Exhibit 10.18
SUBLEASE AGREEMENT
THIS SUBLEASE AGREEMENT ("Sublease"), effective as of April 30, 1997,
is made by and between BLUESTONE SOFTWARE, INC., a Delaware corporation
("Sublandlord"), and BLUESTONE CONSULTING, INC., a Delaware corporation
("Subtenant").
BACKGROUND
X. Xxxxxx Properties Partnership ("Prime Landlord"), as lessor, and
Sublandlord, as lessee, entered into a Lease dated September 27, 1993, as
amended by a First Addendum to Lease dated December 1, 1993, a Second Addendum
to Lease dated December 15, 1994, a Third Addendum to Lease dated June 1, 1995,
and a Fourth Addendum to Lease dated May 16, 1996 (collectively, "Prime Lease").
Pursuant to the Prime Lease, Prime Landlord leased to Sublandlord approximately
34,746 square feet of space ("Demised Premises") in the building located at 0000
Xxxxxx Xxxx, Xx. Xxxxxx, Xxx Xxxxxx 00000 ("Building"), for a term expiring at
midnight on the 30 day of November, 2003.
B. Subtenant desires to sublease from Sublandlord, and Sublandlord
desires to sublease to Subtenant, a portion of the Demised Premises in
accordance with the terms and conditions of this Sublease.
NOW, THEREFORE, in consideration of the rents herein provided and of
the covenants and agreements herein contained, and intending to be legally bound
hereby, Sublandlord and Subtenant hereby covenant and agree as follows:
1. SUBLEASED PREMISES. Sublandlord hereby subleases to Subtenant and
Subtenant hereby rents from Sublandlord a portion of the Demised Premises
("Subleased Premises") containing approximately ___________ square feet, as
described more particularly on EXHIBIT A attached hereto and made a part hereof.
2. TERM OF SUBLEASE.
(a) The term of this Sublease ("Term") shall commence on April
30, 1997 ("Commencement Date"), and shall expire on the earlier of (i) the date
on which the Prime Lease shall terminate for any reason or (ii) at 11:59 P.M. on
the scheduled termination date of the Lease ("Expiration Date").
(b) Under no circumstances shall the Term of this Sublease extend
beyond the expiration, surrender or termination of the Prime Lease, whether the
Prime Lease expires by its own terms, is terminated for Sublandlord's default,
is surrendered by agreement of Prime Landlord and Sublandlord, or is terminated
for any other reason.
(c) Sublandlord shall attempt to obtain Prime Landlord's consent
to this Sublease. Sublandlord shall incur no liability if Sublandlord does not
obtain Prime Landlord's consent to this Sublease.
3. USE. The Subleased Premises shall be occupied only by Subtenant and
used solely for the purpose of general office use and the sale of computer
software, training and counseling, and related activities.
4. RENT.
(a) Subtenant shall pay to Sublandlord, at a place designated by
Sublandlord, base rent in the annual amount of One Hundred Thousans Seven
Hundred Three Dollars ($107,703), to be paid in equal monthly installments, in
advance, on the first day of every calendar month during the Term hereof,
without deduction, abatement or set off (except as otherwise provided in this
Sublease). If the Term of this Sublease shall commence or end on a day other
than the first day of the month, the monthly rent installment due for such month
shall pro rated based on the number of rental days of such calendar month. If
any payment of base rent is received by Sublandlord more than five (5) days
after payment is due, Subtenant shall pay to Sublandlord a late payment charge
equal to five percent (5%) of such late payment.
(b) Subtenant also shall pay Subtenant's Proportionate Share
(defined below) of "Taxes" (as such term is defined in Article IV of the Prime
Lease) for the Subleased Premises as "Taxes" are determined by the Prime
Landlord in accordance with the Prime Lease and charged to Sublandlord. The
amount payable by Subtenant to Sublandlord for Taxes shall be deemed "additional
rent" and paid within fifteen (15) days after each such tax billing is received
by Subtenant from Sublandlord.
(c) Subtenant also shall pay Subtenant's Proportionate Share of
the "common area maintenance costs" (as such term is defined in Article XI of
the Prime Lease) for the Subleased Premises as such "common area maintenance
costs" are determined by Prime Landlord in accordance with the Prime Lease and
charged to Sublandlord. The amount payable by Subtenant to Sublandlord shall be
deemed "additional rent" and shall be paid within fifteen (15) days after each
such billing is received by Subtenant from Sublandlord.
