more
of the aggregate issued and outstanding equitable interests (whether stock,
partnership interests, or otherwise) of LESSEE. The transfer of the outstanding
capital stock of any corporate tenant shall not be deemed an assignment of this
Lease if such transfer shall be effected by the sale of stock through the
"over-the-counter-market" or through any recognized stock exchange.
15.8. It is a further condition to the effectiveness of any
assignment otherwise complying with this Article 15 that the assignee execute,
acknowledge, and deliver to LESSOR an agreement in form and substance
satisfactory to LESSOR whereby the assignee assumes all of the obligations of
LESSEE under this Lease and agrees that the provisions of this Article 15 shall
continue to be binding upon it with respect to all future assignments and deemed
assignments of this Lease.
15.9. No assignment of this Lease nor any sublease of all or
any portion of the Demised Premises shall release or discharge LESSEE from any
liability, whether past, present, or future, under this Lease and LESSEE shall
continue to remain primarily liable under this Lease.
15.10. LESSEE shall be responsible for obtaining all permits
and approvals required by any governmental or quasi-governmental agency in
connection with any assignment of this Lease or any subletting of the Demised
Premises, and LESSEE shall deliver copies of these documents to LESSOR prior to
the commencement of any work, if work is to be done. LESSEE is also responsible
for and is required to reimburse LESSOR for all fees, costs and expenses,
including, but not limited to, reasonable attorneys' fees and disbursements,
which LESSOR incurs in reviewing any proposed assignment of this Lease, any
proposed sublease of the Demised
30
Premises, and any permits, approvals, and applications for CONSTRUCTION
WITHIN THE Demised Premises.
15.11. If LESSOR consents to any proposed assignment or
sublease and LESSEE fails to consummate the assignment or sublease to which
LESSOR consented within ninety (90) days after the giving of such consent,
LESSEE shall be required again to comply with all of the provisions and
conditions of this Article 15 before assigning this Lease or subletting the
Demised Premises. If LESSEE consummates the assignment or sublease to which
LESSOR consented within said ninety (90) day period, LESSEE agrees that it shall
deliver to LESSOR a fully executed, duplicate original counterpart of the
assignment or sublease agreement within ten (10) days of the date of execution
of such item.
15.12. LESSEE agrees that under no circumstances shall LESSOR
be liable in damages or subject to liability by reason of LESSOR'S failure or
refusal to grant its consent to any proposed assignment of this Lease or
subletting of the Demised Premises.
15.13. If LESSOR withholds its consent of any proposed
assignment or sublease, LESSEE shall defend, indemnify, and hold LESSOR harmless
from and reimburse LESSOR for all liability, damages, costs, fees, expenses,
penalties, and charges (including, but not limited to, reasonable attorneys'
fees and disbursements) arising out of any claims that may be made against
LESSOR by any brokers or other persons claiming a commission or similar
compensation in connection with the proposed assignment or sublease.
15.14. (a) Notwithstanding anything to the contrary contained
in this Lease, in the event that this Lease is assigned to any person or entity
pursuant to the provisions of the Bankruptcy Code, any and all monies or other
consideration payable or otherwise to be delivered in connection with such
assignment shall be paid or delivered to LESSOR, shall be and remain the
exclusive property of LESSOR and shall not constitute property of LESSEE or of
the estate of LESSEE within the meaning of the Bankruptcy Code. Any and all
monies or other consideration constituting LESSOR'S property under the preceding
sentence not paid or delivered to LESSOR shall be held in trust for the benefit
of LESSOR and be promptly paid to or turned over to LESSOR.
(b) If LESSEE proposes to assign this Lease pursuant to the
provisions of the Bankruptcy Code to any person or entity who shall have made a
bona fide offer to accept an assignment of this Lease on terms acceptable to
LESSEE, then notice of such proposed assignment setting forth (i) the name and
address of such person or entity, (ii) all of the terms and conditions of such
offer and (iii) the adequate assurance to be provided by LESSEE to assure
31
such person's or entity's future performance under this Lease, including,
without limitation, the assurance referred to in Section 365(b)(3) of
the Bankruptcy Code, or any such successor or substitute legislation or rule
thereto, shall be given to LESSOR by LESSEE no later than twenty (20) days after
receipt by LESSEE, but in any event no later than ten (10) days prior to the
date that LESSEE shall make application to a court of competent jurisdiction for
authority and approval to enter into such assignment and assumption. LESSOR
shall thereupon have the prior right and option, to be exercised by notice to
LESSEE given at any time prior to the effective date of such proposed
assignment, to accept an assignment of this Lease upon the same terms and
conditions and for the same consideration, if any, as the bona fide offer made
by such person for the assignment of this Lease. Any person or entity to which
this Lease is assigned pursuant to the provisions of the Bankruptcy Code shall
be deemed without further act or deed to have assumed all of the obligations
arising under this Lease on or after the date of such assignment. Any such
assignee shall, upon demand, execute and deliver to LESSOR an instrument
confirming such assumption.
ARTICLE 16
CASUALTY
16.1. If there is any damage to or destruction of the Demised
Premises, LESSEE shall promptly give notice thereof to LESSOR, describing the
nature and extent thereof.
