EXHIBIT 10
LEASE
THIS AGREEMENT OF LEASE, made this day of September 2004, by and between
JVNJ REALTY CORP., a New Jersey corporation having an address 0000 Xxxx Xxxxx
Xxxxxxxxx, #0000, Xxxxxx, Xxxxxxx 00000 (hereinafter referred to as "Landlord"),
and MEDIA SCIENCES INTERNATIONAL INC., having an address at 00 Xxxxxxxx Xxxx,
Xxxxxxxxx, Xxx Xxxxxx 00000 (hereinafter referred to as "Tenant").
W I T N E S S E T H:
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ARTICLE 1 - DEFINITIONS
Section 1.01 For the purposes of this Lease, unless the
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context otherwise requires, the following terms shall have the
ascribed meanings:
1.01 "Additional Rent" shall be as defined in Section
3.03.
1.02 "Building" shall mean an office, manufacturing and warehouse building
located on the Demised Premises, containing approximately 41,735 square feet,
which is the entire building.
1.03 "Commencement Date" shall be the date which is the delivery of actual
possession of the Demised Premises to Tenant with simultaneous execution and
delivery of lease documents.
1.04 "Demised Premises" or "Premises" shall mean the Building, the land
thereunder and appurtenant thereto, all as owned by Landlord, and any and all
improvements now located or hereafter constructed thereon by Tenant.
1.05 "Environmental Laws" shall be defined in Section 23.01.
1.06 "Expiration Date" shall be the fifth (5th) anniversary of the last day
of the month in which the Rent Commencement Date of the Term occurs. If the Term
is extended, or if the Lease is cancelled or terminated at any time during
the term, the date to which the Term is extended or the effective date of such
cancellation or termination, as the case may be, shall be the Expiration Date of
the Term.
1.07 "First Lease Year" shall be the period commencing on the Rent
Commencement Date and ending on the first anniversary of the last day of the
month prior to the month in which the Rent Commencement Date occurs.
1.08 "Fixed Rent" is that amount of annual rental, payable in equal
monthly installments, which Tenant pays to Landlord during the Term of this
Lease as and for the rental of the Demised Premises.
1.09 "Governmental Approvals" refers to the approval of any and all
permits, licenses and authorizations by the appropriate governmental bodies
having jurisdiction thereof necessary to permit renovation to be carried out in
the Demised Premises and use of the Demised Premises in accordance with this
Lease.
1.10 "Laws" shall be as defined in Section 4.04.
1.11 "Lease Year" shall be a period of 12 consecutive calendar months
following the end of the previous Lease Year.
1.12 "Rent" shall mean Fixed Rent and Additional Rent.
1.13 "Term or "term" shall consist of a period of five (5) years,
commencing on the Rent Commencement Date and expiring on the Expiration Date or
such date on which the term is sooner terminated in accordance with the
provisions of the Lease.
1.14 "Penalty Rate" shall mean two (2) percentage points above the prime
commercial lending rate as announced from time to time by Citibank, N.A. (or its
successor).
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ARTICLE 2-DEMISED PREMISES AND TERM
Section 2.01 Landlord, in consideration of the rents and
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covenants hereinafter specified to be paid and performed by Tenant, hereby
leases to Tenant, and Tenant hereby rents from Landlord, the Demised Premises
for the Term and upon the Fixed Rent hereinafter described, and otherwise upon
the terms and conditions herein set forth. The Demised Premises shall be for the
exclusive use of Tenant, and Landlord shall not be permitted to construct any
improvements on the Demised Premises without Tenant's consent, unless required
by this Lease.
Section 2.02 At any time after the Rent Commencement Date,
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at the request of either party, each party shall execute a certificate in
recordable form setting forth the exact Rent Commencement Date and originally
fixed Expiration Date.
Section 2.03 Landlord shall promptly provide Tenant with
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a copy of any correspondence that Landlord (or Landlord's environmental
consultant including without limitation Xxxxxxx Xxxxxx) receives from or sends
to the New Jersey Department of Environmental Protection (or any similar local,
state, or federal governmental entity). In addition, Landlord shall use its best
efforts to obtain, and deliver to Tenant, a site-wide No Further Action letter
with a covenant by the New Jersey Department of Environmental Protection not to
xxx pursuant to N.J.S.A. 58:10B-13.1, and a release from ISRA (the "No Further
Action Letter") as soon as possible.
Section 2.04 Notwithstanding anything else herein
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contained, provided that Tenant makes the proper applications therefor within
ten (10) days of the Commencement Date, this Lease shall terminate at Tenant's
option if Tenant is unable to obtain all necessary Governmental Approvals within
sixty (60) days from the date hereof, in which event Landlord shall promptly
return to Tenant any prepayment of Rent and the security deposit.
ARTICLE 3 - RENT AND ADDITIONAL RENT
Section 3.01 Fixed Rent.
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A. From and after the Rent Commencement Date, Tenant shall pay to
Landlord, at XX Xxx 000, Xxxxxx, Xx. 00000, or to
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such other person or at such other address in the United States as Landlord may
from time to time designate by notice to Tenant, in advance, without previous
demand therefor and without counterclaim, deduction or set-off, except as
expressly set forth herein on the first day of each calendar month during the
term the annual sum of $296,318.50 payable in equal monthly installments on the
first day of each and every month during the Term of $24,693.20(hereinafter
called "Fixed Rent").
B. If the Rent Commencement Date shall occur on a date other than the
first day of a calendar month, then Tenant shall pay to Landlord in advance a
pro rata share of the monthly installment of Basic Rent for such partial month
and thereafter the full monthly Basic Rent installment shall become due and
payable in advance on the first day of each and every month. If the Expiration
Date shall occur on a date other than the last day of a calendar month, then
Tenant shall pay to Landlord a pro rata share of the monthly installment of
Fixed Rent for such partial month.
C. Landlord hereby waives Tenant's obligation, and Tenant shall not be
required to pay, the Fixed Rent for the period until the Rent Commencement Date
(as hereinafter defined) as an allowance for Tenant's moving costs. The date
which is the later of (a) the date on which Landlord has completed all of the
work set forth on Landlord's letter dated September 15, 2004 attached hereto as
Exhibit "B" including the fixing of any and all existing cracks in the silo
(collectively, "Landlord's Work") or (b) the ninetieth (90th) day from the
Commencement Date is herein called the "Rent Commencement Date." Landlord's Work
shall be promptly completed in a good and workmanlike manner and in compliance
with all applicable laws and ordinances.
D. The security deposit hereinafter set forth and the first month's
Fixed Rent shall be due and payable simultaneously with the execution of this
Lease by both parties.
Section 3.02 No Partnership. Landlord shall not in any
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way or for any purpose, be deemed to be or to have become a partner of Tenant in
the conduct of its business, or otherwise, or be a joint venturer or a member of
a joint enterprise with Tenant.
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Section 3.03 Additional Rent.
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Any and all sums which may become due under the provisions of this Lease
and payable to Landlord shall be deemed to be "Additional Rent".
Section 3.04 Personal Property Taxes. Tenant agrees to
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pay all taxes and assessments against its personal property on the Premises and
all permit and license fees, if any, assessed or imposed on the conduct of
Tenant and/or its business.
Section 3.05 No Setoff. Tenant shall pay all Fixed Rent
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and Additional Rent payable hereunder under this Lease as provided for herein
without setoff, counterclaim or deduction of any kind except as allowed under
the terms of this Lease.
Section 3.06 Late Charge. In the event that Tenant shall
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not have paid the Fixed Rent on or before the fifteenth (15th) day of the month
during which the same is due or Additional Rent, within fifteen (15) days after
same is due, there shall be a late charge due to Landlord equal to Three cents
($.03) of each dollar past due. This late charge shall be deemed Additional Rent
and shall, at the Landlord's election, be added to the rent for the month in
which any item of Rent shall be due, and Landlord shall have all rights with
respect to Additional Rent as and for non-payment of any and all other rents due
under the terms of this Lease. The demand for and collection of the aforesaid
late charges shall in no way be deemed a waiver of any and all other remedies
which Landlord may have under the terms of this Lease, by summary proceedings or
otherwise, in the event of a default in the payment of Fixed Rent or Additional
Rent.
Section 3.07 Personal Property and Real Estate Taxes
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A. During the term of this Lease and any extension thereof, Tenant
shall pay as they become due and prior to delinquency, the following:
Taxes and assessments, if any, levied upon all personal
property, including trade fixtures and inventory kept in the Demised Premises
("Personal Property Taxes").
B. During the term of this lease and any extension thereof, Tenant
shall pay as they become due and prior to delinquency, the following:
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Real Estate Taxes (special or otherwise) (and if they may be payable in
installments, shall be payable in installments) levied against the Demised
Premises, including the land, all buildings and improvements situated
thereon.
C. Tenant may contest the validity of any tax, lien, or assessment to
be paid by it, and Tenant shall have the right to institute any proceedings in
the name of Landlord provided that all costs, expenses, liabilities, including
attorneys' fees, incurred by reason thereof, shall be paid by Tenant. Tenant
shall not be in default hereunder in respect to the payment of any tax, lien, or
assessment which Tenant is in good faith contesting. In the event Tenant desires
to contest any tax, lien, or assessment hereunder, as provided herein, Tenant
shall be required to take such steps as will ensure the Landlord that the
authorities imposing such tax or lien shall not be able to exercise any right
against the Demised Premises during the period Tenant is contesting such tax,
lien, or assessment, based upon Tenant's failure to pay such tax, lien, or
assessment. Tenant hereby indemnifies and saves the Landlord harmless from all
costs, expenses, claims, loss or damages (including reasonable attorneys' fees)
by reason of, in connection with, on account of, growing out of, or resulting
from the contest of any Personal Property Taxes or lien, or any action or
proceeding relating to the contest of any Personal Property Taxes or lien, or
any action or proceeding relating to the contest of any Personal Property Taxes
or lien under this Subsection C.
D. Landlord shall mail copies of all tax and/or assessment bills to
Tenant promptly after such bills are received from the tax collector and Tenant
shall pay said bills directly to the taxing authority no later than the due
date.
E. Nothing in this Lease shall be constructed to require Tenant to pay
any income, rollback, inheritance, franchise, estate, transfer, succession or
excess profit tax that is or may be imposed upon the Demised Premises or
Landlord, its successors or assigns.
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ARTICLE 4 - USE AND OCCUPATION
Section 4.01
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A. Tenant agrees that the Demised Premises may be used and occupied by
Tenant for the manufacture of supplies for office color printers and related
products, conduct of research and development, and the servicing of printers and
related equipment, offices and warehouse for the storage of such supplies,
products and equipment. It may include sale of merchandise in connection
therewith, and office use and any other lawful purpose of any kind whatsoever
("the Use") subject, however, to zoning ordinances, laws, the orders, rules and
regulations of the Board of Fire Insurance Underwriters and any similar bodies
having jurisdiction thereof now in effect or hereafter adopted by any
governmental authority having jurisdiction, and such conditions, restrictions
and other encumbrances, if any, to which the Demised Premises are subject at the
time of execution and delivery hereof. Tenant shall have access to the Premises
at all hours of the day or night, each and every day of the week, 365 days per
year for the Term of this Lease. All of the parking on the Premises shall be for
the exclusive use of the Tenant.