(d) Subtenant shall pay Subtenant's Proportionate Share of
utility costs and other services rendered or furnished to the Subleased Premises
during the Term of this Sublease such as trash disposal and janitorial services,
provided Subtenant's use is no more intensive than that of Sublandlord. Where
Subtenant shall require utilities or services beyond that provided by the Prime
Lease (including other than during normal business hours established by the
Prime Lease), Subtenant shall pay any additional charge incurred by Sublandlord
therefor. If, however, any utilities are separately metered and billed to the
Subleased Premises, Subtenant shall pay all of such charges directly to the
utility provider. The amount payable by Subtenant to
Sublandlord shall be additional rent and shall be paid within fifteen (15) days
after each such billing is received by Subtenant from Sublandlord.
(e) "Subtenant's Proportionate Share" shall be 28% which has been
determined by dividing the Subleased Premises by the Demised Premises (9,500 /
34,746 = .28) and multiplying such figure by 100%.
5. CONDITION OF THE SUBLEASED PREMISES. Subtenant acknowledges and
represents to Sublandlord that (a) Subtenant has thoroughly inspected and
examined the Subleased Premises, (b) Subtenant is fully familiar with the
physical conditions and state of repair of the Subleased Premises, (c) Subtenant
hereby accepts the Subleased Premises in their "as is" condition as of the date
hereof and that Sublandlord shall have no obligation to perform any work in
connection with this Sublease, and (d) neither Sublandlord nor any agent of
Sublandlord has made any representation or warranty with respect to the
Subleased Premises or the Building including without limitation, any
representation or warranty with respect to the suitability or fitness of the
Subleased Premises or the Building for the conduct of Subtenant's business.
6. PRIME LEASE.
a. COPY OF PRIME LEASE. Sublandlord represents that the copy of
the Prime Lease attached hereto as EXHIBIT B is a true, complete and correct
copy of the Prime Lease.
b. SUBORDINATION. This Sublease and all the rights of Subtenant
hereunder are expressly subject and subordinate to the Prime Lease and all
leases and mortgages to which the Prime Lease is subordinate. In the event of
the foreclosure of any underlying mortgage against which Sublandlord has
nondisturbance protection, Subtenant shall enjoy the same nondisturbance
protection as Sublandlord.
c. INCORPORATION BY REFERENCE. Except as otherwise provided in
this Section 6 or elsewhere in this Sublease, all of the terms, covenants,
conditions and definitions of the Prime Lease (except such as by their nature or
purport do not relate to the Subleased Premises or are inapplicable or
inappropriate to the subleasing of the Subleased Premises pursuant to this
Sublease or are inconsistent with any of the provisions of this Sublease) are
hereby incorporated in and made part of this Sublease with the same force and
effect as though set forth at length herein. The foregoing incorporation by
reference is subject to the provisions of this Section 6, including the
following:
(i) References in the Prime Lease to "Lessor" (other than in
provisions of the Prime Lease which impose or relate to obligations of Prime
Landlord to repair or restore, or to perform or furnish utilities, work or
services with respect to, the Demised Premises or the Building) shall be deemed
to refer to Sublandlord under this Sublease unless the context requires that
such reference be deemed to refer to both Prime Landlord and Sublandlord;
(ii) References in the Prime Lease to "Lessee" (other than
in provisions of the Prime Lease which grant to the lessee thereunder an
expansion option, right of first refusal or option to renew) shall be deemed to
refer to Subtenant under this Sublease;
(iii) Reference in the Prime Lease to "the Lease" or "this
Lease" shall be deemed to refer to this Sublease;
(iv) Reference in the Prime Lease to specific terms or
provisions of the Prime Lease shall be deemed to be to the provisions of the
Prime Lease incorporated herein;
(v) References in the Prime Lease to the "term" of the Prime
Lease shall be deemed to refer to the Term of this Sublease;
(vi) References in the Prime Lease to "minimum rent" or
"additional rent" or "rental" or "rent" shall be deemed to refer to the rent
payable under this Sublease, but the provisions of the Prime Lease
notwithstanding, the only rent to be paid by Subtenant is as provided in Section
4 of this Sublease;
(vii) Whenever a provision of the Prime Lease incorporated
herein by reference obliges Sublandlord to perform some act for the benefit of
Prime Landlord, including by way of example providing insurance or indemnity or
making repairs or permitting access, such provisions as incorporated herein
shall oblige Subtenant to perform such act to the extent applicable to the
Subleased Premises for the benefit of Prime Landlord and Sublandlord. Whenever a
provision of the Prime Lease incorporated herein by reference affords the Prime
Landlord some right against Sublandlord, such provision as incorporated herein
shall afford Prime Landlord and Sublandlord such right against Subtenant;
(viii) Whenever a provision of the Prime Lease incorporated
herein by reference requires or refers to Prime Landlord's consent and approval,
such provision as incorporated herein shall be deemed to require or refer to
both Prime Landlord's and Sublandlord's consent and approval. In such a case,
Subtenant shall submit its request for consent or approval to Sublandlord and
Sublandlord shall immediately submit such request for consent or approval to
Prime Landlord. Sublandlord shall notify Subtenant of Sublandlord's
determination to grant or deny its consent or approval within the time period,
if any, set forth in the Prime Lease.