16.2. If the Demised Premises are damaged, but are not thereby
rendered partially or wholly untenantable, and this Lease is not terminated
pursuant to Section 16.4, 16.5 or 16.6 hereof, LESSOR shall, at its own expense,
cause Restoration to be completed as soon as reasonably practicable but in no
event later than ninety (90) days from the occurrence, subject to any Excusable
Delays, and the Basic Rent and Additional Rent shall not xxxxx.
16.3. If the Demised Premises are damaged or destroyed and are
rendered partially or wholly untenantable, and this Lease is not terminated
pursuant to Section 16.4, 16.5 or 16.6 hereof, LESSOR shall, at its own expense,
cause Restoration to be completed as soon as reasonably practicable but in no
event later than one hundred eighty (180) days from the occurrence, subject to
any Excusable Delays, and the Basic Rent and Additional Rent shall be equitably
abated.
16.4. If, in the sole opinion of LESSOR, the Building is
damaged or destroyed and the total cost of Restoration shall amount to twenty
percent (20%) or more of the full insurable value of the Building, LESSOR, in
lieu of Restoration, may elect to
32
terminate this Lease, provided that notice of such termination shall be sent to
LESSEE within sixty (60) days after the occurrence of such casualty. If LESSOR
exercises its right to terminate this Lease, this Lease shall cease, terminate
and expire, and all Basic Rent and Additional Rent shall be prorated, as of the
date of such damage or destruction.
16.5. If the Building is damaged or destroyed and, in the sole
opinion of LESSOR, more than one hundred eighty (180) days are necessary to
complete Restoration, or if during the final year of the Term the Demised
Premises are damaged or destroyed and rendered partially or wholly untenantable,
then in either case LESSOR may elect to terminate this Lease provided notice of
such termination shall be sent to LESSEE within sixty (60) days after the
occurrence of such casualty. If LESSOR exercises its right to terminate this
Lease, this Lease shall cease, terminate and expire, and all Basic Rent and
Additional Rent shall be prorated, as of the date of such damage or destruction.
16.6. LESSOR shall not be required to expend for Restoration an
amount in excess of the Net Award received by it. In the event the Net Award is
not adequate or the holder of an Underlying Encumbrance elects to retain the Net
Award, LESSOR shall have the right to terminate this Lease provided notice of
such termination shall be sent to LESSEE within sixty (60) days after the amount
of such Net Award is ascertained, or after the date on which the holder of the
Underlying Encumbrance notifies LESSOR that it has elected to retain the Net
Award, whichever the case may be. If LESSOR exercises its right to terminate
this Lease, this Lease shall cease, terminate and expire, and all Basic Rent and
Additional Rent shall be prorated, as of the date of such damage or destruction.
ARTICLE 17
CONDEMNATION
17.1. LESSEE hereby irrevocably assigns to LESSOR any award or
payment to which LESSEE becomes entitled by reason of any Taking of all or any
part of the Demised Premises, whether the same shall be paid or payable in
respect of LESSEE'S leasehold interest hereunder or otherwise, except that
LESSEE shall be entitled to any award or payment for the Taking of LESSEE'S
trade fixtures or personal property or for loss of business, relocation or
moving expenses provided the amount of the Net Award payable to LESSOR with
respect to the fee interest is not diminished. All amounts payable pursuant to
any agreement with any condemning authority which have been made in settlement
of or under threat of any condemnation or other eminent domain proceeding shall
be deemed to be an award made in such proceeding. LESSEE agrees that this Lease
33
shall control the rights of LESSOR and LESSEE in any Net Award and any contrary
provision of any present or future law is hereby waived.
17.2. In the event of a Taking of the whole of the Demised
Premises, then the Term shall cease and terminate as of the date when possession
is taken by the condemning authority and all Basic Rent and Additional Rent
shall be paid up to that date.
17.3. In the event of a Taking of thirty (30%) percent or more
of the Demised Premises, then, if LESSEE shall determine in good faith and
certify to LESSOR that because of such Taking, continuance of its business at
the Demised Premises would be uneconomical, LESSEE may at any time either prior
to or within a period of sixty (60) days after the date when possession of such
premises shall be required by the condemning authority, elect to terminate this
Lease. In the event that LESSEE shall fail to exercise any such option to
terminate this Lease, or in the event of a Taking of the Demised Premises under
circumstances under which LESSEE will have no such option, then, and in either
of such events, LESSOR shall, subject to the provisions of Section 17.4. cause
Restoration to be completed as soon as reasonably practicable, but in no case
later than ninety (90) days after the date the condemning authority takes
possession of such portion of the Demised Premises, subject to any Excusable
Delays, and the Basic Rent and Additional Rent thereafter payable during the
Term shall be equitably prorated based upon the square foot area of the Demised
Premises and/or of the Building actually taken.
17.4. If (a) the Net Award is inadequate to complete
Restoration of the Demised Premises, or (b) in the case of a Taking of thirty
(30%) percent or more of the Demised Premises, LESSEE has not elected to
terminate this Lease pursuant to Section 17.3 hereof, then LESSOR may elect
either to complete such Restoration or terminate this Lease by giving notice to
LESSEE within sixty (60) days after (x) the amount of the Net Award is
ascertained or (y) the expiration of the sixty (60) day period within which
LESSEE may terminate this Lease (as described in Section 17.3 hereof), whichever
the case may be. In such event, all Basic Rent and Additional Rent shall be
apportioned as of the date the condemning authority actually takes possession of
the Demised Premises.