B. Tenant agrees that the value of the Demised Premises and the
reputation of the Landlord will be seriously injured if the Demised Premises are
used for any obscene or pornographic purposes or any sort of commercial sex
establishment. Tenant agrees that Tenant will not bring or permit any obscene or
pornographic material on the Demised Premises, and shall not permit or conduct
any obscene, nude or semi-nude live performance in the Demised Premises, nor
permit use of the Demised Premises for nude modeling, or as a so-called rubber
goods shop, or as a sex club of any sort, or as a "Massage Parlor". Tenant
agrees further that Tenant will not permit any of these uses by any sublessee or
assignee of the Demised Premises. This Article shall directly bind any
successors in interest to Tenant. Tenant agrees that if at any time Tenant
violates any of the provisions of this Article, such violation shall be deemed a
breach of a substantial obligation of the terms of this Lease and objectionable
conduct. Pornographic material is defined for purposes of this Article as any
written or pictorial matter with prurient appeal or any objects or instruments
that are primarily concerned with lewd or prurient sexual activity.
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Section 4.02 Tenant will promptly obtain any and all
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permits or licenses which it may require for the operation of its business
within the Demised Premises, at its own cost and expense. Landlord agrees to
execute all other consents and applications which require the approval or
participation of the fee owner for issuance of future permits for such business
or the performance of Alterations or other activities of Tenant permitted by
this lease.
Section 4.03 If Tenant shall install any electrical
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equipment that overloads the lines in the Demised Premises, Tenant shall at its
own expense make whatever changes are necessary to comply with the requirements
of the insurance underwriters and governmental authorities having jurisdiction
thereover.
Section 4.04 Tenant warrants, covenants and agrees that it
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will at all times fully and completely comply with all the conservation,
sanitation and health laws of the State of New Jersey, the rules, regulations,
ordinances and directives of the Sanitary Code of the State of New Jersey; and
such other municipal departments, special divisions, etc., having jurisdiction
and control over environmental control, sanitation and health and as may now or
hereinafter be organized and/or enacted, which relate to conditions created by
Tenant and not (i) with respect to violations issued before the Commencement
Date or (ii) with respect to uses or conditions which existed before the
Commencement Date (collectively, "Laws"). Landlord shall comply at Landlord's
sole expense with Laws in all other instances that Tenant is not obligated to do
so under the provisions of this Section 4.04.
Section 4.05 Tenant warrants, covenants and agrees to
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install such other health and sanitary facilities as may be required by the
municipal authorities having jurisdiction in the future, whether such
requirement is imposed upon Landlord or Tenant, and to engage an exterminating
service if necessary, at its own cost and expense throughout the term of this
Lease, but this shall be Landlord's obligation with respect to existing
conditions.
Section 4.06
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A. Landlord represents that:
1. The use permitted in this lease is a lawful use under the Town
of Oakland's Zoning Resolution now in effect;
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2. Landlord has not received notice of a proposed change in such
Zoning Resolution;
3. There is a Certificate of Occupancy issued for the Premises
which permits the Use (Exhibit "C" attached hereto);
4. At Commencement Date there are no issued and outstanding
violations or notices with respect to the Premises or the Use, or any applicable
zoning ordinances, laws or orders, or of the rules or regulations of the Board
of Fire Insurance Underwriters or of any similar or dissimilar private or public
body having jurisdiction of the Premises including notices from any fire
insurance company or fire rating organization requiring the performance of
alterations as a condition to continued coverage or to prevent insurance premium
increases;
5. Landlord has not caused or allowed the generation, treatment,
storage, maintenance, existence or disposal of Hazardous Substances, as defined
in the Comprehensive Environmental Response Compensation and Liability Act
(CERCLA) nor of asbestos and petroleum products (which for purposes of this
Lease are Hazardous Substances) at the Premises except in accordance with local,
state and federal statutes and regulations, except as set forth in the letter of
Xxxxxxx Xxxxxx , dated June 14, 2004 and attached hereto as EXHIBIT A;
6. Landlord has not caused or allowed the release of any
Hazardous Substance from, onto, at, or near the Premises, except as set forth in
the letter of Xxxxxxx Xxxxxx , dated June 14, 2004 and attached hereto as
EXHIBIT A;
7. Landlord is in compliance with all applicable laws, rules, and
regulations regarding the handling of Hazardous Substances;
8. Landlord has secured all necessary environmental, business and
other permits, licenses and approvals, if any, of a commercial building, and
Landlord is in compliance with such permits as of the date of this Lease.
9. Landlord has not received notice of any proceedings, claims,
or lawsuits arising out of its operations at the Premises;
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10. All equipment installed and used in the operation of the
Building and all heating, ventilating and air conditioning equipment, fire
suppressant and burglar alarm systems and equipment, on the Premises are in good
operating order as of the Commencement Date and all such equipment has been
installed in the manner required by law, and no notices of violations of law
have been issued with respect thereto;
11. In the event any representation of Landlord in this Lease
shall be deemed false or inaccurate in any respect, Landlord covenants to
correct promptly, when as required by law, if the misrepresentation involves a
requirement of law, at Landlord's expense, the condition as to which the
misrepresentation relates and any order or violation relating thereto and to
defend and indemnify Tenant at Landlord's expense against any proceeding,
action, suit or administrative proceeding brought by any private or public
person or agency as the result of the presence of the misrepresented condition
or fact including reasonable attorneys' fees.
ARTICLE 5 - ALTERATIONS; MAINTENANCE AND REPAIRS
Section 5.01 Tenant may not make alterations,
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installations, additions or improvements in or to the Demised Premises
("Alterations") without Landlord's prior written consent, not to be unreasonably
withheld or delayed, if such Alterations are to remove, replace or materially
affect the roof or exterior walls, floors or foundation of the Building
(structural) or construct walls in the interior of the building. No Landlord
consent shall be required for any other Alteration or for maintenance, repairs
or replacements of the whole or any part of (i) equipment which is now and shall
remain the property of Tenant; or (ii) other equipment used in the operation of
Tenant's business including work required for the performance of such equipment
such as, but not limited to repair, maintenance or replacement of electrical
wiring. Tenant shall inform Landlord of any such changes. All installations
which can be installed without the consent of Landlord shall remain the property
of Tenant and may be removed at the end of the term. Tenant will repair damage
caused by Tenant's removal but not mere marks or holes caused by removing braces
or screws. All installations or work done by Tenant shall at all times comply
with (i) laws, rules, orders and regulations of governmental authorities having
jurisdiction thereof; (ii) and if Landlord's consent shall be required, plans
and specifications prepared by
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a licensed architect or engineer and at the expense of Tenant theretofore
submitted to Landlord for its prior written approval. No installations or work
shall be undertaken, started or begun by Tenant, its agents, servants or
employees until Landlord has approved such plans and specifications (where such
plans and specifications are required). Any Alterations upon the Demised
Premises shall become the property of Landlord and shall remain upon and be
surrendered with the Demised Premises at the end of the Term, unless with
respect to Alterations requiring Landlord's approval Landlord elects, at the
time of providing Landlord's approval, to have such alterations, installations,
additions or improvements removed by Tenant in which event, Tenant shall repair
all damage caused by such removal and restore the Demised Premises to its
original condition, at its own cost and expense at or prior to the expiration of
the Term. If Tenant paints the concrete floor, then Tenant shall, at Landlord's
option, be required to restore the floor in the condition that it was in at the
Commencement Date.
Section 5.02 All alterations made by Tenant pursuant to
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this Article shall be done at its sole cost and expense and performed in a
workmanlike manner. Tenant shall obtain sufficient amounts of liability and
worker's compensation insurance and shall deliver certificates of insurance
naming Landlord as an additional insured prior to the commencement of any work.
Section 5.03 Except as set forth in this Lease, Tenant
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hereby accepts the Demised Premises in the condition in which they exist as of
the date of the beginning of the original term of this Lease, but Landlord shall
be responsible for all conditions and violations of law, if any, of the Demised
Premises which existed on the Commencement Date and shall defend, indemnify and
hold Tenant harmless therefrom including reasonable attorneys' fees resulting
therefrom. This indemnification shall survive the expiration or earlier
termination of this Lease. Except as set forth in this Lease, Landlord is not
liable or bound by any statements, representations, broker set-ups or
information pertaining to the Demised Premises furnished by any real estate
broker, agent, employee or other person, unless the same are specifically set
forth herein. Tenant, at its expense, will during the term hereof, make all
repairs and replacements of equipment necessary to maintain the Demised Premises
(including, but not limited to, all painting, glass, utilities, fixtures and
equipment, heating and air conditioning systems, wiring, plumbing, elevators,
well,
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sprinkler systems and other utilities, and sidewalks, curbs and gutters and
fences) in as good a condition as they existed at the beginning of the original
term, ordinary wear and tear excepted. Landlord will, at its own expense, make
all replacements, maintenance and repairs of a structural or capital nature to
the Building which shall include the floors, foundation, exterior walls and roof
and the service lines and pipes for fuel and utilities between the property line
and the Building, and all other repairs or replacements as the result of the
acts or omissions of Landlord or Landlord's employees or agents. As of the
Commencement Date, Landlord shall provide Tenant with a certificate from
Landlord's licensed HVAC contractor that the HVAC Equipment is in good working
order and condition. Tenant, at its own expense, will keep the Demised Premises
clean and in order, and will keep the sidewalks and curbs adjacent thereto free
from snow, ice, dirt and rubbish. Provided, however, nothing contained herein
shall be deemed to alter or affect the rights and obligations of Tenant in the
event of damage or destruction resulting from casualty as set forth in Article 9
hereof.
Section 5.04 All repairs and replacements which shall be
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made by Tenant or Landlord, as the case may be, shall be performed in a good and
workmanlike manner and in accordance with all existing ordinances, laws and
regulations applicable thereto. Tenant shall make and complete any such repairs
or replacements free and clear of any and all mechanic's liens or claims against
Landlord or against the Demised Premises.
Section 5.05 If, because of any act or omission of Tenant,
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any mechanic's lien or order for the payment of money shall be filed against the
Demised Premises or any building or improvement thereon or against Landlord
(whether or not such lien or order is valid or unenforceable as such), Tenant
shall, at Tenant's own cost and expense, contest the same pursuant to Section
3.07(C) and/or cause the same to be cancelled and discharged of record or bonded
within thirty (30) days after the date of notice to Tenant, and Tenant shall
indemnify, save harmless and defend Landlord from and against any and all costs,
expense, claims, special proceedings, actions, judgments, losses or damages,
including reasonable counsel fees, resulting therefrom or by reason thereof.
Section 5.06 Allowance For Renovations and Repairs.
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Within ten (10) days after Tenant's submission of plans and/or drawings of its
proposed repairs to and renovation of the Premises, prior to moving in to the
Premises, Landlord
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simultaneously with its approval of said repairs and renovations required under
this ARTICLE 5, which shall not be unreasonably withheld or delayed, upon
receipt of proper invoices for same, and proof of payment by Tenant, shall pay
directly to Tenant the sum of TWO HUNDRED THOUSAND ($200,000) DOLLARS as an
allowance and/or partial reimbursement of Tenant's renovation costs for the
premises. All costs for renovations and repairs in excess of TWO HUNDRED
THOUSAND ($200,000) shall be the obligation of Tenant to pay.