(ix) Whenever pursuant to a provision of the Prime Lease
incorporated herein by reference Sublandlord is required to take some action by
a date certain or within a certain time period, Subtenant shall take such action
not less than three (3) days prior to the date or time for Sublandlord's
performance provided that in any instance, other than scheduled or regularly
recurring obligations, Subtenant shall have had at least five (5) days prior
written notice of the date and time performance is required. Immediately upon
receipt or delivery
thereof, as the case may be, Sublandlord shall provide Subtenant with copies of
any default notices under the Prime Lease given by Sublandlord or received by
Sublandlord. Immediately upon receipt thereof, Sublandlord also shall provide
Subtenant with copies of any other notices under the Prime Lease relating to the
Subleased Premises received by Sublandlord.
(d) PROTECTION OF PRIME LEASE. Subtenant shall not do or cause to
be done or suffer or permit any act or thing which would constitute a default
under the Prime Lease or cause the Prime Lease or the rights of Sublandlord as
lessee thereunder to be terminated or which would cause Sublandlord to become
liable for any damages, costs, claims or penalties or would increase the minimum
rent or additional rent or other charges or obligations of Sublandlord as lessee
under the Prime Lease, or would adversely affect or reduce any of Sublandlord's
rights or benefits under the Prime Lease. Sublandlord agrees that it shall not
do or cause to be done, or suffer or permit to be done, any act or thing which
would constitute a default under the Prime Lease or cause the Prime Lease to be
terminated.
(e) INDEMNIFICATION.
(i) Subtenant shall indemnify, defend and hold harmless
Sublandlord from and against any and all claims, actions, liabilities, losses,
damages, costs, and expenses, including, without limitation, reasonable fees for
legal counsel (collectively, "Claims") arising (A) from the use or occupancy by
Subtenant of the Subleased Premises or the Building or any business conducted
therein by Subtenant, or (B) from any condition created by or any negligence or
willful misconduct of Subtenant or its employees, agents, contractors, visitors
or licensees, in or about the Subleased Premises or any other part of the
Building, or (C) from Subtenant's failure to perform any of the obligations
imposed on it hereunder (through incorporation of the Prime Lease or otherwise),
or (D) from a termination of the Prime Lease resulting from a default by
Subtenant under this Sublease.
(ii) Sublandlord shall indemnify, defend and hold harmless
Subtenant from and against any and all Claims arising (A) from the negligence or
willful misconduct of Sublandlord, its employees, agents, contractors, visitors
or licensees in or about the Subleased Premises or (B) Sublandlord's failure to
perform any of the obligations imposed on it under the Prime Lease.
(f) LIMITATION ON PRIME LANDLORD'S OBLIGATION. Notwithstanding
anything contained in this Sublease (including any provisions of the Prime Lease
which are incorporated by reference into this Sublease), Subtenant acknowledges
and agrees that except as specifically provided below Sublandlord shall have no
obligation, liability or responsibility whatsoever to Subtenant to provide or
perform any work, service, utility, repair, alteration, restoration or other
obligation as such items pertain to the Subleased Premises which Prime Landlord
is obliged to provide or perform pursuant to the provisions of the Prime Lease.