ARTICLE 18
EVENTS OF DEFAULT
18.1. Any of the following occurrences, conditions or acts
shall constitute an "Event of Default" under this Lease:
34
(a) if LESSEE shall default in making payment when due of any
Basic Rent, Additional Rent or other amount payable by LESSEE hereunder, and
such default shall continue for ten (10) days; or
(b) if LESSEE shall fail to take actual occupancy of the
Demised Premises within thirty (30) days after the Commencement Date or shall
thereafter vacate the Demised Premises for a period in excess of thirty (30)
days; or
(c) if the Demised Premises shall be abandoned by LESSEE for a
period of thirty (30) consecutive days; or
(d) if LESSEE shall file a petition in bankruptcy pursuant to
the Bankruptcy Code or under any similar federal or state law, or shall be
adjudicated a bankrupt or become insolvent, or shall commit any act of
bankruptcy as defined in any such law, or shall take any action in furtherance
of any of the foregoing; or
(e) if a petition or answer shall be filed proposing the
adjudication of LESSEE as a bankrupt pursuant to the Bankruptcy Code or any
similar federal or state law, and (i) LESSEE shall consent to the filing
thereof, or (ii) such petition or answer shall not be discharged or denied
within sixty (60) days after the filing thereof; or
(f) if a receiver, trustee or liquidator (or other similar
official) of LESSEE or of all or substantially all of its business or assets or
of the estate or interest of LESSEE in the Demised Premises shall be appointed
and shall not be discharged within sixty (60) days thereafter or if LESSEE shall
consent to or acquiesce in such appointment; or
(g) if the estate or interest of LESSEE in the Demised Premises
shall be levied upon or attached in any proceeding and such process shall not be
vacated or discharged within sixty (60) days after such levy or attachment; or
(h) if LESSEE shall use or suffer or permit the use of the
Demised Premises or any part thereof for any purpose other than expressly
specified in Section 7.1; or
(i) if LESSEE fails to discharge any Lien within the time
period set forth in Article 11; or
(j) if LESSEE fails to maintain the insurance required pursuant
to Article 13, or LESSEE fails to deliver to LESSOR the insurance certificates
required by Article 13 within the time periods set forth in Section 13.3; or
35
(k) if LESSEE fails to deliver to LESSOR the estoppel
certificate required by Article 14 within the time period set forth therein; or
(l) if LESSEE assigns this Lease or sublets all or any portion
of the Demised Premises without complying with all the Provisions of Article 15;
or
(m) if LESSEE fails to deliver to LESSOR the subordination
agreement required by Section 22.1 within the time period set forth therein; or
(n) if LESSEE fails to comply with any Legal or Insurance
Requirement, and such failure continues for a period of ten (10) days after
LESSOR shall have given notice to LESSEE specifying such default and demanding
that the same be cured; or
(o) if LESSEE shall default in the observance or performance of
any provision of this Lease other than those provisions contemplated by clause
(i) through (n), inclusive, of this Section 18.1, and such default shall
continue for thirty (30) days after LESSOR shall have given notice to LESSEE
specifying such default and demanding that the same be cured (unless such
default cannot be cured by the payment of money and cannot with due diligence be
wholly cured within such period of thirty (30) days, in which case LESSEE shall
have such longer period as shall be necessary to cure the default, so long as
LESSEE begins promptly to cure the same within such thirty (30) day period,
prosecutes the cure to completion with due diligence and advises LESSOR from
time to time, upon LESSOR'S request, of the actions which LESSEE is taking and
the progress being made).
ARTICLE 19
CONDITIONAL LIMITATIONS; REMEDIES
19.1. This Lease and the Term and estate hereby granted are
subject to the limitation that whenever an Event of Default shall have happened
and be continuing, LESSOR shall have the right, at its election, then or
thereafter while any such Event of Default shall continue and notwithstanding
the fact that LESSOR may have some other remedy hereunder or at law or in
equity, to give LESSEE written notice of LESSOR'S intention to terminate this
Lease on a date specified in such notice, which date shall be not less than ten
(10) days after the giving of such notice, and upon the date so specified, this
Lease and the estate hereby granted shall expire and terminate with the same
force and effect as if the date specified in such notice were the date
hereinbefore fixed for the expiration of this Lease, and all right of LESSEE
hereunder shall expire and terminate, and LESSEE shall be liable as hereinafter
in
36
this Article 19 provided. If any such notice is given, LESSOR shall have, on
such date so specified, the right of re-entry and possession of the Demised
Premises and the right to remove all persons and property therefrom and to store
such property in a warehouse or elsewhere at the risk and expense, and for the
account, of LESSEE. Should LESSOR elect to re-enter as herein provided or should
LESSOR take possession pursuant to legal proceedings or pursuant to any notice
provided for by law, LESSOR may from time to time re-let the Demised Premises or
any part thereof for such term or terms and at such rental or rentals and upon
such terms and conditions as LESSOR may deem advisable, with the right to make
alterations in and repairs to the Demised Premises.