ARTICLE 6 - EQUIPMENT AND PUBLIC UTILITIES
Section 6.01 Tenant shall make application for (in which
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application Landlord shall join, if required) all utility services to be used,
rendered or supplied to or in connection with the Demised Premises and Tenant
shall promptly thereafter arrange to be billed directly and pay all charges, for
gas, water, electricity, telephone, sanitary sewer, and all other utility
services used, rendered, or supplied to or in connection with the Demised
Premises from and after the Commencement Date. In case any such utility charges
are not paid by Tenant, and if Landlord may be charged or a lien established
against the Demised Premises or the Building as a result of such failure,
Landlord may upon notice to Tenant pay the same to the utility company or agency
furnishing the same, and any amounts so paid by Landlord shall be paid by Tenant
as Additional Rent for the month next following such payment by Landlord,
together with interest thereon at the Penalty rate until paid. Except as
provided herein with respect to applications, Landlord is not required to supply
any utility services.
Section 6.02 Tenant shall have the right to enter into
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agreements with utility companies creating such easements, and serving the
Demised Premises in, over and under the Demised Premises as may be required, to
provide utilities necessary for the operation of Tenant's business. Landlord
agrees upon request of such utility companies, to consent to the creation of
such easements, and to execute promptly any and all documents, agreements and
instruments reasonably necessary to effectuate the same, at Tenant's sole cost
and expense.
Section 6.03 All heating, ventilating and air conditioning
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equipment ("HVAC Equipment"), if any, within or upon the Demised
Premises, shall remain under Tenant's exclusive care and control
during the Term. Except as set forth herein, Tenant, at its own
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expense, shall operate, maintain, repair and make all replacements of HVAC
Equipment, or any part thereof. All HVAC Equipment shall at all times remain the
property of Landlord and shall, upon the expiration of the Term, be surrendered
to Landlord together with the Demised Premises in good working order, reasonable
wear and tear and damage by fire and other casualty excepted.
Section 6.04 Tenant may, at its expense, install or
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assemble or place on the Demised Premises and remove and substitute, such other
items of machinery, trade fixtures, equipment, furniture, furnishings or other
personal property, used or useful in Tenant's business (the "Severable
Property"), and title to same shall remain that of Tenant. Tenant may remove the
Severable Property at the expiration or prior termination of this Lease, and
Tenant shall repair any damage caused by such removal.
ARTICLE 7 - OBSERVANCE OF LAWS, REGULATIONS, ETC.
Section 7.01 Tenant, at its sole and expenses shall
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observe and comply with all laws, regulations and ordinances, rules and
regulations of all governmental or quasi-governmental authorities or Fire
Insurance Rating Organization, New Jersey Board of Fire Underwriters Regulations
having jurisdiction over the Demised Premises, now or hereafter in force,
applicable to its use or occupancy of the Demised Premises arising out of
Tenant's use or method of operation therein, including the installation or
sprinklers or other fire or safety equipment, but not including violations of
Regulations which existed as of Commencement Date whether or not notices of
violations were issued with respect to such on Commencement Date. Tenant shall
pay for all periodic fire sprinkler inspections. Nothing contained herein shall
affect Landlord's responsibility to comply with Laws as set forth in Section
4.04, 4.06, or elsewhere in this Lease.
Section 7.02 Landlord represents and warrants to Tenant
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that the Premises and all improvements thereon comply with all Laws as defined
in Sections 4.04 herein. In the event that any repairs, maintenance,
alterations, or replacements are required after the Commencement Date to make
the Premises conform to such Laws as a result of Landlord's noncompliance with
such Laws on the Commencement Date, Landlord shall, at its sole cost and
expense, pay for same and if Landlord does not, then, after
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thirty (30) days notice to Landlord (or less time in the event of an emergency),
Tenant may make such repairs, alterations or replacements and set off the cost
thereof against Fixed Rent and Additional Rent due under this Lease.
Section 7.03 Landlord represents and warrants to Tenant
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that, to the best of Landlord's knowledge, the Certificate of Occupancy for the
Building permits the occupancy of the Demised Premises as set forth in Section
4.01 hereof.
ARTICLE 8 - ASSIGNMENT OR SUBLETTING
Section 8.01 A. (i) Tenant, under penalty of instant
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forfeiture, shall not assign, mortgage or pledge this Lease, nor underlet or
sublease the Demised Premises or any part thereof without the written consent of
Landlord first had and obtained, which consent shall not be unreasonably
withheld or delayed; nor after such written consent has been given shall any
assignee or sublessee assign, mortgage or pledge this Lease or such sublease or
underlet or sublease the Demised Premises or any part thereof without an
additional written consent by Landlord which subsequent consent shall also not
be unreasonably withheld or delayed; and in neither case without such consent
shall any such assignment, mortgage, pledge, underletting or sublease be valid.
An assignment within the meaning of this Lease is understood and intended to
encompass not only (i) the voluntary action of Tenant, and (ii) a transfer by
Tenant of an existing equity interest in Tenant or the issuance of a new equity
interest in Tenant or some combination of both which has the effect of changing
the party, if any, who has majority control of the Tenant at the time of the
execution of this Lease, but also any levy or sale on execution or other legal
process and every assignment for the benefit of creditors, adjudication or sale
in bankruptcy or insolvency or under any other compulsory procedure or order of
court. A transfer of a stock interest in the Tenant between a shareholder and
members of his immediate family, or the sale of a majority of Tenant's common
stock or assets to another successive, acquiring entity, shall not be considered
an assignment within the meaning of this Lease. No assignment or sublease, if
consented to in the manner aforesaid, shall in any way relieve or release Tenant
from liability upon any of the covenants under the terms of this Lease, and
notwithstanding any such assignment or sublease, the responsibility and
liability of Tenant hereunder shall continue in full force and effect until the
expiration of the term during which the assignment occurs, including any renewal
of this Lease
15
which may subsequently be exercised by any successor Tenant. No assignment shall
be valid unless the assignee shall consent to and agree in writing to be bound
by all of the covenants and conditions herein contained.
B. If this Lease is assigned, or if the Demised Premises or any part
thereof are sublet or occupied by anybody other than Tenant, Landlord may, in
the event of a default by Tenant beyond the applicable cure period, collect rent
from the assignee, sublessee or occupant, and apply the amount collected to the
rent payable hereunder; but no such collection shall be deemed a waiver of this
covenant against assignment and subletting, or the acceptance of the assignee,
sublessee or occupant as Tenant.
C. If Tenant shall desire to assign this Lease or to sublet the
Demised Premises in whole or in part (where Landlord's consent is required)
Tenant shall submit to Landlord a written request for Landlord's consent to such
assignment or subletting, which request shall contain or be accompanied by the
following information: (i) the name and address of the proposed assignee or
subtenant; (ii) a description identifying the space to be sublet and Tenant's
improvements included therein; (iii) the terms and conditions of the proposed
assignment or subletting; (iv) the nature and character of the business of the
proposed assignee or subtenant and its proposed use of the Demised Premises; and
(v) current financial information and any other information Landlord may
reasonably request with respect to the proposed assignee or subtenant.
In connection with such request by Tenant to Landlord for consent, the
following additional conditions shall be fulfilled:
(1) Tenant shall not then be in default hereunder beyond the
applicable cure period, and said default must be cured simultaneously with or
prior to Landlord's consent;
(2) In case of a subletting, it shall be expressly subject to all
of the obligations of Tenant under this Lease and the further condition and
restriction that the sublease shall not be assigned, encumbered or otherwise
transferred or the subleased premises further sublet by the sublessee in whole
or in part, or any part thereof suffered or permitted by the sublessee to be
used or occupied by others,
16
without the prior written consent of Landlord in each instance;
and
(3) No subletting shall end later than one (1) day before the
Expiration Date of this Lease or shall be for a term of less than one (1) year
unless it ends not more than one (1) month before the Expiration Date.
D. Every subletting hereunder is subject to the express condition, and
by accepting a sublease hereunder each subtenant shall be conclusively deemed to
have agreed, that if this Lease should be terminated prior to the Expiration
Date or if Landlord shall succeed to Tenant's estate in the Premises, then at
Landlord's election the subtenant shall attorn to and recognize Landlord as
subtenant's landlord under the sublease and the subtenant shall promptly execute
and deliver any instruction Landlord may reasonably request to evidence such
attornment.
E. Tenant shall furnish Landlord with a counterpart (which may be a
conformed or reproduced copy) of each sublease or assignment made hereunder
within ten (10) days after the date of its execution. Tenant shall remain fully
liable for the performance of all of Tenant's obligations hereunder
notwithstanding any subletting provided for herein, and without limiting the
generality of the foregoing, shall remain fully responsible and liable to
Landlord for all acts or omissions of any subtenant or anyone claiming under or
through any subtenant which shall be in violation of any of the obligations of
this Lease and any such violation shall be deemed to be a violation by Tenant.
F. Notwithstanding any assignment or assumption by the assignee of the
obligations of Tenant hereunder, Tenant herein named, shall remain liable
jointly and severally (as a primary obligor) with its assignee and all
subsequent assignees for the performance of Tenant's obligations hereunder, and,
without limiting the generality of the foregoing, shall remain fully and
directly responsible and liable to Landlord for all acts and omissions on the
part of any assignee subsequent to it in violation of any of the obligations of
this Lease.
G. Notwithstanding anything to the contrary hereinabove set forth, no
assignment of this Lease shall be binding upon Landlord unless the assignee
shall execute and deliver to Landlord an agreement, whereby such assignee agrees
unconditionally to be bound by and to perform all of the
17
obligations of Tenant hereunder and further expressly agrees that
notwithstanding such assignment the provisions of this Article shall continue to
be binding upon such assignee with respect to all future assignments and
transfers. A failure or refusal of such assignee to execute or deliver such an
agreement shall not release the assignee from its liability for the obligations
of Tenant hereunder assumed by acceptance of the assignment of this Lease.
H. As a condition to any assignment or sublease being effective as
against Landlord, a fully executed copy of the assignment or sublease shall be
delivered to Landlord before its effective date with respect to any assignment
or sublet for which Landlord's consent is required and Tenant shall pay to
Landlord's attorney a reasonable attorneys' fee, which shall not exceed $500.00
for legal services required by Landlord for review and approval of any such
assignment or sublease documentation.
I. Tenant may pledge or encumber by security agreement, financing
statement or other commercially usual means, any installations of Tenant, in
connection with financing the repairs, maintenance or replacement of such
equipment.
ARTICLE 9 - INSURANCE, DAMAGE, DESTRUCTION AND EMINENT DOMAIN
Section 9.01 Insurance
------------ ---------
A. Tenant shall at its expense maintain in force and effect throughout
the term hereof:
(i) Insurance covering the Building against loss or damage by
fire and such risks as are generally included in extended coverage and vandalism
and malicious mischief and sprinkler leakage endorsements attached to fire
insurance policies in an amount sufficient to prevent the insured or Landlord
from becoming a co-insurer within the terms of the applicable policies, but in
any event in an amount not less than the full replacement value thereof. The
term "full replacement value", as used herein, shall mean the cost of actual
replacement of the Building, excluding the cost of excavation, foundations,
footings, and underground flues, pipes and drains. Such insurance shall name
Tenant as the insured, and Landlord
18
and any mortgagee as the additional insureds as their interests
may appear.
(ii) Boiler and pressure vessel insurance, including pressure
pipes, if there be any such boiler or vessel or pipes in the Building, in an
amount not less than One Million and 00/100 ($1,000,000.00) Dollars, to the
extent not covered by Tenant's regular liability insurance policy.