If Prime Landlord shall default or delay in providing or performing any such
work, service, utility, repair, alteration, restoration or other obligation as
such items pertain to the Subleased Premises,
Sublandlord's only obligations to Subtenant on account thereof shall be (i) to
permit Subtenant, at its expense, to prosecute an action against Prime Landlord
for damages or specific performance for Subtenant's benefit in Sublandlord's
name, and (ii) to make a good faith effort and to reasonably cooperate with
Subtenant (at Subtenant's expense) in attempting to cause Prime Landlord to
provide or perform such service or obligation. Any condition resulting from such
default or delay by Prime Landlord shall not constitute an eviction, actual or
constructive, of Subtenant. No such default or delay shall excuse Subtenant from
the performance or observance of any of its obligations to be performed or
observed under this Sublease or shall entitle Subtenant to terminate this
Sublease or to any reduction in or abatement of the minimum rent or other
charges provided for in this Sublease; provided, however, if Sublandlord is
entitled to a reduction or abatement in the rent due under the Prime Lease, then
Subtenant shall be entitled to a pro-rata share of such reduction or abatement
based on Subtenant's Proportionate Share or, if less than all of the Subleased
Premises are affected, Subtenant shall be entitled to an abatement, deduction,
or set off based on the ratio of the square footage of the area of the Subleased
Premises affected by such default or delay to the square footage of the
Premises. In furtherance of the foregoing, to the extent permitted by law,
Subtenant does hereby waive any cause of action and any right to bring an action
against Sublandlord by reason of any act or omission of Prime Landlord under the
Prime Lease. If Subtenant shall undertake any action against Prime Landlord
pursuant to clause (i) of the second sentence of this Section 6(e), then (i) all
papers, pleadings and other aspects of such action shall be subject to
Sublandlord's approval, not to be unreasonably withheld, and (ii) Sublandlord
may participate in such action.
(g) SUBLANDLORD'S OBLIGATIONS UNDER THE PRIME LEASE. Sublandlord
agrees that it shall pay all amounts due and perform all obligations required of
it under the Prime Lease in a timely manner. Sublandlord agrees that it shall
not amend, modify, terminate, or otherwise change the Prime Lease in any manner
which materially and adversely affects Subtenant or this Sublease without first
obtaining the approval of Subtenant, which approval shall not be unreasonably
withheld, delayed or conditioned. The parties agree that a denial of Subtenant's
consent shall not be unreasonable if the change in the Prime Lease results in
the imposition of an increased monetary burden on Subtenant.
7. NOTICES. All statements and notices to be given under this Sublease
and the Prime Lease shall be in writing and given either (i) in person, (ii) by
certified mail, return receipt requested, postage paid, or (iii) overnight
deliver by Express Mail, Federal Express or other nationally recognized carrier,
fee prepaid, addressed in each case to the proper party at the following
address:
To Prime Landlord: Xxxxxx Property Partnership
0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
To Sublandlord: Bluestone Software, Inc.
0000 Xxxxxx Xxxx
Xx. Xxxxxx, XX 00000
Attn: X. Xxxxxxxx, CFO
To Subtenant: Bluestone Consulting, Inc.
0000 Xxxxxx Xxxx
Xx. Xxxxxx, XX 00000
Attn: X. Xxxxxxxx, COO
Any party may inform the other in the manner provided for the giving of notices
of any change in address. Notices so given shall be deemed given and received on
the earlier of actual receipt or the first business day where delivery is
attempted.
8. ASSIGNMENT AND SUBLETTING. Subtenant shall not assign, mortgage or
encumber this Sublease or sublet all or any part of the Subleased Premises, or
permit the Subleased Premises to be used by others not in the employ of
Subtenant, without the prior written consent of the Sublandlord and the Prime
Landlord under the Prime Lease. For purposes of this Sublease, a change in the
control or ownership of Subtenant shall be deemed an assignment. If consent is
granted, Subtenant shall remain liable for the performance of all of the terms
and conditions on the part of the Subtenant to be performed hereunder.
9. ALTERATIONS. Subtenant shall not make any additions, alterations,
changes or improvements to the Subleased Premises without the prior written
consent of Sublandlord and, where necessary in Sublandlord's opinion, Prime
Landlord.
10. BROKERS. Sublandlord and Subtenant each warrants and represents to
the other that it had no dealing with any broker or finder concerning the
subletting of the Subleased Premises. Each party hereto agrees to indemnify and
hold the other party harmless from any and all liabilities and expenses,
including, without limitation, reasonable attorneys' fees, arising out of claims
against the other party by any broker, consultant, finder or like agent claiming
to have brought about this Sublease based upon the alleged acts of the
indemnifying party. This Section 10 shall survive the expiration or termination
of this Sublease.
11. SURRENDER OF SUBLEASED PREMISES. At the expiration or earlier
termination of the Term, Subtenant shall quit and surrender the Subleased
Premises broom clean, in as good condition as it was at the beginning of the
Term, reasonable wear and tear excepted, and shall, to the extent not
inconsistent with any specific provision of this Sublease, comply with all terms
and conditions of the Prime Lease regarding surrender of the Subleased Premises.