19.2. In the event of any termination of this Lease as in this
Article 19 provided or as required or permitted by law, LESSEE shall forthwith
quit and surrender the Demised Premises to LESSOR, and LESSOR may, without
further notice, enter upon, reenter, possess and repossess the same by summary
proceedings, ejectment or otherwise, and again have, repossess and enjoy the
same as if this Lease had not been made, and in any such event LESSEE and no
person claiming through or under LESSEE by virtue of any law or an order of any
court shall be entitled to possession or to remain in possession of the Demised
Premises but shall forthwith quit and surrender the Demised Premises, and LESSOR
at its option shall forthwith, notwithstanding any other provision of this
Lease, be entitled to recover from LESSEE, as and for liquidated damages, the
sum of:
(a) all Basic Rent, Additional Rent and other amounts payable
by LESSEE hereunder then due or accrued and unpaid, and
(b) for loss of the bargain, an amount equal to the aggregate
of all unpaid Basic Rent and Additional Rent which would have been payable if
this Lease had not been terminated prior to the end of the Term then in effect,
discounted to its then present value in accordance with accepted financial
practice using a rate equal to six percent (6%) per annum; and
(c) all other damages and expenses (including attorneys' fees
and expenses), which LESSOR shall have sustained by reason of the breach of any
provision of this Lease.
19.3. Nothing herein contained shall limit or prejudice the
right of LESSOR, in any bankruptcy or insolvency proceeding, to prove for and
obtain as liquidated damages by reason of such termination an amount equal to
the maximum allowed by any bankruptcy or insolvency proceedings, or to prove for
and obtain as liquidated damages by reason of such termination, an amount equal
37
to the maximum allowed by any statute or rule of law whether such amount shall
be greater or less than the excess referred to above.
19.4. In the event that LESSEE should abandon the Demised
Premises, LESSOR may, at its option and for so long as LESSOR does not terminate
LESSEE'S right to possession of the Demised Premises, enforce all of its rights
and remedies under this Lease, including the right to recover all Basic Rent,
Additional Rent and other payments as they become due hereunder. Additionally,
LESSOR shall be entitled to recover from LESSEE all costs of maintenance and
preservation of the Demised Premises, and all costs, including attorneys' and
receiver's fees, incurred in connection with the appointment of or performance
by a receiver to protect the Demised Premises and LESSOR'S interest under this
Lease.
19.5. Nothing herein shall be deemed to affect the right of
LESSOR to indemnification pursuant to Section 8.1 of this Lease.
19.6. At the request of LESSOR upon the occurrence of an Event
of Default, LESSEE will quit and surrender the Demised Premises to LESSOR or its
agents, and LESSOR may without further notice enter upon, re-enter and repossess
the Demised Premises by summary proceedings, ejectment or otherwise. The words
"enter", "re-enter", and "re-entry" are not restricted to their technical legal
meanings.
19.7. If LESSEE shall be in default in the observance or
performance of any provision of this Lease, and an action shall be brought for
the enforcement thereof in which it shall be determined that LESSEE was in
default, LESSEE shall pay to LESSOR all fees, costs and other expenses which may
become payable as a result thereof or in connection therewith, including
attorneys' fees and expenses.
19.8. If LESSEE shall default in the keeping, observance or
performance of any covenant, agreement, term, provision or condition herein
contained, LESSOR, without thereby waiving such default, may perform the same
for the account and at the expense of LESSEE (a) immediately or at any time
thereafter and without notice in the case of emergency or in case such default
will result in a violation of any Legal or Insurance Requirement, or in the
imposition of any Lien against all or any portion of the Premises and (b) in any
other case if such default continues after thirty (30) days from the date of the
giving by LESSOR to LESSEE of notice of LESSOR'S intention so to perform the
same. All costs and expenses incurred by LESSOR in connection with any such
performance by it for the account of LESSEE and also all costs and expenses,
including attorneys' fees and disbursements incurred by LESSOR in
38
any action or proceeding (including any summary dispossess proceeding) brought
by LESSOR to enforce any obligation of LESSEE under this Lease and/or right of
LESSOR in or to the Demised Premises, shall be paid by LESSEE to LESSOR upon
demand.
19.9. Except as otherwise provided in this Article 19, no right
or remedy herein conferred upon or reserved to LESSOR is intended to be
exclusive of any other right or remedy, and every right and remedy shall be
cumulative and in addition to any other legal or equitable right or remedy given
hereunder, or now or hereafter existing. No waiver by LESSOR of any provision of
this Lease shall be deemed to have been made unless expressly so made in
writing. LESSOR shall be entitled, to the extent permitted by law, to injunctive
relief in case of the violation, or attempted or threatened violation, of any
provision of this Lease, or to a decree compelling observance or performance of
any provision of this Lease, or to any other legal or equitable remedy.
ARTICLE 20
RIGHT OF ENTRY; RESERVATION OF EASEMENTS
20.1. LESSOR and LESSOR'S agents and representatives shall have
the right to enter into or upon the Demised Premises, or any part thereof, at
all reasonable hours for the following purposes: (1) examining the Demised
Premises; (2) making such repairs or alterations therein as may be necessary in
LESSOR'S sole judgment for the safety and preservation of the Building or the
Demised Premises; (3) erecting, maintaining, repairing or replacing wires,
cables, ducts, pipes, conduits, vents or plumbing equipment running in, to or
through the Demised Premises; (4) showing the Demised Premises to prospective
new tenants during the last twelve (12) months of the Term; or (5) showing the
Demised Premises during the Term to any mortgagees or prospective purchasers of
the Premises. LESSOR shall give LESSEE three (3) business days prior written
notice before commencing any non-emergency repair or alteration.
20.2. LESSOR may enter upon the Demised Premises at any time in
case of emergency without prior notice to LESSEE.