(iii) Rental value insurance against loss of Rent or other income
derived from the operation due to the risks referred to in this Section 9.01
(including those embraced by "extended coverage") in an amount sufficient to
prevent Landlord or Tenant from becoming a co-insurer within the terms of the
policy or policies in questions, but in no event in an amount or amounts more
than the aggregate amount of the Rent hereunder for a period of one year; and
Tenant hereby assigns to Landlord the proceeds of such insurance so that in the
event the improvements on the Demised Premises or the Building shall be
destroyed or seriously damaged such proceeds shall be held as security for the
payment of such Rent hereunder until the restoration of such Building and/or
improvements and, as Tenant shall make payment of such Rent, Landlord shall, if
Tenant shall not be in default, pay out to Tenant from said amount, the sums
which shall have been so paid by Tenant. Tenant may, at its election, carry such
insurance coverage as is contained in a business interruption insurance policy.
(iv) Such other insurance and in such amounts as may from time to
time be reasonably required by Landlord against other insurable hazards which at
the time are customarily insured against with respect to buildings similar in
character, general location and use and occupancy to the Building.
(v) During any period of construction (whether Building and
improvements or off-site-work) and/or during any permitted alteration or
addition to the Building, Tenant shall maintain, or shall cause its general
contractor to maintain, in addition to the other insurance required under this
Article, insurance of the following character naming Landlord as additional
insured as its interest may appear:
(a) Commercial general liability insurance with minimum
limits of Three Million and 00/100 ($3,000,000.00) Dollars combined single limit
for bodily injury, death or property damage; and
19
(b) All contractors and subcontractors shall carry Xxxxxxx'x
Compensation insurance covering all of their respective employees; and shall
also carry commercial general liability insurance, including property damage,
and the policies therefor, as well as the contractor, and Tenant and Landlord as
additional insureds. Certificates for all of the foregoing insurance shall be
delivered to the Landlord before the construction is started or contractor's
equipment is moved onto the site.
B. Tenant shall, at its expense, maintain for the benefit of Tenant
naming the Landlord as an additional insured, commercial general public
liability insurance, including contractual liability insurance against the
liability assumed under Section 9.01F of this Lease, against claims for bodily
injury, death or property damage occurring in, on or about the Demised Premises,
with a combined single limit of $3,000,000.00 for bodily injury, death or
property damage.
C. If Tenant shall fail to procure and maintain any insurance required
to be carried by this Section 9.01, Landlord may, but shall not be obligated to,
upon notice to Tenant, procure and maintain the same, but at the expense of
Tenant, and Tenant shall reimburse Landlord for the cost thereof on demand,
together with interest thereon at the Penalty Rate.
D. All insurance required pursuant to this Article above shall be
procured in companies of recognized responsibility qualified to do business in
the State of New Jersey.
E. Prior to the Commencement Date, Tenant shall deliver to Landlord
certificates or evidence of such insurance naming Landlord and any mortgagee as
additional insureds with a loss payable clause satisfactory to Landlord. Such
insurance shall not be cancelable except upon thirty days prior notice to
Landlord. Thirty (30) days prior to the expiration or cancellation of such
policies, Tenant shall furnish Landlord with certificates of insurance or copies
of endorsements evidencing renewals or "Binders" thereof. Tenant shall not do or
permit to be done anything which shall invalidate the insurance coverage
referred to in this Section 9.01.
F. Tenant, during the term thereof, shall indemnify and hold harmless
Landlord from and against any and all claims of any kind or nature arising from
Tenant's use or misuse of the
20
Demised Premises or from the conduct of Tenant's business or from any activity,
work or things done, permitted or suffered by Tenant in or about the Demised
Premises and shall further indemnify and hold harmless Landlord from and against
any and all claims arising from any breach or default in the performance of any
obligation on Tenant's part to be performed under the terms of this Lease, or
arising from any negligence of Tenant, or the negligence of any of Tenant's
agents, invitees, contractors, or employees, sublessees, and from and against
all reasonable costs, attorney's fees, expenses and liabilities incurred in the
defense of any such claims or any action or proceeding brought thereon. Tenant's
indemnification shall be limited to acts, conditions and violations caused by
Tenant and not existing on Commencement Date and shall not include acts of
Landlord or its agents.
G. Landlord, during the term thereof, shall indemnify and hold
harmless Tenant from and against any and all claims of any kind or nature
arising from Landlord's use or misuse of the Demised Premises or from the
conduct of Landlord's business or from any activity, work or things done,
permitted or suffered by Landlord in or about the Demised Premises and shall
further indemnify and hold harmless Tenant from and against any and all claims
arising from any breach or default in the performance of any obligation on
Landlord's part to be performed under the terms of this Lease, or arising from
any negligence of Landlord, or the negligence of any of Landlord's agents,
invitees, contractors, or employees, and from and against all reasonable costs,
attorney's fees, expenses and liabilities incurred in the defense of any such
claims or any action or proceeding brought thereon.
Section 9.02 Damage or Destruction.
------------ ---------------------
A. If during the term of this Lease, the Demised Premises or any part
thereof shall be damaged or destroyed by fire, the elements or other casualty,
event or loss, whether or not insured against and however occasioned, Tenant
shall give notice thereof to Landlord. Landlord shall, restore the Building and
the Demised Premises with reasonable promptness, subject to the "force majeure"
provisions of this Lease, and Tenant shall have no right to terminate this Lease
except as provided herein. Landlord need not restore fixtures and improvements
owned by Tenant.
In any case in which use of the Premises is affected by any damage to
the Building, there shall be either an
21
abatement or an equitable reduction in Fixed Rent depending on the period for
which and the extent to which the Demised Premises are not reasonably usable for
the purpose for which they were used hereunder immediately prior to the
casualty. The words "restoration" and "restore" as used in this Section 9.02
shall include repairs.
Notwithstanding anything in the foregoing paragraphs of this Article,
if (i) the insurance claim is not settled within one year from the date of the
casualty or (ii) if the restoration required by the casualty is not
substantially completed within 90 days after settlement of the insurance claim
by the Landlord, then Tenant may elect to terminate this Lease by notice to
Landlord given within thirty (30) days after such applicable deadline. Upon the
giving of notice, the term of this Lease will expire and Tenant shall have a
reasonable time to remove any of Tenant's furniture, furnishings and equipment.
B. Landlord and Tenant shall cooperate with each other and any
mortgagee in connection with collection of any insurance monies that may be due
in the event of loss and Tenant shall execute and deliver to Landlord and any
mortgagee such proofs of loss and other instruments that may be reasonably
required for the purpose of facilitating the recovery of any such insurance
monies.
C. Each insurance policy carried by Landlord insuring the Demised
Premises against loss by fire and causes covered by standard extended coverage,
and each insurance policy carried by Tenant and insuring its fixtures and
contents against loss by fire, water and causes covered by standard extended
coverage, shall be written in a manner so as to provide that the insurance
company waives all right of recovery by way of subrogation against Landlord or
Tenant in connection with any loss or damage covered by such policies, whether
or not said endorsement increases the premium payable for said insurance. To the
extent Landlord and Tenant are insured, each shall not be liable to the other
for any loss or damage caused by fire, water or any of the risks enumerated in
standard extended coverage insurance.
D. No damages, compensation or claims shall be payable by Landlord for
inconvenience, loss of business or annoyance arising from any repair or
restoration of any portion of the Demised Premises provided that the Rent is
abated during such period.
22
Section 9.03 Eminent Domain.
------------ --------------
A. If Tenant's use and beneficial enjoyment of the Demised Premises
for the Use, is materially affected due to the taking by condemnation or eminent
domain of the Demised Premises or any part thereof or any estate therein, then,
in that event, this Lease shall terminate on the date when title vests pursuant
to such taking. The Rent shall be apportioned as of said termination date and
any Rent paid for any period beyond said date shall be promptly repaid to
Tenant. Tenant may file a separate claim for any taking of fixtures and
improvements owned by Tenant which have not become the Landlord's property, and
for moving expenses. In the event of a partial taking which does not materially
affect Tenant's use and beneficial enjoyment of the Demised Premises for its
Use, Landlord shall rebuild, repair and restore the Demised Premises as provided
in Section 9.03 B and there shall either be an abatement or an equitable
reduction of the Fixed Rent and Additional Rent, depending on the period for
which and the extent to which the Demised Premises so taken are not reasonably
usable for the purposes the Demised Premises were used immediately prior to the
taking.
B. In the event of any taking as aforesaid, Landlord may elect to
rebuild, repair or restore the Demised Premises as nearly as reasonably possible
to the same specifications as existed prior to such taking; provided, however,
that in the event of a taking prior to the Commencement Date, Landlord shall
rebuild, repair or restore the Demised Premises as herein provided. Upon
completion of the rebuilding, repair or restoration to a complete architectural
unit, an officer of Landlord shall notify Tenant that all rebuilding, repair or
restoration work has been completed in accordance with the provisions of this
Section 9.03. Tenant shall be entitled to an abatement or equitable reduction in
Rent from the date of the taking until the earlier of (i) thirty (30) days after
Landlord's notice to Tenant that the work has been completed as aforesaid, or
(ii) Tenant's reoccupancy of the Demised Premises or portion thereof affected by
the taking. .
C. Landlord shall receive the entire amount of any condemnation award
for the value of the Demised Premises and nothing in this Article shall be
deemed the Landlord's surrender of any rights to compensation for the
condemnation of all or a part of the Demised Premises. Landlord's compensation
shall be limited to said condemnation award for the value of the Demised
Premises. Any award for the value of the leasehold or Tenant's business,
fixtures or equipment shall belong to Tenant.
23
D. It is expressly understood and agreed that the provisions of this
Article shall not be applicable to any condemnation or taking for governmental
occupancy for a limited period except the Rent shall be appropriately and
equitably abated during such time.
ARTICLE 10 - SIGNS
Section 10.01 Tenant may not erect any sign or signs in
-------------
connection with its business upon the exterior front of the Demised Premises,
except in accordance with all applicable requirements of governmental
authorities having jurisdiction thereover, if any. Tenant shall be responsible
for all costs and expenses in connection with said signs.
Section 10.02 Landlord, upon request and at no cost or
-------------
expense to Landlord, agrees to execute any necessary consents or applications
which may be required by law to permit the erection of signs. Tenant shall
remove any sign installed by Tenant upon the expiration of the term, and repair
any damage resulting therefrom.
Section 10.03 Tenant shall be responsible for and shall
-------------
maintain all signs in good condition and repair at its sole cost
and expense.
ARTICLE 11 - COVENANT AGAINST LIENS
Section 11.01 Tenant covenants and agrees that it shall
-------------
keep the Demised Premises free from any liens arising from any labor performed
by or on behalf of, or materials furnished to, Tenant, or other obligations of
Tenant incident to its use or occupancy thereof. If any such lien attaches, and
the same is not released by payment, bond or otherwise within 30 days after
Landlord notifies Tenant thereof, Landlord shall have the option to discharge
the same and Tenant shall reimburse Landlord promptly therefor.