Without limiting the generality of the foregoing, Subtenant, on or before the
expiration or termination of this Sublease, shall (a) remove all of Subtenant's
personal property and repair any damage caused by such removal, and (b) remove
all trash and broom-sweep the Subleased Premises. If any personal property of
Subtenant shall remain in the Subleased Premises after the termination of
this Sublease, at the election of Sublandlord, (a) it shall be deemed to have
been abandoned by Subtenant and may be retained by Sublandlord as its own
property, or (b) such property may be removed and disposed of by Sublandlord at
the expense of Subtenant. Subtenant's obligation to observe or perform under
this Section 12 shall survive the expiration or termination of this Sublease.
12. HOLDOVER. If Subtenant shall unlawfully hold possession of the
Subleased Premises after the end of the Term of this Sublease, Subtenant shall
pay to Sublandlord the greater of (i) any amounts owed by Sublandlord to Prime
Landlord as a result of Subtenant's holding over or (ii) monthly holdover rent
equal to one hundred fifty percent (150%) of the base rent payable in the last
month of the Term, plus additional rent at its regular rate. The rights and
remedies of Sublandlord under this Section 12 shall be Sublandlord's exclusive
remedies in the event of any holdover by Subtenant (provided, however, that such
remedies shall not vitiate Sublandlord's rights to compel Subtenant's removal
from the Subleased Premises upon the expiration or other termination of the
Term).
13. DEFAULT. If Subtenant defaults under the terms of this Sublease or
the terms of the Prime Lease incorporated herein by reference, and such default
continues beyond any applicable grace or cure periods, if any, provided under
the Prime Lease except to the extent modified hereby, Sublandlord shall be
entitled to exercise any remedies available to a landlord under New Jersey law,
including without limitation, those remedies set forth in the Prime Lease.
Notwithstanding the terms of the Prime Lease, if Subtenant shall fail to pay any
installment of rent (including additional rent) required under this Sublease
within five (5) days after notice of nonpayment, Sublandlord shall have all
rights described in the preceding sentence. If Subtenant shall fail to provide
insurance as required under the terms of this Sublease, or to perform any other
obligation required under the terms of this Sublease within twenty (20) days
after notice of nonperformance, Sublandlord shall have the right to perform such
obligation and Subtenant shall reimburse Sublandlord for all costs and expenses
related to such performance, as additional rent, promptly upon receipt of any
invoice therefor.
14. MISCELLANEOUS.
a. QUIET ENJOYMENT. Provided Subtenant complies with its
covenants, duties and obligations hereunder, Sublandlord shall not disturb
Subtenant's quiet enjoyment of the Subleased Premises. The foregoing shall not,
however, be deemed to limit Section 2 of this Sublease.
b. LIMITATION OF LIABILITY. The term "Sublandlord" shall refer
only to the owner from time to time of the lessee's interest in the Prime Lease
so that if Sublandlord shall assign its interest in the Prime Lease, the
assignor shall be entirely freed from all obligations, covenants and duties
hereunder thereafter accruing, provided that the assignee assumes the liability
of Sublandlord for all such obligations, covenants and duties hereunder
thereafter accruing.
c. ENTIRE AGREEMENT. This Sublease (i) contains the entire
agreement of the parties; (ii) supersedes all prior or other negotiations,
representations, understandings and agreements of, by or between the parties,
which shall be deemed fully merged herein; (iii) shall be construed and governed
by the laws of the State of New Jersey is located; and (iv) may not be changed
or terminated orally.
d. COUNTERPARTS. This Sublease may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
shall constitute one and the same instrument.
e. PROVISIONS BINDING. This Sublease shall be binding upon and
inure to the benefit of the parties hereto and their respective permitted
successors and assigns.
f. INVALIDITY OF PARTICULAR PROVISIONS. If any term or provision
of this Sublease or the application thereof to any person or circumstance shall,
to any extent, be invalid or unenforceable, the remainder of the Sublease, or
the application of such term or provision to persons or circumstances other than
those as to which it is held invalid or unenforceable, shall not be affected
thereby, and each term and provision of this Sublease shall be valid and be
enforced to the fullest extent permitted by law.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Sublease as of the day and year first above written.
SUBLANDLORD:
BLUESTONE SOFTWARE, INC.,
a Delaware corporation
By: /s/ Xxx Xxxxxx
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Xxx Xxxxx, President
SUBTENANT:
BLUESTONE CONSULTING, INC.,
a Delaware corporation
By: /s/ Xxx Xxxxxx
----------------------------------
Xxx Xxxxx, President