20.3. LESSOR, in exercising any of its rights under this
Article 20, shall not be deemed guilty of an eviction, partial eviction,
constructive eviction or disturbance of LESSEE'S use or possession of the
Demised Premises and shall not be liable to LESSEE for same.
20.4. All work performed by or on behalf of LESSOR in or on the
Demised Premises pursuant to this Article 20 shall be
39
performed with as little inconvenience to LESSEE'S business as is reasonably
possible.
20.5. LESSEE shall not change any locks or install any
additional locks on doors entering into the Demised Premises without the consent
of LESSOR and, if any change is made, a copy of any such lock key shall be given
to LESSOR. If in an emergency LESSOR is unable to gain entry to the Demised
Premises by unlocking entry doors thereto, LESSOR may force or otherwise enter
the Demised Premises, without liability to LESSEE for any damage resulting
directly or indirectly therefrom. LESSEE shall be responsible for all damages
created or caused by its failure to give LESSOR a copy of any key to any lock
installed by LESSEE controlling entry to the Demised Premises.
20.6. LESSOR reserves the right to make changes, alterations,
additions, improvements, repairs or replacements in or to the Premises, the
Building (including the Demised Premises) and the fixtures and equipment thereof
from time to time as LESSOR may reasonably deem necessary or desirable;
provided, however, that there be no unreasonable obstruction of the means of
access to the Demised Premises or unreasonable interference with LESSEE'S use of
the Demised Premises and the usable square foot area of the Demised Premises is
not unreasonably affected thereby. Nothing contained in this Article shall be
deemed to relieve LESSEE of any duty, obligation or liability of LESSEE with
respect to making any repair, replacement or improvement or complying with any
law, order or requirement of any governmental authority.
ARTICLE 21
ACCORD AND SATISFACTION
The receipt by LESSOR of any installment of Basic Rent or of
any Additional Rent with knowledge of a default by LESSEE under the terms and
conditions of this Lease shall not be deemed a waiver of such default. No
payment by LESSEE or receipt by LESSOR of a lesser amount than the rent herein
stipulated shall be deemed to be other than on account of the earliest
stipulated rent, nor shall any endorsement or statement on any check or any
letter accompanying any check or payment as rent be deemed an accord and
satisfaction, and LESSOR may accept such check or payment without prejudice to
LESSOR'S right to recover the balance of such rent or pursue any other remedy in
this Lease provided.
40
ARTICLE 22
SUBORDINATION
22.1. This Lease and the term and estate hereby granted are and
shall be subject and subordinate to the lien of each mortgage which may now or
at any time hereafter affect all or any portion of the Premises or LESSOR'S
interest therein and to all ground leases which may now or at any time hereafter
affect all or any portion of the Premises (any such mortgage or ground lease
being herein called an "Underlying Encumbrance"). The foregoing provisions for
the subordination of this Lease and the term and estate hereby granted to an
Underlying Encumbrance shall be self-operative and no further instrument shall
be required to effect any such subordination; provided, however, at any time and
from time to time, upon not less than ten (10) days' prior notice by LESSOR,
LESSEE shall execute, acknowledge and deliver to LESSOR any and all reasonable
instruments that may be necessary or proper to effect such subordination or to
confirm or evidence the same.
22.2. If all or any portion of LESSOR'S estate in the Premises
shall be sold or conveyed to any person, firm or corporation upon the exercise
of any remedy provided for in any mortgage or by law or equity, such person,
firm or corporation and each person, firm or corporation thereafter succeeding
to its interest in the Premises (a) shall not be liable for any act or omission
of LESSOR under this Lease occurring prior to such sale or conveyance, (b) shall
not be subject to any offset, defense or counterclaim accruing prior to such
sale or conveyance, (c) shall not be bound by any payment prior to such sale or
conveyance of Basic Rent, Additional Rent or other payments for more than one
month in advance (except prepayments in the nature of security for the
performance by LESSEE of its obligations hereunder), and (d) shall be liable for
the keeping, observance and performance of the other covenants, agreements,
terms, provisions and conditions to be kept, observed and performed by LESSOR
under this Lease only during the period such person, firm or corporation shall
hold such interest.
22.3. In the event of an act or omission by LESSOR which would
give LESSEE the right to terminate this Lease or to claim a partial or total
eviction, LESSEE will not exercise any such right until it has given written
notice of such act or omission, or, in the case of the Demised Premises or any
part thereof becoming untenantable as the result of damage from fire or other
casualty, written notice of the occurrence of such damage, to the holder of any
Underlying Encumbrance whose name and address shall previously have been
furnished to LESSEE in writing, by delivering such notice of such act, omission
or damage addressed to such holder at said address or if such holder hereafter
furnishes another address to LESSEE in writing at the last address of such
41
holder so furnished to LESSEE, and, unless otherwise provided herein, until a
reasonable period for remedying such act, omission or damage shall have elapsed
following such giving of such notice, provided any such holder, with reasonable
diligence, shall, following the giving of such notice, have commenced and
continued to remedy such act, omission or damage or to cause the same to be
remedied.
22.4. If, in connection with obtaining financing for the
Premises or refinancing any mortgage encumbering the Premises, the prospective
lender requests reasonable modifications to this Lease as a condition precedent
to such financing or refinancing, then LESSEE hereby covenants and agrees not to
unreasonably withhold, delay or condition its consent to such modifications,
provided such modifications do not increase the Basic Rent or Additional Rent,
do not reduce the length of the Term, do not materially and adversely affect the
leasehold interest created by this Lease and do not materially and adversely
affect the manner in which LESSEE'S operations are conducted at the Demised
Premises.