24
ARTICLE 12 - ACCESS TO PREMISES
Section 12.01 Landlord and its agents shall have free
-------------
access to the Demised Premises on reasonable notice to Tenant, to make such
repairs, additions, alterations or improvements as Landlord is obligated to make
hereunder. In the event of any emergency, Landlord may, without notice, enter
the Demised Premises to meet the emergency and to take such steps as may be
reasonably necessary to meet the emergency; to the extent such steps are taken,
the cost thereof shall be paid by Tenant to Landlord on demand, except where
such costs are not the responsibility of Tenant under this Lease. However, this
provision is not intended to nor shall it impose any obligation upon Landlord to
make such emergency repairs. During any such access, Landlord will not interfere
with Tenant's business, except in case of emergency, if necessary.
ARTICLE 13 - NO WAIVER OR CHANGES
Section 13.01 It is hereby covenanted and agreed, any law,
-------------
usage or custom to the contrary notwithstanding, that either party shall have
the right at all times to enforce the covenants and provisions of this Lease in
strict accordance with the terms hereof, notwithstanding any conduct or custom
on the part of either party in refraining from so doing at any time or times;
and, further, that the failure of either party at any time or times to enforce
its rights under said covenants and provisions strictly in accordance with the
same shall not be construed as having created a custom in any way or manner
contrary to the specific terms, provisions and covenants of this Lease or as
having in any way or manner modified the same, and the receipt of any Rent by
Landlord from Tenant or any assignee or sublessee of Tenant, whether the same be
rent that originally was reserved or that which may become payable under any
covenants herein contained or of any portion thereof, shall not operate as a
waiver of the right of Landlord to enforce the payment of Additional Rent or of
any of the other obligations of this Lease by such remedies as may be
appropriate.
25
ARTICLE 14- NOTICES
Section 14.01 Notices hereunder shall be deemed
-------------
sufficiently served when mailed by certified mail, return receipt requested, or
by nationally recognized overnight mail or Federal Express delivery, and/or by
facsimile copy (with confirmation of delivery), and addressed to Landlord and/or
Tenant:
To the Landlord: JVNJ Realty Corp.
c/o Xxxxxxx Xxx Xxxxx
0000 Xxxx Xxxxx Xxxx. #0000
Xxxxxx, Xx 00000
Telecopy Number: (000) 000-0000)
with a copy to: Xxxxx X. Xxxxxxxx, Esq.
Xxxxx & Moroknek
000 Xxx Xxxx
Xxxxxxx, XX 00000
Telecopy Number: (000) 000-0000
With a copy to: Xxxxxxx Xxx Xxxxx
000 Xxxxxxx Xx.
XX Xxx 000
Xxxxxx, Xx 00000
Telecopy Number: (000) 000-0000
And to Tenant: Media Sciences International, Inc.
0 Xxxxxxxx Xxxx
Xxxxxxx, XX 00000
Attn: Vice President Operations
with a copy to: Xxxxxx X. Xxxxxxxx, Esq.
Xxxxxxx Xxxxxxxx, LLC
00 Xxxxxxxx Xxxxx Xxxx
Xxxxxxxx, XX 00000
Telecopy Number: (000) 000-0000
or to such other address as either may give to the other party from time to time
by notice as herein provided.
26
ARTICLE 15- SURRENDER OF PREMISES AT END OF TERM
Section 15.01
-------------
A. Upon the expiration or termination of the term hereof, Tenant shall
surrender possession of the Demised Premises, peaceably and without notice,
broom clean and in as good condition as it exists after the initial
installations by Landlord and Tenant, except for ordinary wear and tear, fire
and other casualty, and except for such damages or conditions as are not
required hereunder to be repaired or remedied by Tenant.
B. Subject to the provisions of this Lease, all trade fixtures,
carpeting, furniture, furnishings, equipment and other personalty owned or
installed by Tenant before or during the term or any extension thereof, shall
remain Tenant's property, and during the lease term or upon vacating the Demised
Premises Tenant may remove same but shall repair any damage caused by such
removal. All additions made by Tenant which are or become permanently attached
to and are required for operation of the realty other than trade fixtures, shall
remain in place. Tenant shall repair any and all damage caused by such removal.
C. If at or prior to the expiration of termination of the term hereof,
Tenant fails to remove any property belonging to the Tenant, then such property
shall be deemed abandoned and Landlord may either become the owner of such
property or dispose of it in any manner Landlord deems appropriate.
ARTICLE 16 - SUBORDINATION
A. Landlord represents that it owns the Demised Premises in fee simple and that
there are no mortgages or liens affecting the Demised Premises. This Lease is
subject and subordinate to all mortgages affecting the Demised Premises and to
all renewals, modifications, amendments, consolidations, replacements or
extensions thereof provided that Tenant receives a non-disturbance agreement
reasonably acceptable to Tenant. In confirmation of such subordination, Tenant
shall execute promptly any certificate that Landlord may reasonably request.
27
B. Intentionally Deleted.
C. In the event of any act or omission by the Landlord which would
give the Tenant the right to terminate this Lease or to claim a partial or total
eviction, pursuant to the terms of this Lease, if any, the Tenant agrees that
(i) it will not exercise any such right until it has given written notice of
such act or omission to the holder of any mortgage, whose name and address shall
previously have been furnished to Tenant, by delivering such notice of such act
or omission addressed to such holder at the last addresses so furnished, and
(ii) if Landlord shall have failed to remedy such act or omission within the
time provided for in this Lease, then the mortgagee shall have an additional
thirty (30) days within which to remedy such act or omission or if such act or
omission cannot be remedied within that time, then such additional time as may
be necessary, if within such thirty (30) days, any mortgagee has commenced and
is diligently pursuing the actions necessary to remedy such act or omission, in
which event this Lease shall not be terminated while such actions are being so
diligently pursued.
D. If, in connection with obtaining financing for the Demised
Premises, a banking, insurance company, pension plan or other recognized
institutional lender shall request reasonable modifications in this Lease as a
condition to such financing, Tenant will not unreasonably withhold, delay or
defer its consent thereto, provided that such modifications do not increase the
financial obligations of Tenant hereunder, decrease Tenant's rights hereunder,
or materially adversely affect the leasehold interest hereby created or Tenant's
use and enjoyment of the Demised Premises.
E. Notwithstanding anything else herein contained in this Article 16,
Landlord agrees that in connection with any mortgage it places on the Demised
Premises, said mortgagee shall enter into a Non-Disturbance, Recognition, and
Attornment Agreement with the Tenant in form and content reasonably acceptable
to Tenant. Tenant agrees to sign said agreement at the request of Landlord.
Tenant will not unreasonably withhold, delay or defer its consent thereto,
provided that such modifications do not increase the financial obligations of
Tenant hereunder or materially adversely affect the leasehold interest hereby
created or Tenant's use and enjoyment of the Demised Premises.
28
ARTICLE 17 - BANKRUPTCY, DEFAULT, ETC.
Section 17.01
-------------
A. Tenant shall be deemed in default hereunder, if at any time during
the term hereof there shall be filed against Tenant in any court pursuant to any
statute either of the United States or of any State a petition in bankruptcy or
insolvency or for reorganization or for the appointment of a receiver or trustee
of all or substantially all of Tenant's property, and within 60 days thereof
Tenant fails to bond or secure a discharge thereof, or if Tenant shall make an
assignment for the benefit of creditors, or file a petition in bankruptcy, or
insolvency or for reorganization of or an arrangement of or the appointment of a
receiver or trustee of all or substantially all of Tenant's property. Nothing
herein contained shall limit or prejudice the right of Landlord to prove for and
obtain as liquidated damages by reason of such termination an amount equal to
the maximum allowed by any statute or rule of law in effect at the time when,
and governing the proceedings in which, such damages are to be proved, whether
or not such amount be greater, equal to or less than the amount of the
difference referred to above. In the event that under any bankruptcy statute or
other provisions of law, Landlord may not terminate this Lease, Landlord and
Tenant agree that upon the occurrence of any of the events in this Section 17.01
the Security Deposit provided for in this Lease shall be increased to an amount
equal to 12 months of Fixed Rent, this being agreed to be the minimum amount
necessary to assure Landlord of Tenant's ability to comply with this Lease.
Section 17.02
-------------
A. If Tenant is in default pursuant to the provisions of Section 18.01
hereof, or if Tenant defaults in fulfilling any of the covenants of this Lease,
then in any one or more of such events, upon Landlord serving a written 15
business days notice as to Fixed Rent defaults and 45 days' notice as to all
other defaults specifying the nature of said default, and upon the expiration of
said 15 or 45 days, whichever is applicable, if Tenant shall have failed to
comply with or remedy such default, or, in the case of non-monetary default, if
said default shall be of such a nature that the same cannot be cured within said
45 day period, if Tenant shall not have diligently commenced curing such default
within such 45 day period, and shall not thereafter with reasonable diligence
and
29
good faith proceed to remedy or cure such default,("Event of Default") then in
the case of a Fixed Rent default, Landlord may dispossess Tenant by summary
proceeding for non payment of rent and in the case of other defaults, Landlord
may serve a written 10 day notice stating that the term of this Lease shall
terminate and expire at the end of said 10 day period. This Lease and the term
thereunder shall end and expire as fully and completely as if the date of
expiration set forth in said notice were the day definitely herein fixed for the
expiration of the term of this Lease, and Tenant shall then quit and surrender
the Demised Premises to Landlord.
B. If the notice provided for in Section 17.02A hereof shall have been
given, and the term shall expire as aforesaid; Landlord may reenter the Demised
Premises and dispossess Tenant and/or the legal representative of Tenant or
other occupant of Demised Premises by summary proceedings or otherwise and
remove their effects and hold the Demised Premises as if this Lease had not been
made.
Section 17.03 In case of any such default under Sections
-------------
17.01 or 17.02 and Landlord's termination of the Lease as aforesaid; (a) the
rent shall become due thereupon and be paid up to the time of such re-entry,
dispossess and/or expiration, together with such expenses as Landlord may incur
for legal expenses, attorney's fees, brokerage, and/or putting the Demised
Premises in good order, or for preparing the same for re-rental; (b) Landlord
may re-let the Demised Premises or any part or parts thereof, either in the name
of Landlord or otherwise, for a term or terms, which may at Landlord's option be
less than or exceed the period which would otherwise have constituted the
balance of the term of this Lease and may grant concessions or free rent or
charge a higher rental than that in this lease, and/or (c) Tenant or the legal
representatives of Tenant shall also pay Landlord as liquidated damages for the
default of Tenant, any deficiency between the rent hereby reserved and/or
covenanted to be paid and the net amount, if any, of the rents collected on
account of the Lease or leases of the Demised Premises for each month of the
period which would otherwise have constituted the balance of the term of this
Lease. Landlord shall make commercially reasonable efforts to relet the Premises
and mitigate damages. The failure or refusal of Landlord to re- let the Demised
Premises or any part or parts thereof shall not release or affect Tenant's
liability for damages. In computing such liquidated damages there shall be added
to the said deficiency such reasonable expenses as Landlord may incur in
connection with re-letting, such as legal expenses, attorneys'
30
fees, brokerage, advertising and for keeping the Demised Premises in good order
or for preparing the same for re-letting. Any such liquidated damages shall be
paid in monthly installments by Tenant on the rent day specified in this Lease
and any suit brought to collect the amount of the deficiency for any month shall
not prejudice in any way the rights of Landlord to collect the deficiency for
any subsequent month by a similar proceeding. The making of alterations,
repairs, replacements, and/or decorations shall not operate or be construed to
release Tenant from liability for damages hereunder. Landlord shall in no event
be liable in any way whatsoever for failure to re-let the Demised Premises, or
in the event that the Demised Premises are re-let, for failure to collect the
rent thereof under such re-letting, and in no event shall Tenant be entitled to
receive any excess, if any, of such net rent collected over the sums payable by
Tenant to Landlord hereunder.
Section 17.04 Tenant hereby expressly waives any and all
-------------
rights of redemption granted by or under any present or future laws in the event
of Tenant being evicted or dispossessed for default, or in the event of Landlord
obtaining possession of the Demised Premises, by reason of the default by
Tenant.
Section 17.05 If Tenant shall be in default hereunder
-------------
beyond the applicable cure period, and Landlord shall commence proceedings to
remove Tenant from the Demised Premises and Landlord shall permit Tenant to cure
such default after the grace period had ended and shall withdraw such action, or
Tenant shall pay all sums due in the case of a non-payment proceeding, Tenant
shall reimburse Landlord for reasonable attorneys' fees and costs in commencing
such action.
Section 17.06 The following shall constitute a Landlord
----------------
event of default:
(a) if any representation of Landlord shall be false in a material
respect, which impairs the operation of the business at the Demised Premises and
Landlord shall fail for thirty (30) days after notice by Tenant, to commence to
remedy and/or shall fail to continue to remedy the condition misrepresented; or
(b) if Landlord shall fail for thirty (30) days after notice by Tenant
to commence to make any repair, maintenance, or replacement to the Demised
Premises agreed to be paid for and/or made by Landlord herein.
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Section 17.07 If a Landlord Event of Default shall occur
---------------
and be continuing, Tenant may:
(a) commence an action seeking injunction or other appropriate remedy
at law or equity to enforce Landlord's obligations; or
(b) commence an action for damages for breach of Lease which damages
may include lost business opportunity and income. The selection of one remedy
shall not preclude Tenant from any other remedy;
(c) offset the amount due, as finally determined under paragraphs (a)
and (b) of this Section by a court of competent jurisdiction, against Fixed Rent
and/or Additional Rent due Landlord by Tenant hereunto; or
(d) terminate this Lease by notice to Landlord.
ARTICLE 18 - LANDLORD'S RIGHT TO PERFORM TENANT'S OBLIGATIONS
Section 18.01 If Tenant shall default in the observance or
-------------
performance of any non-monetary term or covenant to be observed or performed by
Tenant under this Lease, Landlord may immediately or at any time thereafter,
after five (5) business days' notice to Tenant perform the same for the account
of Tenant and if Landlord in connection with such performance of Tenant's
obligations at any time is compelled to pay or elects to pay any sum of money or
do any act which will require the payment of any sum of money, by reason of the
failure of Tenant to comply with this Lease the expenses incurred with respect
to such performance, together with attorneys' fees and interest thereon, shall
be deemed Additional Rent hereunder and shall be paid by Tenant to Landlord on
the first day of the month following the incurring and billing to Tenant of such
respective expenses.
Section 18.02 If Landlord shall default in the
---------------
observation or performance of any term, covenant or representation to be
observed or performed by Landlord under this Lease, Tenant may immediately or at
any time thereafter, after five (5) business day's notice to Landlord, perform
the same for the account of the Landlord and if Tenant in connection with such
performance of Landlord's obligations at any time is
33
compelled to pay or elects to pay any sum of money or do any act which will
require the payment of any sum of money, by reason of the failure of Landlord to
comply with this lease, the expenses incurred with respect to such performance,
together with attorney's fees and interest thereon, shall be paid by Landlord to
Tenant on the first day of the month following the incurring and billing to
Landlord of such respective expenses. If Landlord shall fail to pay to Tenant
any amount due, Tenant may offset the amount due against Rent.
ARTICLE 19 - PAYMENTS
Section 19.01 The rent and all other sums which, under
---------------
the provisions of this Lease, may become payable to the Landlord, shall be paid
all as rent at the times and in the manner in this Lease provided, without
notice or demand and without any claim, set-off, abatement, deduction, or
compensation whatsoever, except as expressly set forth herein, whether now
existing or hereafter arising, and whether beyond the present contemplation of
the parties. All costs relating to the day to day maintenance of the Demised
Premises (except as set forth in this Lease) shall be the responsibility of
Tenant. Nothing in this Section shall be construed to require the Tenant to pay
any rollback, franchise, estate, inheritance, succession or transfer tax of the
Landlord, or any business, income, excess profits, or revenue tax, or any other
tax of a personal nature charged or levied upon the Landlord. Nothing in this
Section shall be construed to require the Tenant to pay any of the Landlord's
obligations for structural or capital repairs and/or alterations as set forth in
Section 5.03 herein; and any of the Landlord's obligations set forth in Section
7.02 herein.
ARTICLE 20 - TENANT'S UTILITIES
Section 20.01 Tenant shall furnish, at its own expense,
-------------
all utilities of every type and nature required by it in its use of the Demised
Premises and shall pay or cause to be paid, when due, all bills for water,
sewerage, heat, gas, electricity and other utilities, if any, used on, in
connection with, or chargeable against the Demised Premises until the
termination of this Lease. All bills for utility charges relating to the
33
Demised Premises or the use thereof and imposed on users of utilities, whether
or not such charges shall relate to services or benefits available to the Tenant
during the term of this Lease shall be paid by Tenant, and the Tenant shall
indemnify and save harmless the Landlord from and against any loss, cost and
expense in connection therewith.
ARTICLE 21 - ATTORNEYS' FEES
Section 21.01 Should any action, proceeding or lawsuit be
-------------
brought by Landlord or Tenant against the other in order to enforce any of the
provisions hereof, the prevailing party shall be entitled to collect the cost of
its reasonable attorneys' fees and other costs from the other party in any such
action or proceeding, including appeals.
ARTICLE 22 - SECURITY DEPOSIT
Section 22.01 Tenant has deposited with Landlord the sum
-------------
of $24,693.20 as security for the faithful performance and observance by Tenant
of the terms, provisions and conditions of this Lease. It is agreed that in the
event Tenant defaults in respect of any of the terms, provisions and conditions
of this Lease beyond the applicable cure period, whether before or after the
Commencement Date, including, but not limited to, the payment of Fixed Rent and
Additional Rent, Landlord may use, apply or retain the whole or any part of the
security so deposited, and any advance payment of Fixed Rent, to the extent
required for the payment of any Fixed Rent and Additional Rent or any other sum
which Landlord may expend or may be required to expend by reason of Tenant's
default in respect to any of the terms, covenants and conditions of this Lease,
including but not limited to, any damages or deficiency in the re-letting of the
Demised Premises, whether such damages or deficiency accrued before or after
summary proceedings or other re-entry by Landlord. In the event that Tenant
shall fully and faithfully comply with all of the terms, provisions, covenants
and conditions of this Lease, the security shall be returned to Tenant within
thirty (30) days after the date fixed as the end of the Lease (or such earlier
termination of this Lease, except if as the result of a Tenant default) and
after delivery of
34
entire possession of the Demised Premises to Landlord in the condition required
pursuant to this Lease. In the event of a sale of the Demised Premises Landlord
shall transfer the security to the vendee or lessee and Landlord shall thereupon
be released by Tenant from all liability for the return of such security; and
Tenant agrees to look to the new landlord solely for the return of said
security; and it is agreed that the provisions hereof shall apply to every
transfer or assignment made of the security to a new Landlord. Tenant further
covenants that it will not assign or encumber or attempt to assign or encumber
the monies deposited herein as security and that neither Landlord nor its
successors or assigns shall be bound by any such assignment, encumbrance,
attempted assignment or attempted encumbrance.
Section 22.02 If Landlord applies all or any part of the
-------------
Security Deposit to remedy any default of Tenant, Tenant shall promptly deliver
to Landlord the amount so applied so that Landlord shall have the full deposit
on hand at all times during the term of this Lease.
ARTICLE 23 - HAZARDOUS SUBSTANCES; ENVIRONMENTAL LAWS
Section 23.01
-------------
A. Except as set forth in the letter of Xxxxxxx Xxxxxx dated June 14,
2004 and attached hereto as EXHIBIT A,Landlord has not caused or allowed the
generation, treatment, storage, maintenance, existence or disposal of Hazardous
Substances, as defined in the Comprehensive Environmental Response Compensation
and Liability Act (CERCLA) nor of asbestos, petroleum products, or other
non-hazardous pollutants (which for purposes of this Lease are Hazardous
Substances) at the Premises except in accordance with local, state and federal
statutes and regulations. If Hazardous Substances are determined to be upon, in,
or under the Demised Premises and said Hazardous Substances are determined to
have arisen prior to the Commencement Date, then it shall be Landlord's
responsibility to perform all necessary cleaning, repairs, and restoration of
the Demised Premises and/or remove the Hazardous Substances at its own cost and
expense, only if said cleaning, repairs, restoration and/or removal are (1)
mandated by legal authority, (2) if failure to do so would impair the operation
of, or result
35
in the closing of the Tenant's business, or (3) necessary to obtain a No Further
Action Letter.
B. Tenant warrants, covenants and agrees that it will not knowingly
use, or cause or permit anyone to use, Hazardous Substances at or on the Demised
Premises in any manner which violates federal, state or local laws or
regulations, that it will remove any such Hazardous Substances from the Demised
Premises promptly upon discovery thereof and that it will perform any cleaning,
repair or restoration of the Demised Premises made necessary by the presence of
any Hazardous Substances generated or placed upon, in, or under, the Premises by
Tenant, or the removal thereof, all at Tenant's sole cost and expense. Tenant
indemnifies Landlord and its agents, employees and assigns against all claims or
losses arising in connection with Hazardous Substances generated or placed upon,
in, or under, the Premises by Tenant, relative to the Demised Premises. This
indemnity shall survive expiration or earlier termination of this Lease. All
costs or expenses incurred by Landlord in connection with performing any
obligation of Tenant herein by Landlord shall be payable by Tenant upon demand,
with reasonable attorneys' fees and interest.
Section 23.02 Landlord and Tenant acknowledge the
-------------
existence of the federal, state and local environmental laws, rules, and
regulations applicable to the Demised Premises and Tenant's use and occupancy
thereof (the "Environmental Laws").
Landlord and Tenant hereby agrees to execute such documents as Landlord and
Tenant reasonably deems necessary to make such applications as Landlord and
Tenant reasonably require to assure compliance with all Environmental Laws.
Tenant shall bear all costs and expenses incurred by Landlord associated with
any required compliance with Environmental Laws resulting from Tenant's
generation or placement of Hazardous Substances at the Premises, including, but
not limited to, state agency fees, engineering fees, clean-up costs, filing fees
and suretyship expenses. The foregoing undertaking shall survive the termination
or sooner expiration of the Lease and surrender of the Demised Premises and
shall also survive sale, or lease, or assignment of the Demised Premises by
Landlord. Tenant agrees to indemnify and hold Landlord harmless from any
violation of Environmental Laws occasioned by Tenant's generation or placement
of Hazardous Substances at the Premises. The Tenant shall immediately provide
the Landlord with copies of all correspondence, reports, notices, orders,
findings, declarations, and other materials pertinent to the Tenant's compliance
with Environmental Laws as they are issued or received by the Tenant.