ARTICLE 23
LESSEE'S REMOVAL
23.1. Upon the expiration or earlier termination of this Lease,
LESSEE shall surrender the Demised Premises to LESSOR in the condition same is
required to be maintained under Article 7 of this Lease and broom clean. Any
personal property which shall remain in any part of the Demised Premises after
the expiration or earlier termination of this Lease shall be deemed to have been
abandoned, and either may be retained by LESSOR as its property or may be
disposed of in such manner as LESSOR may see fit; provided, however, that,
notwithstanding the foregoing, LESSEE will, upon request of LESSOR made not
later than thirty (30) days after the expiration or earlier termination of this
Lease, promptly remove from the Demised Premises any such personal property.
23.2. If, at any time during the last three (3) months of the
Term, LESSEE shall not occupy any part of the Demised Premises in connection
with the conduct of its business, LESSOR may elect, at its option, to enter such
part of the Demised Premises to alter and/or redecorate such part of the Demised
Premises, and LESSEE hereby irrevocably grants to LESSOR a license to enter such
part of the Demised Premises in connection with such alterations and/or
redecorations. LESSOR'S exercise of such right shall not relieve LESSEE from any
of its obligation under this Lease.
23.3. If LESSEE holds over possession of the Demised Premises
beyond the Termination Date, such holding over shall not be deemed to extend the
Term or renew this Lease but such holding
42
over shall continue upon the terms, covenants and conditions of this Lease
except that LESSEE agrees that the charge for use and occupancy of the Demised
Premises for each calendar month or portion thereof that LESSEE holds over (even
if such part shall be one day) shall be a liquidated sum equal to one-twelfth
(1/12th) of two (2) times the Basic Rent and Additional Rent required to be paid
by LESSEE during the calendar year preceding the Termination Date. The parties
recognize and agree that the damage to LESSOR resulting from any failure by
LESSEE to timely surrender possession of the Demised Premises will be extremely
substantial, will exceed the amount of the monthly Basic Rent and Additional
Rent payable hereunder and will be impossible to accurately measure. If the
Demised Premises are not surrendered upon the expiration of this Lease, LESSEE
shall indemnify, defend and hold harmless LESSOR against any and all losses and
liabilities resulting therefrom, including, without limitation, any claims made
by any succeeding tenant founded upon such delay. Nothing contained in this
Lease shall be construed as a consent by LESSOR to the occupancy or possession
by LESSEE of the Demised Premises beyond the Termination Date, and LESSOR, upon
said Termination Date, shall be entitled to the benefit of all legal remedies
that now may be in force or may be hereafter enacted relating to the immediate
repossession of the Demised Premises. The provisions of this Article shall
survive the expiration or sooner termination of this Lease.
ARTICLE 24
BROKERS
LESSEE and LESSOR each represents to the other that no real
estate broker or sales representative participated in this transaction or has
any interest herein. LESSEE and LESSOR each agrees to indemnify and hold
harmless the other and their respective directors, officers, employees and
partners, from and against any threatened or asserted claims, liabilities,
losses or judgments (including reasonable attorneys' fees and disbursements) by
any broker or sales representative other than as named above arising out of or
in connection with this Lease. The provisions of this Article shall survive the
expiration or sooner termination of this Lease.
ARTICLE 25
NOTICES
All notices, demands, requests, consents, approvals, offers,
statements and other instruments or communications required or permitted to be
given hereunder shall be in writing, shall be either hand delivered by
respectable priority overnight delivery service, or mailed by first class
registered or certified
43
mail, postage prepaid, addressed to the address for such party set forth above,
or to such other address as either party shall designate to the other in
writing, and shall be deemed to have been given when delivered, or three (3)
days after being mailed. Notwithstanding the foregoing, any notice changing the
address of a party shall not be deemed given until received by the party to whom
it was addressed.
ARTICLE 26
NATURE OF LESSOR'S OBLIGATIONS
Anything in the Lease to the contrary notwithstanding, no
recourse or relief shall be had under any rule of law, statute or constitution
or by any enforcement of any assessments or penalties, or otherwise or based on
or in respect of this Lease (whether by breach of any obligation, monetary or
non-monetary), against LESSOR, it being expressly understood that all
obligations of LESSOR under or relating to this Lease are solely obligations
payable out of the Premises and are compensable solely therefrom. It is
expressly understood that all such liability is and is being expressly waived
and released as a condition of and as a condition for the execution of this
Lease, and LESSEE expressly waives and releases all such liability as a
condition of, and as a consideration for, the execution of this Lease by LESSOR.
ARTICLE 27
SECURITY DEPOSIT
27.1. (a) Concurrently with the execution of this Lease, LESSEE
shall deposit with LESSOR the sum of $5,306.00, the same to be held by LESSOR as
security for the full and faithful performance by LESSEE of the terms and
conditions by it to be observed and performed hereunder. If any Basic Rent,
Additional Rent or other sum payable by LESSEE to LESSOR becomes overdue and
remains unpaid, or should LESSOR make any payments on behalf of LESSEE, or
should LESSEE fail to perform any of the terms and conditions of this Lease,
then LESSOR, at its option, and without prejudice to any other remedy which
LESSOR may have on account thereof, shall appropriate and apply said deposit, or
so much thereof as may be required to compensate or reimburse LESSOR, as the
case may be, toward the payment of Basic Rent, Additional Rent or other such sum
payable hereunder, or loss or damage sustained by LESSOR due to the breach or
failure to perform on the part of LESSEE, and upon demand, LESSEE shall restore
such security to the original sum deposited.