ARTICLE 24 - HOLDING OVER
Section 24.01 In the event Tenant remains in possession of
-------------
the Demised Premises after the expiration of the Term, without the execution of
a new lease and without purchasing the Premises under the provisions of Article
35, unless the lease term has been extended by Tenant, Tenant shall be deemed to
be occupying said Demised Premises as a Tenant from month to month, at a monthly
rental equal to one hundred twenty five (125%) percent of the monthly
installment of Fixed Rent payable during the last month of the Term, and subject
to all the other conditions, provisions and obligations of this Lease insofar as
incurred, the same are applicable to a month-to-month tenancy.
ARTICLE 25 - ASSIGNMENT OR TRANSFER BY LANDLORD
Section 25.01 Subject to this Lease, Landlord shall have
-------------
the right, upon notice to Tenant, to assign, sell or transfer, any or all of its
rights, title and privileges to the Demised Premises or this Lease. Upon
Landlord's written notice to Tenant of any such sale, assignment or transfer,
Landlord shall be relieved of any liability arising after the date of such sale
or assignment.
ARTICLE 26 - ESTOPPEL
Section 26.01 Tenant and Landlord, shall, from time to
-------------
time, upon not less than ten (10) days prior written request by the other,
execute, acknowledge and deliver to the other, a written statement in form
satisfactory to the other, certifying that this Lease is unmodified and in full
force and effect (or that same is in full force and effect as modified, listing
the instruments of modification), the dates to which the Fixed Rent and
Additional Rent have been paid, and whether or not to the best of Tenant's
knowledge, Landlord is in default hereunder
37
(and if so, specifying the nature of the default), or whether or not to the best
of Landlord's knowledge, Tenant is in default hereunder (and if so, specifying
the nature of the default), it being intended that any such statement delivered
pursuant to this paragraph may be relied upon by a prospective purchaser of
Landlord's or Tenant's interest, or mortgagee of Landlord's or Tenant's interest
or assignee of any mortgage upon Landlord's or Tenant's interest or potential
assignee or subtenant of Tenant.
ARTICLE 27 - MODIFICATIONS; CHANGES
Section 27.01 This writing contains the entire agreement
-------------
between the parties hereto, and no agent, representative, salesman, employee or
officer of either Landlord or Tenant has authority to make or has made any
statement, agreement or representation, oral or written, to add to or detract
from, or otherwise change or alter the terms and conditions herein set forth. No
negotiations between the parties, nor any custom or usage shall be permitted to
modify or contradict any of the terms hereof. No modification, alteration,
changes, waiver or estoppel to this Lease or any of the terms hereof shall be
valid or binding unless in writing and signed by the duly authorized officers of
both the parties hereto.
ARTICLE 28 - WAIVER OF JURY TRIAL AND COUNTERCLAIMS
Section 28.01 Landlord and Tenant shall and they hereby do
-------------
waive trial by jury in any action, proceeding or counterclaim brought by either
of the parties hereto against the other on any matters whatsoever arising out of
or in any way connected with this Lease, the relationship of Landlord and
Tenant, Tenant's use or occupancy of the Demised Premises, and/or any claim of
injury or damage. In the event Landlord commences any proceedings for
non-payment of rent, Fixed Rent, or Additional Rent, Tenant will not interpose
and counterclaim of whatever nature or description in any such proceedings
unless failure to do so will result in same being waived. This shall not,
however, be construed as a waiver of Tenant's right to assert such claims in any
separate action or actions brought by Tenant.
38
ARTICLE 29 - VALIDITY OF LEASE
Section 29.01 Tenant understands and agrees that this
-------------
Lease shall have no force or effect, nor be binding upon Landlord, until it has
been returned to Tenant duly executed by Landlord.
ARTICLE 30 - EXCUSE OF PERFORMANCE
Section 30.01 The time of Landlord or Tenant, as the case
-------------
may be, to perform any of its obligations hereunder, except for the obligation
of Tenant to pay Fixed Rent or Additional Rent, shall be extended if, and to the
extent that the performance thereof shall be prevented due to strikes, lockout,
civil commotion, war-like operation, invasion, rebellion, hostilities, military
or usurped power, governmental regulations or controls, inability to obtain
labor or materials despite due diligence, act of God, or other cause beyond the
control of the party hereto whose performance is required.
ARTICLE 31 - SUCCESSORS AND ASSIGNS
Section 31.01 The provisions hereof shall bind Landlord
-------------
and Tenant, their respective heirs, legal representatives, successors and
assigns, and, except as otherwise provided in the lease, shall inure to the
benefit of Landlord and Tenant.
ARTICLE 32 - LIMITATION OF LIABILITY
Section 32.01 The term "Landlord" as used in this Lease
-------------
means only the owner or the mortgagee in possession for the time being of the
Demised Premises so that in the event of any sale of the Demised Premises, or an
assignment of this Lease, Landlord shall be and hereby is entirely freed and
relieved of all obligations of Landlord hereunder prior to the sale or
assignment, and other than liability arising out of breach of Landlord's
representations hereunder, and it shall be deemed without further agreement
between the parties and such
39
purchaser(s)or assignee(s) that the purchaser or assignee has assumed and agreed
to observe and perform all obligations of Landlord hereunder.
Section 32.02 It is agreed that Landlord or a successor in
-------------
interest (which as used herein includes aggregates of individuals, including
joint ventures, general or limited partnerships or associations making up
Landlord or a mortgagee in possession) shall be under no personal liability with
respect to any of the provisions of this Lease, and if there is a breach or
default with respect to its obligations or otherwise under this Lease, Tenant
shall look solely to the equity of Landlord in the Demised Premises for the
satisfaction of Tenant's remedies. It is expressly understood and agreed that
Landlord's liability under the terms, covenants, conditions, warranties and
obligations of this Lease shall in no event exceed the loss of its equity
interest in the Demised Premises.
Section 32.03 Landlord agrees to be liable for all of
--------------
Landlord's representations and obligations under this Lease. In the event
Landlord does not comply with any monetary obligation or liability assumed under
this Lease, Tenant may, in addition to Tenant's other remedies under this Lease
or otherwise at law or in equity : (1) obtain a judgment against Landlord's
equity in the reversion; and/or (2) obtain a judgment against any other asset of
Landlord; and/or (3) offset the Tenant's Rent liability against any adjudication
of liability.
Section 32.04 If Landlord shall otherwise be liable, or
-------------
required to make repairs, it shall not be liable for damages or injury to any
person or property unless written notice of any defect alleged to have caused
such damage or injury shall have been given to Landlord in sufficient time prior
to the occurrence of the damage or injury which would afford Landlord the
reasonable time to correct the defect. This provision shall not impose any
additional obligations on Landlord or increase any existing obligations for
maintenance and repairs.
ARTICLE 33 - BROKER
Section 33.01 Each party represents and warrants to the
-------------
other that it has dealt with no brokers in connection with this Lease and the
Demised Premises, other than MRH Real Estate Services Inc, 00 Xxxxx Xxxxxx,
Xxxx, XX 00000 (The Broker") and
40
each party agrees to indemnify and hold the other harmless of and from any and
all loss, cost, liability and expense, including but not limited to, reasonable
attorneys' fees, in connection with any claim by any other broker with whom such
party has dealt in connection with this Lease. Landlord agrees to pay all
compensation due Broker. This Article shall survive the expiration or earlier
termination of this Lease.
ARTICLE 34 - RENT RESTRICTION
Section 34.01 If at the commencement of, or at any time(s)
-------------
during the term of this Lease, the Rent(s) reserved in this Lease shall not be
fully collectible by reason of any Federal, State, County or local law,
proclamation, order or regulation, or direction of public officer or body
pursuant to law, Tenant shall enter into such agreement(s) and take such other
steps (without additional expense to Tenant) as Landlord may reasonably request
and may be legally permissible to permit Landlord to collect the maximum rents
which may from time to time during the continuance of such legal rent
restriction be legally permissible (and not in excess of the amounts reserved
therefor under this Lease). Upon the termination of such legal rent restriction
prior to the expiration of the term of this Lease, (a) the rents shall become
and thereafter be payable hereunder in accordance with the amounts reserved in
this Lease for the periods following such termination and (b) Tenant shall pay
to Landlord, if legally permissible, an amount equal to the rents which would
have been paid pursuant to this Lease but for such legal rent restriction less
the rents paid by Tenant to Landlord during the period(s) such legal rent
restriction was in effect.
ARTICLE 35 - OPTION TO PURCHASE BUILDING
Section 35.01
-------------
A. Tenant shall have an option (the "Option") to purchase the Demised
Premises through the date (the "Option to Purchase Deadline") that is the later
of (a) the date which is three (3) years from the Rent Commencement Date, or (b)
the date which is one (1) year from the date on which Landlord has delivered to
Tenant a No Further Action Letter. The purchase price shall be the sum of THREE
MILLION TWO HUNDRED THOUSAND ($3,200,000.00) DOLLARS, payable in full at
closing.
Section 35.02 The Option shall be exercised by Tenant
-------------
giving written notice to Landlord of Tenant's exercise of said Option (the
"Option Notice") by certified mail, return receipt requested or nationally
recognized overnight carrier, at any time through the Option to Purchase
Deadline.
In the event Tenant exercises the Option, Tenant in the Option Notice,
shall fix the Closing Date on a date which shall be no later than six (6) months
after the exercise of Tenant's Option. Landlord represents, warrants and agrees
that on the date of the Option Closing Landlord will deliver:
(a) a deed with covenant against grantor's acts and title subject to
no encumbrances placed thereon or permitted by Landlord and no title exceptions
other than those exceptions existing as of the date hereof;
(b) an environmental indemnity letter stating that Landlord knows of
no environmental violations on the premises at the date of closing of title;
(c) such other documentation reasonably required by Tenant or Tenant's
lender; and
(d) a No Further Action Letter, which may be any No Further Action
Letter (as defined above) dated after the date hereof. Tenant agrees to accept a
natural attenuation remedy used by Landlord as a means to obtain the No Further
Action Letter; however, if Landlord is unable to obtain the No Further Action
Letter by natural attenuation, then Landlord shall promptly take all further
steps required by the New Jersey Department of Environmental Department in order
to obtain the No Further Action Letter.
In the event of a breach by Landlord of its warranties, representations and
obligations contained above, Tenant may elect in addition to all other remedies
available under this Lease or otherwise at law or in equity (i) to terminate the
Option and may also elect to terminate the Lease as of the date of the breach by
Landlord of its Warranties, or (ii) to accept such title as Landlord shall be
able to deliver under the existing circumstances and purchase the Demised
Premises as aforesaid with title in its then existing condition but Landlord
shall be liable to Tenant for the costs of removing any such
42
violations, liens, encumbrances, restrictions and other matters then affecting
the Demised Premises and the improvements which are not exceptions permitted by
this Section and for all damages, costs and expenses (including legal fees)
resulting from or arising out of or in connection with any such breaches, and
Tenant shall have the right to set-off such claims against the Option Price or
other amounts payable for the Demised Premises.
Section 35.03 At any time during the period of this lease
-------------
and any extension thereof, Tenant shall have the "Right of First Refusal" to
purchase the Demised Premises. In the event Landlord wishes to accept a
bona-fide offer to purchase the Demised Premises from a third party, Landlord
shall first submit the terms of such offer to Tenant by certified mail, return
receipt requested or nationally recognized overnight carrier. Tenant shall have
the right to purchase the Demised Premises upon the same terms and conditions as
the aforementioned third party. Tenant must notify Landlord, by certified mail,
return receipt requested, or nationally recognized overnight carrier within
thirty (30) days after receiving notification from the Landlord as to the terms
and conditions of the third party offer, whether its wishes to exercise its
Right of First Refusal. In the event Tenant fails to exercise its Right of First
Refusal or fails to notify Landlord within said thirty (30) day period, then
Landlord may proceed to enter into a contract of sale with said third party on
the same terms and conditions as offered to Tenant and Tenant's Right of First
Refusal shall have lapsed with respect to each offer and Tenant shall have no
further rights under this Section with respect to such offer and such Right of
First Refusal. Notwithstanding the foregoing, in the event Landlord, thereafter,
does not enter into a contract with such party on the same terms and conditions
offered to Tenant or does not close the sale of the Demised Premises to such
third party within 180 days after the expiration of such 30 day Right of First
Refusal period, Tenant shall again have a Right of First Refusal on the terms
set forth in this Section 35.03 with respect to any changed terms and conditions
to such third party and with respect to any offers made after the expiration of
such 180 days.
A transfer of title to the Demised Premises to a related corporation
controlled by XXXXXXX XXX XXXXX and/or XXXXXX XXX XXXXX or members of their
immediate family, or to XXXXXXX XXX XXXXX and/or XXXXXX XXX XXXXX individually,
or members of their immediate family individually, shall not be subject to
Tenant's Right of First Refusal, provided however the transferee agrees
43
to be bound by the provisions of this Section 35.03 in a writing
delivered to Tenant.
Section 35.04 Notwithstanding the foregoing provisions of
-------------
this Article 35, if on the date that Tenant exercises the Option, or its Right
of First Refusal, Tenant is in default, beyond applicable notice and grace
periods, in the payment of annual Fixed Rent or Additional Rent hereunder,
Tenant's exercise of such Option and/or its Right of First Refusal, shall, at
the option of Landlord exercised by written notice to Tenant, be rendered null
and void and shall be of no further force and effect unless Tenant,
simultaneously with the exercise of the Option and/or its Right of First
Refusal, cures said default.
ARTICLE 36 - OPTION TO RENEW LEASE
Section 36.01 Tenant shall have an option (the "Renewal
-------------
Option")to renew this Lease upon the following terms and conditions:
(a) All of the terms, conditions and warranties contained in this
Lease shall remain in full force and effect during the renewal term of this
Lease except for the Fixed Rent, which shall be as set forth in subsection(c) of
this Section 36.01;
(b) Tenant must give Landlord ninety (90) days written notice prior to
the Expiration Date, of Tenant's exercise of said Renewal Option, by certified
mail, return receipt requested or by nationally recognized overnight carrier.
Failure to do so shall render this Renewal Option null and void.
(c) The Fixed Rent for said renewal term shall be as follows:
1st year: $302,578.75 per annum, $25,214.90 per month;
2nd year: $308,839.00 per annum, $25,736.58 per month;
3rd year: $315,099.25 per annum, $26,258.27 per month;
4th year: $321,359.50 per annum, $26,779.96 per month;
5th year: $327,619.75 per annum, $27,301.65 per month.
Section 36.02 Notwithstanding the foregoing provisions of
-------------
this Article 36, if on the date that Tenant exercises the
44
Renewal Option, Tenant is in default beyond applicable notice and grace periods,
in the payment of annual Fixed Rent or Additional Rent hereunder, Tenant's
exercise of such Renewal Option, shall, at the option of Landlord exercised by
written notice to Tenant, be rendered null and void and shall be of no further
force and effect unless Tenant, simultaneously with the exercise of the Renewal
Option, cures said default.
ARTICLE 37 - ARBITRATION
Section 37.01 In any case where this Lease expressly
-------------
provides for the settlement of a dispute or claim by arbitration, or in any case
where the Landlord and Tenant dispute the meaning of a portion of this Lease, or
in the event of any other dispute under this Lease, the same shall be finally
resolved by arbitration conducted in the County of Bergen by the American
Arbitration Association in accordance with its Commercial Arbitration rules then
obtaining for a three party arbitration panel and the decision rendered in such
arbitration shall be binding upon the parties and either parties' failure to
comply with such decision (or proceed in good faith to comply with such
decision) shall be a default hereunder fifteen days after written notice
thereof. Judgment upon the award rendered by the arbitration may be entered in
any court having jurisdiction. The award of the arbitrators shall be accompanied
by a statement of the reasons upon which the award is based. In the event that
the American Arbitration Association shall not be then in existence, either
party by notice in writing to the other may request arbitration and within
fifteen (15) days after receipt of such notice the parties shall agree upon an
impartial arbitration panel of three arbitrators. If the parties are unable to
agree upon such impartial arbitrator either party may apply to the Presiding
Justice (or an Associate Justice) of the highest court of appellate jurisdiction
of the State of New Jersey located in the County of Bergen to appoint such three
party arbitration panel. The expenses of arbitration shall be shared equally by
the parties but each party will pay the fees of its own experts.
The arbitrators shall have no power to modify the terms of this Lease.
45
ARTICLE 38 - INTERPRETATION
Section 38.01 Construction of Terms. Wherever the word
------------- ---------------------
Landlord and Tenant appear herein, each shall be applicable to one or more
persons, as the case may be, the singular shall include the plural, and the
neuter to include the masculine and feminine, and if there shall be more than
one, the obligations hereunder shall be joint and several.
Section 38.02 Captions. The headings used for the various
------------- --------
articles herein contained are for convenient references only, and are not
intended to define, construe or in any manner limit the contents of such
articles.
Section 38.03 Recording. Tenant may not record this Lease
------------- ---------
or a memorandum hereof. Any violation of this provision shall constitute a
material breach of this Lease and Landlord, at its option, shall have all rights
and remedies of Landlord for default.
Section 38.04 Partial Invalidity. The invalidity of any
------------- ------------------
provisions of this Lease as determined by a court of competent jurisdiction,
shall in no way affect the validity of any other provision thereof.
Section 38.05 Waste. Tenant shall not commit, or suffer
------------- -----
to be committed, any waste on the Demised Premises.
Section 38.06 Conflict of Laws. This Lease shall be
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governed by the laws of the State of New Jersey. Jurisdiction
and venue shall be Bergen County.
Section 38.07 Accord and Satisfaction. No payment by
--------------------------------------
Tenant or receipt by Landlord of a lesser amount than the Fixed Rent and
Additional Rent payable hereunder shall be deemed to be other than a payment on
account of the earliest stipulated Fixed Rent and Additional Rent, nor shall any
endorsement or statement on any check or any letter accompanying any check or
payment for Fixed Rent or Additional Rent be deemed an accord and satisfaction,
and Landlord may accept such check or payment without prejudice to Landlord's
right to recover the balance of such Fixed Rent and Additional Rent or pursue
any other remedy provided herein or by law.
Section 38.08 Authority. Landlord and Tenant each
------------- ---------
warrants that they have full right, power and authority to
46
execute this Lease for the primary term and any extended term. If Tenant is a
corporation, Tenant represents and warrants that this Lease and the
undersigned's execution of this Lease has been duly authorized and approved by
the corporation's Board of Directors. The undersigned officers and
representatives of the corporation executing this Lease on behalf of the
Corporation represent and warrant that they are officers of the corporation with
authority to execute this Lease on behalf of the corporation, and within fifteen
(15) days of execution hereof, Tenant will provide Landlord with a corporate
resolution confirming the aforesaid.
Section 38.09 Landlord's Liability for Loss of Property.
------------- -----------------------------------------
Landlord shall not be liable for any loss of property from theft or burglary
from the Demised Premises, except with respect to Landlord's agents, employees
or representatives and Tenant covenants and agrees to make no claim for any such
loss at any time, except with respect to Landlord's agents, employees, or
representatives.
ARTICLE 39 - BANK WAIVER
Upon execution of this Lease, Landlord shall execute the bank waiver in the
form of Exhibit "D" attached hereto.
-----------
IN WITNESS WHEREOF, the parties hereto have duly executed
this Lease on the day of , 2004 .
AS TO THE LANDLORD:
JVNJ REALTY CORP.
By:_____________________________
AS TO THE TENANT:
MEDIA SCIENCES INTERNATIONAL, INC.
BY:______________________________
47
TABLE OF CONTENTS
-----------------
ARTICLE 1 - DEFINITIONS 1
ARTICLE 2-DEMISED PREMISES AND TERM 3
ARTICLE 3 - RENT AND ADDITIONAL RENT 3
ARTICLE 4 - USE AND OCCUPATION 7
ARTICLE 5 - ALTERATIONS; MAINTENANCE AND REPAIRS 10
ARTICLE 6 - EQUIPMENT AND PUBLIC UTILITIES 13
ARTICLE 7 - OBSERVANCE OF LAWS, REGULATIONS, ETC. 14
ARTICLE 8 - ASSIGNMENT OR SUBLETTING 15
ARTICLE 9 - INSURANCE, DAMAGE, DESTRUCTION AND EMINENT DOMAIN 18
ARTICLE 10 - SIGNS 24
ARTICLE 11 - COVENANT AGAINST LIENS 24
ARTICLE 12 - ACCESS TO PREMISES 25
ARTICLE 13 - NO WAIVER OR CHANGES 25
ARTICLE 14- NOTICES 26
ARTICLE 15- SURRENDER OF PREMISES AT END OF TERM 27
ARTICLE 16 - SUBORDINATION 27
ARTICLE 17 - BANKRUPTCY, DEFAULT, ETC. 29
ARTICLE 18 - LANDLORD'S RIGHT TO PERFORM TENANT'S OBLIGATIONS 32
ARTICLE 19 - PAYMENTS 33
ARTICLE 20 - TENANT'S UTILITIES 33
ARTICLE 21 - ATTORNEYS' FEES 34
ARTICLE 22 - SECURITY DEPOSIT 34
ARTICLE 23 - HAZARDOUS SUBSTANCES; ENVIRONMENTAL LAWS 35
ARTICLE 24 - HOLDING OVER 37
ARTICLE 25 - ASSIGNMENT OR TRANSFER BY LANDLORD 37
ARTICLE 26 - ESTOPPEL 37
ARTICLE 27 - MODIFICATIONS; CHANGES 38
ARTICLE 28 - WAIVER OF JURY TRIAL AND COUNTERCLAIMS 38
ARTICLE 29 - VALIDITY OF LEASE 39
ARTICLE 30 - EXCUSE OF PERFORMANCE 39
ARTICLE 31 - SUCCESSORS AND ASSIGNS 39
ARTICLE 32 - LIMITATION OF LIABILITY 39
ARTICLE 33 - BROKER 40
ARTICLE 34 - RENT RESTRICTION 41
ARTICLE 35 - OPTION TO PURCHASE BUILDING 41
ARTICLE 36 - OPTION TO RENEW LEASE 44
ARTICLE 37 - ARBITRATION 45
ARTICLE 38 - INTERPRETATION 46
ARTICLE 39 - BANK WAIVER 47
LEASE AGREEMENT
BETWEEN
JVNJ REALTY CORP
Landlord,
and
MEDIA SCIENCES INTERNATIONAL INC.
Tenant
Premises:
Xxxxxxxxx Xxxxxxxx
0 Xxxxxxxx Xxxx
Xxxxxxx, Xxx Xxxxxx