(b) LESSEE hereby agrees that the security deposit shall equal
$5,306.67 one (1) month's Basic Rent at all times during
44
the Term, and LESSEE agrees to deposit with LESSOR such additional sum as may be
required to satisfy such requirement within thirty (30) days after any increase
in the Basic Rent.
27.2. Conditioned upon the full compliance by LESSEE of all of
the terms of this Lease, and the prompt payment of all sums due hereunder, as
and when they fall due, said deposit shall be returned in full to LESSEE within
fifteen (15) days after the end of the Term.
27.3. In the event of bankruptcy or other debtor-creditor
proceeding against LESSEE, such security deposit shall be deemed to be applied
first to the payment of rent and other charges due LESSOR for all periods prior
to filing of such proceedings.
27.4. In the event of any transfer of title to the Premises, or
any assignment of LESSOR'S interest under this Lease, LESSOR shall have the
right to transfer the security deposit to said transferee or assignee and,
provided that the transferee or assignee assumes in writing the obligations of
LESSOR under this Lease, LESSOR shall thereupon be released by LESSEE from all
liability for the return of such security deposit. In such event, LESSEE agrees
to look to the new lessor for the return of the security deposit. It is hereby
agreed that the provisions of this Section shall apply to every transfer or
assignment made of the security deposit to a new lessor.
ARTICLE 28
RULES AND REGULATIONS
LESSOR shall have the right to adopt at any time during the
Term such rules and regulations with respect to the Premises as it deems
reasonably necessary for the safety, care and cleanliness of the Premises, the
preservation of good order therein and the general convenience of all the
tenants, and LESSEE and LESSEE'S Visitors shall comply with such rules and
regulations after twenty (20) days' written notice thereof from LESSOR (such
rules and regulations, as the same may be amended pursuant to this Section, are
collectively referred to as the "Rules and Regulations"). LESSOR may make, at
its sole discretion, reasonable amendments thereto from time to time, and LESSEE
and LESSEE'S Visitors shall comply with such amended Rules and Regulations after
twenty (20) days' written notice thereof from LESSOR. All Rules and Regulations
shall apply to all tenants occupying space within the Building, and will not
materially interfere with the use and enjoyment of the Demised Premises by
LESSEE. In the event there is a conflict between the provisions of this Lease
and the Rules and Regulations, the provisions of this Lease shall govern.
45
ARTICLE 29
MISCELLANEOUS
29.1. This Lease may not be amended, modified or terminated,
nor may any obligation hereunder be waived, orally, and no such amendment,
modification, termination or waiver, shall be effective unless in writing and
signed by the party against whom enforcement thereof is sought. No waiver by
LESSOR of any obligation of LESSEE hereunder shall be deemed to constitute a
waiver of the future performance of such obligation by LESSEE. If any provision
of this Lease or any application thereof shall be invalid or unenforceable, the
remainder of this Lease and any other application of such provision shall not be
affected thereby. This Lease shall be binding upon and inure to the benefit of
and be enforceable by the respective successors and assigns of the parties
hereto, except as provided in Article 15. Upon due performance of the covenants
and agreements to be performed by LESSEE under this Lease, LESSOR covenants that
LESSEE shall and may at all times peaceably and quietly have, hold and enjoy the
Demised Premises during the Term. The table of contents and the article headings
are for convenience of reference only and shall not limit or otherwise affect
the meaning hereof. Schedules A and B annexed hereto are incorporated into this
Lease. This Lease will be simultaneously executed in several counterparts, each
of which when so executed and delivered, shall constitute an original, fully
enforceable counterpart for all purposes. This Lease shall be governed by and
construed in accordance with the laws of the State of New Jersey.
29.2. No act or thing done by LESSOR or LESSOR'S agents during
the Term shall be deemed an acceptance of a surrender of the Demised Premises,
and no agreement to accept such surrender shall be valid unless in writing and
signed by LESSOR. No employee of LESSOR or LESSOR'S agents shall have any
authority to accept the keys to the Demised Premises prior to the Termination
Date and the delivery of keys to any employee of LESSOR or LESSOR'S agents shall
not operate as an acceptance of a termination of this Lease or an acceptance of
a surrender of the Demised Premises.
29.3. LESSOR'S failure during the Term to prepare and deliver
any of the statements, notices or bills set forth in this Lease shall not in any
way cause LESSOR to forfeit or surrender its rights to collect any amount that
may have become due and owing to it during the Term.
29.4. The submission of this Lease to LESSEE for examination
does not constitute an offer to lease the Demised Premises on the terms set
forth herein, and this Lease shall become
46
effective as a lease agreement only upon the execution and delivery of this
Lease by LESSOR and LESSEE.
29.5. (a) LESSOR hereby reserves the right to relocate the
portion of the Demised Premises which is warehouse space to other warehouse
space of comparable size within the first floor of Building (the "New Space") at
any time during the Term. If LESSOR elects to relocate LESSEE, LESSOR agrees to
(i) reimburse LESSEE for all reasonable expenses incurred by LESSEE in
connection with its move to the New Space within ten (10) business days after
receipt of a reasonably detailed statement describing each expense.
(b) LESSEE agrees to relocate to the New Space on or before the
later to occur of (i) sixty (60) days after the date of LESSOR'S notice to
LESSEE electing to relocate LESSEE or (ii) ten (10) days after the date of
LESSOR'S notice to LESSEE stating that the New Space is ready for LESSEE'S
occupancy.
(c) LESSOR and LESSEE hereby agree, within twenty (20) days
after LESSEE takes possession of the New Space, to promptly amend those
provisions of this Lease which are affected by the relocation and the change, if
any, in the rentable area.
(d) LESSOR and LESSEE hereby agree further that all of the
terms and conditions of this Lease, as amended pursuant to Section 29.5(c),
shall remain in full force and effect and shall apply to the New Space.
29.6. If either LESSOR or LESSEE shall institute an action or
proceeding against the other relating to any of the terms, covenants, conditions
or provisions of this Lease, or a default herein, the unsuccessful party in such
action or proceeding shall reimburse the successful party for reasonable
attorneys' fees or other costs and expenses incurred therein by the successful
party, including fees, costs and expenses incurred in any applicable proceeding.
29.7. LESSOR, at its sole cost and expense, shall install in
the lobby of the Building a directory board indicating the floor upon which the
Demised Premises are located.
47
29.8. LESSOR represents that the Preliminary Assessment/Site
Investigation Report prepared by Xxx Xxxxx Associates, Inc. dated October 8,
1996 is the most recent environmental report obtained by LESSOR regarding the
Premises.
ARTICLE 30
RENEWAL OPTION
30.1. (a) Subject to the terms and conditions of this Section
30.1., LESSOR hereby grants to LESSEE the right to extend the original five-year
term of this Lease for one period of five years. LESSEE shall exercise the
renewal option by delivering written notice thereof at least one (1) year prior
to the Termination Date, time being of the essence with respect to the delivery
of such notice.
(b) In the event LESSEE exercises its renewal right, LESSOR
shall deliver to LESSEE, its determination of the Basic Rent for the renewal
period within thirty (30) days after the date LESSEE exercises its renewal
right. LESSEE shall have thirty (30) days from receipt from LESSOR'S
determination of the Basic Rent for the renewal period to revoke its exercise of
the renewal option by delivering written notice thereof to LESSOR, time being of
the essence with respect to the delivery of such revocation notice. If LESSEE
does not timely revoke its exercise of the renewal option, then the Basic Rent
for the renewal period shall be the amount determined by LESSOR as set forth in
LESSOR'S notice.
(c) LESSEE'S right to exercise its renewal option is expressly
subject to the following: (i) LESSEE shall not be in default as of the date of
LESSEE's notice exercising such renewal option or as of the commencement of the
renewal period; (ii) LESSEE shall be in occupancy of the entire Demised
Premises; and (iii) LESSEE shall not have sublet all or any portion of the
Demised Premises. If any of the foregoing conditions is not accurate, then
LESSEE shall not have the right to renew this Lease and any notice exercising
such renewal rights shall be deemed automatically null and void.
48
IN WITNESS WHEREOF, the parties have executed this Lease as of
the date first above written.
LESSOR:
VITAMIN REALTY ASSOCIATES, L.L.C.
By: XXXX XXXXXXXX
--------------------------------------
Name: Xxxx Xxxxxxxx
Title: Member
LESSEE:
ALL COMMUNICATIONS CORPORATION
By: XXXXXXX XXXXX
--------------------------------------
Name: XXXXXXX XXXXX
Title: PRES.
49
SCHEDULE B
BASIC RENT
The Basic Rent shall be payable in equal monthly installments,
in advance, on the Basic Rent Payment Dates. The Basic Rent for the Term shall
be $63,680.00 per annum, payable in equal monthly installments of $5,306.67.
[SECOND FLOOR PLAN LAYOUT]
SECOND FLOOR TENANT SPACE PLAN
------------------------------
THIS PLAN IS BASED ON A DRAWING ENTITLED
"BUILDING IS SECOND FLOOR PLAN OF EXISTING CONDITIONS"
PREPARED BY XXXXXXX AND XXXXXXXX, ARCHITECTS
DATED 26 JANUARY 1987.
TENANT NET ADD- RENTABLE
SPACE AREA ON AREA
----- ---- ---- --------
A 6,775 1,258.75 8.073.76
B 1,100 210.75 1,310.75
C 1,060 203.04 1,263.04
D 3,680 705.06 4,385.06
E 4,550 545.22 5,855.22
F 3,055 532.84 3,687.84
G 3,400 651.55 4,051.35
H 8,300 1,705.65 10,605.63
I 1,330 381.24 2,371.23
J 1,075 206.46 1,281.46
K 1,060 207.32 1,287.32
L 810 155.00 363.06
M 810 155.06 365.06
N 825 158.45 583.45
O 1,425 286.14 1,781.14
P 3,650 422.93 4,343.33
------ -------- ---------
44,635 8,567 53,262
PROPOSED TENANT DIVISION IN
BUILDING 15 FOR
LIBERTY HILLSIDE ASSOCIATES
XXXXX 00
XXXXXXXX XXX XXXXXX
[FIRST FLOOR PLAN LAYOUT]
FIRST FLOOR
91,000 SQ. FT.
